AGENDA AND BUSINESS PAPER

 

 

Ordinary Meeting of Airport Advisory Committee

 

 

 

To be held on
Wednesday

21 March 2018

AT 6.00pm

 

 

 

Cnr Baylis and Morrow Streets,
Wagga Wagga NSW 2650
PO Box 20, Wagga Wagga

 

Phone: 1300 292 442
Fax: 02 6926 9199
Website: www.wagga.nsw.gov.au


Reports submitted to the Ordinary Meeting of Airport Advisory Committee to be held on Wednesday 21 March 2018.

 

Ordinary Meeting of Airport Advisory Committee AGENDA AND BUSINESS PAPER

Wednesday 21 March 2018

ORDER OF BUSINESS:

CLAUSE               PRECIS                                                                                            PAGE

ACKNOWLEDGEMENT OF COUNTRY                                                                          4

APOLOGIES                                                                                                                 4

CONFIRMATIONS OF MINUTES                                                                                   4

DECLARATIONS OF INTEREST                                                                                    4

Reports from Staff

RP-1                     Contractual arrangements with AVDATA                          4

RP-2                     Airport - Financial information                                            4    

QUESTIONS/BUSINESS WITH NOTICE                                                                         4

 


ACKNOWLEDGEMENT OF COUNTRY

 

 

APOLOGIES

 

 

Confirmation of Minutes

CM-1              Airport Advisory Committee       

 

Recommendation

That the Minutes of the proceedings of the Airport Advisory Committee Meeting held on 8 March 2018 to be confirmed as a true and accurate record.

 

 

Attachments  

1.

Minutes - Meeting held 8 March 2018

4

 

 

  

 

 

DECLARATIONS OF INTEREST

 

 


Report submitted to the Ordinary Meeting of Airport Advisory Committee on Wednesday 21 March 2018.                  RP-1

 

Reports from Staff

RP-1               Contractual arrangements with AVDATA

Author:          Darryl Woods 

Director:       Caroline Angel

         

 

Analysis:

The purpose of this report is to correct advice provided by public address at the ordinary Council meeting of the 29 January 2018, on the income and charges received by Council for aviation charges other than Regular Public Transport RPT operations.

 

 

 

Recommendation

That the Committee note the contents of this report.

 

Report

In the ordinary Council Meeting of the 29 January 2018, a public address to Council misquoted financial information on the cost of collection of fees associated with Aviation classes other than Regular Public Transport (RPT) operators.

 

Council’s arrangements with AVDATA is commercial in confidence, however the public available material published by AVDATA and Council’s financial information provides sufficient information to assess the cost of collection.

 

The reliable record of aircraft movements at Wagga Wagga Airport is the audio recording taken by AVDATA of the Common Traffic Advisory Frequency (CTAF).  AVDATA transcribe aircraft registration numbers from the audio recording which is then matched against the aircraft registration owners and a bill is raised by AVDATA on behalf of Council for landing and take-off charges.  AVDATA collect the charges and offset their cost of collection and remit the net balance to Council on a month by month basis.

 

Details of the revenue, cost of collection and net income is provided below in the financial section.

 

A large element of AVDATA’s charges is transcribing audio tapes into a record of Airport use and users during the month.  Compression software eliminates periods where there is no voice on the CTAF frequency and for information of the Airport Advisory Committee the average charge time for transcription is around 40 Hours per month.

 

Financial Implications

For the 2016/17 financial year the total billing receipt from AVDATA to users was $120,593 with $34,737.33 of charges to receive the income. Of the $34,737.33 of AVDATA charges, transcription charges were $19,733.78.

 

An additional $5,084.23 is received directly by users who paid Council directly rather than remit through AVDATA.

 

Council’s net income for this charge line for the 2016/17 financial year was $90,950.

Policy and Legislation

N/A

 

Link to Strategic Plan

Community Leadership and Collaboration

Objective: We are informed and involved in decision making

Outcome: Everyone in our community feels they have been heard and understood

 

Risk Management Issues for Council

N/A

Internal / External Consultation

Airport Advisory Committee

 

 

  

 

 


Report submitted to the Ordinary Meeting of Airport Advisory Committee on Wednesday 21 March 2018.                  RP-2

 

RP-2               Airport - Financial information

Author:          Carolyn Rodney 

Director:       Natalie Te Pohe

          

 

Analysis:

Follow up financial information requested by the Airport Advisory Committee at the 8 March 2018 meeting.

 

 

Recommendation

That the Committee note the contents of the report.

 

Report

At the 8 March 2018 Airport Advisory Committee meeting, discussions were held regarding “RP-2 Wagga Wagga City Council – Airport Financial Overview” report.  The Committee requested a subsequent report be presented for their information.  The information requested was based on the following topics:

 

·        Depreciation

·        Asset valuations

·        Capital project status updates for capital projects currently listed for completion this financial year (2017/18)

·        AvData information (provided in separate report)

·        Internal Administration Costs

·        Loan Borrowings

 

DEPRECIATION

 

Please see Attachment A for the detailed Asset Book Listing for the Airport as at 30 June 2017. 

 

ASSET VALUATIONS

 

Council’s assets have been progressively revalued to fair value in accordance with a staged implementation advised by the Office of Local Government. Council undertakes full revaluations on all assets on a five-year cycle. 

 

The majority of Airport Assets are classified as “Other Assets”, and were revalued in 2015/16 using a depreciated replacement cost and other inputs including:

·        Gross Replacement Cost

·        Asset Condition

·        Estimated useful life of the asset

·        Residual Value (where applicable)

 

The current inputs for each Airport Asset is contained within Attachment A.


2017/18 CAPITAL PROJECTS

 

The below table shows the total capital works program for the 2017/18 financial year.

 

Table A – 2017/18 Capital Program

 

Capital Expenditure

Grant

Loan Borrowings

Airport

Reserve

Full Year
Budget

EOM FEB

Actuals

EOM FEB

Commitments

EOM FEB

Total Exp

Budget

Remaining

 

1 - Airport Redevelop Internal Baggage

 

1,980,358

2,000,000

-

3,980,358

30,382

11,855

42,236

3,938,121

 

2 - Airport Upgrade to Code C: Taxiways A, B, D, E

 

3,827,313

-

-

3,827,313

44,407

2,304

46,712

3,780,602

 

3 - Airport Lighting Cabinet Upgrade

 

 

98,909

 

98,909

-

-

-

98,909

 

4 - Airport Runway Lighting Upgrade

 

 

432,230

 

432,230

14,438

1,375

15,813

416,418

 

5 - Airport Car Park Equipment Upgrade

 

 

44,550

 

44,550

-

-

-

44,550

 

6 - Airport Bay 4 Concrete Pads and Lead In

 

 

 

320,018

320,018

319,627

-

319,627

391

 

7- Airport Reseal Roads/Line Marking

 

 

 

100,000

100,000

1,000

-

1,000

99,000

 

8 - Airport Taxiway C Shoulders

 

 

 

55,000

55,000

18,780

-

18,780

36,220

 

9 - Airport Acquisition of Land

 

 

1,300,000

 

1,300,000

-

-

-

1,300,000

 

TOTAL CAPITAL EXPENDITURE

 

5,807,671

3,875,689

475,018

10,158,378

428,634

15,534

444,168

9,714,210

 

 

 

 

 

 

 

 

Individual Project Status updates:

 

1.           Airport Redevelop Internal Baggage

 

This project is on hold until resolution of funding and security regulatory changes are known. The project will remain as planned future capital works and will be included in the Airport Review. Council has requested that the Infrastructure NSW funding allotted to this project be rolled into the Taxiway project.

 

2.           Airport Upgrade to Code C: Taxiways A, B, D, E

 

Council has requested that Infrastructure NSW re-allocate the funding for the terminal upgrade to the Airport Taxiway upgrade project. Currently taxiway A (south) and taxiway B, taxiway A (north) and taxiway E pavements are in poor condition.  If the project does not proceed remedial works will have to be performed to keep the taxiway open to the current class of aircraft. Council have current tender pricing to undertake the project, awaiting Infrastructure NSW advice on funding.

 

3.           Airport Lighting Cabinet Upgrade

 

These projects are subject to the taxiway upgrade program. An amount of $15,813 has been expended on commissioning of boundary obstacle lighting. No further expenditure is expected for the remainder of this financial year.

 

4.           Airport Runway Lighting Upgrade

 

Combined with the above Lighting Cabinet Upgrade project.

 

5.           Airport Car Park Equipment Upgrade

 

This project is not foreseen to be completed this financial year. Lack of communications bandwidth still being addressed by IT.

 

6.           Airport Bay 4 Concrete Pads and Lead In

 

Project completed under emergency repairs. GHD Pty Ltd confirmed that the pavement has not failed as reported to the January 2018 ordinary Council meeting.

 

At peak times, the Available Aircraft Parking bays are fully utilised. In order to consider other repair and pavement techniques for the Aircraft Parking Bays additional bays must be made available to allow capacity to undertake such techniques. This issue of Aircraft Parking needs to form part of the review with participation from all RPT carriers.

 

7.           Airport Reseal Roads/Line Marking

 

Full budget allocation will be expended this financial year to complete dish drainage along the road edges before re-seal during 2018/19.

 

8.           Airport Taxiway C Shoulders

 

Project has been completed. No further expenditure is expected for the remainder of this financial year.

 

9.           Airport Acquisition of Land

 

The acquisition of land at the Airport is not foreseen within this financial year, and the strategic intent needs to be reviewed.  This will form part of the Airport Review.

 

Internal Administration Costs

 

Internal Administration costs involve services that are supplied to the Airport from other corporate support areas of Council. These include services like the provision of information technology equipment and support, accounting, banking, governance, human resources, secretarial and customer service support etc. The administration costs are allocated across each cost centre of Council based upon different drivers. For example, the costs of providing human resources across the organisation is allocated based upon the number of FTE’s (Full Time Equivalent Staff) the area has, whereas the provision of information technology equipment and support is based upon the number of IT devices held within the area.  

 

For the 2016/17 financial year, the Internal Administration costs relating to the Airport totalled $285,568.  As a percentage of the Airports $3.7M turnover in 2016/17, this equates to 7.6%.

 

Loan Borrowings

 

The Airport has utilised loan borrowings to fund capital projects in the past where the Airport Reserve was not in a position to fund the works. The Airport’s current draft Long Term Financial Plan (LTFP) also includes projects proposed to be funded from loan borrowings.

 

In order to obtain the most attractive rate, Council obtains quotations from financial institutions. For the 2016/17 borrowings across Council, quotes were sourced from 11 financial institutions.

 

Table B: Current Airport Loan Borrowings

 

Borrow Year

Project Name

Financial

Institution

Loan Amount

$

Loan Term

(years)

Interest Rate

Annual Loan Repayments – Principal & Interest

$

2009/10

Airport Pavement Upgrade

NAB

3,133,340

10

6.94%

(refinanced in 2014/15)

 

437,305

2011/12

 

Airport Develop Precinct 2A

NAB

6,015,614

15

6.44%

628,860

 

 

In addition to the above borrowings, the Airport has proposed loan borrowings factored into its draft 2018/28 LTFP:


Table C: Proposed Airport Loan Borrowings, as per the draft 2018/28 LTFP

 

Proposed

Borrow Year

Project Name

Loan Amount

$

Proposed Loan Term

(years)

Interest Rate

(Assumption)

Budgeted Annual Loan Repayments – Principal & Interest

$

2017/18

Various, as per Loan Borrowings Column in Table A above

3,875,689

 

10

3.5%

466,018

2018/19

Airport Reseal Don Kendall & Welsh Drives

 

216,645

10

4%

26,710

2019/20

 

Airport Bays 1-3 Upgrade

380,000

10

5%

49,212

2020/21

 

Airport Carpark System Replacement

385,000

10

5%

49,859

2023/24

 

Airport Taxiways A,B,D,E,F Enrichment

380,000

10

6%

51,630

 

If any of the above proposed projects either do not proceed, or are completed with budget savings, the borrowings amount is adjusted to reflect the actual spend. This then has future year budget savings in regards to future year’s debt servicing costs, and is adjusted accordingly. An adjustment is also processed reflecting the actual interest rate once the loan is drawn down.

 

Financial Implications

As noted in this report.

Policy and Legislation

POL 013 – Return on Investment Council Businesses Policy

Link to Strategic Plan

Community Leadership and Collaboration

Objective: We are informed and involved in decision making

Outcome: Everyone in our community feels they have been heard and understood

Risk Management Issues for Council

Without adequate revenue to cover the costs of operating the Airport, there is the risk that the Airport will not be financially sustainable into the future.

Internal / External Consultation

N/A

 

Attachments  

 

1.

Attachment A - Airport Asset Listing as at 30 June 2017

 

 


Report submitted to the Ordinary Meeting of Airport Advisory Committee on Wednesday 21 March 2018.                                                    RP-2

 

  


QUESTIONS/BUSINESS WITH NOTICE

 

  

 

 

 

 

 

 

 

 

                                                    

 


Reports submitted to the Ordinary Meeting of Airport Advisory Committee to be held on Wednesday 21 March 2018.