COMMISSION
AGENDA MEMORANDUM

Item No.

ACTION ITEM

Date of Meeting

DATE:

February 26, 2025

TO:

Stephen P. Metruck, Executive Director

FROM:

Hiedi Popochock, Director, Aviation Finance and Budget

8e
March 11, 2025

SUBJECT: Financial Service Consulting IDIQ Contract
Amount of this request:

$4,500,000

ACTION REQUESTED
Authorization for the executive director to authorize execution of two consulting contracts, one
with an amount not-to-exceed $3,000,000, and one with an amount not-to-exceed $1,500,000,
for financial consulting services for a period of up to five (5) years and a total of $4,500,000.
EXECUTIVE SUMMARY
The purpose of this request is to procure financial consulting services to conduct feasibility
studies in support of future Port bond issuances and to augment Port staff in assessing the
affordability of future capital investments, renegotiating financial provision(s) of the Signatory
Lease and Operating Agreements (SLOA), financial benchmarking of other ports and airports, and
evaluating alternative financing options such as public private partnerships (P3). The projected
total cost of this work is approximately $2,800,000. The separate contracts provide the Port
flexibility to use the most suitable consultant for the specific service requested.
JUSTIFICATION
The airport's 5-year capital plan is projected to exceed $4.6 billion, 80% of which is expected to
be funded with revenue bonds. In connection with the issuance of future revenue bonds, which
are likely to be issued on an annual basis, the consultant will provide a feasibility report that will,
among other things, describe historical and forecasted operating and financial results of the
airport, the Port's financial structure, capital plan and funding sources, debt service obligations,
and debt service coverage forecasts. The report also typically includes robust discussion on the
general market conditions in which the airport operates, including economic and demographic
information for the region, as well as relevant airline traffic trends and forecasts. The feasibility
report is utilized heavily by investors, credit rating agencies, and other financial stakeholders
alike, and provides support for the Port and its underwriters when it sells the bonds in the capital
markets. The inclusion of a feasibility report in new airport revenue bond transactions is a market
Template revised January 10, 2019.

COMMISSION AGENDA - Action Item No. 8e
Meeting Date: March 11, 2025

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standard, and the Port has utilized them consistently (most recently in support of the 2024
Revenue Bonds).
Looking ahead, the Port will need assistance in preparing the funding plan to determine the
affordability of the Aviation capital program and incorporate the capital projects associated with
the Sustainable Airport Master Plan (SAMP). Having consultants with the knowledge of other
airport funding plans and experience with P3 and other alternative funding arrangements will be
helpful to guide financial discussions. Consultants that provide these services often experience
a high level of staff turnover. To ensure that a suitable consultant is available for this work, each
contract will be for an amount close to the total projected need. This contract would replace a
similar indefinite delivery indefinite quantity (IDIQ) contract that recently expired.
DETAILS
Scope of Work
The scope of work could include, but would not be limited to, the following:
1. Prepare feasibility studies to support Port bond issuances relating to the airport;
2. Financial benchmarking of other airports for measures such as current and future rate
and passenger airline cost per enplanement (CPE) comparisons;
3. Assess affordability of future capital projects and programs based on comparisons to
other ports and airports and other financial metrics;
4. Evaluate funding options and financial implications for SAMP projects including potential
P3 options;
5. Assist with future PFC application and FAA grant strategy;
6. Assist with airline lease agreement provisions, negotiation and strategy; and
7. Financial management consulting services.
Schedule
Agreement shall commence in May 2025 through May 2030.
ALTERNATIVES AND IMPLICATIONS CONSIDERED
Alternative 1 - Hire consultants for bond issue feasibility studies and use staff as much as possible
for other projects.
Cost Implications: $1,000,000
Pros:
(1)
(2)

Bond feasibility studies would be done by independent consultant. It is advantageous
to bring in consultants with knowledge and expertise based on experience with other
ports and airports.
$1,800,000 saved could be used for other organizational priorities.

Template revised June 27, 2019 (Diversity in Contracting).

COMMISSION AGENDA - Action Item No. 8e
Meeting Date: March 11, 2025
Cons:
(1)

Page 3 of 4

Some projects require significant resources at a time when staff is fully engaged in
ongoing work such as the annual budget development process and quarterly financial
reporting, making it difficult to complete special projects and potentially impacting
operations and capital investments.

This is not the recommended alternative.
Alternative 2 - Procure individual contracts for each project.
Cost Implications: Each contract would be between $400,000 - $1,000,000 per year over 5 years
Pros:
(1)
(2)
(3)
Cons:
(1)

Provides opportunities for more firms to work with the Port.
Can potentially hire the firm with the greatest qualification for each project.
Consultants on contract gain familiarity with the Port and can often work more
efficiently to meet specific needs, saving time and money.
Individual procurements take time. This can delay high priority projects.

This is not the recommended alternative.
Alternative 3 - Procure IDIQ contracts for up to 5 years.
Cost Implications: $4,500,000 (projected actuals $2,800,000)
Pros:
(1)
(2)
(3)
Cons:
(1)

Greater likelihood of industry-wide experience and knowledge.
Time saved compared to procuring individual contracts for specific projects.
Staff can be fully engaged in ongoing work such as the annual budget development
process and quarterly financial reporting with minimal disruption.
Potentially higher short-term cost of consultant compared to adding temporary or fulltime staff needed for non-feasibility work.

This is the recommended alternative.
FINANCIAL IMPLICATIONS
Annual Budget Status and Source of Funds
The costs incurred by these contracts will be accounted for as operating costs (consulting work)
or a non-operating bond issuance cost (bond issue feasibility studies) and included in the annual
budget. As such, the funding source is the Airport Development Fund, the General Fund, or future
revenue bonds. The costs would be assigned to seaport or airport cost centers as appropriate.

Template revised June 27, 2019 (Diversity in Contracting).

COMMISSION AGENDA - Action Item No. 8e
Meeting Date: March 11, 2025
ATTACHMENTS TO THIS REQUEST
None
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS
None

Template revised June 27, 2019 (Diversity in Contracting).

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