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HomeMy WebLinkAboutReq Direction - Purchase & Operate Bermuda Dunes Airport CITY OF PALM DESERT STAFF REPORT REQUEST: CONSIDERATION AND DIRECTION TO STAFF REGARDING THE CITY OF PALM DESERT AND A MULTI AGENCY PARTNERSHIP TO PURCHASE, MAINTAIN AND OPERATE THE BERMUDA DUNES AIRPORT SUBMITTED BY: Rudy Acosta, Assistant City Manager DATE: August 28, 2014 CONTENTS: Letter (to City Manager) from Supervisor Benoit (7/10/14) Letter to Supervisor Benoit from M. Dunlevie (6/27/14) Bermuda Dunes Airport Profile 2014 Recommendation By Minute Motion, that the: 1. City Council receive, review and consider the Letter of Interest from Riverside County 4th District Supervisor John Benoit to the City Manager regarding a Multi- Agency Partnership to purchase, maintain and operate the Bermuda Dunes Airport Facility and; 2. City Council provide direction to City staff as to subsequent due diligence. Backqround The City Manager recently received a letter from 4th District Supervisor John Benoit regarding the Bermuda Dunes Airport. Specifically, the letter seeks to solicit the interest level of Riverside County and desert cities; Palm Desert, La Quinta, Indian Wells, Indio and Coachella in a partnership for the purchase, maintenance and operation of the Airport. The recent passing of Bermuda Dunes Airport owner and family patriarch, Ernie Dunlevie, has prompted his heirs to approach the local communities prior to the family's consideration of sale to other `private' interests and/or exploration of alternative land development uses. Pending expression of interest from the cities, the Supervisor has volunteered to host a meeting with Mike Dunlevie (son) to discuss the facility in greater detail. Attached, Mr. Dunlevie has provided a copy of the Airport Profile which outlines several improvements and features of the facility such as; 94.3 acres, a 5,000' long x 70' wide Staff Report Consideration and Direction to Staff— Bermuda Dunes Airport August 28, 2014 Page 2 of 2 lighted runway, a 15,150 square foot hanger/lobby/office building, etc. Additionally, the Profile lists the airport capacity, landing/takeoff activity and other uses by the California Highway Patrol and, Eisenhower and JFK Hospitals for emergency and medevac services. The City's ownership of an airport is currently not a part of the City's Economic Development Strategic Plan. Additionally, the information provided (to date) does not sufficiently address critical information or include documents typically reviewed when considering a land and facility purchase of this nature. However, should the Council express interest in pursuing the matter further, staff will contact the Supervisor's office for the arrangement of a joint meeting with the other desert cities. A summary report of said meeting, to include potential costs and recommended actions, will be prepared for Council review at an appropriate meeting date determined by the City Manager. Fiscal Analysis At this time, the costs are undetermined. CITY COUNCILA,�ETION Submitted By: API'ROVED �� DF.rTIF,D R�CEIVED OTHER � MCCTI�,VG DAT �' � g• � b� Rudy costa, Assistant City Manager AYFS:C� � i � r � ��ner NOF.,S: � � AI3Si�,NT: � Reviewed: A�;STA11v: ��- VERIF(LD I3Y: �-- Original on File with City Clerk's Office I S. Gibson, Director of Finance Ap al: hn M. Wohlmuth, City Manager G��Econ Development�Rudy Acosta�BD Airport 082814.doc ����� ��C���������� RIVERSIDE OFFICE: DISTRiCT OFFICE/MAILING ADDRESS: 4080 Lemon Street,Sth Floor ; 73-710 Fred Waring Drive,Suite 222 Riverside,CA 92502-1647 �'' i Palm Desert,CA 92260-2574 �; (951)955-1040 ��"����, (760)563-8211 Fax(95l)955-2194 �,�' Fax(760)863-8905 r � x SUPERVISOR �TOHN .J. BENOIT FOURTH DISTRICT July 10, 2014 Mr. John M. Wohlmuth Via email c/o City of Palm Desert 73-510 Fred Waring Drive Palm Desert, CA 92260 RE: Bermuda Dunes Airport Dear Mr. Wohlmuth: I have been approached by Mr. Michael Dunlevie, son of my recently departed friend Ernie Dunlevie, on behalf of the Dunlevie family. The Dunlevies own the Bermuda Dunes Airport and sought my help in reaching out to each of you. As explained in Mr. Dunlevie's letter, the family believes there is a continuing economic development advantage to all of our communities in maintaining the current use of this properiy as an airport. However, the family anticipates receiving offers for the property for alternative uses. Therefore, Mr. Dunlevie has asked for my help in approaching you, to help determine what level of interest, if any, local governments might have in buying and maintaining the property as an airport. I would appreciate hearing from you with a preliminary answer to the question: would your city have an interest in exploring a cooperative effort to purchase and maintain Bermuda Dunes Airport for the purpose of maintaining that facility as an airport? Preliminarily, I would suggest that Riverside County might be interested in participating in such a partnership. I would be happy to explore that possibility. Such an arrangement could include an oversight or management role involving the Aviation Department, a unit of the Riverside County Economic Development Agency. That department currently manages five Riverside County owned airports (French Valley, Chiriaco Summit, Hemet-Ryan, Jacqueline Cochran and Blythe). I would appreciate hearing by September lst if there is any interest on the part of your city to explore such a possibility. If one or more cities express an interest, I would be pleased to host a meeting with Mr. Dunlevie to begin a more detailed conversation. www.RivCo4.org • District4�rcbos.org Mr. John M. Wohlmuth July 10, 2014 Page 2 Please share this letter and the two attachments with your Mayor and City Councilmembers. Sincerely, s JOHN J. BENOIT Supervisor, Fourth District JJB:das cc: Mr. David Garcia, City Manager, City of Coachella Mr. Wade G. McKinney, City Manager, City of Indian Wells Mr. Dan Martinez, City Manager, City of Indio Mr. Frank Spevacek, City Manager, City of La Quinta Mr. Michael Dunlevie Mr. Rob Field, Riverside County Economic Development Agency MICHAEL DUNLEVIE 79050 Avenue 42 Bermuda Dunes,CA 92203 June 27, 2014 Supervisor John J. Benoit Riverside County Board of Supervisors 73-710 Fred Waring Drive, Suite 222 Palm Desert, California 92260 Re: Bermuda Dunes Airport Dear Supervisor Benoit: As you are aware, the Bermuda Dunes Airport has operated as a private business since 1962 and throughout the years has contributed to the successful economic development of many desert communities. I have attached a summary description of the airport and its operations. With the passing of my father, Ernie Dunlevie,the family ownership has an increased interest in moving toward new ownership. It was my father's desire that the airport continue to operate as a local, valuable transportation element supporting the local economy. My mother has indicated she would also like to see the airport property continue in its historic usage, so our desire is to find a buyer interested in continued operation of the airport. Of course should a non-airport related development type offer appear, we would need to objectively consider that possibility. However, because we feel strongly that there is a significant economic value in having this kind of transit infrastructure located near our neighboring cities, which if lost would never return, the family has asked me to explore the possibility that the surrounding cities that benefit economically from the airport operation, might also have interest in its continued successful aiiport operation. To this end, I wanted to approach one or more of the neighboring cities to assess the interest level of any of them, singularly or perhaps as a group under a special district pursuant to the California Airport District Act(California Public Utilities Act, Division 9, Part 2), in purchasing the airport. As a fellow pilot and former hanger lessee at Bermuda Dunes Airport, and as a friend, would you be willing to help us in contacting the appropriate people to assess the possible interest level among neighboring cities? We would be pleased to meet with their representatives and consider an offer from one or several of them working together to purchase and maintain the property as an airport. I look forward to hearing from you and appreciate your assistance in this matter. Thank you for your courtesy and cooperation. 850 Chambers Avenue,Suite 9,Eagle,Colorado 81631 Telephone: (970)328-5450—Telefa3c: (970)328-5451 Also Licensed to Practice Law in California Sincerely, MICHAEL DUNLEVIE ��� � �� Michael R. Dunlevie mrdunlevie @ gmail.com MRDIbh BERMUDA DUNES AIRPORT 79-880 AVE.42 BERMUDA DUNES,CA 92203 U.S.A. Phone 760 345-2558 Fax 760 345-4618 BERMUDA DUNES AIRPORT PROFILE January 2014 The Bermuda Dunes Airport was established in l 962 and is a privately owned "Public Use General Aviation, Utility Category Airport." It is FAA approved and operates under State Department of Transportation Division of Aeronautics permit NO. Riv-019. The airport operates as a private business under Conditional Use Permit No. 2751,Riv. 1 issued by the County of Riverside. The permit was issued for thirty years, expires in the year 2027 and is renewable. The airport receives no agency funding of any kind and operates without financial burden or obligation to the surrounding municipalities and general public. Operational cost of the airport is borne by the owners and users of the facility. The airport is located on 94.3 acres of commercially zoned property within the community of Bermuda Dunes. Facilities include a 5,000 x 70 foot lighted runway and taxiway (repaved in 2013) and a 15,150 square foot hangar, lobby and office complex. 'Tl�ere are also approximately 450,000 square feet of aircraft ramp and parking space and a 44,000 square foot T-Hangar complex, which will accommodate 43 aircraft. In March of 2002 a new l 3,500 square foot, executive aircraft hangar complex, with an attached office facility, was completed. There are two additional T-Hangar buildings (22 units). In total the airport has parking accommodations for approximately 250 aircraft. Bermuda Dunes Airport is one of the very few successful privately owned, public use, airport operations in Southern California. The airport accommodates between thirty and forty percent of the "General Aviation Traffic" in the Coachella valley area and acts as a reliever airport to the Palm Springs International Airport. "General Aviation Traffic"includes: Business, Corporate, Charter, Aero Medical, Flight Instruction, Aircraft Rental, Scenic, Aircraft Sales and Maintenance, Private and Recreational operations. There are approximately 40,000 operational activities (landings and takeoffs) per year, which result in some 75,000 passenger activities. We average approximately 150 aircraft based at the airport annually with most of the ownership by private individuals complemented by dozens of business and corporate operators. The types of aircraft range from small single engine piston to the largest executive multi-engine corporate jet. The size of the airport and the FAA required dimensional standards prohibit the operation of large transport category aircraft(large airliners). Page 1 of 3 There is also a residential airpark with nineteen home sites. The airpark concept includes a home with an attached hangar that has access to the airport taxiway and a1l facilities. In addition to the airpark there is an adjacent Industrial Park accommodating more than sixty businesses with designated lots having airport access for their corporate or private aircraft. Many of these businesses utilize airport services. About fifty percent of the flight activities are Charter, Corporate or Fractional Ownership flights. About forty five percent of the flight activities are private operators that live in the area and the flight school—aircraft rental service operates five aircraft and has dozens of flights daily. The airport location, with its close proximity to unpopulated areas,results in the airport being an excellent training base. The California Highway Patrol operates many flights out of the airport as the east CHP offices are located just across from the airport on Varner Road. They also use the airport as a refueling station when performing operations in the area. Bermuda Dunes Airport is the designated airport for medivac flights with destinations for both JFK and Eisenhower hospitals. These flights are authorized to operate on a twenty four hour per day basis. Many of these flights come from the eastern and southern part of the state where hospital facilities are not available. Bermuda Dunes Airport is a designated emergency facility. In this capacity the airport provides an operational base for evacuation, transportation services of emergency personnel and other related emergency aviation activities and communications. The airport also provides many additional client services including car rental, limousine, catering and hotel booking. Service is also provided for photo and motion picture site locations for commercial and entertainment production companies. There is an on site restaurant and tennis club. The runway and ramp facilities are open 24 hours per day 365 days per year. The terminal facilities are manned from 6:00 a.m. to 8:00 p.m. seven days per week. Bermuda Dunes Airport is a non-towered airport with a UNICOM radio facility that provides pilots with advisory information as to the wind conditions, runway in use and air traffic. There is a published"Visual Flight Rule" (VFR) traffic pattern and noise abatement procedure, which enhances safety and minimizes noise and the impact that flight operations may have on the surrounding communities. Included is a curfew for turbine operations (jets)between the hours of 11:00 p.m. and 6:00 a.m. local time. The airport and its tenant operations provide employment for approximately forty people. The centralized location of the Bermuda Dunes Airport to all of the desert cities and in particular to the newer hotel, country club and residential developments is very desirable to the general aviation traveler, as well as, the high profile, high income resident or visitor. The trained airport staff provides a level of service that satisfies the needs of all levels of airport clientele. Page 2 of 3 According to Skyways Publications, studies of general aviation traffic and airport statistical information, indicates that for each inbound passenger flight landing at the Bermuda Dunes Airport there are on average 3 persons on board. Further, it is estimated that considering our level of clientele, each person spends approximately $400.00 per day during a three day stay. Estimating that the airport has approximately 25,000 of these types of activities per year, the foregoing formula results in the airport funneling about$10,000,000.00 million dollars annually into the economy of the surrounding communities. Prepared by: Mike Smith Airport Manager Page 3 of 3