RENO-TAHOE AIRPORT AUTHORITY BRIEF OF MINUTES MEETING OF THE BOARD OF TRUSTEES November 10, :00 a.m.

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1 RENO-TAHOE AIRPORT AUTHORITY BRIEF OF MINUTES MEETING OF THE BOARD OF TRUSTEES November 10, :00 a.m. MEMBERS PRESENT Rick Murdock, Chair Jessica Sferrazza, Secretary Lisa Gianoli, Treasurer Nat Carasali Bill Eck Jenifer Rose ALSO PRESENT Marily M. Mora, A.A.E. President/CEO Dean Schultz, A.A.E. Executive Vice President/COO Ann Morgan General Counsel Claire Johnson Clerk of the Board MEMBERS ABSENT/EXCUSED Andy Wirth, Vice Chair Jerry Hall Adam Mayberry The Board of Trustees met in the Board Room, Airport Authority Administrative Offices, Reno-Tahoe International Airport, Reno, Nevada. Chairman Rick Murdock called the meeting to order. The Pledge of Allegiance was recited and roll was called. 3. PRESENTATIONS AND AWARDS a. Employee, Tenant and Special Recognition Marily Mora, President/CEO, announced the recipient of the Employee of the Quarter award for the 3rd quarter of Christine Stanford, Lead Security Specialist, started at the Reno-Tahoe Airport Authority (RTAA) in March of 2002 as an Airport Security Aide, and was promoted to Lead Security Specialist in August of Ms. Mora commended Ms. Stanford for always having a smile and being professional, and for demonstrating a lot of patience which is a must when working out on the curb. She also stated that Ms. Stanford upholds the Airport s standards of security by showing concern and care in her job. Ms. Mora said that as the most senior member of the security team, Ms. Stanford provides a dependable presence and help to the other members of her team. She stated that this Employee of the Quarter award stems from Ms. Stanford s commitment to the RTAA and her enthusiasm for excellence in balancing Airport security needs with customer service issues. Ms. Mora congratulated Ms. Stanford on being selected for the award. Ms. Stanford expressed her gratitude and said she was honored to receive the award. Next, Ms. Mora recognized Michelle Duncan, Security Compliance Specialist, for recently achieving her Airport Certified Employee (ACE)-Trusted Agent Certification. Ms. Mora congratulated Ms. Duncan on this outstanding professional accomplishment.

2 Page 2 of 10 b. Introduction of New, Promoted and Retired Employees Brian Moore, Director of Human Resources, introduced three new employees Todd Lawrence - Airport Duty Manager effective October 17th, Regina Anaya - Facilities Custodian effective October 25th, and Jeff Longacre - IT Network Administrator effective November 7th. Mr. Moore welcomed the new employees to the RTAA. Next, Ms. Mora announced that Randy Whitworth, Facilities Superintendent, will be retiring on November 25, 2016 after 13 years with the Airport Authority, and stated he has played an integral role in keeping this Airport clean and well maintained. Ms. Mora continued by saying that Mr. Whitworth began his career at the Airport on November 10, 2003 as a Facilities Supervisor, and was then promoted to his current position in February of During his tenure, Mr. Whitworth has been involved in many Airport initiatives, including the upgrade and recommissioning of the computerized maintenance management system, the creation of an Access database of the terminal electrical distribution system, and the reprogramming of the HVAC chiller controls, to name a few. Ms. Mora said that Mr. Whitworth was also a major player in two terminal renovation projects, specifically the ABC Project for the inline baggage handling system, and more recently the centralization of the two security checkpoints into one. Ms. Mora indicated that the awards the Airport wins for best customer service and the kudos received about the Airport being so clean and well maintained, have a lot to do with Mr. Whitworth s efforts with his team. Ms. Mora congratulated Mr. Whitworth for the outstanding job he s done and wished him well in his retirement. Mr. Whitworth expressed his thanks for the last 13 years, and specifically mentioned Ms. Mora and Dave Pittman, Director of Facilities and Maintenance, for letting him be part of the organization. He said it was a real honor to put together the Facilities team and he thanked his team for the job they ve done and for supporting him through the years. Lastly, Mr. Moore recognized three employees on their internal promotions Adrian Aranda from Parking Lot Attendant to Airport Communications Specialist effective October 17th, Bill Heath from Facilities Supervisor to Facilities Superintendent effective October 17th, and Loretta McNabb from Special Projects Coordinator to Facilities Project Manager effective October 31, c. Tenant Communication Chair Murdock called upon Tina Iftiger, VP of Airport Economic Development, to introduce Mike Crowell, President/CEO of the Reno Air Racing Association (RARA). She indicated Mr. Crowell would provide a briefing to the Board on the 2016 National Championship Air Races and what to expect for Mr. Crowell began by thanking Ms. Mora and the RTAA team for all their help, saying they have been fantastic to work with and are great landlords. Next, he reminded Trustees that the major performing group at the 2016 Air Races were the Blue Angels and shared a brief video of the Blue Angels in flight. Mr. Crowell stated that the 2016 operating results were much better than 2015, but that the final numbers are still being compiled. However, he said that general admission ticket sales were down by almost 26% and the reason for that is the 9% live entertainment tax implemented by the Legislature in 2015, which affected the 2016 Air Races and came at a cost of $142,000. Mr. Crowell stated that the organization is a 501(c)(3) and this

3 Page 3 of 10 tax imposition will be something that RARA addresses over the next few months with the Legislature to see if there is some type of tax relief. He stated that year over year sales were up 4%, however the goal was 10%, resulting in a huge amount of gross revenue that did not come through. Mr. Crowell said one of the draws to the Air Races is the Unlimited race class, including crowd favorites Straga and Rare Bear. In 2011, there were 30 entrants in this class and in 2016 there were only 13 entrants. The largest barrier for the Unlimiteds is that the cost to own and operate one of these planes is about $3M and many of the operators did not show even though the purse was increased to $1M. Mr. Crowell said that RARA cannot sustain this race class on its own without national sponsors. STIHL became a partner about 3 weeks prior to the 2016 air races, however, due to the timing, RARA was not able to utilize their campaign. STIHL, along with the RSCVA and the Nevada Commission on Tourism (NCOT) will be part of the sponsorship for NBC Sports. In 2017, the NBC Sports will air three 1-hour shows in the March/April timeframe, as compared to 2015 when there was only one 1-hour show. The production cost will be $400,000 and therefore RARA has sought sponsorships to support this effort, which is aimed at gaining sponsors for the classes. Mr. Crowell ended his presentation by saying that the Air Races are strong with a good foundation, a good team in the office, and 2,000 volunteers, and that generally speaking everything is in good shape. Trustee Eck commended Mr. Crowell for hanging in there during the most difficult situation the Air Races have ever faced. Trustee Eck said Mr. Crowell gained a lot of supporters, and put the event back on its feet. Trustee Eck thanked Mr. Crowell for everything he s done. Trustee Sferrazza asked if RARA is aware of any other events that have suffered a detrimental effect since the implementation of the live entertainment tax, saying that for instance Burning Man doesn t seem to have been impacted. She asked Mr. Crowell if he has evidence to support the assumption that the downturn in sales can be attributed to the tax. Mr. Crowell responded that based on an exit survey being conducted by the University of Nevada Reno (UNR) for the 2016 event, they are hearing that the air races are too expensive and the general admission tickets are too high. Mr. Crowell said that on the reserved tickets, box seats and high priced tickets there was no effect; only the low entry level ticket sales were affected. He said if you take a $12.00 ticket and add 10%, that s a big increase for a family to absorb. He said that as far as numbers and people through the gate, on Saturday and Sunday for example, there were 1700 more people this year, whereas normally with the Blue Angels there would be a 30% increase in attendance. Mr. Crowell indicated that Burning Man does not have the overhead that the Air Races has, and that event generates approximately $70M cash money for the week. The Air Races generate an overall $70M economic impact. Mr. Crowell said that for any event where you raise prices like that you will see a downturn, particularly in the lower priced items. Trustee Sferrazza said she would like to see information on Reno events, such as shows and concerts, to see how the tax has affected those events, and perhaps that information could be obtained from the RSCVA. She suggested there is a need to dive into this to see if the live entertainment tax is affecting those types of events. Next, Trustee Sferrazza asked if RARA raised ticket prices from 2015 on the general admission tickets. Mr. Crowell responded that yes

4 Page 4 of 10 the tax was passed on to the consumer and that the live entertainment tax was denoted on the tickets. He said general admission tickets start at $10.00 on Wednesday and go up to $40.00 on Saturday and Sunday. Trustee Sferrazza followed up by asking Mr. Crowell to provide the demographics on attendees, for example numbers of millennials attending. Mr. Crowell responded that he could provide that information at the conclusion of the survey in about 30 days. Trustee Sferrazza stated that the Board wants the event to be successful and offered any help they could provide. Mr. Crowell added that the media plan for 2016 was aimed toward millennials through social media and a newly designed website, and said he feels it really paid off. He indicated that during the week, the races do not attract children because of school and millennials because of their work schedules, and that attendance increases on the weekend. Trustee Sferrazza asked if RARA is looking to attract more people the first 3 days. Mr. Crowell responded by mentioning the idea of offering a $5 or free Wednesday. He added that 3100 school age children did attend during the week to participate in special activities planned by the air racing foundation. He also suggested the kids would come back on the weekend if their wristbands provided free entry, which would then bring the parents. Mr. Crowell reiterated that he will provide a report of the demographic information including age groups, incomes, households, locations, etc. Trustee Sferrazza commented that as part of the Boyd Summit, she heard nothing but praise from the airline executives about the air races, and she complimented both the RARA and RTAA teams. Chair Murdock indicated that he heard lots of positive feedback about the performances such as the Unlimiteds and Blue Angels, and suggested that bringing in big names is a key formula to the success of the Air Races. Chair Murdock suggested that if RARA is going after the millennials, they may want to consider getting the Red Bull Airforce, to which Mr. Crowell said RARA has tried. Chair Murdock added that the Airport chalet had the best ever attendance. Mr. Crowell said that in 2017 the Canadian Snowbirds will perform and then in 2018 the Thunderbirds. 4. PUBLIC COMMENT, if any Limited to Three Minutes per Person None. 5. APPROVAL OF MINUTES On motion by Trustee Sferrazza, seconded by Trustee Eck, which motion duly carried by unanimous vote, the Board approved the minutes from the Board of Trustees meeting of September 8, APPROVAL OF AGENDA Chair Murdock exercised his prerogative to amend the agenda in order to allow the Board to hear Item 10. Items for Board Information and Discussion, a. Presentations, ii. Federal Legislative Update, following this Item 6. Approval of Agenda. On motion by Trustee Rose, seconded by Trustee Gianoli, which motion duly carried by unanimous vote, the Board approved the November 10, 2016 Board of Trustees meeting agenda as amended. 10. ITEMS FOR BOARD INFORMATION AND DISCUSSION a. Presentations

5 Page 5 of 10 ii. Congressman Jon Porter provided an update on the recent election results and discussed federal legislative issues of interest to the RTAA. Mr. Porter began by saying that as a result of the elections, Capitol Hill is currently undergoing a complicated transition. The biggest challenge the RTAA is facing with the change in leadership is that the incoming Senator Catherine Cortez Masto will be a freshmen. Senator Dean Heller who is moving up in leadership is basically at a sophomore/junior level in the world of politics. Congresswoman Dina Titus will become the senior member on the Democrat side of the delegation. Mr. Porter stated that Jackie Rosen, a new member of Congress from southern Nevada, is anxious to spend some time here to get to know the issues of importance to the Airport. Mr. Porter said that his role in representing the Airport is to make sure it works, with whoever wins, and to make sure it is a very smooth transition. Porter Group reached out immediately to the newest members of the Nevada delegation. Senator Reid s staff, his A team, has hung in there over the past year, and are really qualified people which is good for Cortez Masto as she staffs up. She will need to hire people and will literally have 8,000 to 10,000 resumes landing on her desk. Mr. Porter said that Porter Group is encouraging her to bring the Reid staff who have done a tremendous job for the Airport with her. From a legislative perspective, President-elect Trump made a lot of promises during his campaign. Mr. Porter said that realistically, in the words of Mayor Mario Cuomo, campaign is like poetry but governing is prose, so time will tell. From a policy perspective, Mr. Porter is hopeful that the incoming President will work with the Democrats in the House and Senate. This is very important since there is not a clear majority in the U.S. Senate. For the short term, Mr. Porter stated that two paths can happen which will impact us at the Airport. If there is an omnibus, which is the Christmas tree of public policy where everyone gets their pet projects, the Airport s Customs and Border Protection (CBP) related bill is in there. Mr. Porter said his concern is that if there is a continuing resolution, which in essence just funds the government into January, the Legislature may say let s just go home, instead of fighting out a lot of issues. Mr. Porter said his sense is today that there are so many projects pending, there will be an omnibus. With that being said, the Committees are continuing to work and they work very well together. Mr. Porter said he suspects they will continue into the week before Christmas, and the Airport s language will be in the omnibus. In terms of big picture items to be worked on, there is the defense appropriation act, an energy bill, and the omnibus. Mr. Porter continued saying that top priority for the Trump administration as far as business, is that there are a lot of regulations that have been put in place by the former administration that will no doubt be of focus. The Department of Labor and some of its regulations on overtime rules, which have very serious consequences for business, will also be of top concern. In terms of Obama Care, Mr. Trump has promised to repeal and replace, but that is not a simple task. Mr. Porter said in the next 60 days there will probably be a special session specifically on healthcare and healthcare reform, including what steps can happen to curtail the premiums which are doubling and tripling. This will likely be Trump s number one priority. Also, the Supreme Court issues are still pending and the pipeline will be a

6 Page 6 of 10 major issue as we move into next year. Mr. Porter also mentioned labor relations issues and lawsuit reform. Mr. Porter said his wish for Congress is that they finally sit down and try to move bills forward. For the best interest of the Airport, it would be for them to pass an omnibus. Mr. Porter referenced Yucca Mountain saying it is alive and is going to be a major issue for Congress. There are approximately 360 votes needed to pass Yucca Mountain and start refunding/funding it again. He also said there are probably 70+ members of the U.S. Senate that will support funding Yucca. From a top priority State perspective, that is something that needs to be watched closely. Mr. Porter discussed the CBP program by giving a brief description of the proposed new language that would expand the Section 559 reimbursement authority. Only airports that have less than 100,000 arriving international passengers and that are located outside of a 75 mile radius of other international airports will be eligible for the new program parameters. Lastly, Mr. Porter encouraged Trustee involvement by getting to know the new members of the delegation and inviting them to tour and visit the Airport facilities. He also encouraged Trustees to travel to Washington D.C. if time permits to remind legislators of who the Airport is and that their help is needed. 7. COMMITTEE / LIAISON REPORTS Committee / Liaison reports were given by: a. Finance and Business Development Committee Trustee Lisa Gianoli b. Planning and Construction Committee Trustee Jenifer Rose c. Airport Noise Advisory Panel Trustee Jessica Sferrazza d. Community Outreach Committee (COC) Trustee Jessica Sferrazza e. Stead Liaison Trustee Bill Eck f. RSCVA Board Trustee Nat Carasali g. Air Service Liaison Chair Rick Murdock h. The Chamber Reno Sparks Northern NV CEO Marily Mora i. Reno-Tahoe International Airport Users Committee Trustee Bill Eck j. Compensation Committee General Counsel Ann Morgan k. Nevada Legislative Priorities Committee Trustee Lisa Gianoli 8. CONSENT ITEMS FOR BOARD ACTION a. #16(11)-38 Authorization for the President/CEO to Negotiate Final Terms and Execute a New 6-Year, 6-Month Commercial Lease Agreement Between Pro Bumper Repair and the Reno- Tahoe Airport Authority for 9,266 Square Feet of Commercial Space at the Commercial Building Located at 2750 Vassar Street On motion by Trustee Gianoli, seconded by Trustee Sferrazza, which motion was duly carried by unanimous votes, the Board approved Agenda Item #16(11)-38 as follows:

7 Page 7 of 10 Authorized the President/CEO to Negotiate Final Terms and Execute a New 6-Year, 6-Month Commercial Lease Agreement Between Pro Bumper Repair and the Reno-Tahoe Airport Authority for 9,266 Square Feet of Commercial Space at the Commercial Building Located at 2750 Vassar Street. 9. ITEMS FOR BOARD INFORMATION, DISCUSSION AND POSSIBLE ACTION a. #16(11)-39 Authorization for the President/CEO to Execute a Two-Year Contract for Reno- Tahoe Airport Authority Employee Medical and Prescription Insurance with Hometown Health Plan in the Amount of $2,524,300 for Calendar Year 2017 and an Amount not to Exceed a 9% Increase for Calendar Year 2018; Fund Employee Health Savings Accounts in the Amount of $39,250 for Each Calendar Year 2017 and 2018; Continue to Self Insure Dental and Vision Coverage; and Make Corresponding Amendments to the Civil Service Plan and Management Guidelines On motion by Trustee Rose, seconded by Trustee Gianoli, which motion was duly carried by unanimous votes, the Board approved Agenda Item #16(11)-39 as follows: Authorized the President/CEO to Execute a Two-Year Contract for Reno-Tahoe Airport Authority Employee Medical and Prescription Insurance with Hometown Health Plan in the Amount of $2,524,300 for Calendar Year 2017 and an Amount not to Exceed a 9% Increase for Calendar Year 2018; Fund Employee Health Savings Accounts in the Amount of $39,250 for Each Calendar Year 2017 and 2018; Continue to Self Insure Dental and Vision Coverage; and Make Corresponding Amendments to the Civil Service Plan and Management Guidelines. 10. ITEMS FOR BOARD INFORMATION AND DISCUSSION a. Presentations i. Josh Hicks, a Partner with McDonald Carano Wilson (MCW) and the head of their Government Affairs Group, presented an update on State legislative issues of interest to the RTAA. Mr. Hicks stated there were some significant changes at the state legislature. Both houses had been controlled by the Republicans, but that flipped, and now there is Democratic control of the Senate by 11 to 10 and the Assembly by 27 to 15. The good news for the RTAA and the Board is that items worked on for the Airport are really not partisan in nature. Of the four caucuses that are out there, three of them have selected their leaders. The Senate Majority Leader is Senator Aaron Ford, the Speaker will be Assemblyman Jason Frierson, and Senator Michael Roberson will now be the Senate Minority Leader. The Assembly Republican caucus has not selected their leader as of yet. Mr. Hicks said that as reported earlier in the meeting as part of the Legislative Committee liaison report, there will be an updated bill tracker produced by MCW for the RTAA. When the leadership changes, a lot of the bills that have been put in by one party may or may not be processed by the party that ends up taking control. For example, many of the Republican legislators had gun bills and whether those will now be processed under the new leadership remains to be seen.

8 Page 8 of 10 Mr. Hicks reported that there were no changes on the City Council; Reno City Council incumbents who were running will maintain their offices, as is the case with the Washoe County Commission. There were four ballot questions, 3 statewide and 1 county question, that all passed. The two that will go into effect relatively quickly are recreational marijuana and background checks for gun transfers, including private transfers. Mr. Hicks said the two other questions that were on the ballot for constitutional amendments had to do with 1) deregulating the energy market which passed by a significant amount, and because it s a constitutional amendment will come up again in November 2018, and will go into law after that, and 2) sales tax exemption for certain medical equipment, which will also go again in November 2018 to be passed a second time. Mr. Hicks mentioned a local ballot question, Washoe County 1, increases the sales tax in Washoe County by just over.05% that goes to school construction and will go into effect relatively soon. Next, Mr. Hicks referenced the recent special session in October 2016 where the room tax just in Clark County was increased to fund an expansion of the convention center as well as to fund a portion of a stadium. This is related to the fact that the Oakland Raiders have expressed a strong interest in moving to Las Vegas and one of the expectations that has come out of that is there will be a significant amount of travelers coming to Vegas for games and a lot more room nights. Mr. Hicks disclosed that the Oakland Raiders are a client of his and have expressed interest in locating one of their summer camps in the Reno area which could be a very good thing for increased travelers here as well. Mr. Hicks said MCW will continue to monitor the various issues and will be updating the Board and staff as more information on the 2017 session develops. Governor Sandoval has already announced that a significant budget shortfall is expected at the state level. Therefore, that will be a big topic to be addressed by the legislature and the Governor will announce how he intends to deal with that, likely in January when he reveals his budget. As a final note, Mr. Hicks stated that MCW has been working on a resolution in support of the UAS industry and there is a legislator who is willing to carry that forward for us and there may be a few others who are willing to sign on. Trustee Sferrazza asked if regarding infrastructure improvements and the tax abatement if that is something we need to look at, does it apply to Stead and does there need to be tweaks in that legislation. She said she believes it was the one done for Faraday that had provisions regarding property tax for infrastructure. Mr. Hicks deferred to Ms. Iftiger to respond. Ms. Iftiger said there is some conversation about potentially cleaning up some of the legislation that was used for Tesla and Faraday. She said that during that process they may look at adding a new tier. The Tesla deal was a $1.5 billion tier and Faraday was a $1 billion tier, and the legislature is talking about doing a $.5 billion tier to negate the need for calling a special session each time they have a prospective company. Ms. Iftiger said she is not aware of a BDR being introduced yet, and that it may be just a cleanup for the Governor s Office of Economic Development (GOED). Trustee Sferrazza followed up saying that with all the expansion and growth of industrial and residential coming into the north valleys, in addition to the RTAA s big economic development project at Stead, she suggested that it should be looked at closely, and that if it s not in GOED s language, then the RTAA should look at getting a sponsor for it. Trustee Sferrazza asserted there would be a lot of support

9 Page 9 of 10 for that and suggested potentially working with the Regional Transportation Commission (RTC) in getting a broad coalition of support, because there s I-395 and the spaghetti bowl issues as well. She stated she believes staff should have that on their radar. Ms. Iftiger stated that RTAA staff has been working very closely with the RTC on improvements on Red Rock and Moya, to take truck traffic off of Stead Boulevard. Ms. Iftiger added that in addition, RTAA staff has been working with the City of Reno both on their master plan as well as the jobs/housing balance situation north of I-80 and in the north valleys. She said it is her understanding the concept of an infrastructure project may not be a singular company because it involves $.5 billion or more, and may need to expand beyond Stead Airport to deal with all the infrastructure issues. iii. Ted Ohm, Facilities Project Manager, provided a presentation on his experience with the 2016 Leadership Reno-Sparks Chamber Program as this year s RTAA representative. Mr. Ohm also described the significant improvements he and the 2016 Leadership Class provided to the Step2 Residential Facility as their chosen charitable project. Step2, a local non-profit, is a comprehensive residential and outpatient treatment program that provides women struggling to overcome substance abuse disorders, poverty and family violence, the opportunity to rebuild their lives. b. Upcoming Board Meeting/RTAA Event Schedule Chair Murdock referred to the schedule of upcoming meetings and RTAA events. i. Board/Committee Meetings 1. November 16, :30 am Board of Trustees Retreat 2. November 21, :00 pm Compensation Committee Meeting 3. December 5, :30 pm ANAP Meeting 4. December 6, :00 am Finance and Business Development Committee Meeting 5. December 6, :00 am Planning and Construction Committee Meeting 6. December 8, :00 am Board of Trustees Meeting 7. January 10, :00 am Finance and Business Development Committee Meeting 8. January 10, :00 am Planning and Construction Committee Meeting 9. January 12, :00 am Board of Trustees Meeting 10. January 19, :30 pm Community Outreach Committee Meeting 11. February 6, :30 pm RTIA Users Committee Meeting ii. RTAA Events 1. December 3, :00 pm 2016 Holiday Party c. President/CEO s Report Ms. Mora referred the Trustees to the written President/CEO Report included in their Board binders. She mentioned the upcoming master plan public information session scheduled on Thursday, November 17th from 3:00 to 7:00 pm at the Convention Center and the Master Plan Working Group (MPWG) meeting that will be convened earlier that same day with three Trustees as members of the group. Ms. Mora mentioned the all Native American Honor Flight returning from Washington, D.C. on Sunday, November 13th and that Mayor Hillary Schieve will be joining the Airport for that event. Ms. Mora also referenced the NASA drone testing conducted during October and that more detailed information will be reported at the Board

10 Page 10 of 10 Retreat. Lastly, Ms. Mora offered to answer any questions the Trustees may have on the CEO Report. d. General Board Comments, Questions, and Items for Future Board Meetings Chair Murdock asked if the Trustees had any comments, questions, or items for future Board meetings. There were no further comments, questions, or future Board items raised by the Trustees. 11. PUBLIC COMMENT, if any Limited to Three Minutes per Person None. 12. ADJOURNMENT There being no further business, the meeting was adjourned at 10:35 am. ATTEST: Chair Rick Murdock Secretary Jessica Sferrazza