Title
Financial Advisory Services Contract Amendment (Ordinance S-44435)
Description
Request to authorize the City Manager, or his designee, to amend the contract with Frasca & Associates, LLC and increase the amount of Contract 130553 by $1.3 million. The total amount over the life of the contract will not exceed $3.8 million, and funds are available in the Aviation Department's capital budget. Further request authorization for the City Controller to disburse all funds related to this item.
Report
Summary
Frasca & Associates, LLC provides financial consulting services related to the Airport's issuance of bonds, passenger facility charges, customer facility charges, relationships with rating agencies, assisting with the Aviation Department's annual financial report, and other related financial advisory services. The contract's current five-year term began on Feb. 1, 2016 at a cost of $250,000 per year. The additional contract capacity is for consulting services for the Airport's West Ground Transportation Center (WGTC) development and the bond issues to support the Airport's capital program.
The WGTC procurement process was approved by the City Council on Feb. 21, 2018. The project is being planned in coordination with the Stage 2 extension of the PHX Sky Train from Terminal 3 to the Rental Car Center. This extension will include a station at the WGTC. Development around the station is expected to provide an opportunity to better serve the needs of Phoenix residents who live west of the Airport.
The WGTC development agreement is expected to be a complex financial transaction that will include a long-term lease of the Airport's parking operation, investment in additional parking facilities, and long-term leases of Airport land for hotel and other commercial development. The success of this transaction is critical to the Airport's future viability and financial position. Frasca & Associates, LLC would combine their experience with large-scale financial transactions and understanding of the Airport's finances to provide expert advice.
If approved, Frasca & Associates, LLC will provide consulting services for the exploration and implementation of the WGTC development opportunities, in addition to the bonds the Airport will need to issue in support of the upcoming capital plan.
Contract Term
The contract's current five-year term began on Feb. 1, 2016. This was an optional extension of the original five-year term which began on Feb. 1, 2011. The contract will expire on Jan. 31, 2021.
Financial Impact
The total amount over the life of the contract will not exceed $3.8 million. Funds are available in the Aviation Department's capital budget.
Location
2485 E. Buckeye Road
Council District: 8
Department
Responsible Department
This item is submitted by Deputy City Manager Deanna Jonovich and the Aviation Department.