Title
Phoenix Deer Valley Airport Fixed Base Operator Revenue Contract Solicitation (Ordinance S-51418) - District 1
Description
Request to authorize the City Manager, or his designee, to issue a Revenue Contract Solicitation (RCS) for a Fixed Base Operator (FBO) at Phoenix Deer Valley Airport (DVT).
Report
Summary
DVT is currently home to over 1,100 general aviation tenants, including a growing number of corporate jet users. Since 1999, FBO aircraft support services for the DVT community have been provided by Cutter Aviation and, until 2015, Atlantic Aviation.
With the recent developments at DVT, including the construction of corporate jet hangars, increased flight activity from corporate jets, growing demand for additional general aviation services, and increased inquiries from other FBO operators and developers about the potential for another FBO facility, the Aviation Department commissioned an update to the DVT Land Use Plan. The updated plan recommended a second FBO facility on a 20-acre parcel on the southwest corner of DVT based on the relative size of the parcel compared to the other available parcels, which have high visibility from Deer Valley Road, and the proximity to the longer of the two DVT runways.
The new FBO development will be governed by DVT Minimum Standards for FBOs to ensure the delivery of high-quality general aviation products, services, and facilities to DVT users and the design and development of quality general aviation improvements and facilities.
Procurement Information
The Aviation Department proposes to conduct an RCS process to select a qualified FBO to develop, build, operate, and manage a full-service FBO facility.
The RCS will require responsive and responsible respondents to provide the following products and services, as required by DVT FBO Minimum Standards:
- Aircraft Fueling
- Aircraft Maintenance
- Passenger, Crew, Aircraft Ground Services, Support and Amenities
- Aircraft Storage
- Aircraft Flight Training
The required site premises of the FBO will be on a minimum of nine contiguous acres with improvements consisting of:
- Aircraft apron / ramp
- FBO building
- Aircraft maintenance space
- Aircraft storage hangar(s)
- Flight Training space
- Fuel farm storage
Respondents will be encouraged to submit plans to lease and develop the entire 20-acre parcel which, in addition to the FBO facility, may be developed for other aeronautical uses as approved by the Aviation Director.
Responsive and responsible respondents will be evaluated according to the following criteria:
- Experience and Qualifications of Respondent and Partners
- Method of Approach to design, build, and operate a full service FBO and other aeronautical facilities
- Proposed design concept of the FBO and additional aeronautical facilities
- Operations and Management Plan
- Proposed Capital Investment Plan
The highest ranked respondent will be recommended for award to develop and operate a full-service FBO facility at DVT. The Aviation Department intends to issue this solicitation on or about January 2025, with an estimated contract award by November 2025. The City's Transparency Policy will be in effect with the release of the RCS and throughout the solicitation process.
Contract Term
Minimum lease term of 30 years. The lease term may be negotiated up to 40 years depending on proposed capital investment. The lease will include a development term of up to 36 months to develop the site improvements.
Financial Impact
Financial return to the City will be based on current ground rent market value, which is the current aviation industry business model for FBO facility developments. Additional revenue will be generated from fuel flowages fees and applicable specialized aviation services operators fees, which are subject to adjustments based on the Phoenix City Code.
For the designated FBO facility portion of the site parcel, the ground rental rate will be $0.65 per square foot. For the non-FBO portion of the site parcel, the ground rental rate will be $0.55 per square foot. Ground rental rates will be adjusted by the Phoenix-Mesa-Scottsdale Consumer Price Index or three percent, whichever is greater.
Concurrence/Previous Council Action
The Phoenix Aviation Advisory Board recommended approval of the item on October 17, 2024, by a 5-0 vote.
Public Outreach
The solicitation process will include all standard and required outreach efforts and conduct targeted outreach efforts to attract interest.
Location
Phoenix Deer Valley Airport, 702 W. Deer Valley Road
Council District: 1
Department
Responsible Department
This item is submitted by Deputy City Manager Mario Paniagua and the Aviation Department.