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Home My WebLink About2014-08-05 Agenda and Support Documentation Town Council Work SessionNOTE E 3 M VAIL TOWN COUNCIL WORK SESSION AGENDA VAIL TOWN COUNCIL CHAMBERS 75 S. Frontage Road W. Vail, CO 81657 1:35 P.M., AUGUST 5, 2014 TOWN QF VAIL� Times of items are approximate, subject to change, and cannot be relied upon to determine at what time Council will consider an item. Public comments on work session item may be solicited by the Town Council. ITEM /TOPIC: DRB /PEC Update (10 min. ) PRESENTER(S): Warren Campbell, Communitiy Development ITEM /TOPIC: International Air Service Study Presentation (30 min. ) PRESENTER(S): Greg Phillips, Eagle County Regional Airport Aviation Director BACKGROUND: In response to climbing international visitor numbers in Eagle and Pitkin Counties over the last several years, the Eagle County Regional Airport commissioned a study regarding the feasibility of direct nonstop international air service with a nationally regarded air service consulting firm. This presentation reviews the data collected and the conclusions of that study. It was presented to the Eagle County Commissioners on July 22nd. ITEM /TOPIC: Rental Licensing Program Council Discussion (30 min.) PRESENTER(S): Matt Ivy, Farrow Hitt, Packy Walker, Mark Herron (Lodging Representatives) ACTION REQUESTED OF COUNCIL: There is no action on this item. BACKGROUND: Review and discussion of proposed ordinance enacting licensing requirements for vacation rentals of residential property for less than 30 days. ITEM /TOPIC: Discussion on Soft Surface Trail Improvements. In an effort to enhance existing recreational opportunities, staff has explored potential improvements to Vail's existing soft - surface trail system. The intent of this agenda item is to present a general trail concept and to ask if the Town Council is supportive of a more detailed planning process. (20 min.) PRESENTER(S): Gregg Barrie, Public Works, and Jamie Malin, Eagle Valley Mountain Bike Association ACTION REQUESTED OF COUNCIL: Provide input and direction to town staff regarding potential improvements to Vail's trail system 8/5/2014 BACKGROUND: Vail offers many soft surface trail opportunities for hiking and mountain biking. These well -used trails are mostly located on U.S. Forest Service or Holy Cross Wilderness Area lands and they provide access into the natural environment surrounding Vail. They are generally intermediate or advanced -level mountain biking or, in the case of the Wilderness Area trails, "strenuous" level hiking and backpacking trails. In 1994, the Vail Town Council adopted the Town of Vail Comprehensive Open Lands Plan. The purpose of that Plan is "to identify and develop strategies for acquiring or protecting key remaining open lands in Vail that would be valuable for recreation, protecting sensitive environmental resources, extending or connecting trails, providing adequate neighborhood open space and creating a small amount of contingency land for unforeseen needs." Over the past two decades, many of the parcel acquisitions have been completed, as have park facility improvements. However, other than the highly successful North Trail, most trail recommendations remain incomplete. At the same time, the town has focused its trail efforts on the popular paved recreation path system and, most recently, the widened shoulders on Vail's frontage roads which will be completed this year. The completion of that work opens the opportunity to work on other recreation trails including soft - surface trails. STAFF RECOMMENDATION: Staff proposes that improving recreational opportunities is important to Vail's residents and guests and is consistent with adopted planning documents. Staff recommends that the Town Council consider whether or not to direct staff to initiate a conceptual planning process for trail enhancements. 5. ITEM /TOPIC: Information Update: 1) May 2014 Vail Business Review 2) 2014 June Sales Tax Update 3) Revenue Highlights - August 2014 4) Investment Report - 1 st Quarter 2014 5) Ford Park Construction Project Update (verbal update) 6) 1 -70 Underpass Project Update (5 min.) 6. ITEM /TOPIC: Matters from the Mayor, Council and Committee Reports. (15 min.) 7. ITEM /TOPIC: Executive Session, pursuant to: 1) C.R.S. §24- 6- 402(4)(a)(b) (e) - to discuss the purchase, acquisition, lease, transfer, or sale of property interests; to receive legal advice on specific legal questions; and to determine positions, develop a strategy and instruct negotiators, Regarding: Consideration by Council of the proposed Development Agreement and Ground Lease for the redevelopment of the Timber Ridge Property. (45 min. ) PRESENTER(S): Matt Mire, Town Attorney 8. ITEM /TOPIC: Adjournment( estimated 4:10 p.m.) NOTE: UPCOMING MEETING TOPICS AND ESTIMATED TIMEFRAMES BELOW (ALL ARE APPROXIMATE DATES AND TIMES AND SUBJECT TO CHANGE) THE NEXT REGULAR VAIL TOWN COUNCIL MEETING WORK SESSION WILL BEGIN AT APPROXIMATELY 12:30 P.M. (or TBD), TUESDAY, AUGUST 19, 2014 IN THE VAIL TOWN COUNCIL CHAMBERS 8/5/2014 FUTURE AGENDA ITEMS: Ongoing agenda items DRB /PEC updates WS - 15 min.; Information Updates Attachments: WS - 15 min.; Executive Session items: 30 min.; Consent Agenda: 5 min.; Town Manager Report: 5 min. Other agenda items: Sustaining Vail's Economic Health - WS - 8/19 Meet with Eagle County School District (Superintendent and Board Members) - WS 8/19 Half Day Retreat Define Balanced Community - WS - 9/2 Discussion of Parking & Transportation - WS - 9/2 VVMC Master Plan Discussion - WS - 9/16 Discussion of Five Year Capital & RETT Plans - WS - 9/16 Special VLMD Work Session Meeting for 2015 Operating Plan and Budget 9/16 Half Day Retreat w/ VLHA - WS - 10/7 Discussion on Town Manager's Budget (Final Draft) - WS - 10/7 Discussion on Adoption of Strategic Competitiveness Plan - WS - 10/21 Quarterly Status Report on Capital Projects & Programs (Info Update) - WS -10/21 First Reading of Ordinance Budget Adoption - ES - 10/21 VLMD Budget Resolution - 10/21 Discussion on Aspen Report & Follow up - WS - 11 /4 Second Reading of Ordinance Budget Adoption - ES - 11/4 Discussion on Technology - WS - 11/4 Meet with Avon Town Council - TBD Investment Policy Update ES - TBD 1 -70 Vail Underpass Traffic Analysis Update - ES - TBD Clean Up Title 12 Ordinance - TBD Plastic bags - TBD Village Information Center - Greg - TBD Fee Schedule changes - George - TBD Housing Strategic Plan - George - TBD 2015 WAC updates (construction restrictions, legacy program) - WS - TBD Sister City discussion - TBD Discussion of future of RSES - TBD Streaming PEC & DRB - TBD VLMD Term limits - TBD Walking Mountains zero waste program presentation - TBD 8/5/2014 VAIL TOWN COUNCIL AGENDA MEMO MEETING DATE: August 5, 2014 ITEM /TOPIC: DRB /PEC Update PRESENTER(S): Warren Campbell, Communitiy Development ATTACHMENTS: July 16, 2014 DRB Meeting Results July 28, 2014 PEC Meeting Results 8/5/2014 rowH Of vn �ii> TOWN OF VA MEMBERS PRESENT Tom DuBois Bill Pierce Rollie Kjesbo Brian Gillette DESIGN REVIEW BOARD AGENDA PUBLIC MEETING July 16, 2014 Council Chambers 75 South Frontage Road West - Vail, Colorado, 81657 MEMBERS ABSENT Andy Forstl PROJECT ORIENTATION 1:OOpm SITE VISITS 1. Nelson Residence — 3826 Lupine Drive 2. Nugget Properties — 4288 Nugget Lane 3. Lot 5, Elk Meadows Subdivision — 1632 Buffehr Creek Road 4. Northside Grab -N -Go — 2271 North Frontage Road West MAIN AGENDA 3:OOpm 1. Nugget Properties LLC DRB140239 Joe Conceptual review of new construction (duplex) 4288 Nugget Lane /Lot 2, Bighorn Estates Applicant: Nugget Properties LLC, represented by Scott Turnipseed Architects ACTION: Conceptual, no action 2. Northside Grab -N -Go DRB140258 Jonathan Final review of a minor exterior alteration (paint, facade) 2271 North Frontage Road West /Lot 1, Vail das Schone Filing 1 Applicant: Northside Caf6, represented by Mauriello Planning Group ACTION: Approved MOTION: Kjesbo SECOND: Gillette VOTE: 4 -0 -0 CONDITION(S): 1. The applicant shall paint all utilities to match the background facade prior to requesting a final planning inspection. 2. The applicant shall remove the dead tree along the western property and two ornamental trees planted in its place prior to requesting final planning inspections. (T -posts removed from existing trees). 3. The applicant shall paint all railings the darker stucco color to match metal prior to requesting a final planning inspection. 4. The applicant shall terminate the dark wainscoting on an inside corner. 5. The applicant shall repaint the rear windows prior to requesting a final planning inspection. 6. The applicant shall adjust the wood siding to give the appearance of all headers being aligned prior to requesting a final planning inspection. 7. Signage for individual parking spaces shall not be permitted. 8. The applicant shall submit a sign permit application for review and approval of all new signage. 8 /5 /20pbge 1 3. 1632 Buffehr Creek Road LLC DRB140264 Joe Conceptual Review of new construction (SFR) 1632 Buffehr Creek Road /Lot 5, Elk Meadows Applicant: 1632 Buffehr Creek Road LLC, represented by Suman Architects ACTION: Conceptual, no action 4. Nelson Residence DRB140237 Conceptual review of an addition (garage) 3826 Lupine Drive /Lot 9, Bighorn Subdivision 2nd Addition Applicant: James Nelson, represented by Pierce Architects ACTION: Conceptual, no action STAFF APPROVALS Heinen Residence OTC14 -0031 Final review of a changes to approved plans (re -roof) 1225 Westhaven Lane #A & #B /Lot 43, Glen Lyon Subdivision Applicant: Nancy Heinen, represented by J & K Roofing Joe N7 Booth Creek Townhomes DRB140232 Jonathan Final review of a minor exterior alteration (walkway) 2875 Manns Ranch Road /Lot 1, Block 1, Vail Village Filing 13 Applicant: Booth Creek Townhouse HOA, represented by McNeil Property Management 10th Mountain Whiskey & Spirit Company DRB140241 Final review of a minor exterior alteration (sign) 286 Bridge Street /Lot A & B, Block 5A, Vail Village Filing 1 Applicant: Barbara Scrivens Connors Residence DRB140243 Final review of changes to approved plans (closet addition) 2427 Garmish Drive /Lot 13, Block H, Vail das Schone Filing 2 Applicant: Thomas Connors, represented by David Irwin Hawkins Residence DRB140246 Final review of a minor exterior alteration (re- paint) 1479 Aspen Grove Lane /Lot 2, Block 2, Lion's Ridge Filing 4 Applicant: Phil Hawkins, represented by Dan Frederick Joe Jonathan Joe Stockmar Residence DRB140247 Joe Final review of changes to approved plans (GRFA) 4096 Columbine Drive /Lot 14, Bighorn Subdivision Applicant: Brian Stockmar, represented by Scott Turnipseed Architects Century Link Tower DRB140248 Final review of a minor exterior change (louver, chiller) 165 North Frontage Road West /Lot 2, Middle Creek Applicant: Century Link, represented by Archcentric, P.C. Kimmelman Residence DRB140251 Final review of a minor exterior alteration (skylights) 1151 B Casolar Del Norte /Lot 2, Casolar Vail Applicant: Seth Kimmelman, represented by George Plavec 8 /5 /20pbge 2 Jonathan Joe 1767 Alpine LLC DRB140254 Jonathan Final review of a minor exterior alteration (windows /roof /siding) 1767 Alpine Drive /Lot 37, Vail Village West Filing 1 Applicant: 1767 Alpine LLC, represented by CRC design & remodel, Matt Bomer Stockmar Residence DRB140255 Joe Final review of changes to approved plans (window) 4096 Columbine Drive /Lot 14, Bighorn Subdivision Applicant: Brian Stockmar, represented by Scott Turnipseed Architects Vail Racquet Club Condominiums DRB140257 Joe Final review of a minor exterior alteration (re -roof) 4560 Meadow Drive, Buildings 1 & 2 /Unplatted Applicant: Vail Racquet Club HOA, represented by Steve Loftus Johnson Residence DRB140259 Jonathan Final review of changes to approved plans (window, stairs) 4238 Nugget Lane /Lot 5, Bighorn Estates Applicant: Kent & Mary Johnson, represented by Michael Rookey Arrabelle at Vail Square DRB140266 Joe Final review of a minor exterior alteration (gas line) 675 Lionshead Place Units 343 & 372 /Lots 1 & 2, Lionshead Filing 6 Applicant: Arrabelle at Vail Square, represented by Brand Marott Potato Patch HOA DRB140267 Joe Final review of changes to approved plans (railing) 950 Red Sandstone Road Unit 30 /Unplatted Applicant: Potato Patch HOA, represented by GE Johnson Construction Ptarmigan Townhomes DRB140268 Joe Final review of a minor exterior alteration (landscaping) 1975 Placid Drive /Lot 29 -42, Vail Village West Filing 2 Applicant: Ptarmigan Townhomes Association, represented by Ceres Land Care, Mike Earl Schulman Residence DRB140269 Joe Final review of a minor exterior alteration (window) 1772 Alpine Drive /Lot 10, Vail Village West Filing 1 Applicant: Dave Schulman, represented by MPP Design Shop, Michael Pukas Racquet Club Owners Association DRB140271 Joe Final review of a minor exterior alteration (landscaping) 4770 Bighorn Road /Vail Racquet Club Condominiums Applicant: Racquet Club Owners Association, represented by Steve Loftus The applications and information about the proposals are available for public inspection during regular office hours in the project planner's office, located at the Town of Vail Community Development Department, 75 South Frontage Road. Please call 479 -2138 for information. Sign language interpretation available upon request with 24 hour notification. Please call 479 -2356, Telephone for the Hearing Impaired, for information. 8 /5 /20Pbge 3 TOWN OF VAI ' PLANNING AND ENVIRONMENTAL COMMISSION July 28, 2014 at 1:00pm TOWN COUNCIL CHAMBERS / PUBLIC WELCOME 75 S. Frontage Road - Vail, Colorado, 81657 MEMBERS PRESENT MEMBERS ABSENT Site Visit: none 15 minutes A request for a final review of variances from Sections 12 -6D -6, Setbacks, Section 12 -6D -9, Site Coverage, Section 12- 6D -11, Parking, and Section 14 -3 -2F, Other Requirements, Vail Town Code, pursuant to Chapter 12 -17, Variances, Vail Town Code, to allow for a residential addition and remodel with required parking located partially within the public right -of -way, located at 2955 Bellflower Drive /Lot 6, Block 6, Vail Intermountain, and setting forth details in regard thereto. (PEC140018) Applicant: Alan and Francine Peters, represented by MJ Mueller Co. Planner: Warren Campbell ACTION: Approved with condition(s) MOTION: Kurz SECOND: Cleveland VOTE: 6 -0 -0 CONDITION(S): 1. The variance approvals are contingent on the Applicant obtaining Town of Vail approval of a design review application for the proposed additions. 2. The Applicant shall submit a revocable right -of -way permit to Public Works for all improvements located within the Bellflower Drive right -of -way prior to requesting final public works inspections. 3. The Applicant shall remove the kitchen in the lower level second unit to be in full compliance with the Vail Town Code prior to requesting final planning inspections. 4. The Applicant shall trim the large existing evergreen tree in the front yard so that no limbs hang below 7 feet as measured from the ground, upward, prior to the requesting final planning inspections. Warren Campbell gave a presentation pursuant to the memorandum. Commissioner Cartin asked why there was a condition regarding the limbing of the evergreen to a height of 7 feet. Warren explained that it had to do with vehicular safety and sight visibility lines. Commissioner Cleveland asked about the difference between a kitchen and a kitchenette. Warren explained the definition of a kitchenette. Commissioner Martin encouraged the applicant to replace all the existing siding on the south elevation as it was showing its age and likely beyond repair. Carl Mueller stated he would convey that message to Mr. Peters. Commissioner Pratt mentioned that the plans showed a single bathroom for three bedrooms and that there should not be a future variance application to incorporate a bathroom within the setbacks. There was no public comment. Commissioner Cartin asked if a condition should be added to address the siding issue. It was agreed that it was not necessary because it would be addressed during the DRB review. 90 minutes 2. A request for a recommendation to the Vail Town Council on approaches to address identified elements to ensure the special character of Vail Village is not just maintained but also enhanced through the Vail Village Master Plan as an outcome of the Vail Village Character Area Preservation project, an initiative to examine the Town's current regulations, design standards and guidelines applicable to Vail Village. Applicant: Town of Vail, represented by Braun Associates, Inc. Planner: Warren Campbell ACTION: Recommendation of approval MOTION: Cartin SECOND: Hopkins VOTE: 6 -0 -0 Warren Campbell gave a presentation pursuant to the memorandum. He also spoke to his conversation with Carmel, CA, per the direction provided at the previous Commission hearing. Tom Braun stated the discussion today would center around the development review process and the five topics for further evaluation. He proceeded to give a presentation per his Power Point. Expansion of the Application of the Urban Design Guide Plan Tom Braun introduced the topic. Commissioner Cartin mentioned the difference between the "should" and "shalls" and how the revised UDGP might address that difference. Commissioner Kurz spoke to a concern regarding how the expansion of the UDGP would /could be applied to buildings that have already redeveloped. How and what effect would there be. Believed it was important to bring as much of the area under control of the plan. Suggested the Village Core may have differing requirements. Commissioner Cleveland expressed reservations about expanding the area for the UDGP. He stated that when the Council decided to move forward with this project the scale of the Village was the issue of concern. It was about the Village Core and how to preserve its uniqueness in terms of architecture and scale. The lack of color has always been of concern. There should be an ability to have differing neighborhoods. He mentioned that Meadow Drive has turned out well and any overlay expanding the restricting design is not the way to go. ° +s a ► - Commissioner Pratt said that the UDGP should be expanded and that the peripheral areas should tie into the core. Having a small scale village surround by New York scale buildings is not the way to go. Steel and stone did not make Vail famous. He discussed how one or two bad snow years causes a shift in thinking during the review of development applications which tends to turn to revenue generation as a key consideration. The documents being discussed need to provide long term guidance for town councils, planning and environmental commission, and design review boards, as there can be strong and weak boards implementing the regulations. Commissioner Cleveland statted that if the UDGP limits were to be expanded the incorporation of strong language define various sub -areas and what is appropriate. Landmarks. Tom Braun introduced the topic. Warren Campbell raised a question regarding Vail's history in American ski heritage and the potential to preserve that heritage. Commissioner Hopkins described scenarios where drywall was holding up joists and studs when describing some of the initial construction in town. When Vail became a destination resort it changed everything with regard to guest expectations. Commissioner Cartin expressed that scale and the quaint feeling is most important to preserve. Commissioner Cleveland discussed the significance of the Gorsuch clock tower. Let's not hamstring potential development, but let's preserve those landmarks that are quintessential Vail. Vail doesn't have a lengthy history like other communities (mining, agricultural). 50 years is a short period of time. Vail sells service and at the current price point guests have certain expectations of quality. He was not sure the battle to identify structures as landmarks needed to be fought anymore. Commissioners Webb, Kurz and Pratt agreed. Pratt expressed concern legislating the preservation of open space that is privately owned. Commissioner Kurz expressed the need to capitalize on certain locations, encouraging developers to build landmarks. Warren Campbell asked if anything should be done today to establish structures worth saving in the future? Commissioner Pratt said to encourage landmarks could be problematic, as landmarks to past generations have a lesser meaning to young generations. Tom Braun then spoke to the mechanisms other communities have developed in order to preserve their character. The communities of Santa Fe, Park Cirty and Santa Barabra were discussed in regards to what they do to preserve and protect their communities and how that may be applicable in Vail. Commissioner Cleveland stated that real estate was a commodity and what people desired changes over time and therefore any adopted document should allow for change. Commissioner Kurz said he was still struggling will how to define landmarks. Tom Braun suggested another approach to addressing landmarks could be a discussion of scale and architecture that needs to be protects. Non - conforming Properties and Redevelopment Tom Braun introduced the topic. He identified scale as potentially most important factor to include into the UDGP. Commissioner Pratt said the Covered Bridge building presented an impractical application of the 60/40 height limit. He stated the need for a pragmatic approach to regulating height. Maybe a 10% variation is warranted. Pratt then discussed the need for constant upkeep for buildings. Commissioner Hopkins agreed and added a concern regarding vacant properties. Commissioner Cleveland stated that it is not the government's role to regulate upkeep. Commissioner Cleveland thought the proposal presented by Tom were appropriate. Tom then discussed architectural character and the lack of articulation within the UDGP in this regard when compared to the Lionshead Redevelopment Master Plan. Commissioner Pratt mentioned compatibility as an important factor worth considering a development proposal. Sometimes bad projects have been approved due to a lack of stringent criteria. Commissioner Cartin used the Wall Street Building as an example of how a project can change between a PEC approval and a DRB approval based upon each groups review elements. He agreed with the idea of establishing criteria which were focused on height variances in the Village. Architectural Character and Specific Elements of the UDGP Tom Braun introduced the topic. Several PEC members agreed that compatibility is important as discussed by Tom. Commissioner Pratt stated than more compatibility language may provide for enforceable regulations while allowing for flexibility. The Village does not need guidelines and standards as detailed as the Lionshead Redevelopment Master Plan. Commissioner Kurz mentioned the need to upgrade the graphics within the UDGP and define the architectural character elements desired. He also spoke to the need to forward recommendations to other boards regarding projects. There needs to be an effective tool to understanding the rationale when Council overturns a PEC action. Commissioner Pratt discussed how Swiss, Austrian, and Tyrolean architecture are all very different. He added the new fad is mountain contemporary. When need to decide and clarify Vail's architecture. Tom Braun then discussed identifying opportunities to expand retail. Commissioner Pratt stated the streetscape in some areas (1 Willow Bridge Rd) as the result of expanded retail resulted in an expanse of paving without and softscape. There should have been some landscaping incorporated into the redesign. Commissioner Cartin cited examples of island planters that work within Town and allowing for private property to propose planters on Town property as well. Tom Braun then discussed transparency /windows. There is a lot language in this section that is ambiguous. It needs to be more definitive. Tom went on to discuss landscaping and sun /shade. Commissioner Pratt mentioned Arrabelle as a poor example of excessive shading in the winter on the north side adjacent to Lift House Lodge. Others agreed that it is one of the few mistakes with the Lionshead redevelopment. Commissioner Cleveland suggested no additional shading of a street should be permitted Tom Braun mentioned dining decks and patios as features of the Village worth preserving due to their contribution to street life. The Commissioners echoed the importance of the deck and patios. Tom also identified public plazas as another important element of the Village that should be identified as such in the UDGP. Commission Pratt agreed. Tom Braun stated that rooftop equipment should also be addressed in the UDGP. Pam Hopkins said noise needs to be regulated in the UDGP as well. Tom then mentioned a few housekeeping items — the roles of the boards, calculating height, updating maps and graphics. Commissioner Cleveland asked about the next steps. Warren Campbell explained that this recommendation would be taken forward to the Town Council and if there was agreement to move forward with a process of exploring amendments staff would propose a budget and time line for such an effort. 3. A request for a recommendation to the Vail Town Council on a major amendment to Special Development District No. 4, Cascade Village, pursuant to Section 12- 9A -10, Amendment Procedures, Vail Town Code, to allow a revision to the approved development plan for the Cornerstone site to facilitate the construction of a tensioned membrane structure, located at 1300 Westhaven Drive /Unplatted, (Liftside /Cornerstone) and setting forth details in regard thereto. (PEC140019) Applicant: Charter Sports, represented by Braun & Associates Planner: Jonathan Spence ACTION: Table to August 11, 2014 MOTION: Cleveland SECOND: Cartin VOTE: 6 -0 -0 4. Approval of July 14, 2014 minutes MOTION: Kurz SECOND: Cleveland VOTE: 6 -0 -0 5. Information Update 6. Adjournment MOTION: Kurz SECOND: Cleveland VOTE: 6 -0 -0 The applications and information about the proposals are available for public inspection during regular office hours at the Town of Vail Community Development Department, 75 South Frontage Road. The public is invited to attend the project orientation and the site visits that precede the public hearing in the Town of Vail Community Development Department. Times and order of items are approximate, subject to change, and cannot be relied upon to determine at what time the Planning and Environmental Commission will consider an item. Please call (970) 479 -2138 for additional information. Sign language interpretation is available upon request with 24 -hour notification. Please call (970) 479 -2356, Telephone for the Hearing Impaired, for information. Community Development Department Published July 25, 2014 in the Vail Daily. TOWN Of vn' 1[1 VAIL TOWN COUNCIL AGENDA MEMO MEETING DATE: August 5, 2014 ITEM /TOPIC: International Air Service Study Presentation PRESENTER(S): Greg Phillips, Eagle County Regional Airport Aviation Director BACKGROUND: In response to climbing international visitor numbers in Eagle and Pitkin Counties over the last several years, the Eagle County Regional Airport commissioned a study regarding the feasibility of direct nonstop international air service with a nationally regarded air service consulting firm. This presentation reviews the data collected and the conclusions of that study. It was presented to the Eagle County Commissioners on July 22nd. ATTACHMENTS: International Air Service Study Presentation 8/5/2014 EGE International Market Analysis July 2014 8/5/2014 Campbell -Hill Aviation Group, LLC Review of Passenger Data 8/5/2014 Chart 1 YY Campbell -Hill ' _ /aviation Group, LLC Vail /Eagle Local International O &D Passenger History Local O &D Passengers 50,000 - 40,000 30,000 20,000 10,000 0 EGE Runway Construction o °3 o°l o°� o °� o °"' o°"' 11 o°o o °, o°" o°(' o (b o°° o °o o ", p", oNN oNN o'`� o" N'6 ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti 12 Month Rolling 8/5/2014 �•► f 1T y#' Campbell -Hill Source: U.S International O &D Survey Chart 2 ' _ /aviation Group, LLC Vail /Eagle Average International One -way Fare ... Current (October 2012 — September 2013) average one -way fare: $706 • Down 8% year- over -year, Down 9% from Peak • Up $125 or 22% over past 4 years $0 n3 N ti ti ti ti ti ti ti ° ^n3 If, If ti 12 Month Rolling 8/5/2014 Note: Fares do not include taxes, fees and surcharges Source: U.S. International O &D Survey Chart 3 Campbell -Hill ' _ /aviation Group, LLC Vail /Eagle Local International O &D Revenue History Local O &D Revenue (millions) $30 -r $25 $20 $15 $10 $5 EGE Runway Construction • Current (October 2012 — September 2013) O &D revenue: $23.4 MM — Down 7% year- over -year • Peak (July 2011 — June 2012) O &D revenue: $25.1 MM Current O &D revenue is 7% below peak Peak YE Q2 2012 $25.1 MM Current $23.4 MM $0 d^ O0 C^ d0 d^ d0 d^ d0 d^ d0 d^ d0 d^ d0 d^ d0 d^ d0 d� d0 d^ d0 000 000 oOD� o! DK ooh ooh o00 000 00'1 00'1 000 000 000 000 0``0 0�0 0�^ o ^� o ^�, o`��, o ^� oN'b ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti 12 Month Rolling 8/5/2014 �•► Campbell -Hill Source: U.S. International O &D Survey Chart 4 ' _ Aviation Group, LLC DL (ATL) 3% AA (JFK) 4% UA (DEI Bova Who they fly on ... • Over 65% of EGE's International O&D passengers fly on American Airlines, 20% fly on United Other 8/5/2014 Source: U.S. International O &D Survey, Oct 2012 — Sept 2013 Chart 5 AA (MIA) 23% AA (DFW) 34% Campbell -Hill Aviation Group, LLC Vail /Eagle International O &D Passengers by Region Trans- Canada Pacific 6% � 2% Trans - Atlantic- 7% Caribbean 8% Source: U.S. International O &D Survey, Oct 2012 — Sept 2013 • Latin America accounts for nearly 80% of EGE's International O &D passengers Central America 32% 8/5/2014 Chart 6 South America 45% �f w�L y1' Campbell -Hill 1 l _ /aviation Group, LLC Vail /Eagle International O &D Passengers by Country Other 18% Chile 3% United Kingdom-- 3% Dominican Republic , 4% Canada 6% Argentina 7% Venezue 7% • Mexico and Brazil account for over 50% of EGE's International O &D passengers Mexico 28% 8/5/2014 Source: U.S. International O &D Survey, Oct 2012 — Sept 2013 Chart 7 Campbell -Hill ' _ /aviation Group, LLC Vail /Eagle International O &D Passengers are Highly Seasonal • Over 70% of International O&D passengers traveled in the first quarter of 2013, nearly 20% in the fourth quarter of 2012 International O &D Passengers by Quarter 23,056 22.876 23,570 Q1 110 Q3'10 Q1 '11 Q3'11 Q1 '12 Q3'12 Q1 '13 Q3'13 8/5/2014 Source: U.S. International O &D Survey, Jan 2010 — Sept 2013 Chart 8 Campbell -Hill Aviation Group, LLC Vail /Eagle Top International Airport Markets Winter (Jan 2013 —Mar 2013) Top 20 O &D Markets Sao Paulo (GRU) Mexico City (MEX) Rio De Janeiro (GIG) Buenos Aires (EZE) _ Monterrey Caracas Santiago Santo Domingo 599 Toronto (YYZ) 591 Panama City 538 London (LHR) 497 Guadalajara 482 Belo Horizonte 452 Cancun 362 Veracruz 355 Sydney 268 Grand Cayman Island 260 Guayaquil 224 Bermuda 223 Montreal 203 Source: U.S International O &D Survey, Jan 2013 — Mar 2013 OEM- 1,180 11,025 974 8/5/2014 2,182 1,803 2,827 3,713 Campbell -Hill Chart 9 /aviation Group, LLC 8/5/2014 Aspen Chart 10 Campbell -Hill ' _ /aviation Group, LLC Aspen Local International O &D Passenger History Local O &D Passengers 50,000 - 40,000 30,000 20,000 10,000 0 o °3 o°l o°� o°" o°"' o°"' o°o o °o l o°" o (b b o°° o °o o ", p", oNN oNN o'`� o" N'6 ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti 12 Month Rolling 8/5/2014 �•► f J y#' Campbell -Hill Source: U.S International O &D Survey Chart 11 ' _ /aviation Group, LLC Aspen Average International One -way Fare of $760 is at a New High Current /Peak $760 $400 $300 $200 - $100 Current (October 2012 — September 2013) average one -way fare: $760 • Down 16% year- over -year • Up $196 or 35% over past 4 years $0 ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti o ti o` � o` ^ ti o 111P '`� o o'`� 12 Month Rolling 8/5/2014 Note: Fares do not include taxes, fees and surcharges Source: U.S. International O &D Survey Chart 12 Campbell -Hill ' _ /aviation Group, LLC Aspen Local International O &D Revenue History Local r n r% - - - -'n' - - $30 $25 $20 $15 $10 $5 $0 d^ d� C^ & d^ & C^ & C^ C^ d^ d^ & C^ & d� O�l O�" O�� O�� O�� O�� ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti 12 Month Rolling 8/5/2014 1 YY Campbell -Hill Source: U.S. International O &D Survey Chart 13 Aviation Group, PLC Who they fly on ... Other 15% NZ (LAX) 3% AA (DFW) 6% UA (LAX) 7% LH (DEN) 7% QF (LAX) 8% 8/5/2014 Source: U.S. International O &D Survey, Oct 2012 — Sept 2013 • Nearly 65% of ASE International O &D passengers fly on United Airlines UA (DEN) 34% Chart 14 Campbell -Hill ' _ /aviation Group, LLC Aspen International O &D Passengers by Region Central America 18% Source: U.S. International O &D Survey, Oct 2012 — Sept 2013 South Caribbean America 2% 12% • Trans - Oceanic passengers account for nearly 50% of ASE's International O &D passengers - this differs significantly from EGE Trans - Atlantic 27% 20% 8/5/2014 Chart 15 S- ic 21% A 11 Y1' Campbell -Hill 1 l _ /aviation Group, LLC Aspen International O &D Passengers by Country Other 26% New Zealand_ 3% Argentina, - 3% Germany/ 6% Brazil 7% 8/5/2014 Source: U.S. International O &D Survey, Oct 2012 — Sept 2013 • Canada and Australia account for 35% of ASE's International O &D passengers Canada 20% United Kingdom 7% Chart 16 13% Australia 15% Campbell -Hill ' _ /aviation Group, LLC Aspen International O &D Passengers are Less Seasonal Than Vail /Eagle • 30% of ASE's International O&D passengers traveled in the second or third quarter of 2013 compared to only 10% for EGE International O &D Passengers by Quarter 18,462 17.818 Q1 110 Q3'10 Q1 '11 Q3'11 Q1'12 Q3'12 Q1 '13 Q3'13 8/5/2014 Source: U.S. International O &D Survey, Jan 2010 — Sept 2013 Chart 17 Campbell -Hill Aviation Group, LLC Aspen Top International Airport Markets Winter (Jan 2013 —Mar 2013) Top 20 O &D Markets Sydney Toronto (YYZ) Sao Paulo (GRU) Melbourne London (LHR) Mexico City (MEX) Buenos Aires (EZE) Frankfurt Brisbane 473 Auckland 427 Calgary 326 Rio De Janeiro (GIG) 312 Monterrey 289 Cancun 277 Munich 239 Vancouver 29 J204 Montreal Panama City 99 Guatemala City 3 Hamburg 1 2,094 1,669 1,324 1,078 871 782 720 706 8/5/2014 Source: U.S International O &D Survey, Jan 2013 — Mar 2013 Campbell -Hill Chart 18 Aviation Group, LLC Full Year (Oct 2012 —Sept 2013) International O &D Passenger Comparison: Vail /Eagle and Aspen O &D Passengers 14,566 Canada Caribbean Central America South America Trans - Atlantic Trans - Pacific 8/5/2014 Source: U.S. International O &D Survey, Oct 2012 — Sept 2013 Vail /Eagle " Aspen Chart 19 Campbell -Hill Aviation Group, LLC Full Year (Oct 2012 —Sept 2013) Average International One -way Fare Comparison: Vail /Eagle and Aspen Average One -way Fare $1,511 $1,367 Canada Caribbean Central America South America Trans - Atlantic Trans - Pacific 8/5/2014 Source: U.S. International O &D Survey, Oct 2012 — Sept 2013 Vail /Eagle " Aspen Chart 20 Campbell -Hill Aviation Group, LLC Full Year (Oct 2012 -Sept 2013) International O &D Revenue Comparison: Vail /Eagle and Aspen O &D Revenue $14,876,788 Canada Caribbean Central America South America Trans - Atlantic Trans - Pacific 8/5/2014 Source: U.S. International O &D Survey, Oct 2012 — Sept 2013 Vail /Eagle " Aspen Chart 21 Campbell -Hill Aviation Group, LLC Full Year (Oct 2012 —Sept 2013) Major International Gateway Load Factor Comparison Load Factor EGE /ASE to International Gateway Q'10 86% AA -DFW AA -MIA UA-IAH UA -DEN UA -ORD UA IAH 8/5/2014 Note: Sorted by descending Gateway size Source: U.S. International O &D Survey, Oct 2012 — Sept 2013 Vail /Eagle Aspen Chart 22 Campbell -Hill Aviation Group, LLC Full Year (Oct 2012 —Sept 2013) Average International One -way Fare Comparison Rank International Market Avera Vail /Eagle 1 Mexico City (MEX) $416 2 Sao Paulo (GRU) $1,217 3 Toronto (YYZ) $351 4 Sydney $1,372 5 Buenos Aires (EGE) $776 6 Rio De Janeiro (GIG) $1,263 7 London (LHR) $567 8 Monterrey $344 9 Caracas $953 10 Melbourne $1,328 11 Vancouver $249 12 Santiago $744 13 Cancun $295 14 Frankfurt $580 15 Santo Domingo $467 16 Calgary $271 17 Panama City $399 18 Los Cabos $415 19 Guadalajara $324 20 Montreal $238 8/5/2014 Source: U.S. International O &D Survey, Oct 2012 — Sept 2013 One -\n Aspen $479 $1,227 $325 $1,494 $857 $1,066 $775 $385 $1,060 $1,188 $292 $951 $340 $526 $396 $335 $363 $326 $418 $397 Chart 23 Fare Vail /Eagle Compared to Denver Aspen Denver $303 ($63) $114 $922 ($10) $295 $323 $26 $28 $1,148 ($121) $224 $787 ($81) ($11) $869 $197 $394 $609 ($209) ($43) $335 ($41) $10 $684 ($107) $269 $1,188 $139 $140 $315 ($43) ($66) $877 ($207) ($133) $214 ($46) $81 $617 $54 ($37) $309 $71 $157 $352 ($65) ($81) $339 $36 $60 $196 $89 $218 $279 ($94) $45 $363 ($159) ($126) Campbell -Hill ' _ Aviation Group, LLC Vail /Eagle One -Way Fares Compared With Aspen Average Fare $800 - $700 - $600 - $500 $400 $300 - $200 - $100 - $0 EGE Runway Current Construction $760 o °� o °� e o °�` o °"' o °�' o °�O o °�O o °l o °" o °o o °o o °° o °o o'`° o'`° o``^ o'`^ o'`� o'`� o'`� o'`� ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti " ti ti Vail /Eagle Aspen 12 Month Rolling 8/5/2014 Note: Fares do not include taxes, fees and surcharges Source: U.S. International O &D Survey Chart 24 Campbell -Hill /aviation Group, LLC The Average One -way Fare Difference Between Vail /Eagle and Aspen Average One- way Fare Differential (Vail /Eagle > Aspen) $150 - $100 $50 $0 -$50 EGE Runway Construction -$100 o °� o °� o °°� o °�` o °�' o °�' o °�O o °�O o °� o °� o °o o°o o°° o°o o'`° o'`° o``^ oNN o'`� oNl, oN"I oNO3 ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti 12 Month Rolling 8/5/2014 Note: Fares do not include taxes, fees and surcharges Source: U.S. International O &D Survey Chart 25 Campbell -Hill ' _ /aviation Group, LLC Peer Comparisons 8/5/2014 Chart 26 YY Campbell -Hill ' _ /aviation Group, LLC Vail /Eagle is the Only Airport Among its Peers with International Nonstop Service 8/5/2014 Chart 27 YY Campbell -Hill ' _ /aviation Group, LLC Peer Airport Local O &D Passenger Comparison Local O &D Passengers 40,000 - 30,000 20,000 10,000 EGE Runway Construction 0 C' cp C^ cp C' cp a'` d'' C' aP o -, o °b o°l* ell, to to llb o °o o °� o °� o °lb o °�' e1:1 o °° o'`° o'`o o'`N o'`^ o'`� o'`� o'`� o'`� 'e-, ti ti ti ti ti ti ti ti ti ti ti ti " ti ti ti ti ti ti Vail /Eagle Aspen Bozeman Gunnison Hayden Jackson Hole Montrose 12 Month Rolling 8/5/2014 Source: U.S. International O &D Survey Chart 28 Campbell -Hill ' _ /aviation Group, LLC Peer Airport O &D One -way Fare Comparison Average One -way Fare $800 - $700 $600 $500 $400 $300 $200 $100 $0 EGE Runway Construction ti b ti ' el, el, e13 ti ti ° el, ti l l lb lb ti ° ti ° o `o ' ti o ` ti o ` ti o `� ti o ` "1 " o` l o ti Vail /Eagle Aspen Bozeman Gunnison Hayden Jackson Hole Montrose 12 Month Rolling 8/5/2014 Note: Excludes taxes, fees and surcharges Source: U.S. International O &D Survey Chart 29 11 Y1' Campbell -Hill l _ /aviation Group, LLC Identification and Analysis of Opportunities for New International Air Service 8/5/2014 Chart 30 YY Campbell -Hill ' _ /aviation Group, LLC Derivation of O &D Passenger Traffic Model • Data sources — Vail Resorts — international skier visits by country for top twelve Winter 2012 -2013 country markets and airport choice — Aspen Skiing Company — airport choice, % of total visitors by country and international visitors for top ten countries — U.S. Dept. of Transportation (DOT) — Origin- destination (O &D) survey data for YE September 2013 • Data from all three sources was analyzed and combined into a comprehensive passenger traffic database. Passenger traffic sorted by: — Ski area destination (Aspen of Vail /BC) — Airport choice (ASE, DEN or EGE) — Origin airport and country — YE September 201A J ?y quarter and entire time period A 11 Y1' Campbell -Hill Chart 31 l _ /aviation Group, LLC Potential International Air Service Targets • Carriers considered for nonstop service to EGE - Aeromexico to Mexico City (MEX) - Copa to Panama City (PTY) - Volaris to Mexico City (MEX) • Interjet only flies A320s which would require significant payload restriction for 1,648 mile flight to MEX • Service to other Central /South American hubs ruled out due to small local market, inefficient aircraft or limited connecting opportunities • Service NOT considered feasible for Europe, Australia, South America and Caribbean due to EGE operational implications • Service NOT considered to major Canadian airports due to U.S. customs preclearance capabilities 8/5/2014 Campbell -Hill l _ /aviation Group, LLC Aeromexico Has 30 Vail /Eagle- Mexico City Connecting Opportunities It x TAM \ Pa7 BJX*,,�� ZLO MLM "dim ZIHr. ACA H MID ��OCUN ER�0CPE ��1GZ�ySAP \�� ..� �Ccs 7BOG o\ LIM 8/5/2014 �•► 3 J Campbell -Hill Aviation Group, LLC Volaris Has 3 Vail /Eagle- Mexico City Connecting Opportunities GE MID ` CUN MEX TGZ 8/5/2014 �•► Campbell -Hill ' _ /aviation Group, LLC Copa Airlines Has 34 Vail /Eagle- Panama City Connecting Opportunities 8/5/2014 SCL EZE Chart 35 REC YY Campbell -Hill ' _ /aviation Group, LLC Scenarios Considered for EGE Nonstop International Service Scenario ,airline 1 Aeromexico (AM1 2 Aeromexico (AMA 3 Aeromexico (AM) 4 Aeromexico (AMA 5 Volaris fY4'p 6 Volaris ( 4� 7 Volario 4) 8 Volario 4) 9 Copa (CM) 10 Copa i;CM) 11 Copa fCM) 8/5/2014 Airport Mexico City (ME X) Mexico City (ME X) Mexico City (ME X) Mexico City (ME X) Mexico City (ME X) Mexico City (ME X) Mexico City (ME X) Mexico City (ME X) Panama City (PTY) Panama City (PTY) Panama City (PTY) Chart 36 Operational Days Saturday Sat ?Tue ?Thu atl unTFue.FThu Daily Saturday affue ?Thu at?'un?Tue?Thu Gaily atlun ed?Thur Sat arr /Sun dep Campbell -Hill l _ /aviation Group, LLC Review of Methodology for Analyzing Scenarios • Local markets (EGE -MEX /PTY) — Vail /BC traffic using DEN — Vail /BC traffic using EGE — Aspen traffic using ASE — Aspen traffic using DEN — Aspen traffic using ASE • Connecting markets (EGE- hub - beyond markets) — Vail /BC traffic using DEN — Vail /BC traffic using EGE — Aspen traffic using ASE — Aspen traffic using DEN — Aspen traffic using ASE 8/5/2014 ,,��. f w�1' Campbell -Hill Chart 37 l _ /aviation Group, LLC Scenario 2 3 4 6 7 8 9 10 11 Airline Aeromexico (AM) Aeromexico (AM) Aeromexico (AM) Aeromexico (AM) Volaris (Y4} 'polaris (Y4} Volaris (Y4} Volaris (Y4} Copa (CM) Copa (CM) Copa (CM) Results of Route Analysis Airport Mexico City (ME} Mexico City (ME} Mexico City (ME} Mexico City (MEX} Mexico City (ME} Mexico City (ME} Mexico City (MEX} Mexico City (MEXt Panama City (PTYO Panama City (PTY,p Panama City (PTYh 8/5/2014 Operational Daps Saturday S at./Tu e1Th u Sat }SuwTue?Thu Daily Saturday S at.FTu e./Th u Sat /Sun ?Tue ?Thu Daily Sat }Sun Wed ?Thur Sat arr. /Sun dep Aircraft Boeing 737 -700 Boeing 737 -700 Boeing 737 -700 Boeing 737 -700 Airbus A319 Airbus A319 Airbus A319 Airbus A319 Boeing 737 -700 Boeing 737 -701 Boeing 737 -702 Seats 124 124 124 124 144 144 144 144 124 124 124 116% T1% 56% 34 % 148% 60% 47 % 29% 43% 43% 39% Campbell -Hill ' _ Aviation Group, LLC Financial Analysis of EGE International Arrivals Facility • Performed by airport financial consultants Leibowitz and Horton • Air service scenario developed for financial analysis: — 1 weekly flight to MEX during Winter 2015 -2016, 2 weekly flights in Winter 2016 -2017 and 3 in Summer 2017 -2018. — Flights would be operated by Aeromexico or Volaris — Hybrid A319 /Boeing 737 -700 aircraft was used with 134 seats — Based on the route performance results and further data analysis, an 82% load factor was generated for Winter 2015- 2016, 80% for Winter 2016 -2017 and 65% for Winter 2017 -2018 • Based on the analysis, EGE would need to collect a fee ranging from $101.64 to $112.89 per enplaned passenger to recover O &M expenses associated with the international arrivals facility — Airlines will generally consider airports with international arrivals fees ranging up to $20 -25 per enplaned passenger 8/5/2014 A 11 Y1' Campbell -Hill Chart 39 l _ /aviation Group, LLC Financial Analysis of EGE International Arrivals Facility • Subsequent analysis examined the required additional weekly flights necessary to reduce the airline fees for use of the international arrivals facility to a reasonable level • Based on this analysis, EGE would need to attract an additional 5.8 weekly international flight arrivals to lower the costs to $20.00 in Winter 2015 -2016, growing slightly to $22.27 through Winter 2018 -2019 • According to the route analysis results, not enough passengers would choose nonstop flights to EGE to economically justify the required extra weekly flights • This analysis also does not account for the capital costs of developing the facility • Including such capital costs would make the cost per enplanement to the airlines too expensive and would therefore render potential new nonstop service economically infeasible 8/5/2014 Chart 40 11 Y1' Campbell -Hill l _ /aviation Group, LLC Conclusions and Recommendations • Based on the passenger demand and route performance analyses, Campbell -Hill recommends focusing solely on service to MEX with either Aeromexico or Volaris, but not both, for up to a maximum of three weekly roundtrips. This is based on the following data: — U.S. DOT O &D Passenger Survey data for international passenger demand from ASE and EGE — International visitor data from Vail Resorts and the Aspen Skiing Company — Corporate strategy for candidate international carriers — Aircraft performance specifications • Although passenger demand patterns may justify three weekly roundtrips to MEX during the ski season, the O &M cost of an international arrivals facility render the opportunity infeasible • Conclusion: EGE should continue to research but not pursue immediate developmeR jog4f an international arrivals facility at this time. 1- Campbell -Hill /aviation Group, LLC EGE International Market Analysis July 2014 8/5/2014 Campbell -Hill Aviation Group, LLC q9VY C a m p be l lP Hill [ LeibowitaHortoll ., Airport Management Consultants Incorporated FINAL Eagle County Regional Airport (EGE) International Air Service Analysis and Business Case Prepared for: Eagle County Regional Airport Submitted by: Campbell -Hill Aviation Group, LLC July 16, 2014 8/5/2014 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Contents 1 Introduction ......................................................................................... ..............................1 2 Review of International O &D Passenger Data ................................ ............................... 2 2.1 EGE International O &D Passenger Data ................................. ..............................2 2.2 ASE International O &D Passenger Data .............................. ............................... 11 2.3 Combined International O &D Passenger Data for ASE and EGE ...................... 20 2.4 Peer Comparisons ................................................................. ............................... 35 3 Derivation of O &D Passenger Traffic Model ................................ ............................... 41 4 Discussion of Potential International Air Service Targets ............. .............................42 5 Route Analysis for Potential New International Air Service ....... ............................... 44 6 Financial Analysis of EGE International Arrivals Facility .......... ............................... 48 7 Conclusions and Recommendations ................................................. .............................49 8 Appendix A ....................................................................................... ............................... 50 9 Appendix B ....................................................................................... ............................... 51 GwTZ mnGroup LLCM EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE 1 Introduction The purpose of this study is to evaluate the financial feasibility of making the capital investment to equip Eagle County Regional Airport (EGE) in Gypsum, CO to handling inbound international scheduled air service. The targeted scheduled service would require customs and immigration clearance at EGE. Hence, additional nonstop scheduled service to /from airports with U.S. preclearance facilities (e.g., Toronto - Pearson International Airport) is not the subject of this study. The study includes an examination of the EGE and Aspen — Pitkin County Airport (ASE) O &D international passenger markets per data reported by U.S. domestic airlines to the U.S. Department of Transportation. Comparisons will also be made to a group of peer airports which serve similar catchment areas to ASE and EGE. A review of data provided by Vail Resorts and the Aspen Skiing Company will follow as well as a discussion of potential air service targets. Then the results of Campbell - Hill's route analysis will be reviewed which will serve as the input for the financial analysis performed by Leibowitz and Horton. I I mnGroup LLCI EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE 2 Review of International O &D Passenger Data This section will review international O &D passenger data as reported by domestic U.S. carriers to the U.S. Department of Transportation (DOT). An EGE origin- destination passenger is a passenger who starts or ends his or her trip at EGE. Unless indicated otherwise, passengers referred to in this report are one -way passengers (a round -trip passenger is counted twice). DOT O &D Survey and T -100 data are not reported instantaneously. Rather, there is a time lag of between three and seven months between when the activity occurs and it is available to the public. This time lag may affect initial study results when schedule data are taken into consideration because carrier schedule changes may have taken place in the most current schedules being flown at EGE or sold to the public. Throughout this report, references will be made whenever relevant to air service changes made since the data reporting period. The year ended September 30, 2013 was selected as the primary time period used in this analysis because all traffic databases used in this report have data at least as recent as this period. 2.1 EGE International O &D Passenger Data EGE generated 33,104 international O &D passengers for year -ended (YE) September (Q3) 2013, which was up 2% year- over -year. This equates to 45.3 Passengers Per Day Each Way (PDEWs) on average over the course of the twelve -month period. Passengers per day each way, or PDEW, is an industry acronym measuring average daily round -trip O &D traffic levels. PDEW are calculated from total annual O &D passengers divided by the number of days in a year times two (i.e. Annual O &D/(365 *2)). This time period also marked a new peak within the past ten years for international O &D passengers during any consecutive twelve -month period. Although international O &D passengers had grown 2% year - over -year, international passenger traffic has remained relatively flat since YE March 31 (Q1) 2011. This follows a period of rapid growth from YE December 31 (Q4) 2009 where international passenger traffic grew 54% or 11,426 annual O &D passengers. I I mpbellp LLCI EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 1: Vail /Eagle (EGE) Local International O &D Passenger History Local O &D Passengers EGE Runway Gonsirmtfon 50,000 40,000 30,000 20,000 10,000 0 10" le l°°° I? e ti °°a 12 Month Rolling Source: U.S. DOT O &D Survey The average fare for all international O &D passengers for YE Q3 2013 is currently $706 each way, not including government imposed taxes, fees or airline surcharges. The current fare is down 8% YOY and down 9% from the most recent peak fare, which was achieved in YE Q2 2012. The average international O &D fare has risen significantly in the past few years having increased $125 each way, or 22 %, over the past four years. Avei $800 $700 $600 $500 $400 $300 $200 $100 $0 Figure 2: Vail/Eagle (EGE) International One -way Fare History 12 Month Rolling Source: U.S. DOT O &D Survey I I mpbeGroup, LC e 3 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE The EGE international O &D passenger market currently generates $23.4 MM in annual revenue, or approximately $32,000 of revenue per day each way (RDEW). This figure is down 7% YOY and down 7% below the most recent peak revenue of $25.1 MM, which was achieved in YE Q2 2012. Much like average international fares, international O &D revenue grew significantly from YE Q4 2009 through YE Q1 2011, growing 89% over this time period. Figure 3: Vail/Eagle (EGE) International O &D Revenue History LOcal $30 $25 $20 $15 $10 $5 $0 EGE Runway C� Off' & (9 C^ CsP O^ (9 CY CP & CP a^ CP & CP & 0 & CP & 0 ry°o3 ry°oM ti�°p ryopa ryo °� ry°oy °� ryoQm 10%, e e e e e e ON" 16, 1 04' ON", ON`, 12 Month Rolling Source: U.S. DOT O &D Survey International O &D passengers connect via a number of different hubs utilizing various routings when traveling to /from EGE. The largest proportion of international O &D passengers (34 %) connect on American Airlines (AA) via Dallas/Ft. Worth International Airport. This is not surprising given AA's capacity on this route from EGE and the multitude of international connecting options at DFW on both AA and its oneworld alliance partners. 23% of international O &D passengers connect via AA at Miami International Airport (MIA) in Florida. MIA is the largest U.S. gateway to Latin America and the Caribbean and the AA flights are timed well to facilitate such connections throughout the region, especially deep South America. 10% of international O &D passengers connect via Houston -Bush Intercontinental Airport (IAH) on United Airlines (UA). IAH is in fact UA's largest hub and provides nonstop service to numerous destinations throughout Latin America. 8% connect on UA via Denver International Airport I I mnGroup LLCM e 4 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE (DEN), 4% on AA via New York - Kennedy International Airport (JFK) and 3% on Delta Air Lines via Atlanta Hartsfield- Jackson International Airport (ATL). Figure 4: Vail/Eagle (EGE) International O &D Routings DL (ATL) 3% - AA (JFK) 4% - UA (DEN) 8% UA ([ in, Other 18% Wftb% AA (DFV1) 34% AA (MIA) 23% Source: U.S. DOT O &D Survey, YE Q3 2013 The largest segment of EGE international O &D passengers travel to /from South America with 45% of all international passengers. The next largest is Central America with 32% of all international passengers. Central America includes Mexico for purposes of this analysis. 8% of all passengers travel to /from the Caribbean region; 7% travel to /from transatlantic destinations including Europe, Middle East, Africa and India; 6% to /from Canada; and, 2% travel to /from transpacific destinations including the rest of Asia, Oceania and Guam. I I mnGroup LLC e 5 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 5: Vail/Eagle (EGE) International O &D Passengers by Region Trans - Atla 7 Caribbean 8% Trans- Canada Pacific 6% 1 2% America 32% South America 45% Source: U.S. DOT O &D Survey, YE Q3 2013 From a country perspective, 28% of all EGE international O &D passengers travel to /from Mexico. Another 24% travel to /from Brazil. Hence, the top two country origins for EGE international passengers account for over 50% of all international O &D passengers. These are followed by Venezuela at 7 %; Argentina at 7 %; and, Canada at 6 %. I I mnGroup LLCM e s EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 6: Vail /Eagle (EGE) International O &D Passengers by Country Other 18% Chile 3% United Kingdom - 3% Dominican Republic — 4% /® Canada 6% Argentina) 7% Venezue 7% Mexico 28% Source: U.S. DOT O &D Survey, YE Q3 2013 Just like domestic O &D passengers, there exists significant seasonal variation in demand for international O &D passengers. International O &D traffic exhibits the expected surge in Q1 due to ski season with a smaller but still pronounced increase in Q4. International O &D traffic does not experience the significant Q3 increase for summer traffic like domestic passenger traffic does. For YE Q3 2013, over 70% of international O &D passengers traveled in Q1 2013 and nearly 20% in Q4 2012. Hence, approximately 90% of annual international O &D passenger demand occurs in Q4 and the following Q1, which coincides with the holiday season and peak ski season. I I � mpbeh p LLC e 7 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 7: Vail/Eagle (EGE) International O &D Passengers by Quarter International O &D Passengers by Quarter 23.456 77 VA 23.570 01,10 Q3 '10 Q1 '11 03,11 Q1'12 Q3'12 Q1 113 Q3'13 Source: U.S. DOT O &D Survey Since Mexico is the largest country for EGE international O &D passengers, it is no surprise that the largest airport market is Mexico City (MEX) with 4,572 O &D passengers for YE Q3 2013. The next two largest O &D airport markets are both located in Brazil, which was identified as the second largest country for EGE international O &D passengers. Sao Paulo (GRU) had 4,448 O &D passengers and Rio De Janeiro (GIG) had 2,492 O &D passengers. The GRU market is only 3% smaller than MEX but GIG is a whopping 45% smaller than MEX. The top largest markets also include Caracas (CCS) with 2,134 O &D passengers, Buenos Aires (EZE) with 2,012 O &D passengers and Monterrey (MTY) with 1,962 O &D passengers. The top eight international O &D markets are all located in Latin America. I I mnGroup LLCI 8 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 8: Vail /Eagle (EGE) Top Intl. O &D Markets — Full Year (Oct. 2012 — Sept. 2013) TOD 20 0 &D Markets Mexico City (MEX) Sao Paula (GRD) Rio De Janeiro {GIG) Caracas Buenos Aires (EZE) Monterrey Santiago Santa Domingo London (LHR� Toronto(YYZ) Guadalajara Panama City Belo Horizonte Cancun Veracruz Sydney Grand Cayman Island Lima Bermuda Montreal Source: U.S. DOT O &D Survey 572 8 When looking at just the 4th quarter demand by market, Caracas (CCS) jumps to the top spot with 998 O &D passengers for this time period. As the second largest market, Mexico City (MEX) is still relatively large with 937 O &D passengers, just 6% smaller than CCS. Monterrey (MTY) and Santo Domingo (SDQ) are also both much more significant markets for the 4th quarter than for full year demand. I I mpbeup LLCI 9 tion EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 9: Vail/Eagle (EGE) Top Intl. O &D Markets — 4tn Quarter (Oct. — Dec. 2012) Tap 20 O&D Markets Caracas Mexico City RMEX) Sao PaulotGRD} Monterrey Santo Domingo Rio De Janeiro {GIGj London {LHRj Buenos AiresjEZE) Guadalajara Maracaibo Lima Bogota Bermuda Belo Horizonte Toronto ffYZ) Calgary Frankfurt Grand Cayman Island Sydney Los Cabos Source: U.S. DOT O &D Survey 9Ss When looking at just the 1St quarter demand by market, Sao Paulo (GRU) now jumps to the top spot with 3,713 O &D passengers for this time period. As the second largest market for the 1St quarter as well, Mexico City (MEX) is still relatively large with 2,827 O &D passengers, but 24 %% smaller than GRU. Much like the full year data, Rio De Janeiro (GIG) and Buenos Aires (EZE) are also both significant markets for the 1St quarter, as are Monterrey (MTY) and Caracas (CCS). I I mpbeup LLCM 10 tion EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 10: Vail /Eagle (EGE) Top Intl. O &D Markets —1st Quarter (Jan. — Mar. 2013) Tor) 20 D &D Markets Sao Paulo(GRU) Mexic© City RMEX) Rio De Janeiro (GIG) Buenos Aires(EZE) Monterrey Caracas Santiago Santo Domingo Toronto (YYZ) Panama City London(LHR) Guadalajara Belo Horizonte Cancun Veracruz Sydney Grand Cayman Island Guayaquil Bermuda Montreal Source: U.S. DOT O &D Survey 2.2 ASE International O &D Passenger Data on ASE generated 33,235 international O &D passengers for YE Q3 2013, which was up 1% year - over -year. This equates to 45.5 PDEWs on average over the course of the twelve -month period. International passenger traffic during this time period was within I% of the peak, which occurred in YE Q2 2013, the immediately preceding twelve month period. Although international O &D passengers had grown 1% year- over -year, international passenger traffic had grown on average 12% per year over the preceding two years. I I mpbeup LLCM 11 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 11: Aspen (ASE) Local Intl. O &D Passenger History Local O &D Passengers So,000 40,000 30,000 20,000 10,000 0 e ,ti0 e .y@ ,LO .y0 e .l@ .y@ 12 Month Rolling Source: U.S. DOT O &D Survey The average fare for all ASE international O &D passengers for YE Q3 2013 is currently $760 each way, not including government imposed taxes, fees or airline surcharges. This is 8% higher than the current EGE international one -way fare. The current fare is up 16% YOY and establishes a new peak fare. The average international O &D fare has risen significantly in the past few years having increased $195 each way, or 35 %, over the past four years. Avei $800 $700 $600 $500 $400 $300 $200 $100 $0 01 41P e le Figure 12: Aspen (ASE) Intl. One -way Fare History & Qom' & CP & (9 & & & & & & & & & & & & 'YO 'L 'Y@ e 0 e 'Y e e do 'L 411 'e 'V@ 'L@ 411 4 12 Month Rolling Source: U.S. DOT O &D Survey I I mnGroup LLC e 12 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE The ASE international O &D passenger market currently generates $25.3 MM in annual revenue, or approximately $35,000 of revenue per day each way (RDEW). This figure is up 17% YOY and establishes a new peak revenue level. Much like average international fares, international O &D revenue grew significantly from YE Q4 2011 through YE Q1 2013, growing 55% over this time period. Figure 13: Aspen (ASE) Intl. O &D Revenue History Local - -- $30 $25 $20 $15 $10 $5 $0 4& & & (9 & & & O�' O� O' Ca^ CYO' & & & & & CP & & & 0 'Yoo9 1803 �o0p Y6ph dog ti°� YOB Yo�1 X01 'lob e ryop ryo�^ 'lohl ti °^�0 ^9 Yo�y 12 Month Rolling Source: U.S. DOT O &D Survey International O &D passengers connect via a number of different hubs utilizing various routings when traveling to /from ASE. The largest proportion of international O &D passengers (34 %) connect on United Airlines (UA) via Denver International Airport (DEN). Including the codeshare passengers booked on Lufthansa (LH) but actually traveling on UA via DEN, this figure is more accurately 41%. This is not surprising since 62% of all departures and seats at ASE for YE Q3 2013 were provided by UA to DEN. 11% of international O &D passengers connect via UA at Chicago- O'Hare International Airport (ORD) and 9% via Houston -Bush Intercontinental Airport (IAH). According to the DOT data, 8% connect on Qantas (QF) via Los Angeles International Airport (LAX) but these passengers are actually traveling codeshare flights operated by American Airlines (AA). The same can be said for the 3% traveling on Air New Zealand (NZ) which are actually codeshare flights operated by United Airlines (UA), so 10% of the market is actually utilizing this routing. American Airlines' service to DFW and LAX collectively only accounted for 8% of seats and departures during this time period which explains the relatively low share of international connecting passengers traveling on AA. This breakdown I I mpbehp LLCM 13 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE will surely change as Delta Air Lines (DL) has started new nonstop service to both Atlanta - Hartsfield Jackson International Airport (ATL) and Minneapolis -St. Paul International Airport (MSP). Figure 14: Aspen (ASE) International O &D Routings NZ (LAX) 3% AA (DFW) 6% UA (LAX) 7% LH (DE 7% Other 15% UA (DEN) 34% $% UA (IAH) 9% D) 11% Source: U.S. DOT O &D Survey, YE Q3 2013 The largest segment of ASE international O &D passengers travel to /from transatlantic destinations with 27% of all international passengers including Europe, Middle East, Africa and India. The next largest is transpacific destinations with 21% of all international passengers including the rest of Asia, Oceania and Guam. 20% of all passengers travel to /from Canada; 18% travel to /from Central America including Mexico; 12% to /from South America; and, 2% travel to /from the Caribbean region. This differs significantly from EGE where nearly 80% of all international passengers originate in Latin America and transatlantic and transpacific passengers combined account for less than 10% of all international passengers. I I mpbellp LLCM 14 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 15: Aspen (ASE) International O &D Passengers by Region Central America 18% South Caribbean America 2% 12% Trans- Atlantic 27% 20% r Trans - Pacific 21% Source: U.S. DOT O &D Survey, YE Q3 2013 From a country perspective, 20% of all ASE international O &D passengers travel to /from Canada. Another 15% travel to /from Australia and 13% to /from Mexico. The ASE international market is much more fragmented than the EGE international market where the top two countries account for over 50% of all international passengers. Even though 27% of all international passengers are from the transatlantic region, there is no dominant origin country in that region. The same cannot be said of the transpacific region where over 70% of the traffic from the region comes from Australia. et'-02 mnGroup LLCM 15 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 16: Aspen (ASE) International O &D Passengers by Country Canada Other 20% 26% New Zealand 3% Argentina 3% German} 6% 7% United 13 % Kingdom 7% Australia 15% Source: U.S. DOT O &D Survey, YE Q3 2013 Just like domestic O &D passengers, there exists significant seasonal variation in demand for international O &D passengers. International O &D traffic exhibits the expected surge in Q1 due to ski season with a significantly smaller but still pronounced increase in Q4. International O &D traffic does not experience the significant Q3 increase for summer traffic like domestic passenger traffic does. For YE Q3 2013, over 50% of international O &D passengers traveled in Q1 2013. This compares to over 70% for EGE. Traffic is more evenly dispersed in the other three quarters whereas EGE had a spike in the third quarter and very little demand in the 2"d quarter. For YE Q3 2013, 16% of ASE international passengers traveled in Q4 2012 and Q2 2013, 14% in Q3 2013. I I � mpbeh p LLCM e 16 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 17: Aspen (ASE) International O &D Passengers by Quarter International O &D Passengers by Quarter 18.462 17.818 Q1 110 Q3'10 Q1 '11 Q3'11 Q1 '12 Q3'12 Q1 '13 Q3'13 Source: U.S. DOT O &D Survey Since Canada is the largest country for ASE international O &D passengers, it is no surprise that the largest airport market is Toronto - Pearson (YYZ) with 3,004 O &D passengers for YE Q3 2013. The next largest O &D airport market, Sydney (SYD) is located in the second largest O &D country, with 2,904 O &D passengers. The next three markets are London - Heathrow (LHR) with 1,997 O &D passengers; Sao Paulo (GRU) with 1,592 O &D passengers; and, Mexico City (MEX) with 1,588 O &D passengers. MEX has 65% less O &D passengers at ASE than EGE, where it is the largest O &D international market for YE Q3 2013. Conversely, YYZ is has 73% less O &D passengers at EGE than ASE, where it is the largest international O &D market for YE Q3 2013. I I mpbeh p LLC e 17 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 18: Aspen (ASE) Top Intl. O &D Markets — Full Year (Oct. 2012 — Sept. 2013) Top 20 O &D Markets Toronto jYYZ) Sydney London(LHR) Sao Paulo Mexico City lME)O Melbourne Buenos Aires �EZE) Frankfurt Vancouver Calgary Los Cabos Cancun Monterrey Brisbane Montreal Paris (CDG) Auckland Rio De Janeiro�GIG) Munich San Salvador ?,004 ,504 Source: U.S. DOT O &D Survey When looking at just the 4th quarter demand by market, Sydney (SYD) jumps to the top spot with 584 O &D passengers for this time period. As the second largest market, Toronto (YZ) is still relatively large with 431 O &D passengers. Mexico City (MEX) and Los Cabos (SJD) are also both much more significant markets for the 4th quarter than for full year demand. I I mpbeup LLCM 18 tion EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 19: Aspen (ASE) Top International O &D Markets — 4th Quarter (Oct. — Dec. 2012) Top 20 O &D Markets Sydney Toronto (YYZ) Mexico City (MEX) London (LHR) Los Cabos Buenos Aires jEZE) Vancouver Madrid Monterrey Melbourne Sao Paulo (GRU) Calgary Frankfurt Paris (CUG} Shanghai San Jose Amsterdam Cancun Ottawa San Salvador 584 Source: U.S. DOT O &D Survey When looking at just the 1St quarter demand by market, Sydney (SYD) is the largest market with 2,094 O &D passengers for this time period, just as it is for the 4th quarter. As the second largest market for the 1St quarter as well, Toronto- Pearson (YYZ) is still relatively large with 1,669 O &D passengers. Much like the full year data, YYZ and SYD are the top two markets yet they swap places when considering Q4 and Q1 individually. Both Sao Paulo (GRU) and Melbourne (MEL), the third and fourth largest markets for Q1, experience most of their full year traffic during this quarter alone. I I mpbeup LLCM 19 tion EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 20: Aspen (ASE) Top Intl. O &D Markets — V Quarter (Jan. — Mar. 2013) Toe 20 O &D Markets Sydney Toronto {YYZj Sao Paulo (GRIT) Melbourne London (LHR) Mexico City (MEX) Buenas Aires �EZE) Frankfurt Brisbane Auckland Calgary Rio De Janeiro�GIG) Monterrey Cancun Munich Vancouver Montreal Panama City Guatemala City Hamburg 2.09:1 Source: U.S. DOT O &D Survey 2.3 Combined International O &D Passenger Data for ASE and EGE Since international traffic and service is being considered to serve the entire EGE catchment area, it is necessary to perform similar analyses for both airports combined (ASE & EGE). Together, ASE and EGE generated 66,339 international O &D passengers for year -ended (YE) September (Q3) 2013, which was up 1% year- over -year. This equates to 90.0 Passengers Per Day Each Way (PDEWs) on average over the course of the twelve -month period. This time period also marked a new peak within the past ten years for international O &D passengers during any consecutive twelve -month period. International O &D passengers have grown steadily since 2003 for the two airports combined, growing on average 8% annually for the past 10 years, nearly tripling over this time period. 5 mp be[ pHLC 20 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 21: Vail/Eagle (EGE) and Aspen (ASE) Combined Intl. O &D Passenger History Local O &d Passengers 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 °n, °1 °� °0 00 o°j ^D '+° ^h 1" ry0 ti0 ry0 �O ti °. ,y° �O ry° ,yo ti0 ry0 ti0 ,y° �O r�° MO ry0 ti0 ryo ry4 ti° r�0 12 Month Rolling Source: U.S. DOT O &D Survey The average fare for all international O &D passengers for YE Q3 2013 is currently $733 each way, not including government imposed taxes, fees or airline surcharges. The current fare is up 3% YOY and sets a new record high fare for the ten year time period. Although the fare was up 3% YOY, it has increased nearly $100 each way, or 15 %, over the past two years and 7% for each of the past two years on average. This follows the previous two -year period where average fares actually declined ever so slightly. Figure 22: Vail/Eagle (EGE) and Aspen (ASE) International One -way Fare History Avel $800 $700 $600 $500 $400 $300 $200 $100 $0 Cif & CYO & & (9 & (9 & 0 C> C> C;� & & C> <9 CCs C> o� 4' o� a4 oy oy o� d° o1 o" o° °° °9 00 �° �° AA �` 1ti "ti e5 ryo ,�o ,yo �o ,yo ,�o ,yo ,40 ,yo ,yo ,yo ,yo ,yo ,yo ,yo ,yo ,yo ,yo ryo do do ,�o 12 Month Rolling Source: U.S. DOT O &D Survey I I mnGroup LLC e 21 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE The international O &D passenger market for the combined airports currently generates $48.6 MM in annual revenue, or approximately $67,000 of revenue per day each way (RDEW). This figure is up 4% YOY and establishes a new peak level for the ten year time period. Thanks to steady passenger growth but slower fare growth, revenues have increased significantly over the past four years, growing on average 18% per year. Figure 23: Vail /Eagle (EGE) and Aspen (ASE) International O &D Revenue History Local i $50 $ao $30 $20 $10 $0 %, oti o0 00 o°j o°y No po N^ 4l �� "ti N� p ,yo ,tio do ,yo ,yo ,tio ,yo ,yo ryo ,lo ,�o ,yo ,�o ,ya �o ,tio �o do �o ,tio �o ,yo 12 Month Rolling Source: U.S. DOT O &D Survey International O &D passengers connect via a number of different hubs utilizing various routings when traveling to /from ASE and EGE. The largest proportion of international O &D passengers (20 %) connect on United Airlines (UA) via Denver International Airport (DEN). 19% of international O &D passengers connect via American Airlines at Dallas /Ft. Worth International Airport (DFW) and another 12% via Miami International Airport (MIA). Due to the carriers' presence at both airports, most of the international passengers travel via AA or UA. Although the chart indicates that 5% of international passengers travel on Qantas (QF) via Los Angeles International Airport (LAX), these are actually codeshare passengers traveling on AA flights to LAX and then connecting to /from QF flights. Same goes for the 4% traveling on Lufthansa (LH) via DEN which are actually utilizing UA connecting flights to /from DEN. mo etl-02 nGrup LLC 22 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 24: Vail /Eagle (EGE) and Aspen (ASE) International O &D Routings Other LIA (DEN) 21% 20% LIA (LAX) 3% LH (DEN) 4% QF (LAX)_ 5% LIA (ORD) 6% — LIA (IAH) 10% AA (MIA) 12% 4A (DFW) 19% Source: U.S. DOT O &D Survey, YE Q3 2013 The largest segment of ASE and EGE combined international O &D passengers travel to /from South America with 28% of all international passengers. The next largest is Central America with 25% of all international passengers. Central America includes Mexico for purposes of this analysis. 17% of all passengers travel to /from transatlantic destinations including Europe, Middle East, Africa and India; 13% to /from Canada; and, 12% travel to /from transpacific destinations including the rest of Asia, Oceania and Guam. The combined ASE and EGE market is much more fragmented than the EGE market itself where nearly half of all passengers are heading to /from South America. mo I et'-02 don Group, 23 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 25: Vail /Eagle (EGE) and Aspen (ASE) International O &D Passengers by Region Caribbean Trans- 5% Pacific South 12% America 28% Canada 13% Ti At 17% America 25% Source: U.S. DOT O &D Survey, YE Q3 2013 From a country perspective, 21 % of all ASE and EGE combined international O &D passengers travel to /from Mexico. Another 16% travel to /from Brazil and 13% to /from Canada. Hence, the top three country origins for ASE and EGE combined international passengers account for precisely 50% of all international O &D passengers. Five countries make -up the next 25% and they include the following: Australia (8 %), United Kingdom (5 %), Argentina (5 %), Venezuela (4 %) and Germany (3 %). I I mnGroup LLCM e 24 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 26: Vail/Eagle (EGE) and Aspen (ASE) International O &D Passengers by Country Other 25% j Germany 3% Venezuela_, 4% Argentina 5% United I Kingdom) Australia 5% 8% Mexico 21% %, 111dud 13% Brazil 16% Source: U.S. DOT O &D Survey, YE Q3 2013 Just like domestic O &D passengers, there exists significant seasonal variation in demand for international O &D passengers. International O &D traffic exhibits the expected surge in Q1 due to ski season with a smaller but still pronounced increase in Q4. International O &D traffic does not experience the significant Q3 increase for summer traffic like domestic passenger traffic does. For YE Q3 2013, over 60% of international O &D passengers traveled in Q1 2013 and nearly 20% in Q4 2012. Hence, approximately 80% of annual international O &D passenger demand occurs in Q4 and the following Q1, which coincides with the holiday season and peak ski season. I I mnGroup LLCI e 25 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 27: Vail /Eagle (EGE) and Aspen (ASE) International O &D Passengers by Quarter International Q &D Passengers by Quarter 41,339 41,388 01,10 Q3'10 Q1 '11 Q3'11 Q1 '12 Q3'12 Q1 13 Q3'13 Source: U.S. DOT O &D Survey Since Mexico is the largest country for ASE and EGE international O &D passengers, it is no surprise that the largest airport market is Mexico City (MEX) with 6,161 O &D passengers for YE Q3 2013. Since Brazil is the second largest country, it is also no surprise that Sao Paulo (GRU) is the second largest market with 6,040 O &D passengers, nearly the same size market as MEX. These are the same top two markets as the EGE market alone. Toronto - Pearson (YYZ) is the third largest market for the two airports combined with 3,827 O &D passengers but the largest individual market for ASE. Sydney is the fourth largest market for the combined airports with 3,308 O &D passengers, but the second largest individual market for ASE. I I mnGroup LLCM 26 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 28: Vail /Eagle (EGE) and Aspen (ASE) Top International O &D Markets — Full Year Top 20 O &D Markets Mexico City (MEX) Sao Paulo (GRU) Toronto {YYZy Sydney Buenos Aires (ELE) Rio De Janeiro(GIGj London (LHR) Monterrey Caracas Melbourne Vancouver Santiago Cancun Frankfurt Santo Domingo Calgary Panama City Los Cabos Guadalajara Montreal (Oct. 2012 — Sept. 2013) Source: U.S. DOT O &D Survey 6,161 G40 When looking at just the 4th quarter demand by market, Mexico City (MEX) jumps to the top spot with 1,281 O &D passengers for this time period. As the second largest market, Caracas (CCS) is still relatively large with 1,063 O &D passengers. Sao Paulo (GRU) and Monterrey (MTY) are also significant markets for the 4th quarter, indicating a preference for travel from Latin America rather than transatlantic and transpacific destinations during the holiday period. I I mpbeup LLCI 27 tion EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 29: Vail /Eagle (EGE) and Aspen (ASE) Top International O &D Markets — 4th Quarter (Oct. — Dec. 2012) Top 20 O &D Markets Mexico City (MEX) Caracas Sao Paulo jGRU) Monterrey Sydney London jLHRI Toronto (YYZ) Buenos Aires (EZEI Santo Domingo Rio De Janeiro (GIG) Los Cabos Calgary Melbourne Frankfurt Vancouver Madrid Paris (CDG) Lima Guadalajara Maracaibo Source: U.S. DOT O &D Survey 1.289 When looking at just the 1St quarter demand by market, Sao Paulo (GRU) now jumps to the top spot with 5,037 O &D passengers for this time period, much like it does for the EGE market alone. Mexico City (MEX) is the second largest market for the two airports combined with 3,609 O &D passengers, and the second largest market for EGE on its own. The top four also include Buenos Aires (EZE) and Rio De Janeiro (GIG) again showing the affinity with Latin America from EGE, which overpowers the top ASE markets. I I mpbeup LLCI 28 tion EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 30: Vail /Eagle (EGE) and Aspen (ASE) Top International O &D Markets —1" Quarter (Jan. — Mar. 2013) Top 20 O &D Markets Sao Paulo �GRII} Mexico City (MEX) Buenos Aires(EZE} Rio ❑e Janeiro (GIGj Sydney Toronto jYYZ} Monterrey LondonjLHR� Melbourne Caracas Santiago Panama City Frankfurt Cancun Santo Domingo Guadalajara Brisbane Calgary Belo Horizonte Auckland Source: U.S. DOT O &D Survey 5,037 As shown in prior sections, EGE and ASE have nearly the same size international O &D passenger markets, with ASE having 0.3% more international O &D passengers. Figure 31 compares O &D passengers by region for EGE and ASE. EGE has more passenger traffic in three of the regions while ASE has more passenger traffic in the other three regions. Specifically, EGE has more passenger traffic than ASE in the Caribbean ( +354 %), Central America ( +75 %) and South America ( +255 %), while ASE has more traffic to Canada ( +229 %), trans- Atlantic ( +271 %) and trans - pacific ( +787 %). I I mpbeup LLCI 29 tion EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 31: International O &D Passenger Comparison: Vail /Eagle (EGE) and Aspen (ASE) O &D Passengers (Oct. 2012 — Sept. 2013) 74,566 Canada Caribbean Central America South America Trans - Atlantic Trans- Pacific ■ VaillEagle ■ Aspen Source: U.S. DOT O &D Survey As shown in prior sections, ASE has a higher international one -way average fare than EGE. The average one -way international fare for ASE in YE Sept. 2013 was $760, which is 8% higher than the EGE average fare of $706. ASE has a higher one -way average fare to every international region except for the trans - pacific region. The ASE average one -way fare is 4% higher to Canada, 14% higher to the Caribbean, 4% higher to Central America, I% higher to South America and 20% higher to trans - Atlantic destinations. The EGE average one -way fare is 11% higher to trans- pacific destinations. I I mnGroup LLCM 30 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 32: International O &D One -way Fare Comparison: Vail/Eagle (EGE) and Aspen (ASE) (Oct. 2012 — Sept. 2013) Average One -way Fare $1,511 Canada Caribbean Central America South America Trans - Atlantic Trans- Pacific mVail /Eagle wAspen Source: U.S. DOT O &D Survey Much like average one -way international fares, ASE has 8% more international O &D revenue than EGE. ASE had $25.3 million in international O &D revenue while EGE had $23.4 million. EGE has more international O &D revenue in three regions while ASE has more international O &D revenue in the three other regions. EGE has more international O &D revenue to the Caribbean ( +300 %), Central America ( +69 %) and South America ( +251 %). ASE has more international O &D revenue to Canada ( +242 %), trans- Atlantic destinations ( +343 %) and trans- pacific destinations ( +703 %). I I mpbellp LLCM 31 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 33: International O &D Revenue Comparison: Vail /Eagle (EGE) and Aspen (ASE) O &D Revenue (Oct. 2012 — Sept. 2013) $14,$76,788 Canada Caribbean Central America South America Trans - Atlantic Trans- Pacific ■VailfEagle ■Aspen Source: U.S. DOT O &D Survey Figure 34 shows load factors to major international gateways from ASE and EGE. As shown in this chart, it is evident that ASE generates higher load factors to international gateways than EGE. This illustrates one of the key service differentiators between ASE and EGE — the utilization of mainline jet aircraft versus regional jets. The average aircraft size in these EGE markets is 168 seats whereas the average aircraft size in the ASE markets is significantly smaller at only 66 seats. I I mnGroup LLCI 32 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 34: Major International Gateway Load Factor Comparison (Oct. 2012 — Sept. 2013) Load Factor EGEIASE to International Gatewa 01 of- 86% AA -DFVN AA441A UA -IAH UA -DEN UA -ORD UA -IAH VallEagle Aspen Source: U.S. DOT, T -100 Data. Figure 35 compares one -way fares for EGE, ASE and Denver International Airport (DEN) for the top twenty ASE and EGE combined markets. While ASE has higher average one -way international fares than EGE, EGE actually has higher fares in seven of the twenty largest combined markets. Surprisingly, DEN has higher fares than EGE in seven markets including three Canadian markets. Some EGE fares are also very similar to DEN fares, namely Toronto (YYZ), Monterrey (MTY) and Guadalajara (GDL). I I mpbellp LLC 33 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 35: Average International One -way Fare Comparison (Oct. 2012 – Sept. 2013) Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 International Market Mexico City (MEX) Sao Paulo (GRU) Toronto (YYZ) Sydney Buenas Aires (EZE) Rio De Janeiro (GIG) London (LHR) Monterrey Caracas Melbourne Vancouver Santiago Cancun Frankfurt Santo Domingo Calgary Panama City Los Cabos Guadalajara Montreal Average One -way Fare Vail /Eagle Aspen Denver $416 $419 $303 $1,217 $1,227 $922 $351 $325 $323 $1,372 $1,494 $1,148 $776 $857 $787 $1,263 $1,066 $869 $567 $775 $609 $344 $385 $335 $953 $1,060 $684 $1,328 $1,188 $1,188 $249 $292 $315 $744 $951 $877 $295 $340 $214 $580 $526 $617 $467 $396 $309 $271 $335 $352 $399 $363 $339 $415 $326 $196 $324 $418 $279 $238 $397 $363 Source: U.S. DOT O &D Survey Vail /Eagle Compared to Aspen Denver ($63) $114 ($10) $295 $26 $28 ($121) $224 ($81) ($11) $197 $394 ($209) ($43) ($41) $10 ($107) $269 $139 $140 ($43) ($66) ($207) ($133) ($46) $81 $54 ($37) $71 $157 ($65) ($81) $36 $60 $89 $218 ($94) $45 ($159) ($126) Figure 36 shows international one -way fares for ASE and EGE on a 12 -month rolling basis from year -ended Q1 2003 through year -ended Q3 2013. Average international one -way fares for both markets seemingly moved in lock -step from Q1 2003 through Q3 2009. EGE international one- way fares then increased faster than ASE fares and towards the beginning of 2011, were over $100 greater than ASE average one -way fares. EGE fares declined in late 2012 as ASE fares kept growing and ASE fares overtook EGE fares and are now 8% larger. Figure 36: One -way Intl. Fare Historical Comparison: Vail /Eagle (EGE) and Aspen (ASE) Avel $800 $700 $600 $500 $400 $300 $200 $100 $0 OP & CP ry°°b ry�%h — VaillEagle Aspen 12 Month Rolling Source: U.S. DOT O &D Survey et'02 mpbeup LLCI 34 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 37 shows the absolute difference between the ASE and EGE average one -way international fares on a rolling 12 -month basis year -ended Q 12003 through year -ended Q3 2013. As indicated earlier, the EGE average one -way fare was lower than the ASE one -way fare for quite some time up until early 2009. The EGE one -way fare grew until it was approximately $123 greater than the ASE fare in early 2011. The EGE one -way fare is now actually $55 lower than the ASE one -way international O &D fare. Figure 37: One -way International Fare Difference Historical Comparison: Vail/Eagle (EGE) and Aspen (ASE) Average fine- way Fare Differentia[ (Vail /Eagle > Aspen) $150 $100 $50 $0 -$50 -$100 EGE Runway Construdion CYO & 0 CY 0 & 0 & 0 & 0 & 0 a" CYO C? C� O� 03 Off` 09` Oy Oh O° 00 01 01 O$ O® O°j C� ^O ^O ^n ^`n Ary >.1' A9 1� ryo yo yo �o ryo do ,yo do ,yo ryo ,yo do do do do ,yo do do do do ,yo do 12 Month Rolling Source: U.S. DOT O &D Survey 2.4 Peer Comparisons This section examines EGE and its peer airports and compares performance over a number of different benchmarks. The group of peer airports includes: • Aspen — Pitkin County Airport (ASE) • Bozeman Yellowstone International Airport (BZN) • Gunnison — Crested Butte Regional Airport (GUC) • Hayden Yampa Valley Regional Airport (HDN) • Jackson Hole Airport (JAC) • Montrose Regional Airport (MTJ) tie' LLCI 35 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE As shown in Figure 38, EGE is the only airport amongst its peer group with scheduled international service. This service was started by Air Canada serving Toronto - Pearson International Airport (YYZ) weekly with a 120 -seat Airbus A319. Figure 38: Nonstop International Service Map for EGE and Peer Airports (Winter 2013 -14) Source: Innovata Schedules Figure 39 shows international O &D passengers on a rolling 12 -month basis for EGE and all peer airports from year -ended Q1 2003 through year -ended Q3 2013. BZN has historically had the most international O &D passengers except for a brief period of time when EGE had more. GUC consistently had the least international O &D passengers of the peer group. HDN and MTJ flip - flopped in terms of which had greater international passenger traffic but MTJ has had more for the past four years. EGE and JAC international passenger traffic was rather flat from late 2010 through late 2012, yet JAC, EGE, ASE and BZN all have similar international traffic now. In fact, international traffic levels for the four airports are within 7,000 annual passengers. I I mnGroup LLCM 36 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 39: Peer Airport International O &D Passenger Comparison Local O &D Passengers 40,000 30,000 20,000 10,000 0 EGE Runway Construction C^ bps b^ C� b^ C� b^ 0 b^ b� C^ Ors C^ 0 C^ bP b^ by b^ CP b1 CP °� o'� o°' o°` oti o`' o° o�' o'l o'" 00 0° 00 0° ^° ^° ^^ �.^ ^ti ^ti ^'� ^'� ry° ,L° �° �O �° ,l° eto r�Q �° ry0 ,l° �O ti° do rt° ly0 ,y° ,t0 ti° ,l° ti° r�° — Vail /Eagle Aspen Bozeman Gunnison — Hayden Jackson Hole —Montrose 12 Month Rolling Source: U.S. DOT O &D Survey Figure 40 shows year -over year growth for international O &D passengers and compares Oct 2012 — Sept 2013 to Oct 2011— Sept 2012. International passenger traffic at GUC grew the most at 37.8% while HDN grew the least at 0.7 %. Although GUC grew the most, it does have the lowest levels of international O &D passenger traffic. EGE grew 1.7% and ASE grew 1.1 %. JAC grew 15.5% after a few years of no growth. Figure 40: Peer Airport International O &D Passenger Year - year - growth Year -over -'Year Chanae in Passenaers 37.8% EGE ASE BZN GUC HDN JAC MTJ Source: U.S. DOT O &D Survey tie' LLCM 37 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE International O &D passenger traffic was compared to CY 2007 for all peer airports to examine growth since a pre- economic recession time period. All airports showed growth in international O &D passengers since CY 207 except for HDN. EGE international passengers grew 47.3% since 2007 and ASE international passengers grew 82.9 %. MTJ has grown 77.2% over this time but remains one of the smallest international O &D passenger markets amongst the peer airports. Figure 41: Peer Airport Intl. O &D Passengers Comparison: CY 2007 to YE Q3 2013 Change in Passengers 82.9 % - 19.5 % EGE ASE BZN GUC HDN JAC MTJ Source: U.S. DOT O &D Survey Figure 39 shows average international O &D fare on a rolling 12 -month basis for EGE and all peer airports from year -ended Q1 2003 through year -ended Q3 2013. International fares from EGE and its peer group are relatively high with the lowest fare being HDN at $558 each way. ASE is at the opposite end of the spectrum with an average international one -way fare of $760. The EGE international one -way fare is the second highest of the group at $706 each way. The four other airports are rather close with their fares all being within $36 of each other. I I mpbeh p LLCM e 38 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE Figure 42: Peer Airport International O &D One -way Fare Comparison Average One -way Fare $B00 $700 $600 $500 $400 $300 $200 $100 $0 ryoq' le, Vail /Ea EGE Runway Construction gle —Aspen Bozeman Gunnison — Hayden — Jackson Hole — Montrose 12 Month Rolling Source: U.S. DOT O &D Survey Figure 43 shows year -over year growth for international O &D one -way fares and compares Oct 2012 — Sept 2013 to Oct 2011 — Sept 2012. The ASE fare grew the most at 16.0% while the EGE fare actually decreased the most, down 8.3% year- over -year. The only other peer airport with a decreasing fare is JAC, whose fare fell 3.6 %. Figure 43: Peer Airport International O &D One -way Fare Year - year - growth Year - fiver -Fear Change in Fare 16.0% -8.3% EGE ASE BZN GUC HEN JAC MTJ Source: U.S. DOT O &D Survey I I mpbellp LLCI 39 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE International O &D one -way fares were compared to CY 2007 for all peer airports to examine growth since a pre- economic recession time period. International O &D fares grew at all of the airports except for HDN, whose fare decreased 2.6% since 2007. The EGE international O &D average fare grew 26.5% over this time period and the ASE fare grew 29.0 %. The GUC fare grew the most at 47.0% since 2007, at which point GUC had the lowest fare after decreasing significantly over the previous year. Figure 44: Peer Airport Intl. O &D One -way Fare Comparison: CY 2007 to YE Q3 2013 Change in Fare 47.0% -2.6% EGE ASE BZN GUC HDN JAC MTJ Source: U.S. DOT O &D Survey I I mnGroup LLCM e 40 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE 3 Derivation of O &D Passenger Traffic Model Several data sources were utilized to develop a comprehensive representative model of O &D passengers traveling to /from the ASE and EGE catchment areas. These data sources include the following: • Vail Resorts — Vail Resorts provided confidential data that identified international skier visits by country for the top twelve Winter 2012 -2013 country markets and means of access by percentage of the total market (i.e., flying to DIA, flying to EGE, flying to COS and "other ") for all international countries. • Aspen Skiing Company — Aspen Skiing Company provided confidential data that identified method of transportation to the area for all passengers, % of visitors by country of residence for top ten countries and international visitors by country for the top ten countries of origin. • U.S. Department of Transportation (DOT) — Origin - passenger survey data is reported by U.S. domestic airlines and represents a 10% sample of all passengers traveling on itineraries including such airlines. Using this data, one can analyze passenger traffic volumes, revenues (and thus fares and yields) and routings for all itineraries including segments operated by U.S. domestic airlines. Since ASE and EGE were only served by U.S. domestic airlines for the year -ended September 2013 period utilized for this study, the data is available for all international passengers utilizing scheduled air service to /from both airports. Data from all three sources was analyzed and combined into a comprehensive passenger traffic database. Passenger traffic is available using the following sort criteria: • Ski area destination for passengers (Aspen or Vail/BC) • Airport utilized to access catchment area (ASE, DEN or EGE) • Origin airport or origin country • By quarter for YE September 2013 or the entire twelve month time period Due to the confidentiality of the data provided by the two ski companies, the results of this analysis will not be published in the study document. However, the conclusions generated based on this data indicate the potential for nonstop service to destinations including Mexico City, Sao Paulo, Monterrey, Buenos Aires and Toronto. I I mnGroup LLCM 41 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE 4 Discussion of Potential International Air Service Targets Although significant traffic exists to regions such as Europe, Australia, South America and the Caribbean, operational restrictions at EGE render nonstop service to these regions infeasible. Carriers could potentially serve some of these regions with a technical stop to refuel but this is an extremely costly proposition and very few carriers continue to serve U.S. markets in this manner. Significant traffic also exists to some of the major cities in Canada but these airports are equipped with U.S. preclearance facilities. Passengers arriving in the U.S. from these airports are not subjected to customs and immigrations processing after arrival since these functions are performed prior to boarding their flights in Canada. Therefore, nonstop service to Canada is not under consideration for the purposes of this study. Given the distances involved and aircraft capabilities for nonstop service from EGE, the most prevalent opportunities for new international nonstop service exist to Mexico and Central America. The following three carriers were considered as potential candidates for new nonstop international service at EGE: • Aeromexico (AM) — the flag carrier of Mexico serves many regions of the world and is a founding member of the SkyTeam global alliance of carriers, which includes EGE incumbent carrier Delta. Its main hub is located at Benito Juarez International Airport in Mexico City with smaller focus cities in Cancun, Guadalajara and Monterrey. AM has a fleet of over 60 mainline aircraft ranging from 124 -seat Boeing 737 -700s up to 277 -seat Boeing 777- 200ERs. Aeromexico Connect, its regional subsidiary, has a fleet of 57 regional jets ranging from 50 to 99 seats. 0 Copa (CM) — is based at Tocumen International Airport in Panama City, Panama and serves as the country's flag carrier. It is part of the Star Alliance global alliance of carriers, which includes EGE incumbent carrier United. Copa has focus cities in Bogota, Guatemala City, Managua and San Jose (Costa Rica). Its 92 aircraft fleet includes 124 - seat Boeing 737 -700s, 155 -160 seat Boeing 737 -800s and 94 seat Embraer 190s. Copa currently flies to 69 destinations in 30 countries in North America, Central America, South America, and the Caribbean. I I mnGroup LLCI 42 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE • Volaris (Y4) — a low -cost carrier, is the second largest Mexican airline after Aeromexico. Y4 has hubs at Benito Juarez International Airport in Mexico City, Don Miguel Hidalgo y Costilla International Airport in Guadalajara and General Abelardo L. Rodriguez International Airport in Tijuana. Its 47 aircraft fleet includes 144 -seat A319s and 174 - seat A320s. Another 46 aircraft are on order and will start arriving in 2016. Y4 has been aggressively expanding into U.S. markets and currently serves 29 domestic and 10 international destinations. All three of these carriers have aircraft that can operate from EGE on long- distance routes with a nearly fill payload. Of these potential routes, the 2,705 miles flight from EGE to Panama City (PTY) will require too much of a payload restriction. The Mexican carrier Interjet was not considered since its only mainline aircraft is the Airbus A320 which cannot operate the 1,468 mile sector to Mexico City (MEX) without taking a significant payload penalty for the departure from EGE. Other carriers with Central/South American hubs were ruled out due to a small local market, hub carriers that did not possess the appropriate aircraft in their fleet or inadequate connecting opportunities to help support the nonstop service. Such carriers include Avianca, LACSA, LATAM (LAN) and TACA. I I mnGroup LLCM 43 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE 5 Route Analysis for Potential New International Air Service A number of different scenarios were considered for potential new EGE nonstop international service targeting the aforementioned carriers. For purposes of this analysis, it was assumed that only one carrier would start service to Mexico City (MEX), Aeromexico or Volaris, not both. Various service patterns were analyzed utilizing the Campbell -Hill proprietary QSI model and supporting analysis of transportation /airport options for travel to /from the catchment area. QSI analysis, or Quality of Service Index, is performed by combining multiple factors that determine passengers' preferences for flight options over a given route(s). It includes factors like time of day, aircraft type, and total trip time. QSI analysis is commonly used by airlines and the DOT to forecast passenger traffic on potential new routes. The factors are often very similar in all QSI models but the weightings of each factor can vary. The following service patterns were analyzed using QSI analysis: Scenario 1 2 3 4 5 6 7 8 9 10 11 Airline Aeromexico (AM) Aeromexico (AM) Aeromexico (AM) Aeromexico (AM) Volaris (Y4) Volaris (Y4) Volaris (Y4) Volaris (Y4) Copa (CM) Copa (CM) Copa (CM) Airport Mexico City (MEX) Mexico City (MEX) Mexico City (MEX) Mexico City (MEX) Mexico City (MEX) Mexico City (MEX) Mexico City (MEX) Mexico City (MEX) Panama City (PTY) Panama City (PTY) Panama City (PTY) Operational Days Saturday Sat/Tue/Thu Sat/Sun/Tue/Thu Daily Saturday Sat/Tue/Thu Sat /Sun/Tue/Thu Daily Sat/Sun Wed/Thur Sat arr /Sun dep Additional service patterns were analyzed utilizing the results from the QSI analysis, including two weekly flights to MEX. It was assumed that all flights would operate for a 17 -week season. The following methodologies were utilized to analyze traffic flows in both local and connecting markets: Local markets (EGE -MEX /PTY) • Vail/BC traffic using DEN — analyzed EGE -DEN relationships for markets with nonstop service to EGE and those without nonstop service; when a market gains nonstop service to EGE, this analysis indicates how much of the traffic using DEN will now choose to utilize EGE G(1 5 mnGrouPHLCI 44 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE • Vail/BC traffic using EGE — this traffic is already included in the EGE O &D passenger data from the DOT so the QSI analysis will indicate how much of this traffic will now choose to utilize nonstop service instead of existing connecting service • Aspen traffic using ASE — analyzed EGE -ASE relationships for markets with EGE nonstop service but not ASE nonstop service; this indicates what percentage of the traffic using ASE may choose to travel via EGE on nonstop service • Aspen traffic using DEN — assumed similar traffic diversion for Aspen traffic from DEN with nonstop service as EGE albeit, a small portion of Aspen traffic from international destinations utilizes DEN, so these results were relatively inconsequential • Aspen traffic using EGE - this traffic is already included in the EGE O &D passenger data from the DOT so the QSI analysis will indicate how much of this traffic will now choose to utilize nonstop service instead of existing connecting service Connecting markets (EGE- hub - beyond markets) • Vail/BC traffic using DEN — no reason for this traffic to start choosing EGE since EGE already has connecting service to these markets • Vail /BC traffic using EGE — this traffic is already included in the EGE O &D passenger data from the DOT so the QSI analysis will indicate how much of this traffic will now choose to utilize new connecting service instead of existing connecting service • Aspen traffic using ASE — some of this traffic may shift to EGE for better schedule options, better product (mainline aircraft to EGE v. regional jet to ASE) or to avoid long customs processing times at U.S. connecting hubs (i.e., ATL, DFW or IAH) • Aspen traffic using DEN — no reason for this traffic to start choosing EGE since EGE already has connecting service to these markets • Aspen traffic using EGE - this traffic is already included in the EGE O &D passenger data from the DOT so the QSI analysis will indicate how much of this traffic will now choose to utilize new connecting service instead of existing connecting service I I mnGroup LLCM 45 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE The following thirty connecting markets were identified for Aeromexico service to MEX: EG IR ► TAM 6J X*--1 ► ZLO MLM M ZIHr4 AC The following three connecting markets were identified for Volaris service to MEX: 1 l MID �y ► CUN MEX TGZ I I mnGroup LLCM 46 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE The following forty-four connecting markets were identified for Copa service to PTY EGE \ UR sn EZE The analysis yielded the following load factors for each scenario: am jo Scenario Airline Airport Operational [lays Aircraft Seats Load Factor 1 Aeromexico (AM) Mexico City (MEX) Saturday Boeing 737 -700 124 176% 2 Aeromexico (AM) Mexico City (MEX) SatfTuefThu Boeing 737 -700 124 71% 3 Aeromexico (AM) Mexico City (MEX) SaUSunfTuefThu Boeing 737 -700 124 66% 4 Aeromexico (AM) Mexico City (MEX) Daily Boeing 737 -700 124 34% 6 Volans (Y4) Mexico City (MEX) Saturday Airbus A319 144 148% 6 Volans (Y4) Mexico City (MEX) SatfTuefThu Airbus A319 144 60% 7 Volans (Y4) Mexico City (MEX) SatlSun7Tue[Thu Airbus A319 144 47% 8 Volans (Y4) Mexico City (MEX) Daily Airbus A319 144 29% 9 Copa (CM) Panama City (PTY) Sat/Sun Boeing 737 -700 124 43% 10 Copa (CM) Panama City (PTY) WedfThur Boeing 737 -701 124 43% 11 Copa (CM) Panama City (PTY) Sat arr /Sun dep Boeing 737 -702 124 39% GwT mnGroup LLCM 47 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE 6 Financial Analysis of EGE International Arrivals Facility Leibowitz and Horton, a premier airport financial consulting firm, was contracted to provide financial feasibility analysis based on the route forecast results presented in the previous section. For purposes of the financial feasibility analysis, the following air service scenario was developed from the route forecast results: • 1 weekly flight to Mexico City during Winter 2015 -2016, 2 weekly flights in Winter 2016 -2017 and 3 weekly flights in Summer 2017 -2018. • Flights would be operated by Aeromexico or Volaris • A hybrid A319/Boeing 737 -700 aircraft was assumed with 134 seats • Based on the route performance results and further data analysis, an 82% load factor was generated for Winter 2015 -2016, 80% for Winter 2016 -2017 and 65% for Winter 2017- 2018 The results of the financial feasibility analysis are included as Appendix A. This analysis outlines all of the necessary operations and maintenance expenses through the first four years of operations. Based on the analysis, the Airport would need to collect a fee ranging from $101.64 to $112.89 per enplaned passenger to recover operations and maintenance expenses associated with the international arrivals facility. International airlines will generally consider airports with international arrivals fees ranging up to $20 -25 per enplaned passenger but the costs calculated in this analysis indicate the facility would be too expensive for airlines to serve affordably. A subsequent analysis, included in Appendix B, examined the required additional weekly flights necessary to reduce the fees charges to airlines for use of the international arrivals facility to a reasonable level. Based on this analysis, EGE would need to attract an additional 5.8 weekly international flight arrivals to lower the costs to $20.00 in Winter 2015 -2016, growing slightly to $22.27 through Winter 2018 -2019. According to the results presented in Section 5, not enough passengers would choose nonstop flights to EGE to economically justify the required extra weekly flights to reduce the cost per enplanement to the airlines. This analysis also does not account for the capital costs of developing the facility. Including such capital costs would make the cost per enplanement to the airlines too expensive and would therefore render potential new nonstop service economically infeasible. I I mnGroup LLCM 48 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE 7 Conclusions and Recommendations Based on the passenger demand and route performance analyses, Campbell -Hill recommends focusing solely on service to MEX with either Aeromexico or Volaris, but not both, for up to a maximum of three weekly roundtrips. This recommendation is based on the following data: • U.S. DOT O &D Passenger Survey data for international passenger demand from ASE and EGE • International visitor data from Vail Resorts and the Aspen Skiing Company • Individual airline corporate strategy for candidate international carriers • Aircraft performance specifications Although passenger demand patterns may justify three weekly roundtrip frequencies to MEX during the ski season, the operations and maintenance cost of an international arrivals facility render the opportunity infeasible. It is therefore the conclusion of this study that EGE and Eagle County should not pursue development of an international arrivals facility given the concerns regarding the financial implications of operating such a facility. I I mnGroup LLCM 49 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE 8 Appendix A I I mnGroup LLCM 50 00 Q fV 0 EAGLE COUNTY REGIONAL AIRPORT Gypsum, Colorado EGE_INTL2014.123 Table 5 Financial Implementation Plan - Scenario 1: Arrival Fee = Break Even International Air Service Projected Operations & Maintenance Expenses 11- May -14 O erations & Maintenance Ex enses International Terminal - 20,953 sf ft - 23.8% Pro'ected 2015 2016 2017 201872019 Total Salaries & Benefits: CBP Staffing (3 @4.5 months) $0 $168,750 $173,813 $179,027 $184,398 $705,987 CBP Housing Allowance (3 @5 months) 0 22,500 23,175 23,870 24,586 94,132 Staff Salaries /Benefits 18,750 19,313 19,892 20,489 21,103 99,546 $18,750 $210,563 $216,879 $223,386 $230,087 $899,665 Total Salaries & Benefits Annual Growth Rate - 1023.0% 3.0% 3.0% 3.0% 87.2% General & Admin Expense: Advertising $0 $84 $87 $89 $92 $352 Office Supplies 0 42 43 45 46 176 Other Supplies 0 8 9 9 9 35 $0 $135 $139 $143 $147 $564 Total General & Admin Expense Annual Growth Rate - 3.0% 3.0% 3.0% 3.0% Professional Services: Accounting $0 $674 $694 $715 $736 $2,818 Consulting 0 1,263 1,301 1,340 1,380 5,284 Legal 0 842 867 893 920 3,523 $0 $2,779 $2,862 $2,948 $3,036 $11,625 Total Professional Services Annual Growth Rate - 3.0% 3.0% 3.0% 3.0% Janitorial Expense: Janitorial Expense $0 $23,601 $24,309 $25,038 $25,790 $98,738 0 0 0 0 0 0 $0 $23,601 $24,309 $25,038 $25,790 $98,738 Total Janitorial Expense Annual Growth Rate - 3.0% 3.0% 3.0% 3.0% Building Maintenance: - Baggage Handling $0 $2,526 $2,602 $2,680 $2,760 $10,568 Building Repairs 0 2,105 2,168 2,233 2,300 8,807 Doors and windows 0 1,684 1,735 1,787 1,840 7,045 Electrical 0 589 607 625 644 2,466 HVAC Service 0 3,789 3,903 4,020 4,140 15,852 Plumbing 0 632 650 670 690 2,642 Signage 0 842 867 893 920 3,523 Supplies - Building & Janitorial 0 168 173 179 184 705 Roof 0 421 434 447 460 1 ,761 Building Maintenance -Other 0 0 0 0 0 0 $0 $12,756 $13,139 $13,533 $13,939 $53,368 Total Building Maintenance Annual Growth Rate - 3.0% 3.0% 3.0% 3.0% Page 1 of 2 EAGLE COUNTY REGIONAL AIRPORT Gypsum, Colorado EGE_INTL2014.123 Table 5 Financial Implementation Plan - Scenario 1: Arrival Fee = Break Even International Air Service Projected Operations & Maintenance Expenses 11- May -14 Grounds Maintenance: Operations & Maintenance Expenses International Terminal - 20,953 sf ft - 23.8% Projected 2015 1 2016 2017 1 2018 2019 Total Grounds Maintenance: Landscaping $0 $1,852 $1,908 $1,965 $2,024 $7,750 Snowplowing 0 337 347 357 368 1,409 Grounds Maintenance & Repairs 0 2,526 2,602 2,680 2,760 10,568 Pavement Maintenance 0 2,947 3,035 3,127 3,220 12,329 $0 $7,662 $7,892 $8,129 $8,373 $32,056 Total Grounds Maintenance Annual Growth Rate - 3.0% 3.0% 3.0% 3.0% Utilities: Electric $0 $10,104 $10,407 $10,719 $11,041 $42,272 Natural Gas 0 5,894 6,071 6,253 6,441 24,659 Telephone 0 253 260 268 276 1,057 Trash 0 1,010 1,041 1,072 1,104 4,227 Water /Sewer 0 1,095 1,127 1,161 1,196 4,579 $0 - $18,356 - $18,906 3.0% $19,474 3.0% $20,058 3.0% $76,794 3.0% 00 Total Utilities Q fV Annual Growth Rate 0 4A Other Operating Expenses: Medical Supplies $0 $42 $43 $45 $46 $176 Equipment Repair 0 295 304 313 322 1,233 Insurance 0 1,347 1,388 1,429 1,472 5,636 Seasonal Improvements 0 0 0 0 0 0 Fire Alarm System & Maintenance 0 842 867 893 920 3,523 Vehicle Expense 0 842 867 893 920 3,523 Customer Service 0 1,263 1,301 1,340 1,380 5,284 Security 0 295 304 313 322 1,233 Miscellaneous Purchases 0 0 0 0 0 0 $0 $4,926 $5,074 $5,226 $5,383 $20,608 Total Other Operating Expenses Annual Growth Rate - - 3.0% 3.0% 3.0% 3.0% Marketing Expenses: Start-Up Promotion Costs $50,000 $0 $0 $0 $0 $50,000 Annual Marketing Expenses 0 20,000 20,600 21,218 21,855 83,673 $50,000 $20,000 $20,600 $21,218 $21,855 $133,673 Total Marketing Expenses Annual Growth Rate - -60.0% 3.0% 3.0% 3.0% -18.7% Minor Capital Outlays $0 $0 $0 $0 $0 $0 Annual Growth Rate - - - - - $68,750 $300,777 $309,801 $319,095 $328,667 $1,327,090 Total Ops & Maintenance Expenses Annual Growth Rate - 337.5% 3.0% 3.0% 3.0% 47.9% Operating Cost per Square Foot $3.28 $14.35 $14.79 $15.23 $15.69 - Page 2 of 2 EAGLE COUNTY REGIONAL AIRPORT Gypsum, Colorado EGE_INTL2014.123 Table 6 Financial Implementation Plan - Scenario 1: Arrival Fee = Break Even International Air Service Projected International Aviation Traffic 11- May -14 Pounds (avg) Destination Airline Aircraft Year of Operation Landed Weight Per Flight Seats (1) Per Flight Load Factor Enplaned Pax (1) Per Flight Flights (1) Per Week Flights at (1) 17 Weeks Per Season Seasonal Enplaned Pax Seasonal Landed Weight A B C B *C =D E E*17 =F ) 1 (F *D) (F"A Pounds (avg) 134 82.0% 110 1 134 80.0% 107 2 134 65.0% 87 3 Passengers Pounds (000s) 17 1,868 2,267 34 3,645 4,534 51 4,442 6,801 Aeromexic Mexico City o/Volaris AB319/B737 -7 2016 133,350 Aeromexic Mexico City o/Volaris A6319/13737 -7 2017 133,350 6i N O_ _P1 Aeromexic Mexico City o/Volaris A13319/13737 -7 2018 133,350 Notes: (1) Per potential international traffic analysis (Campbell -Hill) 134 82.0% 110 1 134 80.0% 107 2 134 65.0% 87 3 Passengers Pounds (000s) 17 1,868 2,267 34 3,645 4,534 51 4,442 6,801 EAGLE COUNTY REGIONAL AIRPORT Gypsum, Colorado EGE_INTL2014.123 Table 7 Financial Implementation Plan - Scenario 1: Arrival Fee = Break Even International Air Service Projected Operating Revenues 11- May -14 Operating Revenues Revenues Passenger Arrival Fees: Seasonal Enplanements @ 2.0% Growth Fees per Passenger Arrival @ 3.0% Growth Total Passenger Arrival Fees Departure Terminal Use Fees: Seasonal Flight Departures Terminal Use Fees per Flight @ 3.0% Growth Total Departure Terminal Use Fees Landing Fees: Seasonal Landed Weight @ 2.0% Growth Signatory Landing Fee @ 3.0% Growth Total Landing Fees Total Operating Revenues Annual Growth Rate Airline Cost Per Enplaned Passenger: International Terminal Operations EGE /ECAT (estimated current) Non -Hub Industry Average 2015 2016 2017 1 2018 2019 Total 0 1,868 3,645 4,442 4,531 14,486 x x x x x $97.85 $100.79 $103.81 - $0 $177,456 $356,644 $447,699 $470,353 $1,452,152 0 17 34 51 51 153 x x x x x $318 $328 - $0 $5,100 $10,506 $16,232 $16,719 $48,556 0 2,267 4,534 6,801 6,937 20,539 x x x x x $3.22 $3.32 $3.42 $3.52 - $0 $7,300 $15,037 $23,232 $24,408 $69,977 $0 $189,856 $382,187 $487,163 $511,480 $1,570,686 - $101.64 $104.86 $109.67 $112.89 $15.75 $15.75 $15.75 $15.75 $15.75 $9.48 $9.77 $10.06 $10.36 $10.68 8/5/2014 EAGLE COUNTY REGIONAL AIRPORT Gypsum, Colorado EGE_INTL2014.123 Table 8 Financial Implementation Plan - Scenario 1: Arrival Fee = Break Even Financial Plan Summary International Air Service Budgeted and Projected Net Revenues, Capital Funding and Capital Expenditures 11- May -14 Operating Cash Flow Operating /Capital Cash Flow Projected Capital Operating 2014 2015 2016 2017 1 2018 1 2019 Total Operating Cash Flow Revenues: Passenger Arrival Fees $177,456 $356,644 $447,699 $470,353 $1,452,152 Departure Terminal Use Fees 5,100 10,506 16,232 16,719 48,556 Landing Fees - - 7,300 15,037 23,232 24,408 69,977 Total Revenues $0 $0 $189,856 $382,187 $487,163 $511,480 $1,570,686 q0 Operations & Maintenance Expenses ($68,750) ($300,777) ($309,801) ($319,095) ($328,667) ($1,327,090) Q 13 Net Operating Cash Flow Before Debt Service $0 ($68,750) ($110,921) $72,386 $168,069 $182,812 $243,596 R Less Debt Service 0 0 0 0 0 0 0 Less LOC Interest and Fee Payments 0 0 0 0 0 0 0 Net Operating Cash Flow After Debt Service $0 ($68,750) ($110,921) $72,386 $168,069 $182,812 $243,596 Capital Cash Flow Beginning Cash Balance $0 $0 ($68,750) ($179,671) ($107,285) ($107,285) $0 Other Capital Funding Sources: Capital Contribution $0 $0 $0 $0 $0 $0 $0 Eagle County Capital Contribution 0 0 0 0 0 0 0 ECAT Capital Contribution 0 0 0 0 0 0 0 Economic Development Funds 0 0 0 0 0 0 0 Debt Proceeds (What Entity ?) 0 0 0 0 0 0 0 Short Term Line of Credit - Draws (What Entity ?) 0 0 0 0 0 0 0 Short Term Line of Credit - Principal Payments 0 0 0 0 0 0 0 Other Funding 128,394 2,506,815 0 0 0 0 2,635,209 Total Other Capital Funding Sources $128,394 $2,506,815 $0 $0 $0 $0 $2,635,209 Total Funds Available for Capital Expenditures $128,394 $2,438,065 ($179,671) ($107,285) $60,784 $75,527 $2,878,805 Capital Improvement Program Expenditures 128,394 2,506,815 0 0 0 0 2,635,209 Ending Cash Balance $0 ($68,750) ($179,671) ($107,285) $60,784 $75,527 $243,596 EAGLE COUNTY REGIONAL AIRPORT (EGE) INTERNATIONAL AIR SERVICE ANALYSIS AND BUSINESS CASE 9 Appendix B I I mnGroup LLCM 51 q0- Q N 0 EAGLE COUNTY REGIONAL AIRPORT Gypsum, Colorado EGE_INTL2014_B.123 Table 131 Financial Analysis - Scenario B: Flights /Pax Enp Required for Reasonable CPE & Break Even International Air Service Estimated Terminal Development Costs 01- Jun -14 Notes: (1) Costs are based on architect's December 2010 estimate with no adjustment for inflation. Contractor (1) Gen Reqs, Square Construction Profit and Subtotal Soft Total International Terminal Project Components Feet Costs 1 Contingency Costs Costs 1 Costs International Terminal Building CBP Screening Operations & Support Areas 16,408 $992,383 $290,455 $1,282,838 $152,361 $1,435,199 CBP Administration & Support Areas 4,545 274,889 80,456 355,345 42,204 397,549 25,498 $1,267,272 $370,911 $1,638,183 $194,565 $1,832,748 Subtotal Terminal Costs - $126,727 $37,091 $163,818 $0 $163,818 Contingencies for CBP Review /Other 20 953 $1,393,999 $408,002 $1,802,001 $194,565 $1,996,566 Total Estimated Terminal Building Costs 69.8% 20.4% 9.7% 100.0% Total Cost/Sq Ft = $95.29 FIS Equipment FIS Screening Equipment $431,476 $0 $431,476 $0 $431,476 FIS Administrative Equipment 158,021 0 158,021 0 158,021 $589,497 $0 $589,497 $0 $589,497 Total FIS Equipment Total Estimated Terminal Costs $1,983,496 $408,002 $2,391,498 $194,565 $2,586,063 76.7% 15.8% 7.5% 100.0% Notes: (1) Costs are based on architect's December 2010 estimate with no adjustment for inflation. EAGLE COUNTY REGIONAL AIRPORT Gypsum, Colorado EGE_INTL2014_B.123 Table B2 Financial Analysis - Scenario B: Flights /Pax Enp Required for Reasonable CPE & Break Even International Air Service Projected Operations & Maintenance Expenses 01- Jun -14 Page 1 of 2 8/5/2014 International Terminal Projected 2015 2016 2017 2018 2019 Total Operations & Maintenance Expenses Salaries & Benefits: CBP Staffing (3 @4.5 months) $0 $168,750 $173,813 $179,027 $184,398 $705,987 CBP Housing Allowance (3 @5 months) 0 0 0 0 0 0 Staff Salaries /Benefits 18,750 19,313 19,892 20,489 21,103 99,546 $18,750 $188,063 $193,704 $199,516 $205,501 $805,533 Total Salaries & Benefits Annual Growth Rate - 903.0% 3.0% 3.0% 3.0% 82.0% General & Admin Expense: Advertising $0 $84 $87 $89 $92 $352 Office Supplies 0 42 43 45 46 176 Other Supplies 0 8 9 9 9 35 $0 $135 $139 $143 $147 $564 Total General & Admin Expense Annual Growth Rate - - 3.0% 3.0% 3.0% 3.0% Professional Services: Accounting $0 $674 $694 $715 $736 $2,818 Consulting 0 1,263 1,301 1,340 1,380 5,284 Legal 0 842 867 893 920 3,523 $0 $2,779 $2,862 $2,948 $3,036 $11,625 Total Professional Services Annual Growth Rate - - 3.0% 3.0% 3.0% 3.0% Janitorial Expense: Janitorial Expense $0 $23,601 $24,309 $25,038 $25,790 $98,738 0 0 0 0 0 0 $0 $23,601 $24,309 $25,038 $25,790 $98,738 Total Janitorial Expense Annual Growth Rate - - 3.0% 3.0% 3.0% 3.0% Building Maintenance: Baggage Handling $0 $2,526 $2,602 $2,680 $2,760 $10,568 Building Repairs 0 2,105 2,168 2,233 2,300 8,807 Doors and windows 0 1,684 1,735 1,787 1,840 7,045 Electrical 0 589 607 625 644 2,466 HVAC Service 0 3,789 3,903 4,020 4,140 15,852 Plumbing 0 632 650 670 690 2,642 Signage 0 842 867 893 920 3,523 Supplies - Building & Janitorial 0 168 173 179 184 705 Roof 0 421 434 447 460 1,761 Building Maintenance -Other 0 0 0 0 0 0 $0 $12,756 $13,139 $13,533 $13,939 $53,368 Total Building Maintenance Annual Growth Rate - - 3.0% 3.0% 3.0% 3.0% Page 1 of 2 8/5/2014 EAGLE COUNTY REGIONAL AIRPORT Gypsum, Colorado EGE_INTL2014_B.123 Table B2 Financial Analysis - Scenario B: Flights /Pax Enp Required for Reasonable CPE & Break Even International Air Service Projected Operations & Maintenance Expenses 01- Jun -14 Page 2 of 2 8/5/2014 International Terminal Projected 2015 2016 2017 2018 2019 Total Operations & Maintenance Expenses Grounds Maintenance: Landscaping $0 $1,852 $1,908 $1,965 $2,024 $7,750 Snowplowing 0 337 347 357 368 1,409 Grounds Maintenance & Repairs 0 2,526 2,602 2,680 2,760 10,568 Pavement Maintenance 0 2,947 3,035 3,127 3,220 12,329 $0 $7,662 $7,892 $8,129 $8,373 $32,056 Total Grounds Maintenance Annual Growth Rate - - 3.0% 3.0% 3.0% 3.0% Utilities: Electric $0 $10,104 $10,407 $10,719 $11,041 $42,272 Natural Gas 0 5,894 6,071 6,253 6,441 24,659 Telephone 0 253 260 268 276 1,057 Trash 0 1,010 1,041 1,072 1,104 4,227 Water /Sewer 0 1,095 1,127 1,161 1,196 4,579 $0 $18,356 $18,906 $19,474 $20,058 $76,794 Total Utilities Annual Growth Rate - - 3.0% 3.0% 3.0% 3.0% Other Operating Expenses: Medical Supplies $0 $42 $43 $45 $46 $176 Equipment Repair 0 295 304 313 322 1,233 Insurance 0 1,347 1,388 1,429 1,472 5,636 Seasonal Improvements 0 0 0 0 0 0 Fire Alarm System & Maintenance 0 842 867 893 920 3,523 Vehicle Expense 0 842 867 893 920 3,523 Customer Service 0 1,263 1,301 1,340 1,380 5,284 Security 0 295 304 313 322 1,233 Miscellaneous Purchases 0 0 0 0 0 0 $0 $4,926 $5,074 $5,226 $5,383 $20,608 Total Other Operating Expenses Annual Growth Rate - - 3.0% 3.0% 3.0% 3.0% Marketing Expenses: Start -Up Promotion Costs $50,000 $0 $0 $0 $0 $50,000 Annual Marketing Expenses 0 20,000 20,600 21,218 21,855 83,673 $50,000 $20,000 $20,600 $21,218 $21,855 $133,673 Total Marketing Expenses Annual Growth Rate - -60.0% 3.0% 3.0% 3.0% -18.7% Minor Capital Outlays $0 $0 $0 $0 $0 $0 Annual Growth Rate - - - - - - $68,750 $278,277 $286,626 $295,224 $304,081 $1,232,958 Total Ops & Maintenance Expenses Annual Growth Rate - 304.8% 3.0% 3.0% 3.0% 45.0% Operating Cost per Square Foot $3.28 $13.28 $13.68 $14.09 $14.51 - Page 2 of 2 8/5/2014 EGE_INTL2014_B.123 EAGLE COUNTY REGIONAL AIRPORT Gypsum, Colorado Financial Analysis - Scenario B: Flights /Pax Enp Required for Reasonable CPE & Break Even International Air Service Projected International Aviation Traffic Table B3 01- Jun -14 Landed Enplaned Flights at Seasonal Seasonal Year of Weight Seats Load Pax Flights 17 Weeks Enplaned Landed Destination Airline Aircraft Operation Per Flight Per Flight Factor Per Flight Per Week Per Season Pax Weight A B C B *C =D E ) (E "I 7 =F F *D F *A Pounds (avg) Passengers Pounds (000s) Aeromexic Mexico City (1) o /Volaris A13319/13737 -7 2016 133,350 134 82.0% 110 1 17 1,868 2,267 Aeromexic Mexico City (1) o /Volaris A13319/13737 -7 2017 133,350 134 80.0% 107 2 34 3,645 4,534 6i N O_ _;1 Aeromexic Mexico City (1) o/Volaris A13319/13737 -7 2018 133,350 134 65.0% 87 3 51 4,442 6,801 Generic International Generic City (2) Airline A13319/13737 -7 2016 -2018 133,350 134 82.0% 110 5.8 99 10,859 13,179 Notes: (1) Mexico City flight statistics for potential international traffic demand (Campbell -Hill) (2) Generic International City flight statistics for speculative international traffic demand (Leibowitz & Horton AMC) Q N O EAGLE COUNTY REGIONAL AIRPORT Gypsum, Colorado EGE_INTL2014_B.123 Table B4 Financial Analysis - Scenario B: Flights /Pax Enp Required for Reasonable CPE & Break Even International Air Service Projected Operating Revenues 01- Jun -14 Projected Operating Revenues 2015 2016 2017 2018 2019 Total Revenues Passenger Arrival Fees: Seasonal Enplanements @ 2.0% Growth 0 12,727 14,504 15,301 15,607 58,140 X x x x x Fees per Passenger Arrival @ 3.0% Growth - $14.49 $14.92 $15.37 $15.83 - Total Passenger Arrival Fees $0 $184,398 $216,446 $235,195 $247,096 $883,136 Departure Terminal Use Fees: Seasonal Flight Departures 0 116 133 150 150 548 X x x x x Terminal Use Fees per Flight @ 3.0% Growth - $176.22 $181.51 $186.95 $192.56 - Total Departure Terminal Use Fees $0 $20,411 $24,109 $28,011 $28,851 $101,383 Landing Fees: Seasonal Landed Weight @ 2.0% Growth 0 15,446 17,713 19,980 20,379 73,517 X x x x x Signatory Landing Fee @ 3.0% Growth - $3.22 $3.32 $3.42 $3.52 - Total Landing Fees $0 $49,735 $58,746 $68,252 $71,706 $248,440 Total Operating Revenues $0 $254,545 $299,302 $331,458 $347,653 $1,232,958 Annual Growth Rate - - 17.6% 10.7% 4.9% 10.9% Airline Cost Per Enplaned Passenger: International Terminal Operations - $20.00 $20.64 $21.66 $22.27 EGE /ECAT (estimated) $15.75 $15.75 $15.75 $15.75 $15.75 Non -Hub Industry Average $9.48 $9.77 $10.06 $10.36 $10.68 20 N 0 EG E_I NTL2014_B.123 EAGLE COUNTY REGIONAL AIRPORT Gypsum, Colorado Financial Analysis - Scenario B: Flights /Pax Enp Required for Reasonable CPE & Break Even Financial Plan Summary International Air Service Projected Operating and Capital Cash Flow Table B5 01- Jun -14 Projected 2015 2016 2017 2018 2019 Total Operating/Capital Cash Flow Operating Cash Flow Revenues: Passenger Arrival Fees - $184,398 $216,446 $235,195 $247,096 $883,136 Departure Terminal Use Fees - 20,411 24,109 28,011 28,851 101,383 Landing Fees - 49,735 58,746 68,252 71,706 248,440 $0 $254,545 $299,302 $331,458 $347,653 $1,232,958 Total Revenues Operations & Maintenance Expenses ($68,750) ($278,277) ($286,626) ($295,224) ($304,081 ) ($1,232,958 ($68,750) ($23,732) $12,676 $36,234 $43,572 $0 Net Operating Cash Flow Capital Cash Flow Beginning Cash Balance $0 ($68,750) ($92,482) ($79,806) ($43,572) Capital Funding Sources: Eagle County Capital Contribution $0 $0 $0 $0 $0 $0 ECAT Capital Contribution 0 0 0 0 0 0 EGE Capital Contribution 0 0 0 0 0 0 Economic Development Funds 0 0 0 0 0 0 Private 3rd Party Funding 0 0 0 0 0 0 Debt Proceeds (What Entity ?) 0 0 0 0 0 0 Less Debt Service Payments 0 0 0 0 0 0 Other Funding 2,586,063 0 0 0 0 2,586,063 $2,586,063 $0 $0 $0 $0 $2,586,063 Total Capital Funding Sources $2,517,313 ($92,482) ($79,806) ($43,572) ($0 ) $2,586,063 Total Funds Available for Capital Expenditures Capital Improvement Program Expenditures 2,586,063 0 0 0 0 2,586,063 Ending Cash Balance ($68,750) ($92,482) ($79,806) ($43,572) $0 $0 YY Campbell -Hill 19 /aviation Group, LLC Prepared by Campbell -Hill Aviation Group, LLC 8/5/2014 700 North Fairfax Street Suite 300 rowH Of vn �ii> VAIL TOWN COUNCIL AGENDA MEMO MEETING DATE: August 5, 2014 ITEM /TOPIC: Rental Licensing Program Council Discussion PRESENTER(S): Matt Ivy, Farrow Hitt, Packy Walker, Mark Herron (Lodging Representatives) ACTION REQUESTED OF COUNCIL: There is no action on this item. BACKGROUND: Review and discussion of proposed ordinance enacting licensing requirements for vacation rentals of residential property for less than 30 days. ATTACHMENTS: VR Vacation Rental Ordinance Presentation Lodging Representatives Letters of Support 8/5/2014 Vacation Rental Ordinance 2014 Town of Vail Ordinance Draft N O A Support for an ordinance is being brought by the condo lodging community, Vail's top hotels and our trade organizations. Vail is a mountain resort leader and we can be a model for resort communities to follow. Petition To. The Vail Town Council Subject: Vacation Rental Ordinance Date; July 22, 2014 We the undersigned request that the Vail Town Council pass a comprehensive vacation rental ordinance that helps protect visitor's vacation emperience in Vail, levels the playing field wlth other existing business license fees, and ensures that ail lodging rentals pay the same taxes. �� {� �s pr ,�•r■ I�IL� . rr�'�sii�'`►4�r��lfi��l�_��r� p 4 �laf �.. Illll�it 1•�� ". " ".� "- —aft � �Jl�� 1. Lifthouse 2. Vail Resort Rentals 3. Antlers 4. Manor Vail Lodge 5. Montaneros in Vail 6. Simba Run 7. Lodge at Lionshead 8. Vail Spa Condominiums 9. Gemini Resorts Mgmt. 10. Wyndham 11. Evergreen Lodge 12. Antlers at Vail 13. Vail Mountain Lodge 14. Ritz Carlton Vail 15. Four Seasons 16. Vail Marriott 17. Mountain Haus 18. The Wren at Vail 19. Gore Creek Properties 20. Vail Racquet Club Mtn. Resort 21. Destination Resort Mgmt. 22. Ramshorn Lodge AAO Yii[ Yia".'ry PR RTlf FRE"l P` Vail Resort Rentals c!o Dale 3ugby voa email Dear Dale, Thank you for mcludmg me in the recent correspondence regarding the possible regulation of vacation rentals in the Town of Vail This is an important issue for the town as well as our guests, lodging properties, honxmwners and residents. As we discussed, should the town craft an ordiname related to the growing "shared economy„ (Aubab.com) and vacation rental market CVRBO coW, I believe it is important to explore all the pomLbk unintended consequences and to work closely with entities such as Airb -n -b and VRBO- It is important to create parity and get everyone playing by the same rules and to work Frith (not against) these technology companies in the "sharing economy" to ensure oumers know the rules and to ensure we're focused on our guest experience. The goal of any regulation should be to ensure parity with vacation recitals and the lodging centnttmity to en= an even playing field; e;Tr, it's also important to not create new rules or regulations that only apply to one sector_ I believe: some regulations related to "rent a couch„ or sub -unit rentals logically belong at a micro-level such as a POAMOA versus a town ordinance_ Thank you for looping me in and please let me know if you have any questions rd be happy to help make the lodging community aware and to help solicit feedback from lodging propefty managers as you move through the proicess_ Best regards, ( s � � Chris Romer President & CEO Vaal Valley Fartnershrp PC Scar 1.130, viii, CO 81658 Y.ww _WHOt"rr arrey_ cam Goals of the new ordinance • Elevate the quality of the guest experience with protections from un- regulated rentals • Level the playing field with other lodging business rQ license holders on license fees and other CD _PI obligations • Assure that taxes due the Town are getting paid • Create penalties for non - compliance • Raise revenues for VLMD and TOV • Ensure that rentals remain part of the community These goals match the Town of Vail To be the premier international mountain resort community... We must continue to adapt .j the changing marketplace N CD The vacation rental market has changed. Some owners renting online without professional management and typical front desk check in, reservations, advertising, accountine, tax reaortinR, maintenance or housekeeping v Cn N O A Examples of Popular Online Vacation Companies • Homeaway • Air6n6 • VRBO • Craigslist • Rentalhomes.com • Flipkey.com • PetVR.com • Bringfido.com • Vacation rentals.com N O A Security of the traveler online and at his destination is a growing concern. Scams to steal vacation rent payments are growing even with the "reputable" online services US State Department Warnings :'.state gw: cantenU pass p - arts /engfish! emergencies /srzmJreal- estate,html F - (i Real Estate and Overpayme,.. ... .. F.,.. .ie„ Favorites Tools Kf Ir` Print 1- Email Travel Alerts &Warnings Real Estate and Overpayment Fraud Alerts & Warnings Stammers often take advantage of Craigslist and other free Worldwide caution classified listings to defraud victims. In one scam, the stammers J - ; visit a legitimate real estate website and then re -list the properties for rent r; Libya Travel Warning on Craigslist, complete with the addresses and photos. The stammers then answer e-mail inquiries about the properties and collect rental applications Russian f=ederation Travel Alert and credit check fees from the would -be tenants. 10t." "`I- OIsrael, The west Bank and Gaza Travel Warning Oveij;)ayment Refitnds — Sorty! Can I have my money back? (� Yemen Travel warning �+ twy _�, mia The Setup: A U.S. citizen has an item to sell and has advertised it online - usually for auction on a -Bay. He finds a buyer (the scammer) who pays SEE ALL TRAVEL ALERTS AND WARwrrvcs t promptly with an international money order. By mistake, the payer encloses too much money - the money order was made for $850 instead of $350. The buyer requests that the seller refund the excess money via Western Union. The Payoff: Unusual for Nigerian 414 scams, this one does not rely on a Learn About Your Destination significant potential payoff for the victim. It simply takes advantage of the victim's (the seller's) sympathy for the buyer and the desire to maintain good bUSIneSS contacts. I Enter a Country or Area A growing trend is rental of your sofa or extra bedroom., whether you own the home or lease from someone else File Edit View Favorites Tools Help airbnb .-- Vail, CO, United States Browse Sign Up Log In Help + © Search When I Move the Map - a Fillers Room Type X 99 Rentals - Vail Eagles Nesl • I Red and What, Tb, Sp +der Mountain r r 9ald Maunt3in a.— Creek Hen �4/�cHlyy Wllltf RiVeI -. 8a1Pfe 6� Natimaf Foreai '� Mountain - uneva ReaA 41 Wireyle IV Ridge r11VeM IUUI11 dllU UCt.11rUUl'It III l VUII Private room - 23 reviews - Vail 1FT1 u Vail Loft, Cozy - Convenient - busroute Private room - 5 reviews - Vail )usa 24 ,k ps Us Y aly [rrross FO& FIH Mnuntnin Walk to the slopes in Vail! Dog friendly mtn townhouse - Vail /BC Language and Currency Private room - 7 reviews - Vail Private room - 1 review - Vail M7ap data rs'2014 Gaogle Terms of Use Report a map error i Vail's Proposed Ordinance DRAFT ORDINANCE NO. X SERIES 2014 AN ORDINANCE ENACTING LICENSING REQUIREMENTS FOR VACATION RENTALS OF RESIDENTIAL PROPERTY FOR LESS THAN 30 DAYS Cn 1 WHEREAS, the Town of Vail, in the County of Eagle and State of Colorado (the "Town "), is a home rule municipal corporation duly organized and existing under the laws of the State of Colorado and the Vail Town Charter; WHEREAS, the members of the Town Council of the Town (the "Council ") have been duly elected and qualified; WHEREAS, businesses operating within the Town of Vail are required to be licensed, regulated and pay taxes; WHEREAS, tourism is an important element of the local economy and rentals of hotel rooms condominiums and private homes is not prohibited by zoning and encouraged to be part of the character of the community and the right of personal property owners to rent their private residence; WHEREAS, the safety and welfare of residents and visitors within the Town of Vail is a priority; N WHEREAS, sales taxes and lodging taxes are collected to fund municipal services including the Vail Local Marketing District, that requires payment of lodging and sales taxes on the rental of short term occupancy of less than 30 days; WHEREAS, hotels, bed and breakfasts, condominium rental complexes, and property management companies are required to be licensed, regulated and pay taxes; WHEREAS, cities in Arizona, California, Florida, Hawaii, Maine, New York, Illinois have enacted legislation to regulate Vacation Rentals of residential property; WHEREAS, owners of residential property that desire to operate transient lodging rentals of less than 30 days to visitors are acting in a similar manner co to a hotel and must comply with similar requirements; N O_ A NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF VAIL, COLORADO, THAT: Section 1. Vacation Rentals are defined as rental of a residential dwelling unit for less than 30 days. The extension of a previously existing rental agreement for less than 30 days or the lease of a residential unit for more than 30 days; or the rental between parties relating to the sale of that residential unit are exempt. Section 2. A business may license multiple vacation rentals under one license and pay the applicable fee based upon the number of residential units. CO Section 3. An application for Vacation Rentals must be completed and N returned to the sales tax department prior to issuance of a business license and a sales tax permit. Section 4. Vacation Rentals are allowed in all zoning and residential dwelling types that are not otherwise prohibited by covenants or home owner association governing documents. Section 5. Vacation Rentals are only allowed to be operated or licensed by the owner or his authorized short term rental agent of the residential dwelling unit. Vacation Rentals are not allowed: By any lessee or sub tenant. For less than the entire dwelling unit or a portion thereof, unless that 6i residence is zoned for multiple lodging units such as a B &B, or separately N ° keyed with exterior access such as a legal lock off portion. By unrelated persons in the same dwelling unit not traveling together as friends or family under the same reservation To operate without a license. To advertise for rentals without first obtaining a license. Section 6. The application for Vacation Rentals shall require: The name, street address, mailing address, email address, and telephone number of the owner of the property that matches the same ownership name in county records. The name, street address, mailing address, email address, and telephone number of a local representative located within Eagle County who is authorized to act on the behalf of a Vacation Rental owner and take remedial action and respond to any violation of this code, and accept process service on behalf of owners that reside in a location outside of Eagle County. The street location, and unit number, the number of bedrooms and pillows and maximum occupancy of the residence, not to exceed local zoning guidelines. Proof of property insurance Proof of payment of sales taxes to the Town, State, and Vail Local Marketing District on an annual basis. If applicable, attached to each application shall be an affidavit executed by an authorized representative of the homeowners association or the board of directors which attests that: the homeowners association has approved the residence to be used as a Vacation Rental and that the residence is in compliance with all applicable governing documents and house rules. Renewal of this license and application on an annual basis. Information updates are to be filed within 60 days of any changes on the application. Proof of Lodging Quality Assurance inspection on an 18 month basis so long as this standard of inspection continues within the Vail lodging community. CO Section 7. Insurance requirements. During the term of this license the property owner shall maintain adequate insurance to protect the welfare of the renters and the adjoining neighbors with the Town of Vail as a certificate holder evidencing; homeowners fire, hazard and liability insurance in amounts of not less than $1,000,000 for liability and $500,000 for bodily injury and property damage for the residential property named in the application. Section 8. The applicant shall maintain current guest registration records which contain the guests name, address, phone number, vehicle information, and signature reflecting the dates of occupancy for a period of not less than three years. Section 9. Advertising without a license for Vacation Rentals is prima facie evidence that a violation of this code has occurred and a business license shall be denied for a period of 60 days and the application fee will be increased by $500. Section 10. Code enforcement personnel shall have the obligation to investigate complaints of unlicensed Vacation Rentals and report back to the complainant and maintain copies of any complaints in a file system for each 6i licensee. Violators of this code shall be given a summons to be heard in N municipal court. Section 11. A license may be denied or revoked for violations of this ordinance by the municipal court of the Town of Vail. Section 12. This license shall be valid only to the person or business to whom it was issued and it shall not be subject to sale, assignment, or transfer, voluntary or involuntary, nor shall the license be valid for any residence other than for which it was originally issued. Section 13. A license shall be denied or revoked for the following reasons. The applicant makes any false or misleading statement or misrepresents any fact in the license application. The homeowners association suspends or revokes their approval. Cn N Residents, agents or owners fail to comply with or provide false statements to O conceal their rental status. Insurance is cancelled or not maintained in prescribed amounts. Section 14. Insert Vail enforcement code section Section 15. Insert current Lodging License Fees 90 Q N 0 TOWNOFVAO,I TRADE NAME MAILING ADDRESS TOWN OF VAIL LODGING AND PROPERTY MANAGEMENT FEE SCHEDULE FOR BUSINESS LICENSE IMARKETIlVG (Required by Ordinance #28, Series of 1992) A. DETERMINE ZONE Zone 1 — Cascade Village to Man or Vail (south side of Interstate 70) Zone 2 — Outlying areas, i.e. West Vail, Sandstone, Golf Course, East Vail B. COUNT THE NUMBER OF ACCOMMODATION UNITS PER ZONE Zone 1 Zone 2 C. FEE SCHEDULE FLAT FEE PERUNIT FEE Zone 1 $325.00 $17.00 Zone 2 $243.75 $12.75 D. COMPUTE FEE Flat fee for zone business is located in $ # of units in zone 1 X $17.00 + $ #of units in zone 2 X $12.75 + $ TOTAL FEE DUE = $ Quarterly proration is allowed for newly opening businesses only. Re- opening seasonal businesses are not eligible for pro - ration. Opening January l through March 31 100% of the fee is due. Opening April l through June 30 75% of the fee is due. Opening July 1 through September 30 50% of the fee is due. Opening on or after October 1 25% of the fee is due THERE IS A $100.00 MINIMUM FEE SIGNED PRINT NAME DATE PHONE Economic Impacts: Vail Inventory Lodging Study— MTRiP updated November 1, 2011 Vail's short term lodging bed base = 3954 units MTRiP estimate - there are 553 vacation rental units or 12% of the market as of 11/1/2011; a 35% increase over the 2009 study. Extrapolated to 2014 - Vail may now have more than 800 vacation rental units not paying a business license fee Current Vail web search showed VRBO has 1042 units listed HomeAway has 1037 units listed Airbnb has 763 units listed Business license fee — Lodging Zone 1 $325 + 17 per unit (core properties) Zone 2 $243.75 + 12.75 per unit (outlying properties) Business license fees could generate over $250,000 annually Sales taxes of 9.8% are being paid by only some property owners State of Colorado 2.9% Eagle County 110% Eagle County Transportation 015% Town of Vail 4.0% Vail Local Harketing District- Lodging only 1.4% Total 9.8% The lodging community encourages the Council to approve TOV staff time to work with lodging managers to create an ordinance that is tourism based, enforceable, and agreeable to the Town Council for adoption dtl STet lub lrxnhranr� ltrC - Inminl,— July 3D, 2014 Dear Vail Totivn Coundil, The Vail lodging Industry needs your help to pass a comprehensive vacation rental crdinanoe thak helps protect visitors vacation experience In Vail, levels 1h playing fleld with other oxisting business Iicensa fees, slid ensurea that all lodging rentals pay the same taxes. Lodging is the key component to Val I's tourism and overalt economy. There aro various types of lodging properties in Vie ill from hotels to condatniniumsto private hnmes. Lodging Is responsible for the largess park of the guest experience that rnAee a Vail vacation uniquo to oth7or si i auras, Lodging propartles are one of the largest employers In Eagle CourYly that Provide IlvabEe wages to our workers, warkors compensation Insurance for Injuries on the Jab, unemployment Insurance, rofrement bonefds, slok pay and va0etion gay, training and overtime pay, and Income to oulr Investors, We wllhh old taxes on payroll wages, pay local Bounty and state sales taxes, and partlaipate In to0al marketing district taxes. Lodging msrnbere belong to volunteer and professional organizations that raise the standard of professionalism and essurG that Vlsltors to V2II are given an experience that reflerds Biel standards for clean roams, safe buiidita. AaA access and flnancial Integrity. Hotels are I3oensed for food preparation, bar service, spa treatments, and hold a T❑tvo of Vail business license, Private IlOmss and oondominiums that rent their home as nightly rsnialafor Igg$ Itlan SID slays are acting tike hotels and need to be created similar to other commercial enterprises. It is unfair to ask wdstlnq hotels to 6ubsNize the oommiesion on apeaial events with our license fees and not expect other VaOINVOn natal visitors that will attend those same events to parttdipate In the coat. There Is plenty of room fnr competIVon In our Industry. Please treat a,l of the competitors equally and Ina rnan nor Ihat will give the Vail vislk ❑r this hest vacallon experlence pose Ibis, Slrlar3 y, 1sf — - eneral M agar C lI bCn I'ti V.11, f: l��r.�l,i elEe X0.1 ,-484 :7i-4iA8 =: D70-c76 l3i0 -x ,5�1 W.1',IIr IL::�4YL�IU �.11 .11 I FOUR SEASows RESOn AND RESTDENC S %�-e July 31, 2014 Vail Town Council 75 S. Frontage Road Vail, Colorado 81657 Dear Vail Town Council; I recently attended a Hotel Association meeting to discuss a vacation rental ordinance and understand there is a Council work session on Tuesday August 5, 2014 to discuss the ordinance. I would like to attend the session unfortunately; I will be out of the country. I applaud the Council for considering an ordinance to regulate vacation rental. This Issue is not isolated to Vail or any Resort town with vacation rentals. Jackson Hole Wyoming recently reported that 'illegal rentals by home owners are rampant In Jackson and Teton County. The local officials want to suppress the practice, which is in violation of local zoning laws. in addition, no sales tax is collected on these Illegal rentals which represent a great amount of lost revenue for the town. Additionally, illegal nightly units can result in declining resort property values. Whistler has discovered this first hand. The Issue is an increasing phenomenon created by a growing popularity of social tourism sites. It is growing because of the very nature of the websites that are promoting vacation properties by owner. I have in -depth experience with vacation rental from my five year tenure in Whistler, British Columbia, Canada. Whistler has faced this same issue for the past 15 years and it has still not been rectified, A large volume of new rentals came into the market place In 2010 when Whistler hosted the Winter Olympics. The surge of new rentals left the accommodation sector with a 65% occupancy level during the Olympics. There are several challenges that should be addressed when reviewing an ordinance to control vacation rentals: • Effect on the towns Net Promoter Score • Security and safety risks to guests • Zoning • Regulations • Cost of Enforcement • Lodging Quality Assurance Rating System • Loss of tax dollars Property owners who are operating illegally are taking potential revenue away from legitimate accommodation providers, who typically pay thousands of dollars a year in commercial and marketing fees. These Illegal units also pose potential security and safety risks to guests, as they may not be going through the proper inspection and licensing processes. Ultimately, illegal vacation rentals can increase the capacity of inventory beyond what is planned for the resort town of Vail and can inflate the volume of tourist accommodations beyond what may be sustainable. The goal of an ordinance should be to create a level playing field, as far as tax and other regulations is concerned. Respe tfully, ark He ❑ General Manager ONE VAIr. ROAD, VAIN., COLORADO 81657, U.S.A. I'4:1.:. (970; 477.8600 FAX; 1970) 477.8666 x,sx.inu rx ep:p n, +.rom f ,. Simba Runts frear Va li .Town COugCIi: The Vail lodging Industry needs your halpW pass aculnprehen5iyeVacotionrental oldlt)Anue that helps protect vlsihnr's vacation uxpe rip. nre. In Vali, levels the playlnP, f Od with other cxlsting 4usiness license Fees, and ensues that all Ine+gillg rentaJs pay the same taxr.s. tAging is the key co-nlponent to Vailrs tourism aild overall canonry_ There ore varinus types of rudging properties ill Vail frurn hntels to condominiums, cabLis to private horrlts. Lndging is respunsi£ le Me the largos# part of the gums. experience that rr;akes a Vail vacation unique try othrr ski amas. Ladring properties areune of the IargasLeinployersill Eagle Cla 'An tvthaL provide. livaI)le r,agestn nLUrvforkcrs, workers compensation insurance for Injurics arm the job, nllLMipinymeltt InstlranLe, retirement bnripfits, sick Isayarid vacation pay, tro:nInga rid avertlme pay, and income tu our inve5Wf5, Wu withhold taxes on payrxliI wages, pay lor•al rr only and 5LL'sa05 taxes, and parrirlpale In loud markPling district taKes. LadgloR meraburs halnng to volWrAeer and pnofcssdurlaI ornanizotlons that Raise the sturldard nt prafessioriahsm Ind asstlre that visilolstoVail are given uusxperierice that reilt✓crs hotel standards tor clealy roonis, safebuildillem ADA access o lid flnanriarintegrity. Hotels a lie lice nscdfarfood IMparutiun, bar serxarx,, spa trey true rite, a nd hald a Town of Vail h us!n ess license. Prlvala huirn.s and collilorl'iieliums that rent ihzir dome as nightly rentals for hiss than 3pday9 are acting hike hotels and need to be treated similar to vt lie l LornrnarriaO enterprises. Jt is uv fair Lu ask existing hotels Lo subsfdixe the comrriission nn speclaI everts with our license fees ulid riot evpeCt other vacation ren to l visitors thd! will alt end those same events Lo pa rtiripate Jn the cost. There is pi-en tynf room for carnpetitiorl In our indusTry. PIcase treat all of Lhe corn pellto's equal IV and in a mgnnar that will gi',•e tha Vuil visitor the hest vuratinn experience pouihlc. �Ih L1E+r21�r, / Farrow Hilt General lvlerllgerf Simlra Run RP..%rt 111:1: 4 1: ..,,,I - V, R. ;.,I, - {• - Y',M.l ,1 I ". -'JYY 1:' {, ;YA44 - F— — C- 476-U`3n • :•r'n',••sir'.L'.ircn.[a nr ''l I 1:{r9r 4 {wcI R.-or Is P,, iy)] rlf 4 i no r Vail I awn Council: The Vail Iudglng industry heeds your help to pass a comprehensive vacation rcrttil ardlnim4ce [hit helps proteel Vlsltof's vilcatlon PN Ile fienc.P In Val 1, levers the playing field with other existing busleless Pceo5e fees, and rnstlrns that alt lodg -mg rentals pay the sarne taxes. Lodging is the ktv cunipLinunt to VOiI's tourlsm amn nvera!l ecnnnmy. There., arc various typ °m of lod it proaerU,tA In ,fall fron7 Ilntels In rrrfrltsntlllaums, robins to prlvoty horeres. Lodyilly is rrsporu lhle for the largest part of the guest experience ti, at rrlaks a VoiI Vac-Mot, hIWILle to o%nr skl areas. Lodging propertiesarcancoafthelargestcmp !oVcfsIn;CaglerXunttiith - t. provide livable wages IL- our wwkurs, vrofkcrs cr:mtl;rrtsyti +i a Iwwr,trwe fn1' injurles nn thejoh, unemployment i^suranee, R rrrm(ent bum fits, sick pay a.nd ua^atlfm pay, tra•ning and frrerrirne pay, end ineurne to our in esturs. Wt wIthhDld tdxeg On nayrall avaAes, ps°F heal county and state sales taxes, and parllcLpate In (oral Inar1keting dlstnct taxes. I.or!Eing.merrhers helong to voluntccr and prufussional orAallrzallons that raise the standard of professionalism and assure Lhat visilura to Wall dfP AIWPII all expP.flP.I1CP that reFlr.cts hotel standards tar than MOM afC° 31tI11dlpgc, alga, iLr.ess and fi °tancial imtegrity. Hotels are licensee rur fjud pitparalro -1, bar scrvief, Mi LreAlnehl-s, = nd hofj a loom of Vail busness licenso. uri ,ratehoines and cori durniciurrntIlatreeltLheirh, me Pcnghtl? MntahFnr leis than 3'Jdaysamacting like Notels arid Aced w Ue Lreawd siinilru 1u uthef rorlrrrrri l enterprises. It is unfair to askexisling hotalstasubsidize the commission or sl;ccal xvelltS tiVi1h ow, I cense Fees and not expect cthervacatfort rental visiturs that wllf attend tllvxrr swine rver s to lrarticlpate in the cost. I hefe Is plentyuf room cur curnpctitiran iii otlf I1f1I.I4tly. N. °ase treat all of the competituasequafly arid in a manner that will Kite the Vail vzsitur'the best Vacation eNperience possible. slncerety, Derek Schmidt I he Wren at Val I :a:.aldh i I,:. I'de +nr, 1 V.,il. { M I f,5 F31 nal11°:170t>i76.1.'-;62 1 1-ilx:11104,i,410'i DESTINATION RESORTS - t. VA IL Members of Vail's Town Council ANY 30, 2014 755vuth Frontage Road Vail, CO 8:1657 Dea r Mail Town Coup €il: Iti+lnre and mare con dcminIurns owners arc renling their units on their awn thru less traditional saunas. 10,gny of theso unit awntrs or,2 tmuee of their obligations with coil duedug short -term rentals,payfne sales tax and operating a hrisinrL55wvithinthaTown ofvaIL Vail needs to pass a comprehensive vacation rental ordinanrethat lie 1psclarlfytheseouenees respon;ibllitles, prctect visitvr'svacationexperienco, IcvolsMe Playing fie-ld with the existing businesses, and ensures that ail fadging re= 7talsgeneratetaxes for the Town ofVaIt There are various types of Iodeing prOpirtius in Vail from hotels to conduinIrIuins, cabins to priwotc hum as, Ail pay 'oca1, county and state salestaxez, and parti ci p ate in local inarlCULing distr:ci taxes. Within ~fail all pail btfsi:tess license fccs andfulfIll the Insuaancerequirements. Private names and cDri dam iniums that rent their home as nightly rentals for less than 3� days are DOr%glike haters and need to betrcated slmHarto anccrcammoicial an torprlses_ Thls ordinance .mould provide clarit•f of these owner's ok.11ga ~Ions acrd impruue the Kue.st experi a nee., itkvouId assist Condominivrn assodatlons In establishing epprrspriatp poliries for their hulidh}gs• please recognizathm a need exists and that irn any faworabl eInn pralernentswlll r¢5ult with SuppDrtinga comprehenAve uacatton rentalordinanre. $inrerely, r Genf jy 1 ht, al'Manager 610W.L:ansheHLI(.iFCIC. Vr:iI.C:olt,rUI45Mln57 { l'Jror,e (q;t7) 426,135 . 7x (9f'�) 476.16512 ■ T'nl: -"ire (905); 'i,2) A"A If. {Az.l;} F l4. 5150.. 1P$tllldtLUlLtesUFLLVNIi•Ct7[[L A iist:nera L. -0�=. vn , oro))4, + by T7iSrintrron fIorr.4a F? Rcs.:,rrs '.v%- WLk'Hdrmtk1nhQ d%.cc +m Val"l Resort Rentals, Inc. ' rr. July 30, 2011 7eai Vail Tuwii Cu•.u:til; The Vail ladming i:ndustey needs your help to pass rarnorehensivevarF.tnn rental nrd:nance that helps protect tdsltor's Vaeatioi, expeilence in Vill, levees the playing fluid wllh odwr Lyxiswid business license fees, arde^.surea that �;I odpingr tentalspap the s me taxes. LodE ;q Il =hc ccy cwnpoiwnI tq Varl's t❑urlsm and overall efnnorny. There aiz Vafiutus lypes 0 udL;inl; propertiPa in Lail h nm hrtels to rsndn- ninuims, rahins to private homes. I edging i5 respons We for tha largest; partof the guest expeilencethatniakeyaVAIvacatlunLB1F q,I LaulherAlareas. Lodgind properties are true of the iargest ernploye °s in Eag'e County that provide Iivabte wages Lu our wu•kers, %vnrkP -s rnmpen. atinn 'iiwreanr.P for injoi its cin the joi,. L imilOwnient Inscuance, retienle` is beneflt5, slid, pay and vacation pay. Cfalring and uvertlmo txay, and I,'icwrie lu uur iiiYestS1rS: We wilhho d Lanes on payfoll wages, pay Inca cotiinty anti s -ate Nalws trxg5, and participate 11 local narkPting dlst,"t #axe4, i, odglnc members holong tkivo,rintcervic;)rofesslonal organlzatlors tha ralsc:hi standa•d 0' prcfesSlrrtalisrn and a injre that vi. to' iM Vail are given enexper' encethatretlertsnotals -andardsfor clu mrnom,,; afehuliddrrs .AllA acres; and finardallntegn -y, Hotels ale ;Irerlsec for faorlpieparatiGn, bar z4�rvlte, spa treatments, and hold aTown of Va'I business license. prb ate homr.s and rnndnminiuut.5 #oat Mint their hromC is nigh#ly ronrvls `p' css #ban 3[) days ue . ;Dc thig like hr,*e's and need to ue treated similar to other cnmmerc' %I enterprises. It is unfair to ask exiating ho -zeIs to =uosiclOe the comm8slon on specljl events with our liicer.se fees and no expect other vocatlure fentaI vis tors that will attend those same events to participate `ll :I1B [o5C, Tharp. is plenty of room for rnirpn-itin.n in our indi ny, PlnznSr Croat o li o' t lie conioell O'S equal ly d lid M a m oner that will g1ve the Val. v star the hest vacation experience possible_ S::nc 11y, f baAllllrbX f r'rps'dent, GM K;I. VY. •- ■ r'ruL t ii iIC'5'r + I'7rr°f ' ; ";f7±;,[tiy7:'. F I�Citrin -li nx ? L; +45t -s = =Y AirBnB Founder, Brian Chesky, "We want to be regulated, because to regulate us would be to recognize us:' Aspen Daily News 6/30/14 Fig Eat vi— F -.— T —t, Submit a News Tip aspendai lynewsonline Home I Letters & Opinions I Time Out - Arts & Entertainment I ADN Class €feeds Online E- edition Airbnb CEO finds room in Aspen through Time Out own website 2014 Summer Guide by Brent Gardner - Smith, Aspen loumalism Mr,day, Sun_ =U. 2614 Printer - friendly version { I Email this Story Ildhaoafre founder pays only $100 Airbnb co- founder and CEO Brian - -�� Chesky found a place to stay in Aspen Saturday night for about $100 by going on to the Airbnb website, which connects people Search Archives who need a place to stay with Submit your letter online people who have space to rent. Photo Galleries Via the website, Chesky contacted a ski instructor from Brazil named Eric who had listed a room for rent in Aspen as a registered Airbnb "host.- "He was super cool," Chesky said after an appearance Sunday at the Aspen Ideas Festival. "We hung out for an hour- and -a- half." Chesky said Eric was an experienced Airbnb host, and is one of about 450 Local News people in Aspen now renting out all or part of their homes here through 1 2 - 4 5 E 7 - 9 lu 11 12 13 rl 1= 1E 17 1 -8 19 20 21 22 2S 24 25 26 27 28 29 30 31 A Hi Edit view Favorite: Foals CJ1 N O A 13114 15 16 17118119 20 21 22 23 24 25 26 27 28 29130 31 1 l hat You Want r n+ "1 11. Em H1wn An • A.pm a�a.atassoo•+fe.<i...y �e.. Alpha SWMTY A Ideas Festival. "We hung out for an hour - and- a- haff." Chesky said Eric was an experienced Airbnb host, and is one of about 450 Ltoeal News people in Aspen now renting out all or part of their homes here through Airbnb. Mayor seeks meeting of the minds with developers "I think we're an important part of his life now," said Chesky of Eric. Ski[.: tiff 1A base conditions called an'intematilanal issue' What Chesky did — contacting a host through Airbnb, letting the host vet him as a potential guest, and then showing up — is increasingly common rela ci Pfister tive tes 'confrontation' as reason for around the world. restraining order filing Tonight, 300,000 people in 192 countries will be renting a place to sleep Mews in brief through Airbnb, Chesky said Sunday. And of the 600,000 people going to Brazil for the World Cup soccer tournament, 120,000 are finding places to stay through Airbnb, he noted. That helps explain why Airbnb, still a private company, raised around $450 million in private equity this year with help from TPG Capital, whose co- founder, David Banderman, owns a home in Aspen. Airbnb is now valued at $10 billion, more than the largest traditional hotel chains. And Chesky, 32, is said by Forbes to be worth $1.5 billion. He started Airbnb with Jae Gebbia and Nathan Blecharczykin in 2008 after renting space in their San Francisco apartment for people to sleep on air mattresses. "The biggest misconception people have is that they think itrs this little side thing," Chesky said of the emerging "sharing economy" now epitomized by companies such as Airbnb and the car - services Uber and Lyft. "Everyone said the same thing about the intemet. In 1994, it was this little thing." A taxing issue It's wasn't clear Sunday afternoon if 'Eric" of Aspen had paid sales taxes to the city of Aspen on the rental of a bedroom in his home to the CEO of Airbnb, but city officials would likely encourage him to do so. 13114 15 16 17118119 20 21 22 23 24 25 26 27 28 29130 31 1 l hat You Want r n+ "1 11. Em H1wn An • A.pm a�a.atassoo•+fe.<i...y �e.. Alpha SWMTY A Flr €da Vi— €a ±o Taors It's wasn't clear Sunday afternoon if "Eric' of Aspen had paid sales taxes to the city of Aspen on the rental of a bedroom in his home to the CEO of Airbnb, but city officials would likely encourage him to do so. The city estimated in March 2012 that it was losing $100,000 a year in sales taxes and licensing fees from people using the Internet in some fashion to rent their homes and condos short-term. The city council voted to let people rent their domiciles as often as they wanted, as long as they got a license, paid taxes and named a local representative to respond to complaints about things like parking, trash and rowdy guests. And the city hired a company called VR Compliance to scour the intemet looking for properties being rented without a license. Once it knows who is renting their unit on their own, city officials reach out to the property owner and encourage compliance. As of February 2014, the city had a total of 61 short-term rental licenses on file for people booking their units over the intemet. In 2913, the city brought in $73,000 in revenue from 30 new licenses brought into compliance over the previous year. For owners in Aspen, a city license means sales taxes of 11.3 percent, on top of the 3 percent in fees charged by Airbnb. A renter on Airbnb pays what the host asks plus 6 to 12 percent to Airbnb. Airbnb states on its website that it expects "all hosts to familiarize themselves with and follow their local laws and regulations." Aspen is not the only city working to tax this new approach to lodging. Portland, Ore., reached a deal this spring with Airbnb and the company will now collect lodging taxes on its rentals and remit them to the city instead of relying on individual hosts in the city to do so. 'We want to be regulated, because to regulate us would he to recognize us, " Chesky said Sunday during a pointed interview with ]ennifer Bradley of the Brookings Institution. SECRITY Q i� Video surveillance Experts 9r 1t GOLD • DL,01O.VoS Jt.71'F.'LRY • 11147r,11 „c F c•w..lw. • 6www a r Fkw Apo oMr.'ro-sxsam LUVOIAV 54 Y Naib • Spa • Hair 8urdultn 430 E. Nyinen • (970) 544 - 5917 n Fie Edit View Favorite Took Portland, Ore., reached a deal this spring with Airbnb and the company will now collect lodging taxes on its rentals and remit them to the city instead of relying on individual hosts in the city to do so. "We want to he regulated, because to regulate us would he to recognize us," Chesky said Sunday during a pointed interview with Jennifer Bradley of the Brookings Institution. "What we don't want is a blanket prohibition," he said. "And we don't want Nalh • Spa • heir (tie F�ta�n G+x 490 E Nym ii • (970) 544.5977 people regu Dating us without even understanding what we are." Visitor Guide Bradley asked Cheskey about shortcomings of the sharing economy and the Retail Airbnb model, including people feeling that apartments in their urban Aspen Snowmass Ski & buildings have suddenly become busy hotel rooms with "a revolving door of Snowboard Rental strangers coming through." Aspen Real Estate Chesky responded by noting that the "neighbor issue" was not a problem for Access Aspen Properties Eric's neighbors in Aspen. Aspen Snowmass Real Estate Carol Dopkin Real Estate Inc. Greg Rulon- Joshua Co. "His neighbors know he is a host and they think he's awesome," Cheskey Search Aspen Real Estate said. "And then I go to some places in New York, in a. high rise, and they Services find out I'm the founder of Airhnh and a few people, well, they are polite Aspen Rafting New Yorkers." Colorado Fly Fishing Midvalley Window Cleaning Chesky said the company also regularly removes bad actors — either unpleasant guests or hosts that violate company policies — from its Professional platform. Internet Marketing Solutions Momentum Interactive "We are not shy about removing people" from the Airbnb system, Chesky Lodging said. Frias Properties of Aspen Ritz Carlton Destination Club Editor's note: Aspen Journalism is a focal, online, nonprofit journalism Snowmass Vacation Rentals organization collaborating with the Aspen Daily News on coverage of the Aspen Ideas Festival. More at www.aspenjournalism.org. Copyright 0 2001 - 2014 Aspen Daily News n FOUR SEASONS RESORT AND RESIDENCES July 31, 2014 Vail Town Council 75 S. Frontage Road Vail, Colorado 81657 Dear Vail Town Council; I recently attended a Hotel Association meeting to discuss a vacation rental ordinance and understand there is a Council work session on Tuesday August 5, 2014 to discuss the ordinance. I would like to attend the session unfortunately; I will be out of the country. I applaud the Council for considering an ordinance to regulate vacation rental. This issue is not isolated to Vail or any Resort town with vacation rentals. Jackson Hole Wyoming recently reported that illegal rentals by home owners are rampant in Jackson and Teton County. The local officials want to suppress the practice, which is in violation of local zoning laws. In addition, no sales tax is collected on these illegal rentals which represent a great amount of lost revenue for the town. Additionally, illegal nightly units can result in declining resort property values. Whistler has discovered this first hand. The issue is an increasing phenomenon created by a growing popularity of social tourism sites. It is growing because of the very nature of the websites that are promoting vacation properties by owner. I have in -depth experience with vacation rental from my five year tenure in Whistler, British Columbia, Canada. Whistler has faced this same issue for the past 15 years and it has still not been rectified. A large volume of new rentals came into the market place in 2010 when Whistler hosted the Winter Olympics. The surge of new rentals left the accommodation sector with a 65% occupancy level during the Olympics. There are several challenges that should be addressed when reviewing an ordinance to control vacation rentals: • Effect on the towns Net Promoter Score • Security and safety risks to guests • Zoning • Regulations • Cost of Enforcement • Lodging Quality Assurance Rating System • Loss of tax dollars Property owners who are operating illegally are taking potential revenue away from legitimate accommodation providers, who typically pay thousands of dollars a year in commercial and marketing fees. These illegal units also pose potential security and safety risks to guests, as they may not be going through the proper inspection and licensing processes. Ultimately, illegal vacation rentals can increase the capacity of inventory beyond what is planned for the resort town of Vail and can inflate the volume of tourist accommodations beyond what may be sustainable. The goal of an ordinance should be to create a level playing field, as far as tax and other regulations is concerned. Respe tfully, __.. Mark He o f� General Manager 8/5/2014 ONE FAIL ROAD, VAIL, COLORADO 81657, U.S.A. TEL: (970) 477 -8600 [A\: (970) 477 -8666 NvwNr.fourseasons . com LIETHOUS� LODGE July 29, 2014 Dear Vail Town Council: Thank you for addressing the VRBO issue. It is a situation that is costing the Town of Vail considerable loss of income. What I would like you to address are the following: That they play by the same set of rules as the Vail hotels currently have to abide by. a. Obtain a Business License if they are renting multiple homes or apartments; b. Pay an annual unit fee that goes to fund the CSE; C. Pay sales tax to the TOW; d. Show Proof of Insurance in the amount of $2,000,000.00; e. Obtain Workmen's Compensation Insurance. It would facilitate your tracking down VRBO units in a condominium complex if you would mandate that the Hotel Managers turn over information about VRBO units so you could track down these individuals. Thank you for taking an merest in this troublesome matter. Sincerely yoiL r Pocky Walker General Manager Lifthouse Condom iu'ms 555 E. Lionshead Circle • Vail, Colorado 81657 • 800 - 654 -0635 • Phone: (970) 476 -2340 • Fax: (970) 476 -9303 Email: lifthous @vaI eP - www.lifthousevaii.com Vail Realty Vail & Beaver Creek Real Estate, Vacation Rentals & Management Dear Vail Town Council: The Vail lodging industry needs your help to pass a comprehensive vacation rental ordinance that helps protect visitor's vacation experience in Vail, levels the playing field with other existing business license fees, and ensures that all lodging rentals pay the same taxes. Lodging is the key component to Vail's tourism and overall economy. There are various types of lodging properties in Vail from hotels to condominiums, cabins to private homes. Lodging is responsible for the largest part of the guest experience that makes a Vail vacation unique to other ski areas. Lodging properties are one of the largest employers in Eagle County that provide livable wages to our workers, workers compensation insurance for injuries on the job, unemployment insurance, retirement benefits, sick pay and vacation pay, training and overtime pay, and income to our investors. We withhold taxes on payroll wages, pay local county and state sales taxes, and participate in local marketing district taxes. Lodging members belong to volunteer and professional organizations that raise the standard of professionalism and assure that visitors to Vail are given an experience that reflects hotel standards for clean rooms, safe buildings, ADA access and financial integrity. Hotels are licensed for food preparation, bar service, spa treatments, and hold a Town of Vail business license. Private homes and condominiums that rent their home as nightly rentals for less than 30 days are acting like hotels and need to be treated similar to other commercial enterprises. It is unfair to ask existing hotels to subsidize the commission on special events with our license fees and not expect other vacation rental visitors that will attend those same events to participate in the cost. There is plenty of room for competition in our industry. Please treat all of the competitors equally and in a manner that will give the Vail visitor the best vacation experience possible. Sincerely, C'J4-- 302 Hanson Ranch Road • Vail, Colorado 81657 • www.vailrealty.com VAIL: 970- 476 -8800 • 800 - 627 -VAIL • 970 -476 -8671 FA 84/20�JAVER CREEI(: 970 -949 -9200 • 800 - BEAVER -C • 970- 949 -0870 FAX Petition To: The Vail Town Council Subject: Vacation Rental Ordinance Date: July 22, 2014 We the undersigned request that the Vail Town Council pass a comprehensive vacation rental ordinance that helps protect visitor's vacation experience in Vail, levels the playing field with other existing business license fees, and ensures that all lodging rentals pay the same taxes, / •' PROPERTY WWII WAMM Ali MIN 011H'� . • �.'Mllt2��F� ....�, FKAM I= am �- - i 8/5/2014 r14 hr -r lrvi( f {' i7a:' fir.,., I. e.I, ern ri ♦ 'L�r•1`� • �.f �� :r.. Fj:j:. i--1 •�tj� -, r July 10, 2014 Mr. Dale Bugby c/o Town of Vail 75 S. Frontage Road Vail, CO 81657 Dear Dale, Thank you for taking the time to present the Vacation Rental Ordinance Draft at our VCBA board meeting on July 10th. Recognizing that the draft ordinance would be very impactful to the town, the lodging community and the business community at large, the VCBA is very interested in being involved with the evolution of this proposed ordinance. As advocates for the business community, the argument for a level playing between the lodging community and the vacation rental market is compelling. At the same time, the VCBA recognizes that the proposed ordinance is complicated and could impact the local economy in unintended ways. The VCBA will commit to work to inform and engage the lodging and business community in order to encourage constructive input and elicit different perspectives on this important issue. Thank you again for your presentation and we look forward to facilitating a collaborative effort in meeting the goals of the town, the lodging community and the business community as they relate to this important issue. Sincerely, Alison Wadey Executive Director Vail Chamber and Business Association cc. Pam Brandmeyer Packy Walker Matt Ivy Jeff Andrews 8/5/2014 Tammy Nagel From: Snowden Smith <snowden @vailinternational.com> Sent: Thursday, July 31, 201411:19 AM To: Council Dist List Subject: Vacation Rental Ordinance Attachments: Lodging Petition.pdf Dear Vail Town Council: The Vail lodging industry needs your help to pass a comprehensive vacation rental ordinance that helps protect visitor's vacation experience in Vail, levels the playing field with other existing business license fees, and ensures that all lodging rentals pay the same taxes. Lodging is the key component to Vail's tourism and overall economy. There are various types of lodging properties in Vail from hotels to condominiums, cabins to private homes. Lodging is responsible for the largest part of the guest experience that makes a Vail vacation unique to other ski areas. Lodging properties are one of the largest employers in Eagle County that provide livable wages to our workers, workers compensation insurance for injuries on the job, unemployment insurance, retirement benefits, sick pay and vacation pay, training and overtime pay, and income to our investors. We withhold taxes on payroll wages, pay local county and state sales taxes, and participate in local marketing district taxes. Lodging members belong to volunteer and professional organizations that raise the standard of professionalism and assure that visitors to Vail are given an experience that reflects hotel standards for clean rooms, safe buildings, ADA access and financial integrity. Hotels are licensed for food preparation, bar service, spa treatments, and hold a Town of Vail business license. Private homes and condominiums that rent their home as nightly rentals for less than 30 days are acting like hotels and need to be treated similar to other commercial enterprises. It is unfair to ask existing hotels to subsidize the commission on special events with our license fees and not expect other vacation rental visitors that will attend those same events to participate in the cost. There is plenty of room for competition in our industry. Please treat all of the competitors equally and in a manner that will give the Vail visitor the best vacation experience possible. Snowden Smith, General Manager Vail International Condominiums 800 - 622 -3477 Summer Vail Hike, Bike, Music, Festivals, Fun Stay Feauary l ��is. says Y al Vail International 8/5/20 4 Petition To: The Vail Town Council Subject: Vacation Rental Ordinance Date: July 22, 2014 We the undersigned request that the Vail Town Council pass a comprehensive vacation rental ordinance that helps protect visitor's vacation experience In Vail, levels the playing field with other existing business license fees, and ensures that all lodging rentals pay the same taxes. 14: MA ING PROPERTY 8/5/2014 Tammy Nagel From:Andy Ball <andecball@yahoo.com> Sent:Tuesday, August 05, 2014 9:15 PM To:Stan Zemler Cc:Council Dist List; Suzanne Silverthorn; Edward Stoner; Vail Homeowners Association Subject:Large lodging managers attempt to regulate my private home Dear Town of Vail City Manager Zemler, I address my email to you status post today's Work Session topic about rental housing, because you offered staff's time to research the topic. I will cc: the Council members since I attended with the expectation that non-large lodging managers would be allowed to ask questions. I return home disappointed and frustrated that I did not have that opportunity but relieved that my bald spot was not broadcast by the overhead camera. I reluctantly contact you because there are a lot more important problems in the world, but I prefer to have no regrets. The proposed ordinance has zero direct effect on me at this time, but I perceive the sharing economy to be an option for my financial strain of a daily commute whereby providing me the the ability to pay for a hotel when I am tired. I have friends that this directly affects who are reluctant to speak because of the punitive nature of the purposeful presentation. I apologize for the randomness of my email, because I had clear questions before the work session and now status post comments. I arrived to the work session with these questions about the Draft Ordinance: . a.) The fourth WHEREAS stipulates: "...the right of personal property owners to rent their private residence;" However the Power Point in the work sessions' agenda packet has a slide that clearly states: "The lodging community encourages Council......to work with the lodging managers to create..." My reactionary cat hairs were erect after reading that exclusionary language. Did I suddenly evolve into a community whereby specific lodging managers dictate how I live in my residence? Sitting in chambers during the work session, I was reminded of Kim Newbury's answer during the recent candidates debate for Vail Recreation District that one of her lessons learned was to never move forward without input from the entire community. Why are some Council members seemingly willing to accept this Power Point as gospel? I am a servant at work, but when I enter my home, I assume I am king (not married) and not a servant of government inside my home, but these specific large lodging managers want to know how many pillows are in my house (Section 6) if I were to ever rent for less than 30 days? 1 b.) The 8th WHEREAS references other cities enacting legislation. I googled "airbnb banned", and the first result was an August 1, 2014 news article from San Fransisco (hyperlink at bottom of my email). I took away from the article that their attempts to ban AirBnB and regulate the home sharing economy has been a failure, and they are starting over with conflicting intentions without a clear course. Since Mark Herron's letter was referenced multiple times, I want everyone to be aware had not been rectified in that he stated it was a 15 year long issue that Whistler . I don't hear the Vail Daily crying foul, because their classifieds are no longer filled with Vacation Rental ads as they were 20 years ago. They have adapted to the evolving economy. Is the Vail Daily proposing that the Town of Vail ban craigslist.com because of its effect on all classified categories? c.) The 9th WHEREAS states that private homeowners are acting as hotels. I used Homeaway.com during the last few years of my father's life without any expectation that I was renting in a hotel. I searched for detailed listings with photographs that identified the stair situation followed by phonecalls. It never dawned on me to sue HomeAway because every listing was not ADA compliant (reference to letters submitted by the large property managers). d.) The Power Point's language along with the oral presentation and comments stresses that only these specific large property managers are capable of providing world class customer service. What? When I read the Power Point and draft ordinance, I thought of glass houses. I printed the list of twenty-two petitioners and launched TripAdvisor.com. Eighteen of the the twenty-two are properties. Seventeen of the eighteen properties had listings on TripAdvisor.com. All of them had a negative review that I read. One of those reviews specifically stated that they had rented the unit in 2014, because it had a platinum rating whereby the reviewer proceeded to lambaste the maintenance of the room. The four remaining petitioners are property management companies that advertise the listed properties on their websites. Is this list inclusive of all large rental properties and all property managers? I respect the occupation of these petitioners and the hard work and years that they have served their occupation, but are they the most arrogant group in town? I respectfully disagree that a private homeowner cannot provide world class customer service. e.) The letters submitted by the large property managers repeatedly reference safety and security problems generated by all of the scofflaws. Has the Town of Vail Police Department generated a report enumerating the reports filed as a result of the sharing economy since this is presented as a common occurrence? f.) I am amused by the Power Point slide that quotes AirBnB founder's receptive attitude for regulation, however Section 5's second not-allowed-item bans 2 AirBnB. For the record, AirBnB has a growing list of competitors. I predict that forcing regulations on private residences will grow the market. If I gotta satisfy these new regulations for just one week, I might as well do it more often. Any economist will be happy to remind us that markets adapt. g) I was relieved to arrive for today's work session and realize that Town of Vail staff did not compose this Power Point's Economic Impacts slide which I found to be grossly lacking. Once again, a demonstration of the arrogance of this proposal to only consider the petitioners' impacts. Economic impacts not considered: 1.) The last item in Section 6 requires Proof of Lodging Quality Assurance inspection. Is that inspection free for the private homeowner? Most of the regulations in this draft are on an annual cycle but this inspection has be every 18 months? 2.) Section 7 has insurance requirements that would require me to triple the liability in my annual insurance policy, if I were ever to rent my home for a week. This community has a decades long history of renting homes during the last two weeks of the year, World Cups, and other large events. Why is it a problem now? I think these property managers should have to finance their own professional cost-benefit analysis with outside review in this technologically evolving world within the parameters of a ski resort community. 3.) Was enforcement time considered? My untrained review of each detailed new regulation and process would increase staff by at least 1.0 FTE. I understand from Councilmember Rogers' comments during the working session that staff is currently monitoring VRBO, but the list of sharing economy vendors is growing. I think software could be utilized to manage all of the proposed Sections, but the software will have to be managed as to who is in compliance today versus yesterday versus in-process versus tomorrow. Staff time beyond monitoring has to be accounted for enforcement. Remember, the large lodging managers want fines and court adjudication. 4.) Have all costs to the individual property owner been considered that don't want to sign a contract with one of the four property management petitioners? Is this really government being a revenue generator for property management companies, because individual homeowners don't want to deal with the new bureaucratic burden? h.) Section 14 wants the Vail enforcement code inserted. Based on the letters submitted by the petitioners, what type of building codes do they want enforced per situation since they claim private homeowners are hotel operators? I think the IRS and Fire Department can capably determine what type of business is a condo complex? Do they really expect the town to enforce American Disabilities Act and Workers Compensations regulations inside my home if I choose to rent for a week? Remember these petitioners expect fines and court adjudication. 3 i.) How does this draft ordinance affect interval and fractional owners? j.) The customer service problems that these large property owners cite regarding users of the sharing market occur on their own properties. As Mr. Daly repeatedly asked, why are their own business rules and condo association rules not enforced? Sorry for the tome. I would have been much quicker in person, but I do have a proposal. Can owner occupied residences be exempt from the regulation? I want to thank the Councilmembers for their comments today such as Mr. Moffett's and Mr. Daly's but especially Mrs. Rogers. My nickname for Councilmember Margaret Rogers is New York. Today I love her and glad that I voted for her. I hope the Council does not fall for the kitchen sink approach and allow negative parts of their proposal to proceed. I want to thank you and your staff in advance for your endeavor, but I hope Council puts a limit on your time before taking on the growing sharing economy. Will Town Council be asked to ban ride/car sharing (Uber has competition), pet hosting, bike sharing, or clothing and equipment sharing? I believe the power of consumer choice After this, you can and web-posted reviews will self regulate the sharing markets. update your LinkedIn profile. If equal competition is a goal, can minimum night stays be prohibited? Since San Fransisco apparently sets an example for these petitioners, should a living wage be mandated for lodging employees? Thank you for your consideration. Have a good one, Andy Ball tiny property owner in Vail, CO cc: Town of Vail Council group email address Suzanne Silverthorn Ed Stoner (for Vail Daily background information and different perspective) Mr. Lamont S.F. starts on path to regulate Airbnb Right-click here to download pictures. To help protect your privacy, Outlook prevented automatic S.F. starts on path to regulate download of this picture from the Internet. image Airbnb New battle lines were drawn on Thursday 4 over a proposed San Francisco law to let people rent their homes or rooms to travelers. In April, Chiu proposed ... View on www.sfgate.com Preview by Yahoo 5 Tammy Nagel From:Lee Williams <lee@vailrealty.com> Sent:Tuesday, July 29, 2014 11:52 AM To:Dale Bugby Cc:Council Dist List Subject:Emailing: SKMBT_C35114072911481 Attachments:SKMBT_C35114072911481.pdf Please find attached my letter of support on the comprehensive vacation rental ordinance. 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Our main topic of discussion was Vacation Rentals. These are privately owned units that are rented out to the public by the individual property owner without the involvement of a professional management company. From our discussions, it is evident that these Vacation Rentals are in direct competition with hotels and lodges and enjoy unfair competitive advantages in the operation of their rental businesses. Most of the GMs in attendance could share horror stories regarding issues at their own properties in dealing with upset, misinformed and dissatisfied guests who rented a Vacation Rental unit, as well as in dealing with owners who wished to make a personal profit at the Property's expense. Our collective belief is that these concerns should be dealt with by each individual property within the confines of their own systems of governance and rule making. We do not seek to have the Town overregulate Vacation Rentals. However, there are certain areas of concern that are beyond our control and therefore the proper jurisdiction may rest with the Town itself. In order to introduce this topic to the Council, a draft Vacation Rental Ordinance has been prepared in hopes of initiating discussions on the subject and placing several suggestions on the table which might assist in the development of a professionally drafted ordinance that would have the support of Council. We hope to have the opportunity to work together with Town staff toward the advancement of this concept and to fully vet the issues and opportunities in formulating an ordinance that is in the best interests of the Town, its residents and our guests. Our goal is to address, what we believe are, current inequities by leveling the playing field and to legitimize all nightly rentals within the Town. We would like to accomplish something which would give all of our guests a level of comfort in knowing that the Town, as a whole, has taken action to ensure that their Vail lodging experience is positive regardless of what rental method they have chosen to secure their overnight stay in our community. Hopefully, this initiative will capture the Council's interest and you will consider this a worthy topic of further investigation, review and development. Thank you for your time and the to bring forth this matter for your consideration. [a neral Mana r ail Racque Club Mountain Resort 4695 Vail Racquet Club Drive Vail, Colorado 81657 800 -428 -4840 e 970 - 476 -4840 970- 476 -4890 Fax www.vailracquetclub.com TOWN Of vn' 1[1 VAIL TOWN COUNCIL AGENDA MEMO MEETING DATE: August 5, 2014 ITEM /TOPIC: Discussion on Soft Surface Trail Improvements. In an effort to enhance existing recreational opportunities, staff has explored potential improvements to Vail's existing soft - surface trail system. The intent of this agenda item is to present a general trail concept and to ask if the Town Council is supportive of a more detailed planning process. PRESENTER(S): Gregg Barrie, Public Works, and Jamie Malin, Eagle Valley Mountain Bike Association ACTION REQUESTED OF COUNCIL: Provide input and direction to town staff regarding potential improvements to Vail's trail system BACKGROUND: Vail offers many soft surface trail opportunities for hiking and mountain biking. These well -used trails are mostly located on U.S. Forest Service or Holy Cross Wilderness Area lands and they provide access into the natural environment surrounding Vail. They are generally intermediate or advanced -level mountain biking or, in the case of the Wilderness Area trails, "strenuous" level hiking and backpacking trails. In 1994, the Vail Town Council adopted the Town of Vail Comprehensive Open Lands Plan. The purpose of that Plan is "to identify and develop strategies for acquiring or protecting key remaining open lands in Vail that would be valuable for recreation, protecting sensitive environmental resources, extending or connecting trails, providing adequate neighborhood open space and creating a small amount of contingency land for unforeseen needs." Over the past two decades, many of the parcel acquisitions have been completed, as have park facility improvements. However, other than the highly successful North Trail, most trail recommendations remain incomplete. At the same time, the town has focused its trail efforts on the popular paved recreation path system and, most recently, the widened shoulders on Vail's frontage roads which will be completed this year. The completion of that work opens the opportunity to work on other recreation trails including soft - surface trails. STAFF RECOMMENDATION: Staff proposes that improving recreational opportunities is important to Vail's residents and guests and is consistent with adopted planning documents. Staff recommends that the Town Council consider whether or not to direct staff to initiate a conceptual planning process for trail enhancements. ATTACHMENTS: Town Council Memorandum 080514 Powerpoint Presentation 8/5/2014 0 rowN of vain Memorandum To: Vail Town Council From: Department of Public Works Date: August 5, 2014 Subject: Vail Soft Surface Trails Discussion I. INTRODUCTION As a way to enhance existing recreational opportunities, staff has explored potential improvements to Vail's existing soft - surface trail system. The intent of this memorandum is to present a general trail concept and to ask if the Town Council is supportive of a more detailed planning process. II. BACKGROUND Vail offers many soft surface trail opportunities for hiking and mountain biking. These well - used trails are mostly located on U.S. Forest Service or Eagles Nest Wilderness Area lands and they provide access into the natural environment surrounding Vail. They are generally intermediate or advanced -level mountain biking or, in the case of the Wilderness Area trails, "strenuous" level hiking and backpacking trails. In 1994, the Vail Town Council adopted the Town of Vail Comprehensive Open Lands Plan. The purpose of that Plan is... ...to identify and develop strategies for acquiring or protecting key remaining open lands in Vail that would be valuable for recreation, protecting sensitive environmental resources, extending or connecting trails, providing adequate neighborhood open space and creating a small amount of contingency land for unforeseen needs. Over the past two decades, many of the parcel acquisitions have been completed, as have park facility improvements. However, other than the highly successful North Trail, most of the Open Lands Plan trail recommendations remain incomplete. During that time, the town has focused its trail efforts on the popular paved recreation path system and, most recently, the widened shoulders on Vail's frontage roads which will be completed this year. The completion of that work opens the opportunity to work on other recreation trails including soft - surface trails. 8/5/2014 III. BENEFITS The benefits to improving Vail's trail network include: 1) Providing connections between neighborhoods, existing trails and Vail Mountain trails by creating a valley -floor and neighborhood level trail system. In addition, there is the long- term potential of a full Vail "loop" or "rim" trail at higher elevations. 2) Creation of trails tailored to beginner, first -time and youth mountain bikers as well as hikers seeking less strenuous soft - surface trails 3) Alleviate congestion on the paved recreation path system by providing parallel trails and alternate soft - surface routes 4) Provide new intermediate /advanced trails that ease congestion on Wilderness Area trails. 5) Improve winter access and potential for new snowshoe trails at the Nordic Center 6) Support wildland fire mitigation efforts by improving access to the town's boundary, creating a ground -level fire break and even providing alternative evacuation routes in "single access" neighborhoods such as Buffehr Creek and Potato Patch. IV. TRAILS AND CONNECTIONS In some cases, these valley -floor trails and neighborhood connectors can be constructed on town -owned lands, allowing local control of the alignment and approval process. Some trails may require short crossings on Forest Service property. An initial discussion with the Forest Service in July was positive, but with work to do. The attached maps highlight some potential trails and connections. The Katsos Ranch Open Space has several long standing "social" trails currently used by hikers and bikers with possibilities for trail extensions and future connection to the Vail Trail currently located between Golden Peak and the Vail Golf Club. Other possibilities include connections between the Intermountain, Matterhorn and Lionshead neighborhoods as well as a North Trail extension to Booth Creek and a new South Trail accessed from Vail Mountain — all of which are proposed in the Comprehensive Open Lands Plan. V. IMPORTANT CONSIDERATIONS Conceptual planning of trail enhancements can be initiated by town staff with input and assistance from town residents and local trail experts and presented to the town council in the near future. This conceptual planning process would include: 1) Conceptual trail alignments and neighborhood connections 2) Planning and construction costs 3) Coordination with the U.S. Forest Service 4) Maintenance requirements and impacts 5) Connections to other communities (Minturn, Avon, Copper Mountain) 6) Construction partnerships VI. STAFF RECOMMENDATION Staff proposes that improving recreational opportunities is important to Vail's residents and guests and is consistent with adopted planning documents. Staff recommends that the Town Council consider whether or not to direct staff to initiate a planning process for trail enhancements. Town of Vail 8/5/2014 Page 2 CONCEPTS FOR TRAIL CONNECTIONS Iry r _Av �'roo r I. LL p -- o0�t TOO Blue Valley floor and neighborhood connectors Red North Trail and South Trail expansion to "Rim" or "Loop" trail Purple Future community connections Create connections between neighborhoods, existing trails and Vail Mountain trails by creating a valley -floor and neighborhood level trail system. In addition, there is the long -term potential of a full Vail "loop" or "rim" trail at higher elevations KATSOS OPEN SPACE CONCEPTS Expand existing social trails and Vail Trail to provide beginner -level hiking and biking on town -owned property Town of Vail 8/5/2014 Page 3 Discussion on Soft Surface Trails a A&A VAIL•DEAVER CREEK L'w 1 V TOWN OF VAIL Discussion on Soft Surface Trails 90 N O Gregg Barrie Landscape Architect Office: 1.9 70.4 79.233 7 Mobile: 1.9 70.390.3286 cgbarrie a), vail_gov. com Town of Vail I Public Works j 8/5/14 2 PUBLIC WORKS 90 N O Gregg Barrie Landscape Architect Office: 1.9 70.4 79.233 7 Mobile: 1.9 70.390.3286 cgbarrie a), vail_gov. com Town of Vail I Public Works j 8/5/14 2 N O Discussion on Soft Surface Trails Katsos Open Space a s if % R Vail Trail Town of Vail I Public Works l 8/5/14 �+A t ,41 Eagles Nesty'� Wilderness Trails J t 1 �tr Vail Mountain 3 Discussion on Soft Surface Trails 00 N O 'own of Vail W Town of Vail I Public Works l 8/5/14 Discussion on Soft Surface Trails N O • Adopted by the Town Council in 1994 • "...to identify and develop strategies for acquiring or protecting key remaining open lands in Vail that would be valuable for recreation, protecting sensitive environmental resources, extending or connecting trails, providing adequate neighborhood open space..." ACTDN PLAN Comprehensive Open Lands Pla • Priority #2 — Improvement of the trail and bike path system in and around ExhiSit 5 the Town. Action Plan LEGEND �P- icK I" .�.-� Town of Vail I Public Works j 8/5/14 5 Discussion on Soft Surface Trails N O A am North Trail Town of Vail I Public Works l 8/5/14 Frontage Road Widened Shoulders Discussion on Soft Surface Trails Natl6M Forest System IV O A I IIA O.i—s Trail r Natlon Booth Creek Trail Saath Tra6 Town of Vail I Public Works l 8/5/14 7 '.0 Discussion on Soft Surface Trails ❖ Provide connectivity between existing trails, neighborhoods and Vail Mountain trails by creating a valley -floor and neighborhood level trail system ❖ Provide beginner -level mountain bike trails tailored towards N beginner, first -time and youth mountain bikers as well as IR hikers seeking less strenuous soft - surface trails ❖ Explore expanded intermediate level hiking and biking trails along the north and south slopes above Vail similar to the existing North Trail ❖ Improve wayfinding through signage, maps and digital means ❖ Align with other Eagle County communities to provide a high level of county -wide soft surface trail options Town of Vail I Public Works j 8/5/14 8 90 N O Discussion on Soft Surface Trails EXISTING TRAILS _ I 4 _ 1II III Town of Vail I Public Works l 8/5/14 9 Discussion on Soft Surface Trails Q N O Town of Vail I Public Works l 8/5/14 10 A Discussion on Soft Surface Trails N O Town of Vail I Public Works l 8/5/14 M N O Discussion on Soft Surface Trails AIL "RIM TRAIL" CONCEPTS Town of Vail I Public Works l 8/5/14 CJf t .,< A. r, FF� 12 W7 Discussion on Soft Surface Trails Q N O Town of Vail I Public Works l 8/5/14 13 Discussion on Soft Surface Trails Town of Vail I Public Works l 8/5/14 14 90 N O A Discussion on Soft Surface Trails Vail Trail Extension am Town of Vail I Public Works l 8/5/14 15 90 C) Discussion on Soft Surface Trails Existing Social Trails Town ofVail I Public Works l 8/5/14 16 Discussion on Soft Surface Trails am N O Town of Vail I Public Works l 8/5/14 17 Discussion on Soft Surface Trails ❖ Beginner -level mountain bike trails •'• New hiking /trail running routes 2 rQ ❖ Additional routes for the Nordic Center Alleviate congestion on the paved recreation path + Mostly on town -owned land aA Town of Vail I Public Works j 8/5/14 18 Discussion on Soft Surface Trails 00 N O Town of Vail I Public Works l 8/5/14 19 Discussion on Soft Surface Trails CONSIDERATION •'• Planning and construction costs •'• Maintenance requirements and impacts ❖ Coordination with the U.S. Forest Service •'• Construction partnerships Town of Vail I Public Works l 8/5/14 20 92 h i c VAIL•BEAVER CREEK i�'w 1 V TOWN OF VAIL VAIL TOWN COUNCIL AGENDA MEMO MEETING DATE: August 5, 2014 ITEM /TOPIC: Information Update: 1) May 2014 Vail Business Review 2) 2014 June Sales Tax Update 3) Revenue Highlights - August 2014 4) Investment Report - 1st Quarter 2014 5) Ford Park Construction Project Update (verbal update) 6) 1 -70 Underpass Project Update ATTACHMENTS: May 2014 Vail Business Review 2014 June Sales Tax Update Revenue Highlights August 2014 Investment Report 1 st Quarter 2014 1 -70 Update Memorandum 8/5/2014 TOWN Of vn' 1[1 TOWN OF VAIL' 75 South Frontage Road west Finance Department Vail, Colorado 81657 970.479.2100 vailgov.com 970.479.2248 fax Vail Business Review May 2014 July 15, 2014 The May Vail Business Review breaks down the four percent sales tax collected for May. Overall May sales tax increased 3.1 % with Retail increasing 5.9 %, Lodging increased 5.5 %, Food and Beverage increased 2.2% and Utilities /Other (which is mainly utilities but also includes taxable services and rentals) decreased 1.6 %. Excluding the Out of Town category, sales tax for the month of May was up 3.9 %. Town of Vail sales tax forms, the Vail Business Review and the sales tax worksheet are available on the internet at www.vailgov.com. You can subscribe to have the Vail Business Review and the sales tax worksheet e- mailed to you automatically from www.vailgov.com. Please remember when reading the Vail Business Review that it is produced from sales tax collections, as opposed to actual gross sales. If you have any questions or comments please feel free to call me at (970) 479 -2125 or Judy Camp at (970) 479 -2119. Sincerely, Sally Lorton Sales Tax Administrator 8/5/2014 May TOWN OF VAIL BUSINESS REVIEW TOWN OF VAIL Sales Tax Newsletter May 2014 Sales Tax 7/14/2014 8:05:46 PM 11M/20,14,;.,, Page 1 of 2 May 2013 Collections May 2014 Collections May % Change VAIL VILLAGE Retail 42,121 48,683 15.58% Lodging 35,794 45,227 26.35% F & B 81,474 84,669 3.92% Other 1,084 891 -17.81 % Total 160,473 179,470 11.84% LIONSHEAD Retail 10,673 9,666 -9.44% Lodging 26,840 28,192 5.04% F & B 26,173 25,284 -3.40% Other 3,271 4,508 37.84% Total 66,957 67,649 1.03% CASCADE VILLAGE /EAST VAIL /SANDSTONE/WEST VAIL Retail 84,036 83,187 -1.01 % Lodging 22,710 17,987 -20.80% F & B 35,352 36,264 2.58% Other 5,191 4,647 -10.48% Total 147,290 142,086 -3.53% OUT OF TOWN Retail 62,339 69,349 11.24% Lodging 2,710 1,485 -45.20% F & B 9 0 - 100.00% Utilities & Other 123,833 121,171 -2.15% Total 188,891 192,005 1.65% 7/14/2014 8:05:46 PM 11M/20,14,;.,, Page 1 of 2 May TOWN OF VAIL BUSINESS REVIEW TOWN OF VAIL Sales Tax Newsletter May 2014 Sales Tax TOTAL Total 563,611 581,210 3.12% RETAIL SUMMARY May May May RETAIL -FOOD 2013 2014 % RETAIL - LIQUOR Collections Collections Change Retail 199,170 210,885 5.88% Lodging And Property Mgmt 88,055 92,891 5.49% Food and Beverage 143,009 146,217 2.24% Other 133,378 131,217 -1.62% Total 563,611 581,210 3.12% RETAIL SUMMARY 7/14/2014 8:05:46 PM „ 5 /2614,;.,, Page 2 of 2 May 2013 Collections May 2014 Collections May % Change RETAIL -FOOD 65,305 63,236 -3.17% RETAIL - LIQUOR 15,986 17,355 8.56% RETAIL - APPAREL 19,579 21,178 8.17% RETAIL -SPORT 17,902 22,001 22.90% RETAIL - JEWELRY 6,464 6,409 -0.84% RETAIL -GIFT 2,089 1,771 -15.21 % RETAIL - GALLERY 1,134 2,502 120.60% RETAIL -OTHER 70,496 76,432 8.42% RETAIL -HOME OCCUPATION 215 0 -100.00% Total 199,170 210,885 5.88% 7/14/2014 8:05:46 PM „ 5 /2614,;.,, Page 2 of 2 MEMORANDUM July 29, 2014 To: Vail Town Council Stan Zemler Pam Brandmeyer Judy Camp From: Sally Lorton Re: June Sales Tax I estimate Vail will collect another $44,000 in June sales tax to bring collections to $1,146,192. If so, June will be up 10.7% or $110,369 from budget and up 12% or $122,391 from June 2013. Year to date increases 8.1 % or $1,032,648 from 2013 and 6% or $775,980 from budget. 8/5/2014 Month 2003 2004 2005 2006 2007 2008 Town of Vail Sales Tax Worksheet 7/29/2014 2009 2010 2011 2012 2013 Budget 2014 Collections % Change % Change Budget from from Variance 2013 Budget January 1,997,091 2,225,841 2,275,967 2,597,985 2,783,306 2,976,655 2,619,673 2,564,383 2,795,688 2,855,524 3,145,620 3,222,713 3,481,390 258,677 10.67% 8.03% February 2,111,163 2,362,825 2,429,377 2,527,130 2,718,643 3,071,615 2,588,889 2,577,360 2,803,136 2,994,580 3,267,351 3,268,542 3,474,211 205,669 6.33% 6.29% March 2,372,942 2,344,178 2,785,101 2,852,954 2,986,446 3,327,304 2,504,567 2,685,004 3,143,418 3,185,859 3,650,157 3,507,081 3,773,172 266,091 3.37% 7.59% April 871,468 992,157 915,554 1,280,324 1,330,740 1,098,918 1,235,941 1,156,934 1,191,690 1,183,087 1,069,186 1,349,514 1,273,515 (75,999) 19.11% -5.63% May 428,919 411,595 458,770 449,283 545,874 622,103 516,150 421,925 473,292 487,739 563,602 592,713 603,885 11,172 7.15% 1.88% June 742,755 732,113 834,913 805,362 953,017 918,061 717,233 873,765 895,951 963,143 1,023,801 1,035,823 1,102,192 66,369 7.66% 6.41% Total 8,524,338 9,068,709 9, 699, 682 10, 513, 038 11, 318, 026 12 ,014,656 10,182,453 10,279,371 11,303,175 11,669,932 12,719,717 12,976,385 13,708,365 731,980 7.77% 5.64% July 1,075,532 1,128,514 1,166,183 1,255,243 1,265,781 1,397,842 1,121,860 1,228,767 1,481,329 1,573,499 1,654,161 1,587,328 August 1,029,446 994,445 993,985 1,055,614 1,162,746 1,349,795 1,068,391 1,147,352 1,310,471 1,380,710 1,507,048 1,457,262 September 679,208 757,033 795,807 832,549 908,318 834,569 753,754 761,425 889,945 978,037 994,135 999,126 October 508,092 532,537 566,173 614,396 688,519 662,767 581,033 594,362 623,420 644,577 755,133 742,761 November 591,269 623,646 713,117 799,582 747,877 719,109 651,873 701,075 788,430 825,873 947,627 878,595 December 2,171,098 2,362,095 2,549,032 2,771,258 2,821,871 2,652,628 2,553,974 2,963,763 3,184,645 2,973,826 3,422,178 3,358,544 Total 14,578,983 15,466,979 16,483,979 17,841,680 18,913,138 19,631,366 16,913,338 17,676,115 19,581,415 20,046,454 21,999,999 22,000,000 8/5/2014 TOWN OF VAIL REVENUE HIGHLIGHTS August 1, 2014 Sales Tax Upon receipt of all sales tax returns, June collections are estimated to be $1,146,192 up 12.0% from last year and up 10.7% compared to budget. Year to date collections of $13,752,365 are up 8.1% from the prior year and up 6.0% from budget. Inflation as measured by the consumer price index was up 2.1 % for June and up 1.7% for the first half of the year. The amended annual budget totals $23.1 million. Real Estate Transfer Tax (RETT) RETT collections through July 28 total $3,438,326 up 51.0% ($1.1M) from this time last year. The significant increase is mainly due to the purchase of residential properties. So far this year there have been 5 properties sold for over $10 million, 11 properties sold between $5 and $10 million and 22 properties sold between $2.5 and $5 million. These properties account for $2.0 million, or 59% of the total collections year to date. The amended annual RETT budget currently totals $4.9 million. Construction Use Tax Use Tax collections total $853,951 year -to -date compared to an amended annual budget of $1.5 million. Construction Use Tax is up 21.0% ($146,908) from collections this time last year. Summary Across all funds, year -to -date total revenue of $35.8 million is up 6.3% from the amended budget and up 11.5% from prior year, mainly due to increases in both Sales Tax and RETT collections. 8/5/2014- TOWN OF VAIL MEMORANDUM TO: Stan Zemler Council Members FROM: Kathleen Halloran DATE: 1 st Qrtr 2014 RE: Investment Report Enclosed is the investment report with balances as of March 31, 2014. The estimated average yield for the pooled cash fund is 0.75 %. As of 3/31/2014, the Treasury yield curves for 3 months, 6 months, and 1 year are 0.05 %, .07 %, and 0.13% respectively. TOV investments performed above these yields. Our investment mix follows the policy objectives of safety, liquidity, and yield in that order. 2014 Investment Mix $63.0 million Cash $20.3M, 32% C olo racte Investment Pool $11.9M, 19% Gov't Securities $18.61VI, 30% ii CD's $12.2M, 19% There were no other changes to investment products or banking institutions. Please call me if you have any questions. 8/5/2014 Town of Vail, Colorado Investment Report Summary of Accounts and Investments As of 3/31/14 Cash Commercial Banks Money Market Funds Total Cash U.S. Government Securities (see page 4) Government Agency Seurities -Piper Jaffray FNMA'S, GNMA'S, FHLMC'S & SBA'S - Dana Total Government Securities Certificates of Deposit Colorado Investment Pools Total Portfolio Maturing Within 12 Months Maturing Within 24 Months Maturing After 24 Months Investments 140331 8/5/2019 2014 Balances Percentage of Total $19,267,148 30.57% $974,807 1.55% $20,241,954 32.12% $13,076,004 20.75% $5,541,230 8.79% $18,617,234 29.54% $12,239,661 19.42% $11,919,685 18.91% $63,018,535 100.0% 37,924,606 60.18% 2,750,649 4.36% $22,343,280 35.46% 63,018,535 100.0% Performance Summary as of 3/31/2014 Institution Type of Accounts "CASH" ACCOUNTS Commercial Bank Accounts: First Bank of Vail - Operating Interest Alpine Bank Money Market Accounts: Schwab Institutional Money Market Fund - Dana Investments Interest and Balance Vail Super Now Public Funds Account - Piper Jaffray Interest and Balance Total Money Market Funds Total "Cash" Accounts GOVERNMENT SECURITIES (see pg 5) Government Agency Seurities -Piper Jaff ray FNMA'S, GNMA'S, FHLMC'S & SBA'S - Dana Total Government Securities 1st Bank, Vail Colorado ( #5734) Matures September 14, 2017 1st Bank, Vail Colorado ( #3782) Matures Nov 17, 2014 1st Bank, Vail Colorado ( #5114) Matures March 27, 2017 1st Bank, Vail Colorado (#4983) Matures March 6, 2017 1st Bank, Vail Colorado ( #1992) Matures Nov 23, 2015 1st Bank, Vail Colorado ( #3421) Matures Mar 17, 2016 1 st Bank, Vail Colorado ( #4290) Matures Sept 29, 2016 1 st Bank, Vail Colorado ( #4754) Matures Dec 28, 2016 1st Bank, Vail Colorado ( #5319) Matures May 19, 2014 Piper Jaffray 36161 NXR4 Matures Apr. 20, 2015 Piper Jaffray 2546704RO Matures Mar 14, 2017 Piper Jaffray 02005QZZ9 Matures Mar 28, 2016 Piper Jaffray 795450PJ8 Matures Sept 19, 2017 Piper Jaffray 38143AJM8 Matures Feb 8, 2017 Alpine Bank, Vail Colorado ( #83597) Matures Sept 11, 2014 Alpine Bank, Vail Colorado (#43763) Matures Nov 13, 2014 Total Certificates of Deposit LOCAL GOVERNMENT INVESTMENT POOLS Colotrust General Fund Interest Total Local Government Investment Pools Accounts Total All Accounts Investments 140331 8/5/2014 Average Balances Return 03/31/14 0.200% $18,544,360 $722,787 0.010% $893,594 0.000% $81,213 $974,807 $20,241,954 1.15% $ 13,076,004 1.19% $ 5,541,230 $ 18,617,234 $ 18,617,234 1.200% 1,018,605 1.500% 1,043,679 1.300% 1,055,388 1.300% 1,027,157 2.000% 1,081,960 2.500% 1,078,046 1.750% 1,044,452 1.750% 1,039,994 0.600% 1,516,904 1.050% 100,405 1.450% 101,790 1.200% 101,306 1.600% 100,881 1.700% 101,427 0.459% 665,560 3.440% 1,162,108 12,239,661 $ 12,239,661 0.010% $11,919,685 $11,919,685 $63,018,535 Government Securities as of 3/31/2014 Days /Years Int Rate Purchase Maturity to Maturity Market Agency Broker Coupon Yield Date Date at Purchase Value ** *Federal Agency Discount Notes & Bonds * ** FNMA 3136FTEK1 Piper Jaffray 1.500% 1.490% 10/24/2011 10/28/2016 5.0 $0 FNMA 3136GOER8 Piper Jaffray 1.150% 1.150% 1/18/2012 5/9/2017 5.3 $800,864 FFCB 3133EAF86 Piper Jaffray 0.980% 0.980% 1/19/2012 8/7/2017 5.6 $992,490 FFCB 3133ECWK6 Piper Jaffray 1.330% 1.330% 1/19/2012 8/7/2017 5.6 $225,484 FFCB 3133EAK49 Piper Jaffray 0.990% 0.990% 1/20/2012 8/15/2017 5.6 $496,205 FNMA 3135GONRO Piper Jaffray 1.110% 1.110% 1/21/2012 8/28/2017 5.6 $498,420 FNMA 3136GOZG9 Piper Jaffray 1.160% 1.160% 1/22/2012 8/28/2017 5.6 $497,990 FHLM 3134G3J43 Piper Jaffray 1.050% 1.050% 1/23/2012 9/27/2017 5.7 $396,128 FNMA 3135GOPHO Piper Jaffray 1.010% 1.010% 1/24/2012 9/27/2017 5.7 $495,370 FNMA 3135GOPL1 Piper Jaffray 1.060% 1.060% 1/25/2012 10/4/2017 5.7 $495,560 FHLB 3133813R4 Piper Jaffray 1.020% 1.020% 1/26/2012 11/9/2017 5.8 $491,570 FFCB 3133EC5A8 Piper Jaffray 0.890% 0.890% 1/28/2012 11/27/2017 5.8 $491,800 FFCB 3133EC7134 Piper Jaffray 0.860% 0.860% 1/29/2012 12/13/2017 5.9 $588,990 FHLB 313383DQ1 Piper Jaffray 1.020% 1.020% 1/29/2012 12/18/2017 5.9 $392,868 FNMA 3136G13C1 Piper Jaffray 0.760% 0.760% 1/30/2012 12/19/2017 5.9 $495,665 FNMA 3136G16W4 Piper Jaffray 0.660% 0.660% 1/31/2012 12/27/2017 5.9 $248,043 FHLB 313381RE7 Piper Jaffray 1.020% 1.020% 2/1/2012 1/30/2018 6.0 $491,165 FHLB 313381SP1 Piper Jaffray 1.070% 1.070% 2/1/2012 1/30/2018 6.0 $492,025 FNMA 3136G 1 K57 Piper Jaffray 1.120% 1.130% 2/2/2012 4/30/2018 6.2 $539,105 FHLB 313382GQO Piper Jaffray 1.070% 1.090% 2/2/2012 3/20/2018 6.1 $486,010 FHLM 3134G45D6 Piper Jaffray 1.150% 1.160% 2/2/2012 5/25/2018 6.3 $979,340 FHLB 313383HQ7 Piper Jaffray 1.210% 1.220% 2/2/2012 6/27/2018 6.4 $612,746 FHLB 313383JQ5 Piper Jaffray 1.270% 1.280% 2/2/2012 6/27/2018 6.4 $323,941 FHLB 3130A04A5 Piper Jaffray 2.040% 2.050% 2/2/2012 10/2/2018 6.7 $550,396 FHLM 3134G4KK3 Piper Jaffray 1.750% 1.780% 2/2/2012 11/27/2018 6.8 $496,500 FHLM 3134G4KZO Piper Jaffray 1.800% 1.820% 2/2/2012 11/27/2018 6.8 $497,330 - Dana 5.120% Average Yield 14- May -08 1- Apr -33 1.15% $48,651 $13,076,004 Days /Years Interest Rate Purchase Maturity to Maturity Market Agency Broker Coupon Yield Date Date at Purchase Value * * *FNMA'S, ARM'S & SBA'S * ** SBA 502647V -Q SBA 508940 SBA 508946 SBA 505536V -M Pooled Pooled Pooled Pooled - Dana - Dana - Dana - Dana 3.975% 2.575% 2.250% 3.125% 3.9% 2.4% 2.2% 2.9% 1- Jul -94 6- May -11 1- Jan -12 1- Aug -01 25- Jun -19 25- Jun -30 25- Jul -30 25- Jun -26 25.0 19.2 18.6 24.9 $5,422 $278,644 $175,266 $20,469 GNMA 8417 Pooled - Dana 5.125% 3.8% 1- Oct -88 20- Oct -18 30.1 $1,224 GNMA 8703 Pooled - Dana 4.750% 1.6% 1- Sep -95 20- Sep -25 30.1 $706 GNMA 8720 Pooled - Dana 5.125% 1.6% 30- Sep -95 20- Oct -25 30.1 $824 GNMA 8788 Pooled - Dana 5.375% 1.6% 1- Jan -96 20- Jan -26 30.1 $575 GNMA 80426 Pooled - Dana 4.500% 1.6% 21- Jul -00 20- Jul -30 30.0 $5,715 GNMA 80696 Pooled - Dana 3.375% 1.6% 23- May -11 20- May -33 22.0 $240,658 GNMA 80710 Pooled - Dana 5.625% 1.6% 1- Jul -03 20- Jul -33 30.1 $6,282 GNMA 82759 Pooled - Dana 2.500% 2.4% 20- Mar -12 20- Mar -41 29.0 $300,968 GNMA 80593 Pooled - Dana 1.750% 1.6% 20- Apr -12 20- Apr -32 20.0 $3,144 GNMA 82382 Pooled - Dana 2.690% 2.4% 30- Sep -13 20- Sep -39 26.0 $142,211 GNMA 1303 Pooled - Dana 2.000% 1.9% 30- Sep -13 20- Sep -43 30.0 $252,354 FNMA 850125 Pooled - Dana 5.146% 2.2% 1- May -09 1- Sep -35 26.4 $43,495 FNMA 422251 Pooled - Dana 5.589% 2.3% 1- Dec -95 1- Jan -21 25.1 $11,821 FNMA 334439 Pooled - Dana 6.200% 2.3% 1- Dec -95 1- Apr -24 28.4 $3,669 FNMA 520790 Pooled - Dana 6.077% 2.3% 1- Jun -00 1- Apr -28 27.9 $5,007 FNMA 546468 Pooled - Dana 5.563% 2.2% 24- May -00 1- Jun -28 28.0 $2,232 FNMA 535326 Pooled - Dana 5.263% 2.1% 26- Jun -00 1- Jun -28 28.0 $2,840 FNMA 323798 Pooled - Dana 5.749% 2.2% 1- Dec -99 1- May -29 29.4 $1,054 FNMA 567875 Pooled - Dana 6.336% 2.5% 1- Dec -00 1- Sep -30 29.8 $1,635 FNMA 593941 Pooled - Dana 6.010% 1.8% 1- Dec -01 1- Dec -30 29.0 $5,345 FNMA 545057 Pooled - Dana 5.487% 2.2% 1- May -01 1- May -31 30.0 $434 FNMA 650970 Pooled - Dana 5.118% 8/5/20240% 1- Aug -01 1- Jul -32 30.9 $2,586 FNMA 555378 Pooled - Dana 5.120% 2.1% 14- May -08 1- Apr -33 24.9 $48,651 Investments 140331 Government Securities as of 3/31/2014 8/5/2014 Total $18,617,234 Investments 140331 Days /Years Int Rate Purchase Maturity to Maturity Market Agency Broker Coupon Yield Date Date at Purchase Value FNMA 709092 Pooled - Dana 5.085% 2.2% 1- Jun -03 1- Jun -33 30.0 $11,415 FNMA 723661 Pooled - Dana 5.025% 2.1% 1- Jul -03 1- Jul -33 30.0 $1,543 FNMA 761737 Pooled - Dana 6.488% 2.3% 16- May -05 1- Dec -33 28.6 $8,933 FNMA 725462 Pooled - Dana 5.688% 1.8% 1- Apr -04 1- Jan -34 29.8 $10,308 FNMA 745160 Pooled - Dana 5.763% 2.2% 1- Dec -05 1- Mar -34 28.3 $20,665 FNMA 791573 Pooled - Dana 5.057% 2.2% 1- Jul -04 1- Aug -34 30.1 $3,345 FNMA 888321 Pooled - Dana 5.737% 2.2% 1- Mar -07 1- Aug -34 27.3 $21,954 FNMA 849207 Pooled - Dana 6.340% 1.8% 1- Jan -06 1- Jan -36 30.0 $9,835 FNMA 888710 Pooled - Dana 5.374% 2.3% 1- Sep -07 1- Jul -36 28.9 $28,941 FNMA 893933 Pooled - Dana 5.209% 2.3% 1- Sep -06 1- Oct -36 30.1 $12,460 FNMA 555624 Pooled - Dana 5.366% 2.2% 1- Jun -03 1- Mar -38 34.8 $4,101 FNMA 735967 Pooled - Dana 6.107% 2.2% 1- Sep -05 1- Mar -38 32.5 $8,580 FNMA 888386 Pooled - Dana 5.623% 2.3% 1- Apr -07 1- Mar -38 30.9 $55,403 FNMA 888618 Pooled - Dana 5.799% 2.2% 1- Jul -07 1- Mar -38 30.7 $16,930 FNMA 995451 Pooled - Dana 4.581% 2.2% 12- Feb -09 1- May -38 29.2 $42,664 FNMA 557073 Pooled - Dana 4.255% 1.5% 1- Sep -00 1- Jun -40 39.8 $4,342 FNMA 110540 Pooled - Dana 5.150% 2.9% 1- Nov -90 1- May -20 29.5 $3,703 FNMA 327446 Pooled - Dana 5.747% 2.5% 1- Oct -95 1- Aug -22 26.9 $2,094 FNMA 555921 Pooled - Dana 3.000% 2.7% 1- Sep -12 1- Sep -35 23.0 $21,159 FNMA 868877 Pooled - Dana 5.191% 2.3% 1- Apr -06 1- Apr -36 30.0 $7,943 FNMA 701045 Pooled - Dana 4.830% 2.3% 1- Apr -03 1- Apr -33 30.0 $62,140 FNMA 848390 Pooled - Dana 3.755% 1.8% 12- Feb -09 1- Dec -35 26.8 $27,468 FNMA 844148 Pooled - Dana 3.183% 2.0% 1- Oct -05 1- Nov -35 30.1 $22,276 FNMA 748087 Pooled - Dana 2.585% 2.2% 1- Sep -10 1- Sep -33 23.0 $58,047 FNMA 851297 Pooled - Dana 2.604% 2.3% 3- May -11 1- Sep -35 24.3 $248,521 FNMA AC0038 Pooled - Dana 2.355% 1.9% 24- May -11 1- Sep -38 27.3 $197,208 FHLMC 775572 Pooled - Dana 5.594% 3.1% 1- Sep -94 1- Jun -24 29.8 $7,538 FHLMC 865469 Pooled - Dana 6.440% 2.8% 1- Dec -95 1- Aug -25 29.7 $432 FHLMC 755344 Pooled - Dana 5.160% 2.3% 1- May -00 1- Mar -28 27.9 $1,486 FHLMC 645235 Pooled - Dana 6.340% 2.2% 1- Jul -00 1- Mar -29 28.7 $2,186 FHLMC 846784 Pooled - Dana 5.576% 2.2% 1- Jul -00 1- May -29 28.9 $1,376 FHLMC 786867 Pooled - Dana 5.970% 2.4% 1- Nov -99 1- Aug -29 29.8 $15 FHLMC 846956 Pooled - Dana 6.446% 2.4% 1- Nov -01 1- Nov -31 30.0 $1,358 FHLMC 847166 Pooled - Dana 5.092% 2.3% 1- Jul -03 1- Aug -33 30.1 $4,016 FHLMC 847359 Pooled - Dana 6.072% 2.3% 1- Dec -04 1- Dec -34 30.0 $3,890 FHLMC 782526 Pooled - Dana 4.509% 2.1% 1- Apr -05 1- Apr -35 30.0 $57,045 FHLMC 848000 Pooled - Dana 4.665% 2.2% 1- Sep -08 1- Feb -36 27.4 $52,579 FHLMC 847629 Pooled - Dana 6.092% 2.3% 1- Oct -06 1- Sep -36 29.9 $14,195 FHLMC 865006 Pooled - Dana 6.935% 2.9% 1- Feb -89 1- Aug -18 29.5 $103 FHLMC 865127 Pooled - Dana 3.130% 3.2% 1- Aug -89 1- Mar -19 29.6 $965 FHLMC 865476 Pooled - Dana 6.082% 2.8% 1- Apr -96 1- Feb -36 39.9 $503 FHLMC 865663 Pooled - Dana 6.040% 3.0% 1- Nov -00 1- Feb -30 29.3 $2,794 FHLMC 765114 Pooled - Dana 6.963% 4.4% 1- Mar -99 1- Jan -18 18.9 $895 FHLMC 847427 Pooled - Dana 5.264% 2.3% 1- Jul -05 1- Sep -34 29.2 $4,823 FHLMC 1G1840 Pooled - Dana 5.315% 2.2% 1- Feb -06 1- Nov -35 29.8 $12,300 FHLMC 1B3063 Pooled - Dana 5.553% 2.3% 1- Aug -06 1- Aug -36 30.0 $21,160 FHLMC 847058 Pooled - Dana 5.181% 2.3% 1- Aug -02 1- Aug -32 30.0 $19,826 FHLMC 187033 Pooled - Dana 2.846% 2.2% 25- May -11 1- Sep -35 24.3 $169,211 FHLMC 611384 Pooled - Dana 6.953% 2.3% 11- Feb -05 1- Dec -32 27.8 $8,585 TSY 912828EA4 1.875% 1.5% 16- May -13 15- Jul -15 2.2 $315,272 TSY912828KM1 1.250% 1.1% 30- Jun -12 15- Apr -14 1.8 $221,533 TSY 912828CP3 2.000% 1.6% 30- Jun -12 15- Jul -14 2.0 $252,394 TSY 912828MY3 0.500% 0.5% 15-Apr-1 5 2.0 $275,371 FNMA Fixed rate agency 3135GOHG1 0.375% 0.4% 1- Jan -12 16- Mar -15 3.2 400,784 FNMA Fixed rate agency 3136G1V89 1.050% 1.0% 30- Sep -13 30- Sep -16 3.0 $301,257 FHLB Fixed rate agent 313382MX8 0.600% 0.6% 10- Apr -13 10- Apr -18 5.0 $495,596 FNMA Fixed rate agency 3134G3PD6 0.550% 1.0% 31- Dec -11 27- Feb -15 3.2 $399,600 Accrued Interest 1.2% $12,284 Income Receivable $4,651 Average Yield 1.19% 5,541,230 8/5/2014 Total $18,617,234 Investments 140331 0 rowN of vain Memorandum To: Town Council From: Public Works Department Date: 8 -5 -14 Subject: 1 -70 Vail Underpass Project Update I. BACKGROUND On July 15th, Town staff presented an update to the design progress of the 1 -70 Vail Underpass Project, highlighting the changes since endorsement of a preferred conceptual location on May 6th. See attached Memo from July 15th The changes provide safety and traffic operation improvements resulting in slower roundabout entrance vehicle speeds meeting the CDOT /FHWA Roundabout design guidelines. The changes also allow all truck types to make all turning movements. Although this initially was not felt to be a necessary criteria since large over the road semi - trailers do not generally travel along this stretch of Frontage Road; it is ultimately a beneficial design to be able to accommodate all trucks, this way any errant trucks that may have ignored potential posted restrictions would not get stuck and potentially shut down the underpass. The changes also reduce bridge structure length and overall construction costs as well as future maintenance costs despite an increase in retaining walls on the south side. The new location also avoids the existing wetlands on the south side. After Council discussion at the July 15th work session, staff was directed to continue with the design as presented paying specific attention to the mitigation of impacts to adjacent neighbors, specifically looking at; • Minimizing the encroachment towards Savoy Villas at the flare of the westbound exit of the North roundabout • Mitigating the headlight impact to the residence to the south along the south roundabout • Mitigating and screening the aesthetics of the south roundabout walls from the residence to the south Since that time the Town has received specific comments from the owner of the residence south of the south roundabout regarding proximity of the currently proposed location to his residence and Gore Creek. The attached exhibit shows the varying distances of the proposed 7 degree skewed underpass, and an 18 degree and 27 8/5/2014 degree skew which do not meet the requirements for the Roundabout design guidelines for vehicle fastest path, nor do they allow all truck turning movements, and will encroach into the exiting wetlands. II. NEXT STEPS The design team will continue to move forward in preliminary design and the environmental analysis thru this fall. During preliminary design and the environmental analysis the design team will more thoroughly vet the design solution, including but not limited to; • Further refining the horizontal and vertical design layout as necessary, • Determining the best horizontal and vertical design location; finding the `best fit' with emphasis on reducing encroachment and impacts on private property, Gore Creek, and mitigating visual impacts. • Structural selection for bridges and retaining walls. Taking into account structural needs, impacts, aesthetics, and wall heights. • Project mitigation measures for adjacent properties and other sensitive areas such as wetlands and Gore Creek in close proximity to the proposed project related to environmental impacts, including Visibility, Noise, Aesthetics, Lighting, Air and Water Quality. • A 3D interactive rendering to be prepared and presented to the public at a future Town Council meeting and Open house this fall. This model will allow the public to visualize the underpass and how impacts may be mitigated. III. PROJECT PROGRESS SCHEDULE As we continue thru this collaborative process the following is a list of key design milestones and more formal public input opportunities anticipated to occur during the design process. As this process is dynamic these dates will fluctuate as the project develops; September 2014 Town Council Update (Preliminary Design Complete) September 2014 Open House October 2014 General Contractor Selected for Pre Construction Services October 2014 Town Council Update (Environmental Clearance Update) March 2015 Town Council Update (Final Design Complete) March 2015 Open House (Final Design) March 2015 -Jan. 2016 Right of Way plans and property acquisition process January 2016 Final Environmental Clearance (FHWA) March -April 2016 Construction Documents, Bid & Award, Open House May 2016 -Dec. 2017 Construction As the project progresses public input will be taken continuously thru the project website at www.vailgov.com /underpass and thru specific stakeholder meetings and correspondence. Town of Vail 8/5/2014 Page 2 IV. ATTACHMENTS July 15th Council Memo South Roundabout Locations Comparison South Roundabout Cross Section Town of Vail 8/5/2014 Page 3 00 N O a M O L W O 0 3 N i O 0 N 79.- �-i y� �" s n - " III I �,V!'`��ti`�os � �1.1�3i,•a.a • f� +�+e,�4'_ + 1 !' ' - � III y�i • �r j 11j q1 t III i r _ 111 I — — —J, r 2531 .0 ! R III; ► 'I `�- ',.. 0. PLAN Print Date: 7 /31/2014 Sheet Revisions As Constructed I -70 VAIL UNDERPASS Project No. /Code File Name: 19094DES —South Residence Skew Options Exhibit 07 114.dgn Date: Comments Init. Colorado Department of Transportation RESIDENCE Horiz. Scale: 1:40 Vert. Scale: As Noted No Revisions: SKEW COMPARISON STA- 0702 -327 ,F 714 Grand Avenue, P.O. Box 298 6300 South Syracuse way Q Eagle, CO 81631 Designer: Structure • Revised: 19094 FELSBURG Suite 600 ,4 Phone: 970 - 328 -6385 FAX: 970 - 328 -2368 Detailer: Numbers H O L T & Centennial, CO 80111 ULLEVIG (303)721 -1440 TOWN OF VAIl. Region 3 MLM Void: Sheet Number Q g Sheet Subset: Subset Sheets: 00 Ln N O 0 a M r O W d Ir a M N 8100 8050 hl NI 1( 111 1/ r _ Il I l l 11/ 11 /// /! N/ PLAN } o' 10' 20' 40' + ` r 8150 8100 8050 8000 1 1 1 1 1 8000 0 +00 1 +00 2 +00 3.00 4 +00 5 +00 PROFILE Print Date: 7 /31/2014 Sheet Revisions As Constructed I -70 VAIL UNDERPASS Project No. /Code File Name: 19094DES —South Residence Exhibit 073114.dgn Date: Comments Init. CO�OrddO Department of Transportation RESIDENCE Horiz. Scale: 1:40 Vert. Scale: As Noted 714 Grand Avenue, P.D. Box 298 No Revisions: PROFILE VIEW STA- 0702 -327 6300 South Syracuse way Q Eagle, CO 81631 Designer: Structure • Revised: 19094 FELSBURG Suite 600 O 4 Phone: 970 - 328 -6385 FAX: 970 - 328 -2368 Detailer: Numbers H O L T & Centennial, CO 80111 qULLEVIG (303)721 -1440 TOWN t7F VAIl. Re ion 3 MLM Void: Sheet Number Q g Sheet Subset: Subset Sheets: TOWN OF 0 VAIL � Memorandum To: From: Date: Subject Town Council Public Works Department 7 -15 -14 1 -70 Vail Underpass Project Update BACKGROUND The 1 -70 Vail Underpass is a proposed new multimodal pedestrian and vehicular connection that is midway between Main Vail and West Vail exits, passing under 1 -70. This underpass has been identified in the Vail Transportation Master Plan (VTMP) and the CDOT 1 -70 Programmatic Environmental Impact Statement (PETS) as a critical link between the North and South Frontage Road. The Town and CDOT have recently entered into a Letter of Commitment and an Inter - Governmental Agreement (IGA) to jointly fund the design and construction of this project with an expected completion date of December of 2017. CDOT, the Town of Vail, and the selected design consultant, Felsburg, Holt & Ullevig (FHU), have begun the preliminary design process based on the recently endorsed preferred location of the underpass. For reference each of the past Town Council presentations and Council meeting video links along with additional project information is available at the project website at www.vailgov.com /underpass At the May 6t" Town Council meeting, the design team presented four specific underpass intersection configuration concepts including; • T Intersection with WB Bypass / T Intersection with EB Bypass • T Intersection with WB Bypass / Single Lane Roundabout w/ Aux. Lane Single Lane Roundabout w/ Aux. Lane / Single Lane Roundabout w/ Aux. Lane Compact Roundabout configuration / Single Lane Roundabout w/ Aux. Lane After much discussion with Council and the public the Compact Roundabout concept configuration was recommended and endorsed. The purpose of this Council session is to provide an update on the design and the schedule. DESIGN UPDATE Since the last Council session in May where the Compact roundabout concept design was endorsed the design team has progressed into preliminary design. Over the past 2 months the design team has updated the compact roundabout underpass concept to a preliminary design level. At this design level the following were considered in more 8/5/2014 detail; vehicle fastest path, detailed truck turning movements, bridge structure lengths, retaining wall heights, wetland delineations, and the previous Council and Public discussions and endorsements. As a result the following design updates have been made; • North Roundabout remained at the preferred west location, previously identified in May as "Compact Roundabout — Location 1" • North Roundabout increased in size slightly from 107.5' to 110' in diameter, the additional couple of feet was pushed toward the interstate. • South Roundabout moved approximately 100' to the west and decreased from 130' to 110' in diameter; this reduces the underpass skew from 27 degrees to 7 degrees, a desirable design consideration. The above changes provide safety and traffic operation improvements resulting in slower entrance vehicle speeds and it allows all trucks to make all turning movements. It reduces bridge structure width and costs, requires an increase in retaining walls on the south side, but avoids the existing wetlands on the south side. NEXT STEPS The design team will continue to move forward in preliminary design and the environmental analysis. During preliminary design and the environmental analysis the design team will more thoroughly vet the design solution, including but not limited to; • Further refining the horizontal and vertical design layout as necessary, • Determining the best horizontal and vertical design location; finding the `best fit' with emphasis on reducing encroachment and impacts on private property, and mitigating visual impacts. • Structural selection for bridges and retaining walls. Taking into account structural needs, impacts, and aesthetics. • Project mitigation measures for adjacent properties in close proximity to the proposed project related to environmental impacts, including Visibility, Noise, Aesthetics, Lighting, Air and Water Quality. • A 3D interactive rendering to be prepared and presented to the public at a future Town Council meeting and Open house this fall. This model will allow the public to visualize the underpass and how impacts may be mitigated. IV. PROJECT PROGRESS SCHEDULE As we continue thru this collaborative process the following is a list of key design milestones and more formal public input opportunities anticipated to occur during the design process. As this process is dynamic these dates will fluctuate as the project develops; July 2014 September 2014 September 2014 October 2014 Town of Vail Town Council Update (Design Progress Update) Town Council Update (Preliminary Design Complete) Open House General Contractor Selected for Pre Construction Services 8/5/2014 Page 2 LVA October 2014 Town Council Update (Environmental Clearance Update) March 2015 Town Council Update (Final Design Complete) March 2015 Open House (Final Design) March 2015 -Jan. 2016 Right of Way plans and property acquisition process January 2016 Final Environmental Clearance (FHWA) March -April 2016 Construction Documents, Bid & Award, Open House May 2016 -Dec. 2017 Construction As the project progresses public input will be taken continuously thru the project website at www.vailgov.com /underpass and thru specific stakeholder meetings and correspondence. 611I F_1aAV*6001►Til►Yi140Uy- AI Is] LI No action is required of Town Council at this time. VI. ATTACHMENTS Updated Preliminary Design Layout and Comparison Town of Vail 8/5/2014 Page 3 H O ERG 1 -70 Vail Underpass GHD Design - 7/3/2014 IA cn _ # - A \7! 1 , .> COIONA ©O TOWN OF YA l (FELSBURG iVULLEVIG HOLT 1 -70 Vail Underpass �� ■ Compact Roundabout #1 (May 2014) ■ Latest Design (July 2014) ter, � � • { 0' 50' 100' 200' _ - _ j 3,' +i d�`'. '� }►y.�. F jag I • 9 -- eaLarznoo mnegartment of SIM �1 ,v o� s Aw _ r i i 44 ,.. TOWN OF VAll� I rowH Of vn �ii> VAIL TOWN COUNCIL AGENDA MEMO MEETING DATE: August 5, 2014 ITEM /TOPIC: Matters from the Mayor, Council and Committee Reports. 8/5/2014 rowH Of vn �ii> VAIL TOWN COUNCIL AGENDA MEMO MEETING DATE: August 5, 2014 ITEM /TOPIC: Executive Session, pursuant to: 1) C.R.S. §24- 6- 402(4)(a)(b)(e) - to discuss the purchase, acquisition, lease, transfer, or sale of property interests; to receive legal advice on specific legal questions; and to determine positions, develop a strategy and instruct negotiators, Regarding: Consideration by Council of the proposed Development Agreement and Ground Lease for the redevelopment of the Timber Ridge Property. PRESENTER(S): Matt Mire, Town Attorney 8/5/2014 rowH Of vn �ii> VAIL TOWN COUNCIL AGENDA MEMO MEETING DATE: August 5, 2014 ITEM /TOPIC: Adjournment( estimated 4:10 p.m.) NOTE: UPCOMING MEETING TOPICS AND ESTIMATED TIMEFRAMES BELOW (ALL ARE APPROXIMATE DATES AND TIMES AND SUBJECT TO CHANGE) THE NEXT REGULAR VAIL TOWN COUNCIL MEETING WORK SESSION WILL BEGIN AT APPROXIMATELY 12:30 P.M. (or TBD), TUESDAY, AUGUST 19, 2014 IN THE VAIL TOWN COUNCIL CHAMBERS FUTURE AGENDA ITEMS: Ongoing agenda items DRB /PEC updates WS - 15 min.; Information Updates Attachments: WS - 15 min.; Executive Session items: 30 min.; Consent Agenda: 5 min.; Town Manager Report: 5 min. Other agenda items: Sustaining Vail's Economic Health - WS - 8/19 Meet with Eagle County School District (Superintendent and Board Members) - WS 8/19 Half Day Retreat Define Balanced Community - WS - 9/2 Discussion of Parking & Transportation - WS - 9/2 VVMC Master Plan Discussion - WS - 9/16 Discussion of Five Year Capital & RETT Plans - WS - 9/16 Special VLMD Work Session Meeting for 2015 Operating Plan and Budget - 9/16 Half Day Retreat w/ VLHA - WS - 10/7 Discussion on Town Manager's Budget (Final Draft) - WS - 10/7 Discussion on Adoption of Strategic Competitiveness Plan - WS - 10/21 Quarterly Status Report on Capital Projects & Programs (Info Update) - WS - 10/21 First Reading of Ordinance Budget Adoption - ES - 10/21 VLMD Budget Resolution - 10/21 Discussion on Aspen Report & Follow up - WS - 11/4 Second Reading of Ordinance Budget Adoption - ES - 11/4 Discussion on Technology - WS - 11/4 Meet with Avon Town Council - TBD Investment Policy Update ES - TBD 1 -70 Vail Underpass Traffic Analysis Update - ES - TBD Clean Up Title 12 Ordinance - TBD Plastic bags - TBD Village Information Center - Greg - TBD Fee Schedule changes - George - TBD Housing Strategic Plan - George - TBD 2015 WAC updates (construction restrictions, legacy program) - WS - TBD Sister City discussion - TBD Discussion of future of RSES - TBD Streaming PEC & DRB - TBD VLMD Term limits - TBD Walking Mountains zero waste program presentation - TBD 8/5/2014