Tower Contract Approved

Kenneth A. Black, Airport Director for the City of Manhattan gave his last Power Point presentation Tuesday night. After seven years here Black is taking up the Ministry full time. At Tuesday's meeting Black asked the Commission to approve the Air Traffic Control Tower Federal Contract Tower Agreements

The contracts were approved 5-0. Here is a memo given to the Commission:


Construction of the new Air Traffic Control Tower is underway and on schedule. It should be completed in May 2002. On December 20, 2001, the President signed the 2002 Department of Transportation Appropriations bill (HR2299). This legislation fully funds the Federal Contract Tower Cost Sharing Program for Federal FY2002.

At present, Midwest Air Traffic Control (ATC) Services, Inc is still operating as a non-Federal air traffic control tower facility. The City has an agreement with Midwest ATC to provide the facility and the service through January 31, 2002. With Federal funding now in-place, the FAA is now prepared to transition the service to the Federal Contract Tower Cost Sharing Program for 2002 effective February 1, 2002.


The City will need to use the Midwest ATC facility through May 2002 to continue ATC services. In May, the City should occupy the new facility, and transition ATC services to that facility. An agreement with Midwest ATC has been drafted for the use of that facility and its equipment through May 2002 (see Enclosure 1). Monthly rent for the use of the facility and equipment is $2,500.00 per month.

The enclosed Federal Aviation Administration (FAA) agreement establishes the cost share ratio for the City and the FAA. It states that the FAA shall pay the contractor (Midwest ATC) 46% of the Federal contract amount in FY2002, and the City shall pay the remaining percentage of the contract amount. The contractor shall invoice the City monthly for its share, and a separate agreement with the contractor is included as Enclosure 3. In return, the contractor will provide ATC services 14-hours daily between the hours of 7:00 AM and 9:00 PM[kb1].

As mentioned in previous memorandums to the governing body, the Airport Department has budgeted $177,000.00 for ATC services and facilities. The City also intends to buy-out AERGO, Inc (the Air Traffic Control Tower developer) at the close of construction with a municipal lease purchase for the new facility. The anticipated costs for the contracts discussed herein are as follows:

January 2002 Service and Facility fee to Midwest ATC $9,575.00

Midwest ATC Facility Lease (4 months)


City Cost Share for ATC Services (Federal FY2002, Feb - Sep) $78,624.00

City Cost Share for ATC Services (Federal FY2003, Oct - Dec) $18,746.50

New ATCT Facility Municipal Lease Purchase (7 months) $45,029.25

2002 ATC Expense (Total) $161,974.75

As you can see in the table, the cost share ratio changes in Federal FY2003. The City Commission was previously advised that the criteria used to determine the benefit-cost ratio in the Federal program the second year improves the City’s position. Beginning October 2003, the FAA should pay the contractor 67.4% of the contract amount, and the City pays the balance. The FAA cost share agreement changes according to the benefit-cost ratio each Federal fiscal year. So, as air traffic continues to increase, the City’s cost share should decrease.