Township of Georgian Bluffs Committee of the Whole Agenda

Transcription

1 Township of Georgian Bluffs Committee of the Whole Agenda This document can be made available in other accessible formats or with communications supports as soon as practicable and upon request. December 12, 2016, 7:00 p.m., Council Chambers 1. Call to Order 2. Declaration of Pecuniary Interest and the General Nature Thereof 3. Delegations or Deputations (if required) a) Christian Perreault, Explorer Solutions Wiarton-Keppel International Airport Economic Impact and Feasibility Study Executive Summary Final Report 4. Public Question Period 5. Adjournment Page 1 of 1

2 Final Report Economic Impact and Feasibility Study for WIARTON-KEPPEL INTERNATIONAL AIRPORT Presented to The Township of Georgian Bluffs December 8, 2016

3 Notice of Confidentiality The content of the present report is private and confidential and cannot be reproduced, in full or in part, except with the consent of the Township of Georgian Bluffs. The recipient promises to preserve the confidential nature of the information contained in the present document and will take all necessary actions to prevent non-authorized copying, divulgation or transmission, in part or in full, of this information to unintended parties. 1494, Montarville St, Suite 205, Saint-Bruno-de-Montarville, QC J3V 3T5 2

4 Table of Contents Table of Contents... 3 Executive Summary Introduction Review of Past Studies Wiarton Airport Business Plan Part I Current State of the Airport s Lands, Infrastructure and Operations Existing Airfield Runways, Taxiways, and Aprons Runways Runway Taxiway/Aprons Hangar Area Pavement Runways, Taxiways, and Aprons Pavement Assessment Summary Airfield Lighting VOR/DME Existing Groundside Access Roads Parking Services Water Sewer Electrical Natural Gas Environmentally Sensitive Areas Existing Buildings Internal Review Field Review Manual Library Overview Key Findings and Recommendations Airport Activity Air Traffic Movements Private and Corporate Tenants Economic Impact of the Airport Airport Activity Measuring Economic Activity Current Economic Impacts Summary Airport Benchmarking Analysis Airport Positioning and Strategy Review of Airport Commercial Tenants Marketing Strategies

5 3.2. Revenue Generation Sources Parking and Landing Fees Land Lease ($/sq. ft. per year) Hangar Lease Other Sources of Revenue Land Number of Available Lots / Zoning Concluding Remarks and Recommendations Section 1: Airport Positioning, Economic Drivers and Strategy Section 2: Revenue Generation Sources Section 3: Land Part II Consultation Sessions Return on the 1on1 Interviews and Focus Group Sessions Focus Groups One-on-One Meetings Validation of Potential Growth Opportunities for YVV Retained Opportunities Evaluation of Aviation Opportunities Evaluation of Non-Aviation Opportunities Non-retained Opportunities Evaluation of Aviation Opportunities Commercial Air Services UBER ORNGE MRO Operator Evaluation of Non-Aviation Opportunities Conclusion Industry Survey Results Key Identified Trends Key Identified Issues Considered Factors for Expansion or Relocation of Activities Ontario s Business Environment Perception of the Wiarton Airport Part III Vision and Mission of the Airport Mission Vision Proposed Development Concepts Development Concept A Agro-Food Incubator and Experimental Farm Concept Presentation Positioning Markets and Clienteles Development Site and Building Requirements

6 Development Timeframe Capital Requirements, Cost and Revenue Assumptions Financial Projections Development Concept B General Aviation Expansion and Tourism Concepts Presentation Positioning Markets and Clienteles Development Site and Building Requirements Development Timeframe Capital Requirements, Cost and Revenue Assumptions Financial Projections Development Concept C Solar Farm Concept Presentation Positioning Markets and Clientele Development Site and Building Requirements Development Timeframe Capital Requirements Financial Projections Development Concept D Warehousing Facilities Concept Presentation Positioning Markets and Clientele Development Site and Building Requirements Development Timeframe Capital Requirements, Cost and Revenue Assumptions Financial Projections Development Concept E Agriculture (Haskap Culture) Concept Presentation Positioning Markets and Clientele Development Site and Building Requirements Development Timeframe Capital Requirements Financial Projections Development Concept F Incentive Vehicle Parking Concept Presentation Positioning Markets and Clienteles Development Site and Building Requirements Development Timeframe Capital Requirements, Cost and Revenue Assumptions Financial Projections Overall Capital Plan Ultimate Development Layout Plan Developing the Concepts Evaluation of the Economic Impacts Potential Activity per Sector Potential Ongoing Economic Impacts Potential Direct Impacts Multiplier Impacts Potential One Time Construction Impacts

7 11. Developing the Concepts Zoning-By-Laws Amendments Agro-food Incubator GA Expansion Solar Farm Warehousing Facility Agriculture Incentive Vehicle Parking Marketing and Communication Strategy Unified Brand Message for Airport Development Marketing Strategy per Concept GA Aviation Expansion Agro-Food Incubator and Experimental Farming Warehousing Facilities Solar park development Agriculture (Haskap) Incentive Vehicle Parking Budget Recommendations and Implementation Strategy Development Timeframe Development Priorities Recommendations Conclusion Appendix 1 Focus Groups Participants Appendix 2 One on One Meetings List of Organizations Appendix 3 Key Takeaways of the Airport Business Plan Appendix 4 - Engineering and Servicing Report Appendix 5 Funding Programs Appendix 6 Detailed Capital Cost Plan General Airfield Improvements Parcel B AGN I Taxiway Groundside Improvements Parcel A Parcel D Parcel F Appendix 7 Estimate of the Financial Projections (ownership model)

8 Table of Tables Table 1 - Annual Air Traffic Movement...31 Table 2 - Hangar Size and Rental Information...32 Table 3 - Direct Employment and Wages...35 Table 4 - Direct and Total Employment...35 Table 5 - Direct and Total GDP and Economic Output...36 Table 6 - Direct and Total GDP and Economic Output...36 Table 7 - Review of Airport Tenants...37 Table 8 - Marketing Tools, Business Development Initiatives...39 Table 9 - Aircraft Parking and Tie-down Fee Comparison Table...40 Table 10 - Aircraft Landing Fee and/or Facility Fee Comparison Table...41 Table 11 - Land Lease Rate for Serviced Land at Comparable Airports...42 Table 12 - Availability of General Aviation Hangar and Leasing Rate at other Airports...43 Table 13 - Non-Aviation Revenue at other Airports...44 Table 14 - Available Land and Zoning at Benchmarked Airports...45 Table 15 - List of surveyed companies (29)...60 Table 16 - Terminology Definition for Aerospace Manufacturers...61 Table 17 - Revenue and Cost Assumptions...66 Table 18 - Estimate of the construction cost and capital requirements for the Agro-food incubator construction...71 Table 19 - Financial Projections for the Agro-food Incubator and Experimental Farm...71 Table 20 - Estimate of the Capital Requirements...75 Table 21 - Revenues and Costs Assumptions...76 Table 22 - Financial Projections for the GA Park...76 Table 23 - Financial Projections for the Solar Farm...82 Table 24 - Potential Revenues from a Lease Agreement with Wiarton Marina...83 Table 25 - Timeframe and Assumptions for the Warehouse Concept...85 Table 26 - Financial Projections for the Warehouse Concept...86 Table 27 - Potential Agricultural Revenues from Cost Sharing Agricultural Agreement for a 100- acre parcel...87 Table 28 High Level Financial projections for Haskap Culture...90 Table 29 - Timeframe and Assumptions for the Incentive Vehicle Parking...94 Table 30 - Revenue and Cost Assumptions...94 Table 31 - Potential Annual Direct Employment and Wages after Five Years Table 32 - Potential Direct and Total Employment Table 33 - Potential Direct and Total GDP and Economic Output after Five Years Table 34 - Summary of Potential Ongoing Impacts After Five Years Table 35 - Summary of Potential One-Time Construction Impacts Table 36 Cost of Infrastructure, Revenue and Pre-Tax Profit per Development Concept

9 Table of Figures Figure Leasing Revenue...33 Figure 2- Total Available Land (in acres)...46 Figure 3 - Proposed Development layout for the Agro-food incubator and experimental farm...70 Figure 4 - Proposed Development Layout for GA Park Extension...74 Figure 5 - Designated Land for Solar Development...81 Figure 6 - Proposed Development Site...84 Figure 7 - Haskap berries...87 Figure 8 - Proposed Development Layout for the agricultural area...89 Figure 9 - Proposed development layout for the parking area...93 Figure 10 - Development Layout Plan

10 Executive Summary Explorer Solutions was mandated by the Township of Georgian Bluffs to develop an "Economic Impact and Feasibility Study" for the Wiarton-Keppel International Airport. This study acts as a guide to assist with the planning of financial and physical development at the Airport in a manner that promotes its future growth and sustainability, in accordance with Transport Canada rules and regulations. In order to achieve these results, Explorer Solutions conducted a series of studies and consultations with aviation and regional stakeholders and community leaders along with indepth research and analysis of aviation and non-aviation opportunities, and a detailed review of airport operations and infrastructure. The following undertakings have been carried out: A review of all the background studies and reports in order to fully understand the airport s context; Organization of consultations to gain valuable input from various stakeholders. These sessions were instrumental in identifying suitable opportunities that could be developed at the airport ; A validation process looking into the proposed opportunities that emerged from the consultation sessions and discussions with local partners; In-depth analysis of five (5) comparable airports from the standpoint of land availability, land use, and marketing strategies aimed at identifying best practices and pricing structure; A regional outlook study aimed at outlining the local strengths, key assets and industry drivers. A detailed review of airport operations and an assessment of the airport infrastructure, replacement/rehabilitation cost and an evaluation of useful life of the assets. Current State of the Airport s lands, Infrastructure and Operations An analysis of the existing airfield infrastructure, has determined a fair portion of the runways, taxiways and apron will require rehabilitation within the next 10 years. Ongoing maintenance and reconstruction of sections of the runway could extend the pavement life cycle, however major work will have to be undertaken in the near future. With regards to existing groundside infrastructure, overall facilities are in fair condition, and the airport has the necessary water, sewer, natural gas and electrical infrastructure to support most of the proposed future development. An internal review of the airport operations highlighted, that the majority of the necessary documentation is accessible and findable, but most manuals are due for updates and amendments. The Airport Operations Manual and SMS need to be updated in order to meet new requirements, and the staff needs to be trained on the new operational procedures (to meet Transport Canada requirements). Wiarton airport has a diverse tenant base that occupies the vast majority of its buildings. 9

11 The revenue share between private and corporate tenants is diverse, with each category contributing to around 50% of leasing revenues, helping the airport to be more resilient to economic cycles. Finally, in terms of total economic impact, it is estimated that the airport contributes to 14 jobs (8.5 direct, 3.3 indirect and 2.2 induced jobs), $1.4 million in GDP for a total economic output of $2.3 million to the Ontario s economy. Airport Benchmarking Analysis Our team conducted a benchmarking of five (5) airports of similar size and function to position YVV on a number of criteria and activities, namely key economic drivers, airport tenants, marketing strategies, revenue generation sources and land available for development. Overall, we found that investment attraction and business development initiatives are mostly centred on collaboration with city and economic development officials. When we examine the other airports parking and landing fees, Wiarton s pricing structure is overall at level if not lower than the competition. In terms of land leasing rate, it is recommended that YVV fixes its leasing rate at $0.29 per sq.ft. per year, which corresponds to the competition average. Consultation Sessions In collaboration with the Township of Georgian Bluffs and Wiarton Airport, our team hosted two (2) industry focus groups in August 2016, followed by several one-on-one meetings and interviews with various stakeholders. The objectives of these consultations were to get the participant s opinions on 1) market trends within their own sector of activity, 2) possible ties between their business and the airport, and 3) what asset is missing locally or what effort should be undertaken that could help drive more investment and activity to the airport. The information shared during the interview process was instrumental in identifying potential development opportunities. Validation of Potential Growth Opportunities for YVV A validation phase followed the consultations to determine the most suitable and feasible concepts for the development of the airport. This validation phase included exploring market demand, and confirming interest from stakeholders. The consultant explored both aviation and non-aviation opportunities. Aviation opportunities revolved around restarting regular passenger service, building new hangars, setting up a flight school, developing tourism packages, attracting an MRO operator or ORNGE aircraft, and setting up a Uber for flights service... For non-aviation opportunities, the explored concepts include growing various crops at the airport, utilizing the crosswind runway for winter-driving training, developing an agro-food incubator, raising cattle, developing a solar farm, a parking and shuttle service, a native welcome center, hosting shows and music events, building office towers, and developing an industrial park, and a warehousing facility for boat/rv/snowmobile storage. 10

12 Vision and Mission of the Airport It is recommended that the Wiarton Airport s mission first concentrates on operating a safe and secure full service airport aimed at delivering meaningful value and a heightened customer service to both the aviation and community. The vision is that the airport should become a leader and partner in the economic development of Bruce and Grey Counties, by offering attractive value propositions to its aviation clientele, the community, tourists and businesses. To achieve this, the work of the airport should be guided by the four (4) following principles: 1. Maintain a safe and secure operation compliant with the Canadian Airport Regulation (CAR). 2. Develop and maintain an adequate airport infrastructure to ensure a high level of customer service and support. 3. Strengthen the airport financial by diversifying its revenue sources and developing concepts that make the highest and best use of the airport s lands. 4. Become a tourism destination for GA pilots and expand the aviation hangar park. Proposed Development Concepts Explorer Solutions recommends that the airport pursues six (6) development concepts, which are well suited to help the airport diversify and increase its revenues. The results of the consultation process coupled with the findings of the market outlook have led to the identification of development concepts that will help the airport in leveraging local assets, and expertise and best respond to the needs of its tenants and business community. Restarting a regular commercial air service was not part of the proposed concepts. Even though small aviation charter companies have expressed some interest in offering scheduled passengers service, we were unable in the scope of this study to validate demand. An origindestination study and forecast analysis will have to be performed to confirm the true feasibility of such a service. Agro-food Incubator and Experimental Farm This concept aims to capitalize on the rich and diverse agriculture history and capacity in Bruce and Grey Counties. The opportunity here revolves around the potential of supporting small food producers who have the desire to scale up their operations. The concept includes the construction of an agro-food incubator of 10,000 sq.ft., which could also offer food preparation and business courses in partnership for example with Georgian College. The incubator building will be surrounded by land dedicated to experimental farming, for local producers and the community to grow their own crops. The purpose of this concept is to empower the local community and small producers, by giving them the tools necessary to increase production capacity, grow their business, and revitalize the local economy. 11

13 The proposed model would see the airport rent out the land to a developer interested in building the incubator. The proposed building site for this concept would be on the northeast corner of the airport. General Aviation Expansion & Tourism The second concept is designed to help Wiarton Airport increase its presence in the General Aviation market. We propose that the airport builds the infrastructure for the construction of four aviation hangar dedicated to GA and private aircraft owners during phase 1. An airport user has already expressed his interest to construct a 4,800 sq.ft. hangar for its own storage needs, and that could also be used for storing visitor s business jets. Phase 2 of the GA expansion, which would include 16 new hangars is not recommended in the long term, as the required infrastructure cost greatly outweighs the potential revenues (landlord scenario). Preliminary evaluation estimates that profitability of phase 2 could be attained under a hangar ownership option. This model typically generates better returns but requires larger capital investment for construction of the building (see Appendix 7). It is recommended that the airport explores the hangar ownership scenario. By enabling the construction of these hangars, the airport will ensure it will have the capacity to meet future demand from pilots around the region. Moreover, in order to attract additional tourists and make Wiarton airport a destination of choice, we propose that the airport develops fly-in packages designed around the region s offering. In this report, we detail five (5) packages, targeting wildlife and culinary experiences, a native experience, the nature trails and sports. These packages ensure that there is always an activity to do year round, attracting tourists from around the province and beyond while also presenting them with the opportunity to base their aircraft at the airport. Solar Farm Many airports across the U.S. and Canada have taken the lead on renewable energy projects by developing solar arrays on their land. Building on these successful examples, we propose the airport designates the 86-acre parcel of land located in the southwest development area for solar use. This project will accelerate the region s shift to meet the growing demand for green energy production while generating non-aviation revenues. We recommend the land owner model and work with a solar developer to lease the available land. The advantage of this model is that the infrastructure costs are lower, and the expertise of the developer will ensure the best process, and materials are chosen when building the solar farm. Warehousing Facilities Wiarton sits at the head of the beautiful Colpoy s Bay, a long, well protected inlet offering outstanding sailing opportunities. With increasing demand, the local Marinas have been experiencing difficulties to accommodate all the boats that need storage in the area. Marinas are looking at off-site options to meet excess demand, and they would be favourable to leasing storage space at the airport. 12

14 A parcel of land located on Concession 21 would be well suited to accommodate warehousing facilities. We recommend two 5,000 sq.ft warehouses to accommodate boats during the winter time. During phase 1, the first warehouse would be constructed, and in phase 2, depending on demand, a second warehouse. Agriculture Many airports lease land for agricultural use. To generate more revenues out of this activity, we recommend Wiarton Airport considers alternate revenue models (including models that share costs and benefits) and assess potential revenues associated with different types of crops. We propose that the airport looks into haskap production, on a revenue share model where 1/3 of the production costs are supported by YVV, and in counterpart, the airport retains a 1/3 of the revenue. The haskap is very popular among food processors as it is easier to farm compared to other berry types, it is cultivated in the beginning of summer, and has all the health benefits of other berries. By using the proposed 37.6-acre development site located south of runway 11/29 east of the warehousing development area along Concession 21, preliminary evaluations estimates that the airport will be able to generate $1,886,008 in pre-tax profit over 20 years. Incentive Vehicle Parking The Bruce Peninsula is one of the most visited national parks in Ontario, especially during summer months. Visitors are experiencing heavy traffic congestion due to the popularity of the Peninsula and a lack of parking spaces at destination. Every day, an estimated average of 500 cars is turned away as they cannot find parking space. To help the National Parks, and the local community in developing practical and environmentally friendly solutions to ease traffic and parking and respond to the growing demand, the airport could initiate a Park and Shuttle Service (branded as Park and Play) targeted at Bruce Peninsula tourists. By developing a parking area north of the existing GA hangars and offering a shuttle service to the National Park, the airport could position itself as an alternative transportation platform, increasing its public visibility and notoriety. Overall Capital Plan The consolidated capital plan details the required infrastructure costs that need to be taken into account over the next 20 years in order for Wiarton Airport to rehabilitate its critical infrastructure, as well as implementing the development concepts. Wiarton Keppel International Airport Highest and Best Land Use - Overall Capital Plan Phase 1 Phase 2 General Airfield Improvements Total Airside Development $4,957,250 $3,076,050 $8,033,300 Groundside Improvements 13

15 Total Groundside Development (Groundside Access Road and Parking Lot Rehabilitation) $310,260 $310,260 Development Areas Development of six (6) development concepts $501,600 $1,078,290 $1,579,890 C Total Estimated Costs $5,769,110 $ 4,154,340 $9,923,450 Costs for the parking lot and access roads in the Agro-food incubator and Warehouse concepts will be borne by the private developer. These costs are estimated to be $352,260. Developing the Concepts Evaluation of the Economic Impacts In the first five years, potential direct employment related to the development of the concepts could include the creation of up to 26 new direct jobs and 11.5 jobs during the construction phase. In total, by combining the five years economic impact resulting from the ongoing activity to the construction work, is it estimated that the development of the (6) concepts would generate a total economic output of $11.4M. Developing the Concepts Zoning-By-Laws Amendments A large portion of Wiarton Keppel International Airport falls under the Niagara Escarpment Development Control. Therefore, some of the proposed development concepts within the Niagara Escarpment Development Control Area will require a Development Permit from the Niagara Escarpment. The Township has submitted an application to amend the areas near the concepts to be less restrictive. The response to this request is estimated to arrive in a couple of months. The solar farm development may also require zoning amendments, from the Grey Sauble Conservation Authority, however the concerned land area is minimal and should have little impact on the overall development concept. The Warehousing Facility and Agriculture area will require zoning amendments from the Township to change the current Institutional zoning. For the Warehousing Facility, it will need to be changed to M1-Industrial and A1-General Rural for the Agricultural area by the Township of Georgian Bluffs. Marketing and Communication Strategy In order to attract both aviation tourists and businesses to the airport to increase its traffic and business potential, Wiarton airport will have to create a central message to highlight its key assets and location advantages. We propose the following message: 14

16 The Wiarton airport provides a direct access to a tourism mecca with many surrounding natural beauties. The airport offers a business-friendly environment and cost competitive location, especially an affordable pricing structure. Wiarton Airport welcomes aviators, tourists, local residents and Ontario companies to discover the new opportunities offered by our prime location. Following the general branding message, the airport will then have to undertake specific actions to generate and attract developers interest in the different development concepts. This will include attending specific events such as conferences or trade shows, contacting potential partners, preparing marketing material to be distributed and advertising with targeted publications and websites. We estimate that over three (3) years, a total of $28,900 will be required to carry out the marketing and business development activities for an annual average of $9,633. Recommendations and Implementation Strategy A complete analysis of the proposed concepts was performed to identify development priorities, scope and phasing. Capital requirements, market conditions and demand for the development concepts were among the evaluation factors considered. The analysis leads us to recommend an implantation strategy prioritizing development of concepts that generate rapid returns, require less capital investment and for which demand exists. From this analytical framework, we recommend that the airport implements all the development concepts since they are not capital intensive and have the potential to generate revenue at an early stage. The only concept we recommend against pursuing in the short term is the development of Phase 2/GA hangar expansion under the landlord model. The additional infrastructure cost ($436,890) for the extra sixteen (16) hangars to be constructed is too high compared to short term revenues. To be financially viable, it is recommended that the airport considers the option to own the buildings to be constructed during Phase 2 (see Appendix 7 for financial projections). Specifically, we propose: Agro-food Incubator and Experimental Farming The airport should begin by leasing out the land for agricultural farming and work with local communities and organisations to promote and develop a small-scale experimental farm. While the agricultural use has begun, the airport should work with local stakeholders to identify applicable funding programs and a building partner for the construction of the incubator. For the airport, the estimated infrastructure cost would be $42,000, and the projected 20 year pre-tax profit would be $297,971. Funding for the construction of the incubator building could be received from FedDev s Investing in Regional Diversification, as the project will help strengthen the entrepreneurial potential of the local community, as well as helping to diversify the airport s operations. 15

17 General Aviation Hangar Expansion and Tourism The airport should lease out the land to enable the building of four (4) hangars at the rate of one new hangar every three (3) years, starting on year 1. Concurrent with the hangar development, the airport should, from year 1, start developing the fly-in packages with local partners in order to attract GA tourists from around the region. Overall, the infrastructure requirements for this concept are estimated at $116,150 (Phase 1 hangar development only) which will generate $165,291 pre-tax profit over 20 years. Solar Farm YVV should proceed with the identification of a potential solar developer interested in partnering with the airport through the FIT Program. Then it should submit a formal application to the FIT program during the next large renewable procurement round scheduled for 2017 leading to the construction of the solar farm on Year 3, and be operational on Year 4. Preliminary evaluations estimate the cost to bring 3-phase electrical service to the site at $10,000. The total net revenue from the solar farm development is estimated at $1.14M over the 20-year period. All infrastructure costs are at the charge of the developer, which greatly increases the profitability. Funding for this development concept will be done through Ontario s FIT program, which encourages the development of renewable generating facilities of varying sizes, technologies and configurations via a standardized, open and fair process. Warehousing Facility From year 1, the airport should work with a local partner to begin building the storage warehouse. During phase 2, if there is demand for additional warehousing facilities, the airport could work with the partner to construct a second warehouse of similar size. The estimated infrastructure cost for this concept is $19,150, and the 20 year pre-tax profit would be $320,756. Agriculture (Haskap Culture) It is recommended that YVV explore the potential of developing the parcel designated as agriculture into haskap cultivation. We also recommend the airport enters into a shared revenue model, where the airport s financial contribution is equivalent to a 1/3 of operating costs and 1/3 of revenues. The airport will contribute to 1/3 of the operating costs, but it will also capture a third of the revenues. Initial infrastructure requirements are not considered, however, the airport will share initial start-up costs for the acquisition of equipment, purchasing of the haskap plants, material, irrigation systems and other expenses totaling $184,000 for the first three (3) years. The first harvest will occur on Year 4. The expected 20-year return on the shared revenue model is $1,866,008. Incentive Vehicle Parking The airport should approach potential partners such as Parks Canada and other public organizations to validate their interest in the service. The proposed model sees building of a first carpark for 136 vehicles and launch of the shuttle service in the summer of Starting with four (4) buses per day, the airport could gradually increase the capacity (parking and shuttles) 16

18 following the demand for the service. The construction of the incentive vehicle parking will require a total of $965,700 in capital infrastructure (Phase 1: $324,300 for 136 stalls; Phase 2: $641,400 for 364 stalls). Over a 20-year period, this development concept will generate $1,631,522 in pre-tax profit. The pilot project can be funded through the Federation of Canadian Municipalities Green Municipal Fund. This fund is designed for projects that have the potential to reduce vehicle kilometres travelled in single occupancy vehicles by encouraging alternatives modes of travel. The amount that can be offered covers up to 50 per cent of eligible costs, to a maximum of $350,000. Eligible costs include equipment rental (which would cover the bus), and some construction costs of the initial area. Leasing Office Space in the Terminal Building It is recommended that the airport continues its efforts of promoting the office space it has available for rent in its terminal building. It is estimated that with renting 50% of the available space, the airport could annually generate up to $400,000 in leasing revenue. Airport Infrastructure Priorities Once the development concepts begin generating enough revenue, the airport should focus on rehabilitating its infrastructure, particularly the main runway (05-23), aprons and taxiways. It is proposed that runways and 11-29, as well as the taxiways, and associated fillets be rehabilitated during phase 1. Phase 2 will be dedicated to replacing runway Navigation Lighting Systems, rehabilitating the apron and extending length of runway 23. Runway to the World Fundraising Program The foundation has launched a funding initiative called Runway to the World, which aims to raise private donations for the revitalization and growth of the Wiarton Keppel International Airport. This fund is great initiative that must be seen on a long term perspective. We would recommend keeping the donated capital in the fund and using the growing interest to finance rehabilitation of the airport infrastructure. 17

19 Summary Table Airport Growth Plan, 20-Year Expected Revenues and Profit Returns Parcel Infrastructure 20-Year 20-year Pre- Source of revenue Capital Costs Revenue Tax Profit A Agro-food incubator and experimental farm $42,000 $357,216 $297,971 B GA Hangar Expansion (Phase 1 development only) $116,150 $336,222 $165,291 C Solar Farm $10,000 $1,161,520 $1,148,276 D Warehousing Facilities* $19,150 $347,529 $320,526 E Agriculture - Haskap culture (Revenue-sharing model) $- $2,802,567 $1,866,008 F Incentive Vehicle Parking $965,700 $10,076,467 $1,631,522 Lease of Office Space in Terminal Building - $400,000** $400,000 Grand total $1,153,000 $15,481,521 $5,829,594 In conclusion, the goal behind our methodology was to provide a comprehensive implementation strategy that proposes a structured action plan for the development of aviation and non-aviation concepts at YVV generating interesting surpluses estimated at $5.8M over 20 years. This plan identifies opportunities for the airport to pursue over the next decades and presents the key marketing steps and actions to be undertaken in order to bring the (6) six concepts to fruition. 18

20 1. Introduction Explorer Solutions was mandated by the Township of Georgian Bluffs to develop an "Economic Impact and Feasibility Study" for the Wiarton-Keppel International Airport. This study acts as a guide to assist with the planning of financial and physical development at the Airport in a manner that promotes its future growth and sustainability, in accordance with Transport Canada rules and regulations. The study includes a complete review, identification and evaluation of aviation/aerospace and non-aviation sources of revenue. The aim is to develop creative property uses, assign highest and best land uses, and ensure that the proposed development concepts will allow the airport to generate recurrent and sustainable revenues. This paper also provides strategies for infrastructure investment to support future growth and identifies opportunities to increase revenue, and a complete review of applicable funding programs. Local and regional stakeholders were consulted and engaged in the overall process to validate and confirm the market information. This report also identifies the current economic impact of YVV and the proposed economic impact related to the development concepts. 1.1 Review of Past Studies Wiarton Airport Business Plan Our team reviewed the Airport past studies. A summary of the key points of this Business Plan is presented in Appendix 3. 19

21 Part I Portrait of the Airport: Evaluation of Current State of Infrastructure, Operations and Budget Research Summary Part I of this report is organized into three (3) sections aiming to provide a clear portrait of the airport and how it compares against other similar operations. The first section provides a highlevel evaluation and inventory of the current airport s lands, buildings and the related infrastructure, and provides a review of the airport activity. The third section is a comparison with five (5) other airports of similar size and functions aiming to identify the competitive position of the airport against a number of activities and characteristics. This section concludes with the presentation of the airport economic impacts analysis. 20

22 2. Current State of the Airport s Lands, Infrastructure and Operations This section aims to present the inventory and evaluation of the existing buildings, infrastructure and services available at the airport. The objective is to determine the current utilisation of the different buildings and overall aviation activities occurring at the airport in order to identify opportunities and constraints for the development concepts. This initial mapping will be accompanied by a complete infrastructure assessment to determine the actual condition of the main runway system, the apron and other critical assets. This review will be used to determine what rehabilitation work will be needed for maintaining usability and safety of the airport infrastructure, but also which upgrades will be required to further develop the airside assets. The corresponding costs to support the actual airport operation and future development will be presented in the capital plan section. A complete review of the airport activity aircraft movements, private and commercial tenants was also conducted to get a better grasp of YVV operations. 2.1 Existing Airfield Runways, Taxiways, and Aprons Runways Runway (5,033 ft. by 150 ft., or 1,534 m by m) is a paved, AGN IIIA, Non-Precision runway. The runway pavement is in poor condition and there are numerous areas showing longitudinal and transverse cracking and areas of significant alligator cracking. Many of the surface cracks show vegetation emerging through the cracks, suggesting a lack of crack sealing or areas of potential failure. The runway pavement load rating is Runway Runway (3,456 ft. by 100 ft., or 1,053 m by 30.5 m) is gravel and is a AGN II, noninstrument, day use only runway. There is no maintenance for Runway for approximately five months during the winter and early spring. The gravel surface is in generally fair to poor condition. However there is a loss of aggregate in some sections Taxiway/Aprons Taxiway A is 50 ft. (15.0 m) wide with medium intensity lighting. Taxiway B is 23 ft. (7.5 wide) with no edge lighting. Apron 1 is 328 ft. by 453 ft. (100 m by 138 m) in size with medium intensity edge lights. The taxiways and apron are asphalt. The pavement is in fair to poor condition and there are numerous areas showing longitudinal and transverse cracking and areas of significant alligator cracking. 21

23 Hangar Area Pavement The main taxi access to the tenant hangar areas and in the direction of the maintenance garage is in fair to poor condition from the terminal entrance to the apron to approximately the southwest edge of the main apron (approximately 70 m). The remaining 115 m to the southwest is in poor condition. The taxi/access to the maintenance garage is in fair to poor condition. The taxiway running northwest/southeast behind the hangars facing the main apron is in fair to good condition Runways, Taxiways, and Aprons Pavement Assessment Summary The runways, taxiways and apron will require rehabilitation within the next 10 years. Ongoing maintenance (e.g., crack filling) and reconstruction of sections of the runway (e.g., mill and pave) can extend the pavement life cycle. Pavement Rehabilitation Priority 1. Runway and Taxiway A, includes replacement of runway and taxiway lighting; 2. Runway 11-29; 3. Tenant taxiways, and 4. Main Apron Airfield Lighting Runways 05 and 23 are equipped with threshold lighting and the runway is equipped with medium intensity edge lights. Runway 05 end includes threshold lighting, runway identification lights, and low intensity centre row approach lighting. Both runway ends have Precision Approach Path Indicator (PAPI). Lighted wind socks are also located at both runway ends. A lighted wind sock is also located at the Runway 11/Runway intersection VOR/DME A VOR/DME is located mid-field between Runways 23 and 29. GPS approaches are published for The VOR/DME is maintained by Nav Canada. 2.2 Existing Groundside Access Roads The paved access road from Frank Street is in generally fair condition with some areas showing alligator cracking and pavement edge failures. 22

24 2.2.2 Parking One (1) main parking lot at the terminal building includes approximately 60 parking stalls and serves the airport administration offices. The parking lot pavements are in fair to poor condition Services Water Water is provided to the airport from the 150 mm waterline on Frank Street. A 100 mm water line extends to the pump house located north of the terminal building and the water is then connected to airport owned buildings (e.g., the terminal, maintenance garage, and building immediately southwest of the terminal). Water use for the period June 15, 2015 to August 20, 2016 was 393 m3. This is actually a very low water use. As an example, Water Canada s national average water use estimates an average of 2.03m3/m2. Therefore, a building 200 m2 in size (e.g., the old terminal building) would theoretically use approximately 406 m3 of water annually. The developments proposed in the study are not expected to use significant quantities of water and as such, the existing water supply will be adequate Sewer All of the waste water from airport buildings is currently discharged into three (3) separate septic systems: one at the old ATB, one at the main terminal building, and one at the maintenance garage. It is expected that new hangar developments in the central airport area will not require a sanitary service (see section 7.2). New developments requiring a sanitary service will require installation of a septic system that meets all of the Ministry of Environment requirements Electrical Three-phase power is available at the airport. The existing FEC is located north and west of the old ATB. From this location, power is distributed to the airport owned buildings and the large tenant hangar immediately southwest of the old ATB. Powerlines will be extended to new hangar areas as required. Electrical use for the period June 15, 2015 to August 20, 2016 was 5,500 kwh. This is actually very low. As an example, the St. Thomas Airport administration building, flight centre (old ATB), large hangar east of flight centre, maintenance garage, and water pump house use about 113,000 kwh of electricity annually. The incremental demand for electricity will be small and as such, the existing power supply will be adequate. 23

25 Natural Gas Natural gas is provided to most of the airport owned buildings and some tenants. Natural gas use for the period June 15, 2015 to August 20, 2016 was 12,504 m3. Natural gas lines would be extended from existing lines. 2.3 Environmentally Sensitive Areas A large component of the airport lands is included in the Niagara Escarpment Plan. The Niagara Escarpment Protection Area (NEPA) identifies two (2) land designations: The Niagara Escarpment Protection Area (NEPA) and the Niagara Escarpment Rural Area (NERA). The drawing shows the Wiarton Airport with the rust colored area representing the NEPA and the yellow representing the NERA. The protection areas are important, because of their visual prominence and their environmental significance. The primary objective is to: Maintain and enhance the open landscape character of the Escarpment features. Provide a buffer to prominent Escarpment features. Maintain natural areas of regional significance and cultural heritage features. Encourage agriculture, forestry and recreation. Preliminary evaluation indicates that the proposed developments at the airport will not affect the protection areas. It will be necessary to ensure all new developments minimize disruption to the existing landscape (e.g., protection of forested buffer areas). The remaining airport lands are designated as Rural under the County of Grey Official Plan. A relatively significant portion of the remaining lands would be considered wetland areas. Although these areas are not designated as significant wetlands, they have a role in the overall environmental eco-system. 2.4 Existing Buildings On Wiarton Airport s lands, there is a total of 17 buildings. Of these 17, eight (8) are hangars, with the rest comprising of storage, offices, or infrastructure services buildings. The total square footage of all the hangars combined represents 30,457sq.ft. 24

26 Building Number Type Occupant 1 Shared Hangar GA 2 Storage Georgian Bluffs 3 Shared Hangar GA 4 Hangar GA 5 Hangar GA 6 Hangar GA 7 Hangar GA 8 Hangar GA 9 Hangar GA 10 Generator Georgian Bluffs 11 Water Shed Georgian Bluffs 12 Storage Georgian Bluffs 13 Garage Georgian Bluffs 14 Old Terminal Building Georgian Bluffs 15 Terminal Building Georgian Bluffs 16 Maintenance Building Georgian Bluffs 17 Fuel Shed Georgian Bluffs 25

27 2.5 Internal Review Field Review During the month of July 2016, a general internal review of the operations of the Wiarton Keppel International Airport was conducted. It is noteworthy that this location is difficult to find due to poor signage on the way into town. However, once on the field the Terminal building it is well located, in close proximity to the parking lot. The terminal seems to be appropriately sized for the current operation. However, if the operation was to expand in anyway, and the terminal was needed for passengers and pilots; it would need to be reorganized for the accommodations of aircraft crew members. It currently does not have an elevator and that could be an issue depending on what business was to locate upstairs. The front terminal door currently has a key code lock on it, which means that the building is always locked and secured during the off hours. It seems that many people have the code to this keypad, so perhaps a security camera would be beneficial to help track who is using the building after hours. Upon our internal review of the operation, it proved difficult to get electronic copies of the existing manuals. We believe the reason for this is that over time, any electronic copies that were in existence were lost or stuck in PDF format (not in an editable format). If Transport Canada did request some documentation for their review, it would be difficult to produce it in a timely manner. As the township is aware, the runway is cracked through-out. It has recently been crack sealed, but it needs to be ultimately rehabilitated (long-term solution). The runway is also falling down on the edges due to the pavement being past its age of usefulness. During heavy rains, there is some pooling on the dipped pavement surfaces and the grass around the threshold, which could be indicative of a possible drainage concern. Transport Canada is aware of the issues as is referenced through an SMS report from a few years ago. According to the Airport Operation Manual (AOM), the Wiarton Airport is currently sitting entirely in the 4th Edition, but it is possible that a rehabilitation project would trigger a need to become compliant with the T 312 5th E. It was noted during the Safety Management Quality Assurance Audit in 2013 that the airport may actually be in the 3rd E as well. It appears as though a review has not been done to determine if this was the case or not. A topic of much discussion with the release of the newest edition is the Runway End Safety Area (RESA). Early in the 2nd quarter of 2013 TC issued a RESA-related Advisory Circulars (AC Runway End Safety Area Bearing Strength Requirements). This was a consequence of Transport Canada s NPA activities. 26

28 The intention of this guidance material was to assist airport operators with the planning, design, establishment and maintenance of RESAs at Canadian aerodromes in anticipation of regulatory change to RESA requirements. This may be an area that needs to be reviewed when deciding on the plan for the main runway to ensure that the road that runs along the one end (through the approach lights of runway 05) will not be of concern, nor will the trees north of the threshold of Runway 23, if the runway is ultimately extended as hoped Manual Library Overview During the internal review of the Airport Operations we were able to review some of the operational manuals. Generally speaking, the obligations of the operator as per the Canadian Aviation Regulations (302.07) are well embedded into the operations manual. SMS A strong effort has been made to implement the SMS process at this airport. As part of the safety management system, a Task Calendar has been created. This outlines all of the regular tasks that the airport must address in order to minimize risks within aviation. The task calendar was not available to be reviewed at the time of this project. We were able to review the Goals Progress Form and it appears to be well done initially but has not been kept updated regarding status. There is a hazard registrar that has been created electronically, however, was not available to view at the time of the visit. There is a paper hazard register on file, but it appears to have not been logged in since February I would anticipate that any findings submitted by the public, and those found through the goals progress list along with the items from the Quality Assurance Audit should be found here. As per the onsite manual, initial and recurrent human factors training is required for those involved in the operation (staff and volunteers). At the time of this review, we were not able to view the training records (were not made available) but as per the AOM and SMM these would be available via the Airport Manager. The safety management system is new, but it seems that bi-weekly meetings have been held with Management and the Township which leads us to believe that it is likely on a successful path. We did find multiple versions of the SMS Manual to be on the bookshelf at the airport, all of varying stages of completion. Operations Manual We were able to review the Operations Manual (AOM). It was last amended in February It has not been approved by TC yet. The manual does seem complete and the findings of the Audit done in 2013 have been rectified. I did notice some minor errors in this manual such as the footers are partially incorrect (wrong dates), the dimensions provided in Part 2 should be in conformance with TP 312 4th E , and that SNOWiz is being used interchangeably with AMSCR (Airport Maneuvering Surface Condition Report) which is also incorrect. There was a discussion during July about a staffing change potentially occurring at the airport. 27

29 The operator should be aware that the Obligations of an Operator (1)(f) that states after an operational change the Minister is to be notified within 14 days. Emergency Response Plan The emergency response plan needs to be thoroughly reviewed and brought up standard as per the regulations in the Canadian Aviation Regulations (CARs). The manual is missing some key elements that are required in order to conform to the regulations. Firstly, a current grid map and crash charts is missing from the plan. Secondly, the plan does not provide a demonstration of training of personnel. There are no documentation procedures in place in this manual that explain how this is recorded and maintained. If this requirement were to be streamlined with the SMS task calendar that would satisfy this concern. Lastly, there is a requirement to test the emergency plan through table top exercises and simulated full-scale emergencies. The table top exercise needs to be done on an annual basis, and the full-scale one needs to be completed every four (4) years. There are specific regulations that state what must be completed in each phase of testing the plan and how to document it, as it is necessary to show compliance and current levels of training. Apron Management and Safety Plan As per CARs (3)(C)(xi) this is a requirement within the Operations Manual. The current Apron Management and Safety Plan (AMSP) needs to be updated as it references previous managers and old owners. The last amendment done on this was in This plan states that industry standard training for the safe process of fueling will be provided, and records maintained to prove which training has been completed, as well as, the fuel facilities and equipment will be maintained to all provincial and federal regulations by the fuel provider. The AOM says that the manager is responsible for training the fuellers. The manual of guidance that is referenced here is also outdated (B36-00). This plan also talks about the need for an Airside Vehicle Operates Permit (AVOP) to operate, but the AOM does not address this. We believe that this should be removed from this plan as this is not a requirement for this airport as per Transport Canada. Snow and Ice Removal Plan This plan has also not been reviewed since 2002 so it needs to be reviewed (especially in light of the change of operation that took place in August). This is an airport that receives an unpredictable amount of snow fall in the winter months, so for them it is of extreme importance that this plan be maintained and implanted. 28

30 Maintenance Program There is a Standard within the TP 312 that states that, "A maintenance program including preventive maintenance 1, where appropriate, shall be established at an aerodrome to maintain facilities in a condition which does not impair the safety, regularity or efficiency of air navigation." The role of on Airfield Pavement Management System (APMS) is to improve the quality and performance of pavements and minimize costs through good management practices. A fuel pump maintenance plan could also be included with this Maintenance Program. The Wiarton Airport is currently functioning with an older type of pump, and maintenance will be the key component for ensuring longevity of this equipment. Note, this pump has not been calibrated on the proper schedule. The SMS Program did note the need to revamp the Airside Checklist, but I am not sure of the details of this. However, I would recommend that while amending that checklist that a preventative maintenance program be considered Key Findings and Recommendations Overall, the majority of the necessary documentation was available during our review, but most manuals are due for amendments. It is recommended to start handling the findings found in the 2013 QA Audit and then proceed with the QA audit findings that are found in 2016 once this audit has been completed. It is also suggested that the annual review of these mandatory manuals be placed within the SMS Task Calendar to be completed by the manager during a slower month. We also recommend that all necessary manuals be transferred to an electronic format for quick amendments and safe keeping. Once these tasks are completed, the airport will function to a higher standard of safety, and the airport staff will be better prepared to handle unexpected issues that may arise. It would be beneficial to start transitioning all of the site manuals into an electronic format (PDF and doc) on a township computer or drive if this has not been done yet. This would provide staff with the ability to quickly reference and update the content. This would also provide a method of storing the material through a server or cloud, so that in the event of a disaster or fire, the material would be retrievable. This should be done by someone at the administrative level or as the manuals are amended and reviewed. Along with this, we suggest that the airport purchases the new version (B36-014). 1 Preventive maintenance is programmed maintenance work done in order to prevent a failure or degradation of facilities 29

31 High Priority within 2 months Since the AOM has had the amendment reviewed by Transport Canada and declined we would suggest that this be completed first. Along with fixing the components suggested by them, we would also update the first portion to include the details of the new operation set up and who is responsible for which tasks and activities. The SMS needs to be improved and promoted with the new staff change over. Initially, the goals progress form was done well but the updates regarding status have not happened. We recommend the Accountable Executive and the new airport team review the goals and reestablish timelines and priorities. The staff must also be trained on Human Factors as per the SMS, along with other components of their jobs. We recommend starting a training file on each member that shows how the operator is maintaining safety and aiming to reduce the risk during the time of a staff change over. The airport has several versions of the manual around. A consolidation of the manual will need to be done so that the proper book is being referenced. Snow and Ice Removal Plan Considering the change in staffing at the airport over this year we recommend a full review of this plan to be completed while taking into consideration Advisory Circulars that have been released since 2002, so that this plan can be enhanced. Medium Priority to be completed within 6 months Emergency Response Plan Current Grid Maps and Crash Charts need to be included in the manual and also in the manual of those on the distribution list. This was also a finding in the WSP Audit in 2013, but does not appear to have been rectified yet. Full scale and table-top exercises are not only mandatory, but are also a way for the operator to verify the validity of the plan. Our review did not allow us to see any proof of this being completed. This Emergency Response plan was amended considerably from , but it seems that the Audit Findings from WSP in 2013 have not been corrected and implemented. We recommend that this is done soon and that the distribution list be updated. 30

32 SMS By the end of 2016, a Quality Assurance Audit was to be done by the airport as per their SMS manual. We see no indication of this being started nor do we see a plan to do it this year. This is a relatively important thing to do within the timeline that is outlined within the manual, however, considering the other high priority tasks that need completion and the time of the year (winter is approaching). It is suggested that this be started within 6 months to show a reasonable plan to complete it before the winter months are over. Low Priority to be completed within months Apron Management Safety Plan The current Apron Management and Safety Plan (AMSP) needs to be updated as it references previous managers and old owners. The last amendment done on this was in We suggest that this plan be reviewed in its entirety for accuracy and updated to match current procedures. Preventative Maintenance Plan Within this maintenance program could exist the basic components of an Airfield Pavement Management System. This plan would include a technical inventory of airside pavement operational surfaces, a pavement structural condition survey and pavement management plan. A fuel pump maintenance plan could also be included with this Maintenance Program. 2.6 Airport Activity Air Traffic Movements In 2015, the total movement at the airport was 2,182. For the year to date 2016 (until October), aircraft movement is at 1,736. Below, we have a breakdown of the air traffic movements on a monthly basis. Table 1 - Annual Air Traffic Movement 2016 YTD Actuals Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec To Date Movements Actuals 31

33 Movements From this table, we notice that the airport s busiest period is during the summer months, where it can reach in July close to 400 movements. December and January are the least busy months, with monthly movements falling below Private and Corporate Tenants In total, Wiarton airport has fifteen (15) tenants on-site who rent out a variety of infrastructure or land. These tenants are comprised of a majority of private renters who rent out land and hangar space, and four (4) corporate tenants who rent out office, infrastructure space or land. Wiarton airport currently has nine (9) private tenants who either rent land or space on the premises. Table 2 - Hangar Size and Rental Information Tenant Size Information 1 Private Tenant 5,141 sq. ft. hangar plus land 2 Private Tenant 2,916 sq. ft. hangar plus land 3 Private Tenant 3,132 sq. ft. hangar plus land 4 Private Tenant 1,344 sq. ft. rents space for one aircraft 5 Private Tenant 5,848 sq. ft. hangar plus land 6 Private Tenant 4,900 sq. ft. hangar plus land 7 Private Tenant 2,916 sq. ft. hangar plus land 8 Private Tenant 2,916 sq. ft. hangar plus land 9 Private Tenant 1,344 sq. ft. rents space for one aircraft In addition to the private tenants who rent out hangar or space, Nav Canada rents office space for its weather office, as well as the Coast Guard. Grey Bruce Telecom rents space on the airport for one of their communication towers, which provides the airport with free internet. The airport also rents acres of farmland to three (3) different agricultural farmers. In terms of revenue, the share between corporate and private tenants is represented below, for the year

34 Figure Leasing Revenue 2015 Leasing revenue - Corporate vs. Private tenants 55% 45% Private tenants Corporate tenants The above graphic shows a great diversity in terms of revenue, with a healthy mix of private and corporate tenants. Overall, corporate revenues represent $16,745$ (55%) and private revenue represents $13,420 (45%). It is particularly interesting to note that the revenues are close in terms of share. However, there are only six (6) corporate tenants, compared to nine (9) private tenants. To conclude, we see an excellent presence of corporate revenues at Wiarton airport, which should help the airport overcome seasonal variations, and build a more solid resiliency to market trends. 2.7 Economic Impact of the Airport Airport Activity Airports play a key role in regional economic and social activity, expediting the movement of people and cargo to and from a region. The importance of airports to rural regions is one of the reasons that federal and provincial governments are willing to provide capital funding and sometimes other programs to support airports operations. This section discusses the type of activity at YVV, how economic impacts are measured for a site like this, and then the direct, indirect, induced and total economic impacts of the site based on multiplier analysis. Aviation Most of the economic activity at YVV is aviation-related. Employment activity at the site includes: The airport itself has a little over three (3) full-time equivalents including maintenance and management staff. 33

35 Nav Canada contracts a third-party to provide weather readings and data. 4 FTE are employed by Nav Canada s contractor and are based at the airport. Nav Canada and the Coast Guard also maintain their equipment at the airport. Tenants and pilots use the airport for flights, including charters. Tourism The airport is also a major gateway for visitors in the region, particularly in the summer. It is one of the few regional airports that can accommodate business jets. Georgian Bay region is an attractive tourist destination, including scuba diving (near Tobermory, which is famous for its shipwrecks), rock climbing (in Bruce Peninsula National Park), Salmon fishing, hiking, and cycling. Regional attractions include: The Cobble Beach Golf Course and other courses; The Concours D Elegance Car Show in September, and The Griffith Island Hunting Club. Medical The airport is also used for medevac purposes, which is critical to the regional quality of life. ORNGE aircraft are based in Toronto, and fly to Wiarton as required Measuring Economic Activity Economic impact measures economic activity, such as spending or employment. Impacts can be measured for an economic sector, a project, or a change in spending in the economy. Economic impact is measured in different ways. Two (2) of the most common measures of economic impact are Gross Domestic Product (GDP) and jobs, which are often reported as fulltime equivalents (FTEs). These and other measures such as Output and income are used to explain the impact of activity in the economy. Statistics Canada analyzes the entire Canadian economy and regularly updates an input-output model which describes economic activity in the country. Economic impact analyses such as this report are primarily based on Statistics Canada s input-output model. The economic impact is divided into the following concepts to assist with analysis: Direct These impacts are directly attributable to the operations in an industry, firm, etc. For example, at YVV, all activity based at the airport is considered direct. Indirect Indirect activity supports or enables direct activity. A supplier for a direct activity at the airport is indirect activity. For YVV, this includes supplier to the airport, for example. These are analyzed using economic multipliers. Induced Induced activity is created by people in direct and indirect sectors spending money in the regional economy. For example, a Nav Canada support worker spending money for groceries generates induced impacts. These are also analyzed using economic multipliers. Total impacts are the sum of direct, indirect and induced effects. 34

36 2.7.3 Current Economic Impacts The total direct jobs at the site were measured via telephone interviews with the airport and local businesses. Indirect and induced impacts are analyzed using economic multipliers. Direct Impacts Direct employment related to airport operations includes 8.5 jobs. In the case of YVV, jobs and full-time employment (FTEs) are identical. Employees at the airport earned approximately $461,000 in wages, yielding an average of $54,000 per job year in income, including benefits. Employment figures are summarized in Table 3. Table 3 - Direct Employment and Wages Employment (Jobs) Income 8.5 $460,593 Including indirect and induced impacts, airport activities generate approximately: 14 total jobs in Ontario and $776,000 in total income. Table 4 - Direct and Total Employment Employment (Jobs) Income Direct 8.5 $460,593 Indirect 3.3 $188,633 Induced 2.2 $127,186 TOTAL 14.0 $776,413 Multiplier Impacts The economic measures for YVV GDP and total Output are measured using multiplier analysis and are shown in Table 5. Direct impacts are approximately: $651,000 in direct GDP, and $1.15 million in direct Output. The total impacts are approximately: $1.19 million in total GDP, and $2.10 million in total Output. 35

37 Table 5 - Direct and Total GDP and Economic Output GDP Output Direct $650,833 $1,150,138 Indirect $188,633 $507,392 Induced $127,186 $446,945 Total $1,194,495 $2,104, Summary Table 6 summarizes the economic impacts of YVV. The direct impacts of the site include 8.5 jobs $461,000 in income $651,000 in GDP And $1.2 million in Output As the direct impacts are based on easily verifiable information, it is recommended that they be emphasized over total impacts. Total impacts are based on multipliers produced by Stats Can s input-output model. These are calculations are based on analysis of the entire provincial economy and are more open to question than direct impacts. Table 6 - Direct and Total GDP and Economic Output Employment Income GDP Output (Jobs) Direct 8.5 $585,000 $850,541 $1,297,559 Indirect 2.9 $185,000 $283,105 $502,672 Induced 2.6 $148,000 $309,196 $520,571 TOTAL 14.0 $918,000 $1,442,842 $2,320,802 36

38 3. Airport Benchmarking Analysis Our team conducted a benchmarking of five (5) airports of similar size and function to position Wiarton-Keppel International Airport (YVV) on a number of criteria and activities, namely key economic drivers, airport tenants, marketing strategies, revenue generation sources and land available for development. Both the list of airports and the list of criteria were defined in consultation with the Wiarton airport Team. This exercise provides an overall portrait of the positioning of YVV versus some of its competitors. The key conclusions and some recommendations deriving from this benchmarking are summarized in section Airport Positioning and Strategy Review of Airport Commercial Tenants This section will focus on reviewing the current land uses at each of the surveyed airports by examining their tenants. The tenants can provide insight into what type of businesses other airports have attracted on their grounds, and if they are following a strategy to market to a specific industry besides aviation businesses. Table 7 - Review of Airport Tenants Airport Tenant Industry / Activity Wiarton Grey Bruce Telecom Telecommunications Coastguard Search and Rescue / Coastal Patrols Environment Canada Weather Nav Canada Navigational aid Farmers Agriculture Chatham- Z3 Aviation Aviation / FBO Kent St. Thomas Flight Centre at Aviation / Flight training Chatham-Kent Airport Fabulous Flights in Ultralights Aviation / Sightseeing Kent Flying Machines Aviation / Flying Club Farmers Agriculture St. Thomas Zimmer Helicopter Aviation / Maintenance + Charter + Training and Test Flying Jade Investments Aviation / Property Investment Purple Hill Aviation Aviation / Maintenance and Repair St. Thomas Flight Centre Aviation / Flight training + Meeting rooms Super marine Aircraft Aviation / Aerial application Central Helicopter Training Aviation / Helicopter Flight training Farmers Agriculture Stratford Stratford Air Services Ltd Aviation / Flight training Elms Aviation Aviation / FBO + Maintenance Farmers Agriculture 37

39 Collingwood Short Aviation Aviation / MRO Future Air Flight School Aviation / Flight training + Sightseeing Genesis Flight Centre Aviation / Flight training + Sightseeing BIGBLUEAIR Aviation / Helicopter Tours, Air Taxi Collingwood Flying Club Aviation / Flying Club Airmotive Technologies Group Aviation / MRO + Aircraft Sales Inc. RAAC Collingwood District Aviation / Flying Club Douglas Air Photography Aviation / Aerial Photography Farmers Agriculture Niagara ALLIED AVIATION Aviation / FBO St. Catherines Flying Club Aviation / Tours + Aircraft Charter + Aerial photography National Helicopters Aviation / Helicopter Tours + Charter + Aerial photography Niagara Falls Air Tours Aviation / Tours + Aircraft Charter FOX Aviation Aviation / Tours + Aircraft Charter Eaglerock Aviation Aviation / MRO Genaire Aerospace / Repair + overhaul for DND, manufacturing of pallets and crates. RAA Niagara (Chapter 4910) Aviation / Flying Club CARES (Civil Air Rescue Search and Rescue Emergency Service) Farners Agriculture Note: Some tenants may not be listed as complete listing of tenants was not always available. This table shows that almost all of the surveyed airports have a good tenant base from the general aviation and aerial work sectors, but most airport lack businesses from other aviationrelated sectors. Compared to the other benchmarked airports, Wiarton is weak in terms of aviation-related business Marketing Strategies This section outlines the marketing strategies that surveyed airports have implemented in recent years. The different initiatives could be eventually coupled with ongoing marketing objectives and activities in Wiarton. 38

40 Table 8 - Marketing Tools, Business Development Initiatives Airport Wiarton Chatham-Kent St. Thomas Stratford Marketing/ Business development tools Minimal. Brochures, merchandise, small social media presence and website for the airport that has not been updated. Airshows generate good attendance. Marketing and Business Development is all done through the City and their economic development efforts who promote the airport through events and conferences. The airport hosts various events from model aircraft, to antique car and to truck driver training and others. The airport is also hosting barbecues each Monday evening throughout the summer. The Z3 Aviation (airport management) website provides more information than the official airport site, which is located on the city s web site. The airport uses various marketing tools. Mainly the Great Lakes International Airshow, barbecue every Wednesday evening, promotional videos and promotion of tourism activities like the tourism train and poker runs. Airport marketing also relies on attendance at trade shows, brochures, social media and joint marketing with CAGO. Economic development office promotes the airport in their business development and marketing efforts for the region. Collingwood Niagara Website is their primary tool because most of the potential tenants don t require traditional marketing campaigns to be driven to the airport. The main marketing tool is the region s tourism, and subsequently the airport benefits from this through GA tenants. They are working on marketing collateral to promote the land development opportunities. They also recently published an online survey to find out the public s level of interest for commercial scheduled flights. This airport was recently successful in attracting a regular scheduled passenger s service named Greater Toronto Airways. The company now offers scheduled flights on 8-seaters aircraft between Niagara and Billy-Bishop Airport (Toronto). Of the mentioned initiatives, several can be highlighted to eventually be considered at the Wiarton airport. Some of the surveyed airports, such as Chatham-Kent and Stratford, have all of their business developments and investment attraction done through the municipal government or the local economic development agency. Others rely on the airport s online presence and distribution of flyers and brochure to attract potential tenants. They also conduct marketing initiatives such as surveys on their web platform Collingwood and Niagara. St. Thomas has marketing done for their air show and has several other marketing initiatives from social media to brochures for the airport. What can be taken away from the other airports is that having an up-to-date website and strong relationships with the city and the local economic development agency are two (2) ways of attracting economic activity at the airport. In that sense, it is recommended that Wiarton considers the following as part of its marketing efforts: 39

41 Conduct a review of the website and potentially create a new updated version; and Expand the airports relationship with the local/regional economic development and tourism agencies for them to promote the airport through their different activities. Marketing at Wiarton s airport hasn t been extensive. There have been brochures and various merchandises for the airport, but there is almost no social media presence and the website for the airport has not been updated in some time. Ideas can be taken from the other benchmarked airports as to what might be avenues worth exploring Revenue Generation Sources Parking and Landing Fees This section highlights the fares collected by the airport for aircraft parking and landing fees. By analyzing other airport s fees and pricing structures, we can determine Wiarton s competitiveness and take note of other pricing structures that could be adopted. It is important to bear in mind that several airports waive some charges if fuel is purchased. We calculated these fees under the assumption that no fuel was purchased to obtain the best possible comparative data. Table 9 - Aircraft Parking and Tie-down Fee Comparison Table Airport Wiarton Chatham- Kent $10 daily / $44.73 or $25 (grass parking) monthly (Less Fees than kg) $10 daily / $42 monthly $20 daily (over kg) St. Thomas Stratford Collingwood Niagara $17.46 daily / $46.20 monthly $6 daily /$67 monthly $100 monthly (3 000 kg kg); $150 monthly (Over kg) *Average fee of the price per 1000kg for each weight category $15 daily (Single) / Waiting on Monthly $18 daily (Twin) / Waiting on Monthly $40 daily (Jet under kg) / Waiting on Monthly $70 daily (Jet over kg) / Waiting on Monthly $10 daily / $90 monthly (Less than kg) $13.2 daily / $125 monthly (3,000-4,999 kg)* $25 daily / $160 monthly (5,000-9,999 kg)* $58.5 daily / $230 monthly (10,000-19,999 kg)* Aircraft parking fees or daily tie-down fees for the surveyed airports typically follow a fixed price per day, with the exceptions of Collingwood and Niagara that follow a fixed rate per weight category and type of aircraft Single engine, Twin engine and jet. Wiarton follows the fixed price per weight structure, but also offers lower fees for grass parking. 40

42 Their overall fees for aircraft under 3,000kg are on par if not slightly lower with the surveyed airports as daily fees average to roughly $10 but monthly fees average out to just over $60. For aircraft with weight ranging from 3,000 kg to 6,000kg there is only the Niagara district airport for which we can consider for comparative purposes because of its pricing structure and the Wiarton airport s fees are slightly lower than Niagara. It could be worth looking into adding additional weight categories, which would be similar to the Collingwood and Niagara District airport. This would permit to increase rates for heavier or larger aircraft without affecting the light/small aircraft category, typically more price sensitive. Table 10 - Aircraft Landing Fee and/or Facility Fee Comparison Table Airport Wiarton Chatham- Kent Fees Free ( kg) Free all other aircraft $20 ( kg) $20 or 200L fuel purchase (8000+ kg) $25-50 Commercial Aircraft St. Thomas Stratford Collingwood Niagara $31.37 (facility fee, piston) $94.11 (facility fee, turbo Prop) $ (facility fee, Jet) Free all other aircraft $50 Commercia l aircraft Free (Single) $60 (Twin, Jet, Helicopter under kg) 80$ (Twin, Jet, Helicopter over kg) Free (Under kg $57.50 Aircraft from 4000kg to kg $115 Aircraft over kg Aircraft landing fees have a significant variance from one airport to another. Airports such as Niagara District and Wiarton follow a weight-based pricing structure of having a fixed price for aircraft over and under a certain weight category. Others such as Collingwood have a pricing structure by aircraft type with prices being divided into helicopters, jets and single/twin engine aircraft. The rest of the airports have no landing fees unless the aircraft is commercial in which case they charge a flat landing fee. St. Thomas has no landing fees, but has aircraft facility fees, which are comparable to the landing fee rates. These fees are structured by aircraft type and weight distinguishes piston, turbo prop, jet aircraft and helicopters. Based on the observed airports, it is recommended that Wiarton does not increase its landing fees structure given that three (3) of the surveyed airports do not charge such fees for non-commercial aircraft. Landing fees must remain low to not be regarded as cost burden by recreational pilots Land Lease ($/sq. ft. per year) This section highlights the yearly costs per square foot of leasing airport owned land. This can either be for commercial or private usage and is often used as a mean to generate additional revenue from the airport property. These prices do not include airport maintenance charges and other similar charges. 41

43 Table 11 - Land Lease Rate for Serviced Land at Comparable Airports Airport Serviced land ($/sq.ft.) Wiarton* between $0.25-$0.33 Chatham-Kent $0.30 Collingwood $0.40 London $0.22 Niagara $0.302 Owen Sound $0.35 St. Thomas $0.205 Stratford **$0.29 Competition Average Land Lease Rate $0.295 *There isn t a pre-determined price for serviced land at the airport. ** Average rates at the airport may vary from $0.23 to $0.35. Average land lease rates for the surveyed airports serviced lots vary from $0.205 to $0.40 per square foot annually, which corresponds to a $0.29/sq.ft./year average. The Wiarton airport s land lease rate varies between $0.25 to $0.33/sq.ft./year for a median value of $0.29, which makes Wiarton s fees structure pretty much aligned with the competition. Therefore, we simply recommend increasing the low leases ($0.25/sq.ft.) to the market average ($0.29) when the contract is due for renewal Hangar Lease This section lists the total GA hangars at each airport and those that are available for rental that are either privately or airport-owned. The purpose of this benchmark element was to determine the type of property and rental price of units at airports where the size of the population in the city area, and the economic activity are equivalent to Wiarton. 42

44 Table 12 - Availability of General Aviation Hangar and Leasing Rate at other Airports Airport Wiarton St. Thomas Stratford Brantford Chatham- Kent Lease Rate ($/sq. ft.) Collingwood Niagara $120K (for sale) $ monthly for unheated GA hangar General Aviation Hangar (GA) Units available (airport-owned and privatelyowned) $ regular/ $400 heated** T- Hangar $262, $368 or $515 per month Cannot Disclose Privately owned (rate determined by owner) Privately owned (rate determin ed by owner) Total Units at airport* *Approximate count based on visual observations from airport layout plans. ** Estimates as the hangars are all privately owned. The information gathered shows that General Aviation hangars aren t available, for the most part, at the surveyed airports. The exception is the Chatham-Kent Airport, which has two (2) GA hangars available with lease rates that the Airport did not want to disclose. The Wiarton airport has one (1) GA hangar available for sale at $120,000. It would be worth examining the demand of GA hangars and seeing if their construction would attract tenants because of the low offering from the surveyed airports. Industrial hangars were also considered in this comparison table. However, not all of the airports in this benchmark have industrial hangars/buildings and for those that did, there were none available and the rates were either unavailable to be disclosed or negotiated on a case-by-case basis Other Sources of Revenue This section will investigate revenue sources that don t fall under traditional aviation-related revenue streams representing potential concepts that could be implemented in Wiarton. 43

45 Table 13 - Non-Aviation Revenue at other Airports Airport(s) Non-aviation revenue Description Wiarton Yes Currently, agricultural land leases for $14/acre per year for a total acreage of acres. The lease was contracted by Mac Boulter, Roger Hayes and Jim Hill. Contract is due for renewal at the end of Cell phone tower land rental Office space for two tenants Concord Auto Show Chatham- Kent St. Thomas Stratford Collingwood Niagara Nav Canada/Environment Canada Yes Concerts, Car/Truck shows and other events. Agricultural land leases. Yes Agricultural land leases, with potentially increased lease rates ($250 per acre). Yes Agricultural land leases to farmers. Yes Leases grounds to farmers for them to produce hay while maintaining grounds. Yes Solar farm in 2017 contract signed with Samsung Cell phone towers. They used to do festivals at the airport. Other sources of revenue at the surveyed airports are scarce with the exception of agricultural land leases to local farmers. In airports such as Collingwood, they are primarily set up as a mechanism to save on ground maintenance costs as lease fees charged to farmers result in minimal revenue streams. The other example was at the Chatham-Kent airport where several events, including car and truck shows are held each year. The Niagara district airport also held car events like the Chatham-Kent airport in the past, but have since been discontinued. These events were criticized by some of the surveyed airports because of their low revenue for the amount of organizations required and did not recommend them. While they aren t present at the surveyed airports, solar panel farms are also an emerging trend at several Canadian airports and should be considered as viable options because of their potential to generate higher leases per acre than agricultural uses. It was brought to our attention that the actual agriculture land lease will soon be due for renewal. 44

46 We will recommend increasing the land lease rate to a price that is more aligned with the leasing value of agriculture land in the Wiarton region. Based on discussion held with local authorities, it was suggested that the target price should be set between $50 and $100 per acre. 3.3 Land Number of Available Lots / Zoning This section shows the lots (in acres) that are available for development at each airport along with their zoning classification. Table 14 - Available Land and Zoning at Benchmarked Airports Airport(s) Lot(s) Wiarton Airside / Groundside Lots Chatham-Kent Airside / Groundside Lots St. Thomas Airside / Groundside Lots Stratford Airside / Groundside Lots Collingwood Airside / Groundside Lots Niagara *Approximate Southwest Aviation Area Eastern Development Area Other Areas Surface (1 acre = 43,650 sq.ft.) Zoning 820 acres Agricultural, Environmental Protection and Institutional 200 acres* Airport Zone 500 acres Employment/industrial purposes 85 acres* Waiting on info 390 acres Airport and Airport Related Employment Lands 25 acres 10% commercial 90 non-commercial 25 acres 25 acre 10 acres solar 15 commercial 300 acres* Commercial and other uses Total Acreage Available at Benchmarked Airports The information regarding the available acreage at each airport mentioned in the previous table is summarized in the following figure. 45

47 Figure 2- Total Available Land (in acres) Total available land (in acres) Wiarton St Thomas Collingwood Niagara Chatham-Kent Stratford All the surveyed airports have available land for lease with Wiarton and St. Thomas having the most. Zoning at these airports is usually designated Aviation or Airport with exceptions for agricultural land leases which greatly limits development to aviation-related businesses. As such, the zoning would potentially have to be amended if an industry from another commercial sector would want to proceed with development on the airport s grounds. Our research has demonstrated that airport has developed different classes of zoning to accommodate non-aviation uses. A good example is St. Thomas where the Employment/industrial classification allows them the flexibility to accommodate several industries outside the aviation sector. This approach could be used at Wiarton to maximize its development potential and market its land to non-aviation businesses. 3.4 Concluding Remarks and Recommendations Section 1: Airport Positioning, Economic Drivers and Strategy Many conclusions can be drawn from this benchmarking analysis. The first is that investment attraction and business development initiatives are mostly centred on collaboration with city and economic development officials so that they can promote the airport at trade shows and other events. Having an up-to-date website, which can be used for specific marketing initiatives such as surveys is also a great way to reach out to the clientele. As Wiarton s marketing efforts have been minimal in recent years, following this example would be beneficial in many aspects. Regarding current tenants at these airports, they are all typical aviation-related tenants (MRO, flight school, charter flights, etc.). Looking at attracting non-aviation activities through a strategic tenant attraction program aiming to position the airport in specific niches would be something that would differentiate YVV from the surveyed airports that as mentioned have not diversified their base of tenants. 46

48 Section 2: Revenue Generation Sources When we examine the other airports parking and landing fees, Wiarton s prices are generally level if not lower than the competition. Fees should be reviewed to see if it is advantageous for Wiarton to adjust them to meet these fixed rate averages. It should also be reviewed if the airport could be adding weight categories to its pricing structure allowing YVV to generate more revenues for larger aircraft. In terms of land leasing rates at the Wiarton airport, the average of surveyed airports amounted to a $0.29 sq.ft. per year while Wiarton does not have a set price for land lease per square foot. It is recommended to investigate into implementing a fixed land lease fee in line with the average of the other airports for future development. There are no available industrial and general aviation hangars for rent or sale at the surveyed airports with two (2) exceptions Chatham-Kent with two (2) available GA hangars for rent and Wiarton s available hangar for sale. This leads us to conclude that it could be worth examining the demand for both these types of hangars and defining the existing demand at Wiarton for new hangar development at the airport. Agricultural land leases to farmers are quite common amongst the surveyed airports; however this remains the only common alternative revenue source other than aviation-related revenue at the surveyed airports. Car shows and other events are present at some airports, but do not represent significant revenue streams for the airport. While not present at the surveyed airports, hosting solar farms is popular amongst Canadian airports. Non-aviation uses such as solar farms could be examined into greater detail to see if they could be a fit in Wiarton. Section 3: Land Most of the airports including Wiarton have several hundreds of acres available for development. Wiarton with its 820 acres ranks first ahead of St. Thomas 500 acres of developable land. However, zoning at the St. Thomas airport allows for several non-aviation development opportunities to be pursued while the rest of the airports are typically limited to aviation and airport specific uses. A complete review of the zoning designation for Wiarton Airport s lands was conducted and amendments were proposed to expand the type of uses that can be developed at the airport (see section 11 for details) 47

49 Part II Identifying Opportunities for the Airport Research Summary The second section aims to describe the steps that have been undertaken for the identification of development opportunities for YVV. It first highlights the comments and suggestions raised during the focus groups and 1on1 consultations held with the different stakeholders (industry, airport tenants, local organizations, etc.). The second part presents the information gathered through the phase of validation calls where multiple organizations were contacted to identify the region s strengths and assets that could be leverage to drive investment and growth at the airport. Finally, the third part features the key trends and opportunities raised by the 29 surveyed aviation and aerospace organizations. Opinions of YVV expressed by local aviation and tourism organizations are also presented. The information gathered throughout this validation process played an important role in the selection of development concepts presented in Part III. 48

50 4. Consultation Sessions The following section provides an overview of the discussions, topics, comments and opportunities that were expressed throughout the various consultations that took place during the initial phase of the mandate. 4.1 Return on the 1on1 Interviews and Focus Group Sessions Focus Groups In collaboration with the Township of Georgian Bluffs and Wiarton Airport, our team hosted two (2) industry focus groups on August 17 th and 18 th, The first focus group was attended by six (6) business people, citizens and a representative from the Chippewas Native Community. The second focus group was attended by eight (8) people again from various sectors (see Appendix 1 for the list of attendees). During the focus groups, attendees were asked to provide a brief overview of their company/organization, activities, types of products/services, technologies and in-house equipment. Attendees were also asked to share their opinion on: 1) market trends within their own sector of activity, 2) possible ties between their business and the airport and 3) what asset is missing locally or what effort should be undertaken that could help drive more investment and activity to the airport. Overall, the focus groups generated good ideas and showed a vision and willingness we had not seen in many communities. Attendees suggested several opportunities and avenues to support the Airport Growth Strategy. Here are some of the main comments: The development of tourism packages to attract pilots and aircraft could generate more activity. The region is rich in tourism destinations. Hiking, rock climbing, scuba diving are among the main adventure/sport activities. The region is also rich in agri-food, life at the farms, fishing and hunting experiences and during winter, cross-country and alpine skiing (in Blue Mountain) and snowmobiling. There were a lot of discussions on the challenges the Tobermory peninsula faced in terms of the number of visitors. It seems that early each weekend or holiday the parking lots on the peninsula fill up so it is a repeated challenge for visitors. Suggestions were made to create at the airport a parking area to capture this overflow of vehicles and coordinate a shuttle service to bring the visitors to the Peninsula. There are a fair number of local citizens who need to travel daily to the greater London and/or Toronto. Some of these trips are for medical/health reasons, as well business and government related. It might be worthwhile studying the opportunity to reintroduce commercial air service. 49

51 Griffin Island Hunting Club and Cobble Beach Resort are two (2) destinations that attract wealthy individuals who could fly in. The Hunting Club uses on and off helicopters to ferry its clientele from the main land to the island. Helicopters are used when waters are choppy and rough. Cobble Beach is hosting an annual car show with a smaller aviation component. According to some people, the show has lost a bit of luster lately. It was suggested to follow the evolution of the Owen Sound Airport has a closure is still an option being contemplated. If such a closure was to take place, Wiarton Airport should dynamically market its facilities and attract flight training activities and grow its general aviation hangar farm. The attendees also suggested various non-aviation avenues. One that generated a lot of discussions was the possibility and potential need in the region for an agro-food incubator. These lines of thoughts led to potential Indigenous farming and using airport lands for basic farming activities. Some of the attendees raised the question of winter boat storage it seems that the boat yards are looking for both indoor and outdoor space. Along the same lines, using airport lands to grow various crops and maybe an experimental farm. Some of the types of crops suggested were: mushrooms, worms, crickets. The notion of brokering the airport lands either on a short term basis or longer was also suggested. The representative from the Chippewas community suggested tourism packages to visit native lands and learn the life style and history of the tribe (Aboriginal Experience). Discussions were also held on the development of a native welcoming centre that could be located at or near the airport. The Chippewas would greatly appreciate if the Township leaders agree to meet with the tribe leaders. The Airport terminal has space to house other tenants it could be turned into a business centre or accelerator building. The airport should try to attract/open a restaurant. Part of the airport lands could be used as a commercial or industrial park leveraging proximity to the various highways and providing access to the airside One-on-One Meetings The consultation process also included private, one-on-one meetings with a number of public, business, tourism and academic leaders. Overall, more than thirty (30) such meetings were held either in person or by phone conference. The objective of these meetings was similar to those of the focus groups, but also provided more in-depth knowledge of the activities, technologies, programs and growth perspectives of each visited leader. The meetings also helped the consultant to pre-validate or dismiss some of the proposed opportunities. 50

52 Overall, representatives from Georgian College, economic development, tourism and city officials, airport tenants, Grey and Bruce Counties, the Meaford Military base, regional economic leaders and technology-related manufacturers, were met from August to October. A complete list of the organizations we met/spoke with can is in Appendix 2. Below is a summary of the main discussions and opportunities that came out of the one-on-one meetings and the follow-up calls and meetings we conducted to validate and challenge the various information, opportunities and obstacle we encountered One of our first meetings was with Georgian College. This meeting generated ideas and opportunities to be validated. The conversation ranged from the aviation management program, to pilot training, including the College culinary program has a tourism attraction activity. The College also has a simulator that recreates various environment and landscapes. This simulator can be used in a dining area. Georgian College in Owen Sound is also renowned for its marine emergency training program. Over 1000 students come to the College every year from January to March around 100 students per week. Discussions were held on ferrying these students by air to reduce their travel time. If such an air service were to be started, the College could look at recommending it to its international students. Our team met with the Owen Sound Economic Development office. This meeting provided a strong portrait of the main economic drivers of the town, labor availability and the state of manufacturing in the region. Some of the key highlights were the opportunities around Bruce Power, the growth of agro-food in the region, the potential ties with the native communities and the growth of tourism. We met with Kuhl Machining, one of the few machine shops in the region. Kuhl is a well maintained and equipped shop. They suggested that one of our focuses could be on quality of life and trying to attract more manufacturers to provide a more stable base of revenues for the entire region. Highway access and distance to the major transportation corridors are two main issues that have played into the region losing many larger manufacturing plants. We met with GN Blue Engineering. This group works mainly in the region. Again, tourism and vacation were raised as the main economic driver for the region. But they also suggested our work look into boat/marine storage, flight to Toronto, work and training being conducted at CFB Meaford. This meeting also raised other opportunities around locating a Township Northern Office at the airport, supporting the growth of a mushroom farm by offering airport lands and developing rental cottages and housing for pilots and aircraft owners at the airport. The meeting with the Owen Sound Chamber of Commerce was also very productive. Some of the ideas discussed were around culture, music festival and outdoor adventure like ziplines, rock climbing, waterslides and go kart track. We were also informed of a major fibre optic project (SWIFT) that will bring very high speed internet to the region over the next 3-5 years. The lack of fast transportation to the region was raised again as well as the need to support and develop more retail activities. 51

53 Here is a listing of various other ideas that came out of the one-on-one meeting: an Aboriginal Working Farm, develop a fundraising campaign to support the airport, verify air travel needs from the large employers, develop a Business Incubator and/or Entreprise Centre, solar panel, the airport has an image issue, investigate the ties with the Georgian Circle Tour. We also met with Thom Construction. The company sees some potential to develop a light industrial park at the airport. The community also offers a nice setting for retirement homes. Thom Construction invests in some projects, if the financial modelling is interesting they are opened to discuss a potential investment. Grey Co Tourism has a 550 K marketing budget annually. The marketing strategy focuses mainly on the greater Toronto area and southern Ontario. Blue Mountain draws a large portion of the tourist, but the Tobermory Peninsula is seeing a strong growth. Some of the key attractions are rock climbing, waterfalls, beaches and the Bruce Trail. They suggest promoting a dual personality approach with nature adventure during the day time and arts, culture and culinary experiences at night. The Meaford EDO focuses are the Meaford film festival, the Scarecrow festival and they suggested meeting with CFB Meaford. They support the approach of growing a retirement community. Our team also spoke to three (3) Marina s and boat yards. We were able to identify an opportunity and need for additional boat storage where airport groundside lands could be used. To validate the potential of a daily flight to the greater Toronto region and/or London, we contacted regional Health Organization to challenge the number of medevac and of people having to travel south for various types of test, surgery and others. Along the same line, we contacted Ornge to discuss the possibility of locating (mainly during the summer) one aircraft at Wiarton Airport to service the growing population and related accidents. Our team also spoke to many farmers to challenge the development of an agro-food incubator, using airport lands to grow various types of crops and the notion of an experimental farm. Many Tourism companies and individuals, including Griffin Island and Cobble Beach Resort were met or contacted to challenge the various opportunities, the potential use of aircraft to ferry visitors and provide services. The OPP was part of the groups we talked with looking to assess their requirements for winter driving training, aerial operations and prisoner transportation. We spoke to multiple airlines and aircraft charters companies to estimate the cost of operating daily flights from Wiarton airport. We also spoke to CFB Meaford again to understand the type of training they do, what are their needs for aerial operations and discuss how/if the airport could play a role to support their activities. 52

54 The comments, opportunities and vision expressed in the focus groups and one-on-one meetings have been taken into consideration to assess and evaluate the feasibility of developing these ideas at the airport. They are included in the proposed concepts in the overall study. 5. Validation of Potential Growth Opportunities for YVV This section presents the development ideas with the most potential that were identified during the consultation sessions and throughout the market research conducted by the Explorer Solutions team. For each of the proposed ideas, we briefly outline the methodology and rationale that lead us to dismiss or retain the different development concepts. Through this validation phase, we managed to identify the most suitable and feasible concepts for the development of the airport s land parcels. 5.1 Retained Opportunities Evaluation of Aviation Opportunities Bruce and Grey Counties are some of the most visited counties in Ontario. Every year, thousands of visitors are attracted to their natural beauty, as well as the healthy range of activities that can be done in the area. A study conducted for Regional Tourism Organization 7 indicated that the majority of visitors in the region came from Southwestern Ontario, followed by those from the Greater Toronto Area (GTA). Demographically, Bruce and Grey County visitors tended to be male, in the age group, with high income. Among Bruce and Grey County visitors, the most recognized places in the county are Tobermory, the Lake Huron beach towns of Port Elgin, Sauble Beach, Kincardine, and Southampton, as well as Wiarton and Walkerton. Some of the most popular attractions in the county include the Bruce Trail, Sauble Beach, Bruce Peninsula National Park and Fathom Five National Marine Park. Overall, the most popular attractions in Bruce and Grey Counties are related to nature. Nature lovers in the region can also make the most of the remarkable waterways, notably the direct access to the Georgian Bay, which is famous for its leisure fishing, particularly wild salmon, and its scuba diving adventures. Hunting is also a popular activity, with Griffith Island, North of Wiarton being very popular among foreign visitors. There is also a decent number of hunting opportunities in Grey County. In addition to these natural attractions, both Grey and Bruce Counties feature a prominent heritage, with the presence of the Chippewas of Nawash and Saugeen Tribe first nation. The Chippewas operate Cape Croker Park, a renowned camping ground surrounded by forest on the edge of the Georgian Bay. Activities that can be done onsite include camping, learning traditional art and the tribe s history, as well as meeting with elders. By analyzing the various activities offered in the region, related to nature experiences, and by surveying the possibilities that are offered in proximity to Wiarton Airport, we have come to the conclusion that several tourism packages could be offered to recreational GA pilots and private jet owners and their family looking for week-end getaways. 53

55 At the moment, this segment is relatively small, but with the majority of tourists in the area coming from Ontario, we believe that GA tourists who would fly between 1-2 hours to Wiarton could represent an interesting development opportunity. As such, we propose developing tourism packages, revolving around nature, wildlife, native experience and sports activities to provide these visitors with an all-inclusive experience. Wiarton airport is one of the only airports in the region that features a runway capable of accommodating business jets. As such, it is the destination of choice for larger aircraft in order to visit local attractions, such as the Cobble Beach Golf Club, or the Griffith Island Hunting Club. During the summer time, these aircraft owners appreciate the presence of customs at the airport, especially those who come for hunting, as it allows them to fly in directly from the USA. However, it has been mentioned to us that in the autumn months, there are no customs on site, and the business jets have to make a detour via Waterloo airport or others in order to go through customs. One of the airport s tenants has expressed interest in having a 2,500 to 4,800 sq.ft. heated hangar at the airport, for the storage of their new aircraft. They also mentioned their intent to lease out space to business jet owners visiting Wiarton in summer and autumn. This construction of a larger hangar to accommodate storage needs of transient traffic will be subject to further analysis confirming the market potential. In sum, this expressed interest combined with Wiarton s location advantages to serve the business aviation clientele is among the factors that led us to retain the development of aviation hangars as one of the concepts Evaluation of Non-Aviation Opportunities Food-related industries are some of the largest employers in Bruce and Grey Counties. Agriculture features prominently throughout the region, given the great climate and fertile soil. With over three thousand farms and more than half a million farmed acres of land, Grey County is the number one producer for hay, apples, sheep and lambs and ranks second in Ontario for cattle. The local agriculture production is not just limited to traditional farming, as more exotic foods like buffalo, emu, wild boar and rare mushrooms are also produced. Local famer s markets feature a wide variety of products, such as honey, maple syrup, fruits and vegetables, organic products and various other home grown/made products. Agriculture is also one of the most important components of Bruce County s economy, involving over 3,750 farm operators who generate annually more than $255 million in gross sales. There is also a wide variety of supporting and processing industries which are related to the food production. The most promising agricultural opportunity that was identified is the growth of haskap berries (also known as honeyberries). This type of berry has experienced a surge in popularity, and is known to be very resistant to winter cold weather, perfect for Canada s harsh winters. Certain airports in Quebec are actually contemplating the cultivation of this berry on an industrial scale. As it is very low maintenance, and, at the moment, is being sold at a very profitable price. 54

56 Haskaps can easily grow in Ontario, as the province s dense soils and continental climate are ideal for this type of crops. Valley Orchard in Grand Sudbury area, harvested 2,000 pounds in It is the first company in the area to produce at such a large scale. Its production was a great success, and sold out relatively quickly. Generally speaking, there is not enough haskap production to meet the growing demand. The average yield per bush is in the range of 3-4kg, and wholesale prices range from $5-$7 per kg. Another opportunity that we believe is worth exploring implies cattle and was mentioned to us by a local agricultural organization. This opportunity revolves around utilizing some of the airports land to trial managed rotational grazing with some cattle. It was proposed that a small herd of cattle could be used at first in order to try out the idea, and sold off within a year in order to make a small profit. This cattle farm could be combined with a small crop farm, tied to a possible incubator, to help local communities learn about cooking and crop cultivation. Experimental farming, and growing and buying local farm products are becoming increasingly popular among the population. Townsfolk visiting Grey and Bruce County in the summer and autumn seasons will certainly be inclined in consuming local products and participating in playful activities (edutainment) such as cooking what you have harvested, fished or hunted, would be appealing. Complementariness, suitable tourism profile and the interest from the business community lead us to retain the experimental farming concepts. In terms of food-related business, Bruce and Grey Counties feature a number of local food producers and artisans who wish to scale up their production. However, to achieve this, they require considerable investments for equipment, and extensive knowledge on how to sell their products. At the moment, there is no facility that is designed to help these small entrepreneurs, and most of the production is done on a very small and local scale. In order to help the local economy, there is a need for an incubator, which will help these local producers reach low volume production capabilities, and better sell their products. The closest agro-food incubator is in Northumberland, the Ontario Agro-Food Venture Centre. Grey County Economic Development has confirmed the need for an agro-food incubator, which would focus more on food processing, in order to help local communities. Not only could local producers be interested in using the incubator, but also local families who want to know more about food preparation and handling. Georgian College has manifested interest in helping with such an incubator, and could support it by providing training and some of the required equipment. The College is interested in exploring potential partnerships with the airport to better develop agro-food opportunities in the area. The culinary institute specializes in developing food business and cooking skills. The director of the program is very open to partnerships and would like to explore the concept of an incubator at the airport, as well as developing a culinary experience for GA tourists. Most support offered by the college would be in the form of training and equipment. To be successful, the incubator building could also house a permanent tenant, such as a micro-brewery or microdistillery, which would provide stable income to the incubator and also help boost tourism in the region, and potentially attract GA tourists from all over the province. 55

57 Another opportunity that was explored is related to boat-warehousing. The Georgian Bay is one of the most popular tourist attractions in Ontario, and is navigated by thousands of people very year. Many of these boat-owners come during the summer time to make the most of the pristine waters and coastline, and have their own boat stationed at the local marinas. During the winter time, however, boats cannot stay in the water and have to be stored inland in cold storage facilities. Preliminary observations show limited storage options, and from our conversations with local marina owners, there is always a need for extra storage facilities. One of the marinas we contacted was also interested in renting space if it was made available at the airport. As Wiarton airport is in very close proximity to the local marinas and the lake, it is considered by many as an ideal location for boat storage. Moreover, when the facility is not used for storing boats, it has been suggested that it could be used for other vehicles, such as RVs or ATVs. One development concept that proved interesting was the development of a solar farm on the airport s lands, in order to benefit from Ontario s FIT program. We checked with the program, and the airport is eligible for the preferential pricing offered for energy production. Several solar farm developers exist in the region, such as Samsung Renewable Energy Inc., and it is recommended that the airport pursue the development of the farm, in order to benefit from the FIT program. 5.2 Non-retained Opportunities Evaluation of Aviation Opportunities Commercial Air Services One of the ideas put forward during the one-on-one meetings with various stakeholders, was the development of scheduled passengers service that would fly tourists and local residents in and out of the Wiarton area. Having a regular service would be advantageous from a tourism perspective, but it would also help the airport qualify for infrastructure funding programs such as ACAP. The Airports Capital Assistance Program is a federal government initiative designed to help smaller airports with essential, safety-related infrastructure projects or equipment. To be eligible, airports must offer regular scheduled commercial passenger service, have handled over 1,000 passengers over the last three years or be designated as a Remote Airport. In terms of financial contribution, this will depend upon the number of passengers the airport handles: 56

58 Year-Round Regularly Scheduled Commercial Passengers Number of passengers % contribution of approved project costs Number of passengers % contribution of approved project costs 1,000-49, % 300, ,999 45% 50,000-74,999 95% 325, ,999 40% 75,000-99,999 90% 350, ,999 35% 100, ,999 85% 375, ,999 30% 125, ,999 80% 400, ,999 25% 150, ,999 75% 425, ,999 20% 175, ,999 70% 450, ,999 15% 200, ,999 65% 475, ,999 10% 225, ,999 60% 500, ,999 5% 250, ,999 55% 525, % 275, ,999 50% From our research, we have found that the closest regular airline services in the region serve Kitchener and Toronto. Although, Greater Toronto Airways (GTA) has mentioned that it would be open to look into the feasibility of servicing Wiarton from and to the GTA area, flying a small 10- seater aircraft at a cost of $500-$700 per round trip. However, a complete demand analysis, including identification and survey of the potential clienteles will have to be performed and paid for by the community. A hangar for deicing also figures among the other requirements. Following the discussion with GTA, steps were undertaken to evaluate the demand for regular passengers service. While some demand for a regular service has been expressed, notably within the business community and through Georgian College, a complete demand analysis will have to be conducted in order to accurately quantify the demand for the service. A market analysis for a scheduled passenger service will also need to validate the demand arising from the tourism segment and confirm their interest in flying from the Greater Toronto area to Wiarton. 57

59 It is likely that a certain number of tourists would be open to flying into the region to make the most of the natural beauty, but this may depend on other factors such as time and cost UBER Another potential development opportunity that was suggested was the possibility of working with UBER to develop a service to facilitate charter flights with GA pilots. This concept was not explored further, as according to Transport Canada s SOR/96-433, section , holders of a private pilot license cannot act as the pilot-in-command of an airplane or helicopter for hire or reward if the aim is to make a profit ORNGE We also approached ORNGE to evaluate their need to reposition one of their aircraft at Wiarton airport during the summer, for a faster response time to meet the growing visitor population and volume of accidents. However, they were not favorable to this idea. ORNGE has already positioned one of their planes in Muskoka as a trial program in 2009, but the demand was insufficient and the aircraft was pulled back. As Bruce Peninsula is only 200km from Toronto, it is more financially logical for them to keep their aircraft in the Queen City MRO Operator The potential of attracting an MRO at the airport was also explored, however, to attract an existing MRO, it will take a large volume of aircraft at the airport. From our analysis, at the moment the data is showing us that there is not enough volume to justify the presence of a fully serviced MRO. However, this proposal could be pursued in the future, once the volume of resident aircraft and movements increases. Moreover, one of the airport s tenants has expressed interest in starting a small maintenance operation in the near future, which could eventually grow in a larger scale operation if they are successful Evaluation of Non-Aviation Opportunities For the purpose of this study, we explored various proposals related to agriculture that emerged during the consultation sessions. These included the growing of mushrooms on the airports lands, and considerations were also given to the opening of unconventional farming such as growing crickets. Production of mushrooms is an interesting concept, especially given the presence of a specialized producer in the area. However, from our research, we found out that the local producer was more focused on small-scale volume, having little interest in expanding into bigger facilities. For an industrial-scale production, the surface requirements for the operation to be profitable were simply too important for it to be hosted at the airport. As for the other proposal cricket farming, it showed some potential especially given the rise in popularity of crickets for human consumption. Moreover, one of the largest cricket farms in North America is located in the Peterborough area. However, when contacted, they mentioned having recently confirmed with the City an expansion of their current facility. 58

60 Bruce and Grey Counties feature a number of reputable training and education institutions, notably Georgian College, which has campuses in Owen Sound and Collingwood. The Owen Sound Campus is of particular interest, as it features one of the most popular Marine Studies departments in Canada, as well as a reputable culinary institute. Moreover, Georgian College offers courses in Aviation management from its Barrie Campus. We approached Georgian College regarding possibly increasing their programs or facilities and potential partnerships with Wiarton Airport. One key area we wished to explore was their interest in expanding their aviation and aerospace training programs and verify their interest in opening a flight school at YVV. From our discussion with the Dean of aviation, the College has no interest in exploring this possibility, as the market for flight training is mature, competition is fierce and it is very capital intensive. Moreover, the Ontario government s moratorium on the development of new pilot training programs at the college and university level is another factor explaining why flight training is not being considered at the moment. The Centre for Marine Training and Research, at the Owen Sound Campus is now recognized as one of the most reputable institutions for marine technology attracting dozens of foreign students every year. We approached the centre to better understand the potential to cater to this international clientele by implementing scheduled air service between YVV and Toronto. According to the operations manager of the Centre for Marine Training and Research, it was too complex to evaluate if there will be a demand for the air service. Based on the statistics they are collecting, it is impossible to determine the proportion of students make use of the air service. The manager did mention that the busiest period for the centre is during the winter period with around 1,000 students being trained. This potential should be further explored if a study is commissioned to evaluate the feasibility of a scheduled passenger service. There were several other groundside use proposals that emerged from the consultation sessions and one-on-one meetings. One proposed groundside use involved contacting the Ontario Provincial Police and evaluating their need for a winter-driving training course on the airport s runway. We spoke with the OPP, and they are not interested in the proposal. The reason for this is that they already work with a dedicated training facility in Mount Albert that provides advanced tactical training for first respondents, including police officers. We also contacted the Canadian Forces Base in Meaford in order to explore potential links that could be developed with the airport, as they train 300 troops every week. Unfortunately, the Commandant indicates the base does not offer any air training whatsoever, only ground training. Most of their clientele is Canada-based, and they do not have a need for additional infrastructure or space. In fact, they have ample land at their actual base of operation to simulate any kind of training scenarios. 59

61 5.2.3 Conclusion From our validation process, we have come to the conclusion that in the short to medium term, the airport should explore six (6) development concepts. These are: Agro-food incubator and experimental farm; GA hangar expansion and fly-in packages; Solar farm installations; Cold-storage warehouse space for boats and other vehicles; Agriculture; and Incentive vehicle parking. By working on these development concepts and building on the existing interest from various stakeholders Wiarton airport will be able to ensure that its future growth will be successful. 5.3 Industry Survey Results This external review was performed with the aim to identify trends and issues affecting the aerospace and aviation industry and evaluate if those changes would impact in any way the development of the Wiarton Airport. By going beyond industry statistics and surveying companies out of the Wiarton area, we are able to better understand the needs and requirements of the aerospace and aviation industry. This also gave us insight as to potential development avenues for the Wiarton airport. Below is the table summarizing the 29 surveyed companies and their classification in the aerospace industry followed by an explanation of each category. Table 15 - List of surveyed companies (29) Company Category Company Category Bell Helicopters -Textron OEM Partner Jet Charter Bombardier OEM Flightexec Charter Composites Atlantic Tier 1 Chartright Charter COMTEK Structures Esterline Électronique Advanced CMC Tier 1 DiscoveryAir Technical Services MRO Tier 1 Koss Aerospace Tier 1 Field Aerospace Tier 1 SkylinkExpress Air Freight Delastek Tier 2 SkyLink Aviation Charter Avior Inc. Tier 2 UTC Aerospace Systems- Landing Gear Tier 1 60

62 L-3 Comm MAS Tier 1 DAVWIRE Tier 2/3 MDA Corporation Tier 1 GS Networks Tier 1 Mecaer Amérique Tier 1 Applied Precision Inc. Tier 3 Avianor Group Tier 2/3 Cyclone Manufacturing Inc. Tier 3 MOOG Tier 1 Big Blue Air Services Helicopter tours and services Genesis Flight Centre Georgian Bay Airways FBO, flight training and charter Flight training and charter Evans Aviation Flight training and charter Table 16 - Terminology Definition for Aerospace Manufacturers Category OEM Tier 1 Tier 2 Tier 3 Description Assemble, then market and sell the final aircraft platform to end customers. Engaged in the integrated design, development, manufacturing and marketing of major aircraft systems such as landing gear systems, navigation systems and propulsion systems. Engaged in the integrated design, development, manufacturing and marketing of engineered and proprietary equipment and sub-systems such as sensors, instruments, displays and communications equipment. Parts and assembly suppliers who act as subcontractors that manufacture or supply components and sub-assemblies such as machined components, minor assemblies and their customers are typically tier 1 and 2 firms along with other tier 3 firms Key Identified Trends One of the biggest market trends that companies are seeing is additive manufacturing (3D printing) there s still a lot of testing and certification that needs to be done, but it is quickly asserting itself. Today, Additive Manufacturing is mainly used and developed at the OEM level. Major research initiatives are being developed between industry and academia. It is anticipated the lower level of the supply chain will be asked to upgrade their equipment within the next 5 to 8 years. Companies are also looking for any material, parts, components or technologies that will lead to overall cost reduction, improved production time while respecting quality standards. Other trends are the diversification and internationalization of clientele and suppliers for Ontario companies (notably outsourcing low value manufacturing outside of the country), also airports 61

63 have been increasing their lease rates and available space at major airports has become rare. This has led companies to shift to smaller regional airports instead. Finally, making sure companies are structured to handle sudden economic downfalls such as drops in oil prices and currency fluctuation is something that is being prioritized by several companies for the future Key Identified Issues The biggest supply chain issues that these companies are facing are all related to on-time delivery while maintaining quality standards. Consequently, finding a supplier who can accurately measure their lead times and production capacity is the second most recurrent problem as this can ultimately help in reducing delays along with overall cost reduction. Long term agreements, supplier consolidation, improved levels of communication, more certification (The most mentioned certifications by OEMs and Tier 1 companies were: AS9100, ISO 9000 or 9001 and Nadcap) and sharing the inventory investments is an initiative that is becoming a pillar to manage these supply chain issues Considered Factors for Expansion or Relocation of Activities Because of equal shipping costs in North America and a spread out clientele, half of the companies did not see having an increased distance to a production facility as an issue or something they have to remediate by relocating assets closer to their market. The other half sees proximity to the production facility as necessary for improved relations and proper management. Most of the surveyed companies in Ontario are not looking to relocate or expand operations to another location in Ontario, and most of their expansion plans are being done at or near their current operations base or overseas. When proposed with expanding or relocating to a new location, companies offered one of these 2 answers: 1. (25% of total answers). No because we want to maintain our proximity to our clientele, we like our current location, and we would like to keep our operations close to one another. 2. (75% of total answers). It depends on localization factors such as: the presence of a cluster like environment, the skilled labor of the region, proximity to clients, demand of the region, what incentives are being offered and the availability of land and hangars (for charter companies). For the companies closer to Wiarton, all those contacted have expressed the intention to pursue growth in the upcoming years. Although, none of the interviewed companies intent to open new offices elsewhere in Ontario, they want to focus on local growth at their current site. What is interesting though, is that all interviewed service companies said that that getting closer to touristic regions and highly densified population areas were the most important location factors. For the manufacturing companies, being in close proximity to the market they serve was the most important factor. 62

64 5.3.4 Ontario s Business Environment Most Ontario companies in the aerospace manufacturing section are seeing high growth (over 3%) due to expanding international sales. However charter aircraft companies are seeing either no growth or declining growth as economic downturns have greatly affected most sales. The business environment in Ontario has been favorable in most cases with high praise for the government incentives (notably land and tax incentives, export grants, interest-free loans and R&D funding). Less than favorable comments were: incentives are badly placed (they would like greater focus on incentivizing Tier 2-3 manufacturers rather than only focusing proposed incentives for OEM s and Tier 1s) and the high costs of energy scaring away potential investments in the province Perception of the Wiarton Airport Most of the interviewees were not very familiar with the airport. They know it exists, but the majority have visited the airport once or twice, so their inputs were very limited. One company mentioned that the airport infrastructure was not in very good condition. If they were in an expansion mode, some of the organizations mentioned that the airport would only be a good fit if the infrastructure was rehabilitated. Furthermore, one of the interviewed organisations (a flight school), mentioned that the weather is pretty harsh in the Bruce Peninsula region, which is a disadvantage for their type of operation. 63

65 Part III Development Opportunities for Airport s Land Parcels Research Summary Part III of this report directly builds on Part I and Part II findings to recommend six (6) development concepts to pursue that could be implemented on the airport s land parcels. The objective is to provide the airport with promising concepts likely to guide development in a way that maximizes existing resources and infrastructure and that truly benefits the community. The sections comprised in Part III present the concepts individually while including background information, a preliminary market analysis, the envisioned cluster model and the competitive advantages that link the projects to Wiarton. The suggested locations of the concepts on the airport lands are presented in the Development Plan s section. 64

66 6. Vision and Mission of the Airport Mission The mission of the Wiarton Keppel International Airport is to operate a safe and secure full service airport focusing on delivering meaningful value and a heightened customer service to both the aviation and community. Vision Wiarton Keppel International Airport aims to be a leader and partner in the economic development of Bruce and Grey Counties by offering attractive value propositions to its aviation clientele, the local community, the tourists and local businesses. Principles Wiarton s mission and vision are based on the following main principles, which aim to create the conditions to build a sustainable business model and ensure the future growth of the airport: 1. Maintain a safe and secure operation compliant with the Canadian Airport Regulation (CAR). 2. Develop and maintain an adequate airport infrastructure to ensure a high level of customer service and support. 3. Strengthen the airport financial by diversifying its revenue sources and developing concepts that make the highest and best use of the airport s lands. This will ensure the airport can overcome seasonal variations in air traffic movement by having a more stable source of income. 4. Become a tourism destination for GA pilots and expand the aviation hangar park. Create turnkey tourism packages offering getaways trips to recreational pilots and business aircraft owners. Market hangar rental and ownership opportunities to these clienteles. 65

67 7. Proposed Development Concepts This section expands on the business opportunities identified throughout our research and consultation sessions with multiple stakeholders, and provides a detailed summary of the corresponding six (6) proposed development avenues we believe are best suited to Wiarton Keppel International Airport. The results of the consultation process coupled with the findings of the market outlook have led to the identification of development concepts that will help the Airport to leverage the local assets and respond to the needs of its tenants and business community. Assumptions Financial projections have been based on the assumption that the airport s role will be limited to leasing the land to developers and tenants (lessor s role) ensuring supporting infrastructure is properly maintained and readily available to builders. The airport nor the Township of Georgian Bluffs will own aviation hangars or any other type of commercial buildings. Costs and revenues assumptions have been based on industry standards and comparable data. When applicable YVV airport fees structure has been used. Table 17 - Revenue and Cost Assumptions Assumption Revenues Revenue growth Land rental rate for agriculture use Land rental rate for commercial use Property taxes Costs Description 2% annual increase applied at full build-out. $75 per acre. Median price for agriculture lease in the Wiarton region. $0.29 per sq.ft. This is the average rate actually charged at YVV % - Taxation revenue share for Township of Georgian Bluffs tax schedule applied No increase over the 20-year period. Infrastructure Contingencies and engineering fees were adjusted from 35% to 20%. Inflation Capital loan interest rate Capital loan payback period Building construction cost for commercial property (aviation and non-aviation) 2% inflation applied 4% - annual 25 years Greater Toronto Area s average construction cost. The cost model developed by the Altus Group was used - _2014_web.pdf 66

68 Important Notice Construction timeframe for the development of each of the concepts was based on the assumption that financial resources are available in sufficient amounts to support the development of the supporting infrastructure and buildings. As such, the proposed development timeframes represent the best-case scenarios and should only be considered as high level projections. This approach has allowed us to evaluate/compare the proposed concepts and determine which option(s) generates the best financial return for the airport. 7.1 Development Concept A Agro-Food Incubator and Experimental Farm Concept Presentation Both Grey and Bruce Counties feature a rich and diverse agriculture history that is expected to continue and prosper given the increasing demand for local growth foods. Recent events, such as AG 4.0: The Next Big Thing 2, organized by Grey County and new agricultural organizations illustrate the need for new niche farming products to respond to the ever-growing demand. One of the potential improvements identified in the field of agriculture and food production was the requirement to support small producers having the desire to scale up their operations. In many cases, this requires significant investment, which is not always available and considerable knowledge not always easily accessible. As confirmed by the Grey County Economic Development, there is a need for a facility that would help local producers scale up their production, and teach them how to better market their products and run their businesses. The concept also suggests dedicating lots for experimental farm, and producers wishing to expand production and/or test new crops in close proximity of the incubator. It is also envisioned that the Agro-food incubator collaborates with Georgian College to offer training classes to small scale producers and entrepreneurs, as well as cooking classes for the local community. Georgian College was approached with this concept, and is very favorable to it. The College also has some of the required equipment needed by an agro-food incubator, such as food-labelling machines. They have offered support to the concept in the form of in-kind training. 2 AG 4.0: The Next Big Thing is a conference and tour organized by Grey County to shine a spotlight on creative technological innovation in agriculture. 67

69 Part of the land dedicated to experimental farming could be used for managed rotational grazing, which would also help local producer s further research the concept and study its impact. The airport has already been approached by a local agricultural organization to explore the possibility of a managed rotational grazing project. Such an initiative would entail having a small herd of cattle grazing different parts of the land in order to manage the growth of new pasture, as well as revitalizing the soil. The rest of the experimental farm could be tied to the incubator, offering land to local producers who want to try out specialty crops and do not have the resources for them. Moreover, the local community could benefit from the farming space, to learn how to cultivate crops, and follow short training courses from the incubator to better understand how to cook their produce and how to deal with seasonality Positioning Markets and Clienteles Agro-food incubator The Agro-food incubator will be targeting local food producers who wish to expand their production capabilities as well as receive training to help them grow their business. In order to ensure the profitability of the agro-food incubator, there will be a need to attract a permanent tenant who would rent the majority of the building for their operations. After discussions with Grey County Economic Development, the potential of attracting a microbrewery or micro-distillery was mentioned. These types of organizations often need basic space to house their equipment and craft their products. Grey County Economic Development is currently exploring with a potential micro-distillery tenant who could be interested in renting out such a facility at the airport. Usually, these types of companies are attracted to locations, which offer the possibility of increased tourism traffic. Therefore, a location at Wiarton airport could prove to be a viable alternative, given the increased GA tourists who would fly to the airport, with the development of fly-in packages. Experimental farming The experimental farm will be targeted to agro-food incubator tenants who wish to trial certain crops and do not have the correct land at their disposal. The local community would also be interested in using the land, as it could provide them with a space where they can learn how to grow and cook their own food, through incubator activities as well as have a practical experience on the experimental farm land. It has been mentioned that at the moment the land at the airport might not be fertile enough. Therefore, there is a need to revitalize the soil. One of the best ways to do it would be by conducting a natural revitalization, through cattle farming. In order to reduce the impact of cattle farming on the land a proposed approach could be through managed rotational grazing, where the plot of land on which the cattle graze is changed every week in order to help the pasture grow. The cattle also naturally fertilize the land, as well as plough it. Such a practice could improve the soil on the airport, which could then be used for growing new crops in the future. 68

70 For this proposal, the airport could work with a local farmer in order to manage the herd. It is important to keep in mind that for the project to be a success, this farmer should have previous knowledge of managed rotational grazing, as it can be a complicated process Development Site and Building Requirements The proposed development site for both the Agro-food incubator building and lands for experimental farming is situated at the Northeast of the airport south of Road 1. The agro-food incubator will be comprised of a 10,000 sq.ft. building, attached to Road 1 via an access road and a parking lot. More specifically, it is suggested that the agro-food incubator is laid out as follows to accommodate the needs of local growers and producers: - 1,500 sq.ft. of common shared space area (lunch room, restrooms, conference room); - 1,500 sq.ft. for the class room; - Five (5) rooms of 1,400 sq.ft. each totaling 7,000 sq.ft. to host tenants production activities. All of the land around the building totaling around 38 acres will be dedicated to experimental farming. It is estimated that 20 acres could be assigned for the experimental grazing as a demonstration area with the remaining land parcel divided in smaller lots. It is important to note here that all patches of trees present on the land will have to remain untouched, being protected by the Niagara Escarpment Development Control. 69

71 Figure 3 - Proposed Development layout for the Agro-food incubator and experimental farm Development Timeframe Before construction can begin, the Township and the airport will have to undertake the necessary steps to prepare the site, develop the infrastructure, identify funding programs to fund the incubator, and work on the financial arrangements. While this is on-going, negotiation and contracts may be signed with a developer for the preparation of the architectural plans and launch marketing activities to attract tenants. The suggested development timeline for the Agro-food Incubator and Experimental farm is as follows: Construction timeframe: Incubator will be constructed during the second half of Year 2 to be operational on Year 3. This will allow enough time for the Township of Georgian Bluffs to identify and secure funding for the construction of the incubator building and development of the infrastructure. Designated lands for experimental farming activities totaling around 38 acres could be leased out while funding is secured and the incubator is being constructed. It is therefore recommended starting leasing land for agriculture purpose on Year 1. 70

72 Capital Requirements, Cost and Revenue Assumptions The charts below provide an estimate of the construction cost and capital requirements for the Agro-food incubator construction. Table 18 - Estimate of the construction cost and capital requirements for the Agro-food incubator construction Capital Cost Description Estimated cost Supporting Infrastructure Incubator building Building s infrastructure Water service and electrical service $42,000 $145 per square foot Office-type building with workshop/production areas Access road and parking lot Septic field $1,450,000 $174,780 $34,000 This model has the advantage of requiring minimal infrastructure work. The cost to bring water and electrical service to the future incubator site totals is only $42,000. The cost for supporting infrastructure is assumed to be covered by the Airport/Township. As for the cost of the incubator building and associated infrastructure, this capital cost may be eligible to FedDev s Investing Regional Diversification, a provincially-funded program. The agro-food incubator project will help diversifying the local economy, and in that sense, it falls right into the program s objectives. In our financial projections, we assumed that the entirety of the building cost is funded through public funding sources Financial Projections The table below presents the financial projections for the first year operation, over five (5) years, and for the entire twenty-year period. Rental rate of $0.29/ft² for the incubator building and $75/acre for the 38 acres agriculture parcel were used for revenues calculations. Municipal taxation revenue of % was also applied on the incubator building (assessed value of $1.4M). Expenses included the interest and capital loan repayment for the supporting infrastructure cost estimated at $42,000. Table 19 - Financial Projections for the Agro-food Incubator and Experimental Farm Year 1 Year 1 to 5 20-Year Period Revenues Land rental for commercial use (building) $0 $17,750 $124,191 71

73 Land rental for agriculture use $2,844 $14,801 $69,107 Taxation $0 $27,320 $163,918 Total $2,844 $59,871 $357,216 Expenses Loan Payment for Supporting $0 $9,271 $55,628 Infrastructure (interest and capital repayment) Site maintenance - road and $0 $440 $3,617 services infrastructure Total $0 $9,712 $59,245 Pre-Tax Profit (pre-tax profit margin) $2,844 $50,160 $297,971 %(83.4) Year 1 revenues only consist of agriculture leased land. As per the development timeframe, the incubator is projected to be constructed during the second half of Year 2, and scheduled to be operational on Year 3. This explains the pre-tax profit increase between Year 1 and the Year 1-5 period. For the entire 20-year period, the pre-tax profits reach $297, Development Concept B General Aviation Expansion and Tourism Concepts Presentation We recommend growing the General Aviation activities at YVV through the development of two (2) initiatives. The first concept revolves around the expansion of the existing general aviation hangar park, in order to meet identified demand for stand-alone hangars. We estimate that most of the demand for new hangars will come from GA pilots. An existing airport user has expressed in building a 4,000 to 5,000 sq.ft. hangar. The development will be phased out to respond to the expressed demand. The airport s role will be limited to leasing the land to developers or aircraft owners interested in building aviation hangar. Fly-In Packages The second concept is based on creating turn-key tourism fly-in packages to promote YVV s location advantages to recreational pilots and business aircraft owners. The packages (see section ) will help to attract additional traffic, increase fuel sales and augment transient activity at the airport. The increased volume of airport users also represents a great opportunity to market to this new clientele the developable land designated for aviation hangar use. The development of the packages as well as the marketing material that will accompany the promotional efforts should be done in collaboration with local, county and regional tourism organizations, which have shown interest to collaborate. The recommended clientele is GA aircraft owners and operators seeking daily, weekend or longer term gateway and adventures. 72

74 The proposed fly-in packages are detailed in section The proposed packages revolve around four (4) general activities, which are Wildlife and culinary experience, Native experience, Nature Trail and Sports. The Wildlife and culinary experience revolves around tourists hunting, farming or fishing their food, then heading to the Georgian College Culinary Institute to learn how to prepare and cook a meal based on what they got. The Native experience would focus on having GA tourists visit the Chippewas of Nawash s reserve at Cape Croker Park in order to learn more about their history and culture. The Nature Trail package would offer prospective tourist a range of activities aimed at helping them discover the natural beauty of Grey and Bruce Counties. Finally, the Sports package would offer a range of activities for the adventure seeker who want to push their physical prowess. These packages have been designed to play on the local region s strengths, and to offer year-round activities for GA tourists, meaning flying in to Wiarton can be done, no matter the month Positioning Markets and Clienteles The main clientele for the GA Park expansion will be pilots and aircraft owners from the region, as well as local businesses that need to store or relocate their aircraft. These will include current tenants who need extra space to park their aircraft, and future potential tenants who wish to relocate at Wiarton airport. A marketing campaign targeting recreational pilots and businesses that need storage space will have to be launched. The GA market in Ontario is one of the biggest in North America with 8,546 privately registered piston aircraft in Representing 29% of the Canadian GA fleet, Ontario is the Canadian province with the largest fleet Number of private registered piston aircraft Number of registered piston aircraft 73

75 Development Site and Building Requirements Development for the GA Park is divided in two (2) stages. The first development phase will revolve around the construction, on a per demand approach, of a maximum of 4 stand-alone hangars. We recommend these hangars be located in the available spaces alongside the existing taxiway. Road access is already available, which will reduce the development cost. Once this row is fully built-out, the second development phase should be located southwest of the existing General Aviation hangars. The hangar layout will be roughly the size of existing hangars - 2,000 sq.ft. - found in the General Aviation Park. The projected expansion will be comprised of sixteen (16) box hangars. Figure 4 - Proposed Development Layout for GA Park Extension 74

76 Development Timeframe For budgetary purposes, we suggest a conservative approach where a total of twenty (20) hangars will be erected over a 20-year timeframe. This assumption would mean the following development schedule: Phase 1 (Year 1-10): Construction of four (4) hangars in the existing park. Three (3) 3,000 sq.ft. hangar will be erected at rate of one hangar every three (3) years starting on Year 1 (triggered by demand) plus an additional 4,880 sq.ft. hangar projected to be constructed in the summer of Year 2, bringing the total to four (4) stand-alone hangars. Phase 2: Year 11-20: Development of sixteen (16) 2,000 sq.ft. box hangars at the rate of one (2) hangar per year starting on Year 11. Supporting infrastructure will follow the existing taxiway design and layout Capital Requirements, Cost and Revenue Assumptions The table below provides an estimate of the capital requirements for the two (2) development phases scheduled projected over the 20-year period. Table 20 - Estimate of the Capital Requirements Timeframe Phase 1 Development (Year 1-10) Building Requirements (developer s total construction cost) Infrastructure Requirements (Airport/Public s contribution) Phase 2 Development (Year 11-20) Building Requirements (developer s total construction cost) Infrastructure Requirements (Airport/Public s contribution) Assumptions Stand-Alone Hangar Hangar surface for three (3) units: 3,000 sq.ft. Hangar surface for one (1) unit: 4,889 sq.ft. # of constructed units: 4 $837,230 $55.00/sq.ft. for the 3,000 sq.ft. hangars and $70/sq.ft. for the 4,889 sq.ft hangar $116,150 Stand-Alone Hangar Hangar surface: 2,002 sq.ft. # of units : 16 $1,441,440 $45.00/sq.ft. $436,890 For calculation purposes, we based our projections on the assumption that a total of 12 constructed hangars will be erected over 20 years. 75

77 Table 21 - Revenues and Costs Assumptions Item Revenue Annual leasing rate / sq. ft. Assumptions $ rate for new lease construction As per Wiarton Keppel International Airport s average leasing rate for airport land 2.5% increase applied every year. Property taxes Fuel sale Cost Loan Payment for Supporting Infrastructure % (Commercial New Construction rate) Municipal rate (Township of Georgian Bluffs) rates applied. No increase over the 20-year period. Fuel revenues were based on the assumption that each new hangar would generate $840 in annual fuel sales (assuming that all fuel being purchased in YVV). To arrive at this conclusion, we calculated the fuel purchase value for a Cessna 172 averaging 100 flight hours per year, at a fuel consumption of 30l/hr, for a margin of $0.28 per litre (YVV actual mark-up). 4% interest rate / 25-year payback period Financial Projections Expansion of the GA park will allow the airport to increase the concentration of aviation hangars and generate additional fuel sales and leasing revenues. Airside infrastructure is already in place for phase 1 development (Year 1-10) where four (4) hangar units are projected (see table 20). Phase 1 development will need to be served with electrical and water, which represents a cost of $116,150. In comparison, Phase 2 development will require the extension of AGN 1 taxiway to the west, and electrical and water services for a total cost of $436,890. To illustrate the impact the construction of the taxiway will have on overall profitability; financial projections were separated by development phase. Table 22 - Financial Projections for the GA Park Phase 1 Year 1-10 Phase 2 Year Year Period Revenues Fuel sale $24,360 $120,960 $145,320 Land rental $38,098 $135,148 $173,246 Taxation $38,956 $111,426 $150,382 Total $101,414 $367,534 $468,948 Expenses Loan Payment for Supporting Infrastructure $85,465 $406,937 $492,402 76

78 (interest and capital repayment) Pre-Tax Profit (pre-tax profit margin) $15,949 ($39,403) ($23,454) (-5.0%) Developing the GA expansion concept beyond Phase 1 under the landlord scenario is not financially viable. As illustrated in the above table, revenue generated from the development of the sixteen (16) coupled with Phase revenues new hangar units are insufficient to pay off the $436,890 loan for the construction of Phase 2 infrastructure. It is therefore recommended that the development be limited to Phase 1 should the land-lease model is favored by the airport. That said, it is recommended that the airport explores the opportunity to own the hangar to be developed in Phase 2. Appendix 7 provides a high level estimate of the potential returns of the airport-owned scenario. In conclusion, the pre-tax profit margin for Phase 1 development totals $15,949 over 10 years. Under the present model, cost for servicing the site ($116,150) is borne by the airport/township, but a scenario where some of the cost is shared with interested developers could certainly be envisioned. In addition, development of Phase 1 will allow YVV to attract additional tenants and traffic movements, creating momentum and generating interest in the aviation community for Wiarton airport. This will be beneficial for Wiarton which needs to increase its aviation-related revenue and reach out to the GA aviation clientele. 7.3 Development Concept C Solar Farm Concept Presentation Canada is a world leader in the production and use of renewable energy. Renewable energy currently accounts for 16.9% of Canada s total primary energy supply, with solar photovoltaic energy being the fastest growing sources of electricity in Canada. According to Natural Resources Canada, the period was marked by the significant growth of installed capacity for solar photovoltaic power, which in 2014, reached 1,843 megawatts of installed capacity. The national solar industry employs a Canadian labor force of over 8,000, generates investment revenues approaching $2 billion and creates more than $550 million of direct economic output. The decreasing cost of solar panels (cost-per-watt of a solar panel is less than $1, opposed to more than $3 a watt four (4) years ago) is gradually making solar projects more viable. Subsequently, the industry is expected to play a major role in the global transition to a sustainable and clean-energy future. With 70 large solar farms already up and running, Ontario is by far the leading province in this transition. The province s unique pro-renewable-energy government policies has led to the 77

79 development of large-scale solar projects when other provinces only see small-scale projects due to lack of government support. In Ontario only, solar currently makes up more than 1,500 megawatts, with another 1,900 expected to be online by the end of Major sites include the 97-MW Sarnia Photovoltaic Power Plant and Samsung s 100-megawatt solar farm, located 40 kilometers south of Hamilton, which is currently the largest solar farm in Canada. What s even more promising is that the government of Ontario lists 112 approved solar projects to be developed in the short term, 12% of which will be located in Northern Ontario. Many airports across the U.S and Canada have taken the lead on renewable energy projects by hosting solar farms on their lands. Ontario s FIT program The Ontario Power Authority (OPA) has developed the Feed-In Tariff (FIT) Program for the Province of Ontario to encourage the development of renewable generating facilities of varying sizes, technologies and configurations via a standardized, open and fair process. Feed-in tariffs refer to the specific, guaranteed prices paid to renewable energy suppliers for the electricity produced by the generating facility. To be eligible, a facility must not produce more than 500kW of electricity; otherwise it will fall into the Large Renewable Procurement Program, which is currently in hiatus. While the pricing structure is differentiated by project size and technology type, FIT contract prices are intended to cover total project costs and provide a reasonable rate of return (11%) over a 20-year contract. In 2012, the initiative had managed to contract enough clean energy to power 1.2 million homes. This translates into almost 2,000 small and large FIT Contracts generating a combined installed capacity of almost 4,600 MW of electricity. The program will keep encouraging renewable energy projects over the next few years to reach the 10,700 MW provincial energy target. Proposed Model The airport could undertake two (2) different roles, whereas he could act as the energy producer or lease its land to solar developers. In most cases, airports tend to favor the first option of leasing their land to energy developers (landlord) staying away from the technical and contractual requirements that command the ownership option. It is therefore recommended that YVV opts for the landlord model and leases its land to a developer interested in developing solar installations at the airport. 78

80 Positioning Markets and Clientele Under the landlord scenario, the airport will have to identify and entice a solar developer that Wiarton Airport is the good location to build and operate a solar farm. In this scenario, the airport will have to prepare a value proposition highlighting the advantages to develop solar on the designed land parcel. That said, attracting a solar developer to invest at the airport will be heavily dependent on a successful application to the FIT program 3. The process leading to a successful bid will have to be launched in the next year to ensure the project meets the procurement deadline and the necessary requirements. A new application round will be opened next year with an energy target that should be similar to the last procurement bid closed on November 18. As previous rounds have shown, applications must be received between 4-6 months after the call for the proposal period Development Site and Building Requirements The southwest development area was designated for the development of the solar farm. In general terms an area of 100 acres can accommodate enough solar panels (depending on

81 select solar design) to provide as much as 12.5 megawatts (MW) of power. This assumes the number of panels required to produce each MW of power cover a surface of 8 acres. The specific design of the solar array can change the overall land requirements and power outputs. For budgetary purposes, we calculated the maximum production output for the land bordered by the two runways and the wetland area to the east. In total, the proposed developable land area reaches 86 acres. The budgeted development surface corresponds to average size project sponsored by the FIT program. When considering solar panels it is important to understand photovoltaic (PV) solar panels are designed to convert sunlight into electricity. To maximize electricity generation, manufacturers design panels to minimize sunlight reflection applying antireflective coatings and surface texturing on the panels, which usually have a solar transmission over 90%. However, in certain situations, the glass surfaces of the solar panels can reflect sunlight and produce glint (a momentary flash of bright light) and glare (a continuous source of bright light) that might result in a visual impact for pilots. Atmospheric conditions and actual materials used in the manufacturing of the arrays will ultimately determine the presence and intensity of glare for any solar project. Transport Canada and Nav Canada have developed a methodology to evaluate potential glare issues A 50 m buffer area is provided around the existing VOR/DME site to prevent electrical interference. 3-phase power capabilities will have to be developed to support the solar array. The capital plan includes a $10,000 amount to increase the site electrical capability. 80

82 Figure 5 - Designated Land for Solar Development Development Timeframe Development for the Solar installations will begin at Year 1, by ensuring the airport meets all the requirements for the FIT program. This will be followed by meeting with solar developers to discuss their views on the project. The information gained through the data collection process will help the airport in preparing its application for the FIT Program scheduled for Year 1 (2017). Then the airport will have to prepare and send a request for comments and letters of interest (LOI) to the interested parties, and conduct an environmental study if required. At the end of these steps, YVV will be able to prepare a request for proposals for the interested solar developers, choose the best candidate and launch the project. Construction is expected to begin during the summer of Year 2, for a site to be fully operational in Year Capital Requirements All capital costs are expected to be borne by the solar developer. Leasehold agreement for solar development projects typically implies that the developer takes charge of the construction of the solar array and the associated infrastructure. The responsibility of the lessor (airport) is limited to providing access to 3-phase electrical power. Preliminary evaluations estimate the cost to bring electrical service to the site at $10,

83 The chosen site should not cause any glare issues. Although, a study will be required to confirm that the installed panels will generate no glare, and once the study and subsequent design are complete, consultation and approval of Transport Canada and Nav Canada will be required Financial Projections The fourth development concept, namely the solar array, aims to tap into the various available funding programs for renewable energy initiatives and take advantage of the vast land space located south of the runway. Solar farm development yields better leasing revenue than agriculture use. For Ontario, the average land lease for solar development ranges between $750 and $1,500 per acre. The price paid by developers differs greatly between locations, depending on the market rates and on the contractual terms with the utility company. No standard leasing price could be determined in advance as many markets and financial factors are taken into consideration. Thus, we have utilized the $750 per acre price for our forecast and assumed that the entire parcel (86 acres) is developed. Table 23 - Financial Projections for the Solar Farm Land Lease ($/acre) Surface (acres) Annual Revenue - Starting on Year 4 20-Year Period Forecast Revenue Revenues $ $64,529 $1,161,520 Expenses Loan Payment $736 $13,245 for Supporting Infrastructure (interest and capital repayment) Net Revenue Total $63,793 $1,148,276 * Land lease prices have not been adjusted with inflation (lease agreement are set as fixed-price contract). The total net revenue from the solar farm development is estimated at $1.14M over the 20-year period. All infrastructure costs are at the charge of the developer, which greatly increases the profitability. 82

84 7.4 Development Concept D Warehousing Facilities Concept Presentation Wiarton sits at the head of the beautiful Colpoy s Bay, a long, well protected inlet offering outstanding sailing opportunities. With 250 ships out of which half a dozen is kept available for transient sailors - a fuel dock and modern equipment and maintenance services, the Wiarton Marina is a convenient home port in the region. The Marina has been experiencing increasing demand for storage space over the years and based on its President, this situation is likely to continue. Consequently, the Marina has welcomed the idea to lease building space on airport lands to meet part of the demand. The Wiarton Marina used to rent space at the airport in one of the airside hangar. Because this use was not-permitted on airside land, the lease had to be terminated. Since then, the Marina has been using alternative off-site option to meet excess capacity, but is still looking at other sites as demand keeps growing. Should groundside buildings be developed at the airport, the President confirmed they could be interested in renting between 3,000 to 5,000 sq.ft of space from September to May. In order to accommodate most vessels, 16 feet high door system will be required. The facility does not need to be heated, or lit, and a simple sheet metal construction would suffice. As a benchmark, the Marina currently pays $2.50 per sq.ft (annual basis) at their offsite location for the entire period. From our discussions, it is safe to assume they would consider the airport if the price would be in the same range. Table 24 - Potential Revenues from a Lease Agreement with Wiarton Marina Prospect Lease rate (for the Sept-May period)* Space (sq.ft.) Potential Revenues (for the Sept-May period)* Wiarton Marina $2.5 per sq.ft. 5,000 $12,500 *Corresponds to the storage season As per Table 24, a lease agreement with Wiarton Marina could generate revenue of $12,500 over the September-May period. There are a number of other marinas that offer outdoor and indoor storage located within a 50-km radius of the airport. Although their interest has not been yet confirmed, they could also have an interest in leasing storage space at the airport. 83

85 Positioning Markets and Clientele The warehouse s final consumers will be local Marina s or boat and large vehicle owners who wish to store their assets during off-season. During the validation of the concepts, we have spoken with Wiarton Marine Ltd., who was very enthusiastic with the idea. During the summer period, the hangar could also be used to store other vehicles such as RVs, or even snowmobiles. Further discussions and a small marketing campaign will be needed to evaluate the interest of the clientele in renting out the space during the summer. The airport will also have to identify a developer interested in owning and operating the warehouse facility. The airport s role will be circumscribed to leasing the land to the potential developer Development Site and Building Requirements The proposed development site is located at the southernmost point of the airport, alongside Concession 21. The warehouse would be accessed by a dedicated access road, and would feature a small parking lot along the frontage of the building. The warehouse footprint will total 10,000 sq.ft., for a non-heated steel hangar structure. The access door will have to be at least 16 feet high, and 20 feet large, in order to accommodate the most recent boats, which tend to be higher and larger in size. Figure 6 - Proposed Development Site 84

86 Development Timeframe The lot will be developed in two (2) installments where one 10,000 sq.ft cold-storage warehouse will be constructed in Phase 1 followed by an identical 10,000 sq.ft. hangar in Phase 2. Phase 1 (Year 1-10): Construction of one 10,000 sq.ft. warehouse building during the late summer of Year 1 to be operational the following year. The site will include access road, parking lot. Phase 2 (Year 11-20): Construction of the second 10,000 sq.ft. warehouse building during the summer on Year 11, to be operational in the autumn of the same year. The building will be adjacent to the Phase 1 building Capital Requirements, Cost and Revenue Assumptions Given the revenue model where the airport is simply the landlord, expenditures are tied to the construction of the necessary supporting infrastructure. We have detailed below the costing assumptions used to build the cost projections: Table 25 - Timeframe and Assumptions for the Warehouse Concept Timeframe Phase 1 Development (Year 1-10) Phase 2 Development (Year 11-20) Supporting Infrastructure (Airport/Public s contribution) Other Infrastructure Requirements (Developer) Assumptions Cold-storage warehouse Surface: 10,000 sq.ft. # of units constructed : 1 Cold-storage warehouse Surface: 10,000 sq.ft. # of units constructed : 1 $19,150 for electrical service. $177,480 cost for the construction of the parking lot and access road Financial Projections The table below presents the financial projections for the first year operation (Year 2), over five (5) years, and for the entire twenty-year period. A rental rate of $0.29/ft² for the two (2) coldstorage warehouses was used for the calculation of leasing revenues. Municipal tax rate of % was applied on warehouse buildings to estimate taxation revenues (assessed value of $700,000 per building). Developers will own the warehouse facilities and lease space for the storage of boats, RVs and ATV vehicles. Capital contribution from the Airport/Township will be limited to the cost of servicing the site with electricity. Expenses included the interest and capital loan repayment for the supporting infrastructure cost estimated at $19,

87 Table 26 - Financial Projections for the Warehouse Concept Year 2 Year 1 to 5 20-Year Period Revenues Land rental $5,800 $24,085 $220,037 Property taxes $4,396 $17,585 $127,492 Total $10,196 $41,670 $347,529 Expenses Loan Payment for Supporting Infrastructure (interest and capital repayment) $1,409 $5,636 $26,773 Pre-Tax Profit (pre-tax profit margin) $8,787 $36,034 $320,756 (86.5%) Pre-tax-profit margin totals $320,756 for the 20-year period, which represents a good profit generator for the airport considering that only two (2) building are projected to be constructed over 20 years. 7.5 Development Concept E Agriculture (Haskap Culture) Concept Presentation Many airports lease out land for agricultural use. To generate even more revenue out of this activity, a growing number of airports have taken an approach that consists in sharing costs and benefits with farmers through lease rates defined in terms of a revenue percentage. As an example, Denver International Airport leases out approximately 16,000 acres of farmland on a per acre basis to local farmers. Under the lease program, farm revenue from the sale of crops (mainly wheat, sunflowers, millet, and corn) is divided, with one-third going to the airport and two-thirds to the farmers. Other models exist where airports act as the landlords and lease land to solar farm developers. Previous studies and discussions reveal that many farmers are open to the idea of revenue sharing because having a fixed rent every year puts a financial burden on operations. Conversely, such a model translates into much more revenue for the airport when market prices are up. Depending on the airport s risk aversion and the regional land s characteristics and historical yields and revenues, we recommend considering agriculture and cost/revenue sharing scenarios to generate non-aeronautical revenues. Below is a table showing the potential revenues generated by a 100-acre lot dedicated to agricultural used, and based on the Denver International Airport lease agreement terms (one- 86

88 third / two-thirds). The numbers were based on current Ontario market prices and normal yields for different commodities likely to be grown at the airport. Table 27 - Potential Agricultural Revenues from Cost Sharing Agricultural Agreement for a 100-acre parcel # acres of land / per ton produced Annual Production (ton) Average price per ton Total Revenue (potential) Airport Revenue Share (one-third) Wheat (winter) $ $11, $3, Wheat (spring) $ $16, $5, Soybeans $ $40, $13, Barley $ $11, $3, Oat $ $12, $4, Corn $ $5, $1, Canola $ $46, $15, Berries $4, $338, $112, Haskap $6, $1,500, $500, Sources: Agriculture and Agri-Food Canada; Ontario Ministry of Agriculture, Food and Rural Affairs The majority types of soil available at Wiarton airport vary between Elderslie Silty Clay Loam, and Kemble Clay Loam. Kemble Clay loam is fairly well supplied with plant nutrients, and the chief limitation to crop production is the presence of rock outcrops and imperfect drainage. Elderslie clay loam has a medium to high level of plant nutrients in the virgin soil. Discussions with agricultural specialists have led us to believe that both these types of soil are healthy for crop production. However, it is important to note that the soil is typically 5 to 6 inches deep, followed by flat bedrock. The choice of crops will have to take this parameter into account. Why Haskap Culture? Haskaps are a small oval berry often compared to an elongated blueberry. Also known as blue honeysuckle or honeyberries, haskaps are an emerging crop in North America. The haskap has a similar skin to the blueberry, but its flesh is an intense purple. The fruit has small seeds, almost imperceptible in the mouth. The juice of the berry is of a very dark burgundy color. Haskaps have a unique and complex taste, often attributed to blueberry, raspberry and blackcurrant. Fresh or processed, haskaps showcase a very unique Figure 7 - Haskap berries 87

89 taste that can vary from one crop to another. This berry is very popular among food processors as it is easier to farm compared to other berry types, it is cultivated in the beginning of summer, and has all the health benefits of other berries. The Proposed Model For this concept we propose two (2) models that Wiarton airport could explore. The first one is the landlord scenario, which the airport already implements. In this model, the airport leases the land to a local farmer, and they choose what types of crops they wish to grow and keep all the revenues generated. The second proposed model is the Revenue Sharing model mentioned in the previous section. In this model, the airport gets a percentage of the generated revenue, but in return, it has to assume a portion of the operating costs. In a way, the airport plays a more active role in the agricultural process, and as a result, can yield higher revenues than the typical landlord model. Moreover, the airport could work directly with the farmer in order to ensure that the best crop is selected, to make the most of the current conditions and market Positioning Markets and Clientele The targeted clientele for agriculture development could be the same tenants who are already using the existing farmland north of the runway. The current tenant could be surveyed to determine his interest for the revenue/cost sharing model as this may provide them with more flexibility in terms of rent. The airport should also open a discussion with existing tenants to determine their interest in exploring new types of crop like haskap. If existing tenants are not interested in expanding production or in sharing costs/revenues with a third-party, the airport could work with Grey County to identify potential partners. Moreover, should the airport decide to move forward with haskap culture, we recommend reaching out to the Ontario Haskap Association to present them with the concept and start identifying potential partners for this project Development Site and Building Requirements The proposed 37.6 acres site for the agriculture development is located south of runway 11/29 east of the warehousing development area along Concession 21. The easterly border is delimited by Zion Church Rd. A review of the zoning has revealed that the designated land parcel was already zoned for rural development use, and that it was not subject to any Environmental Protection. The parcel area adjacent to the warehouse facility site has a surface of 17.8 acres and the second development zone bordered by Zion Church Rd totals 19.8 acres. 88

90 Figure 8 - Proposed Development Layout for the agricultural area Development Timeframe For budgetary purpose, it is suggested to start leasing the parcel on Year 1 to farmers interested in increasing production capability (landlord model). In order to compare the landlord with the revenue sharing scenario, financial projections for that second model were also budgeted for Year 1. Needless to say that in order to implement this model, Year 2 is a more realistic starting date Capital Requirements Developing the parcel for haskap cultivation will not require any infrastructure work. The parcel can easily be accessed by Concession 21 and most of the parcel is already being cultivated. This will facilitate the attraction of farmers interested in expanding production capacity or/and to explore new crops offering better yields Financial Projections As opposed to the other concepts, the approach taken for development of the agriculture parcel differs slightly. Two (2) scenarios are proposed: one where the airport will act as the landlord leasing land to farmers, and another option evaluates the financial returns for the airport of sharing the operational risks and revenues with the crop producer. The evaluation will be performed for the haskap crop which commands better yields (see Table 27) and seems to have a promising future. Landlord model Leasing rate of $75 per acre was used to calculate revenues for the 20-year period for the 19.8 acres parcel. Year-over-year revenue was increased by 2.5% to account for sales inflation. 89

91 Revenue sharing model For this model, costing and revenues assumptions were drawn from a study titled Mechanical harvesting of the haskap, operating budget, a 2015 report commissioned by the CRAAQ (Cultivating Expertise Knowledge Centre) 4. The CRAAQ report evaluates the equipment, material, and other expenses required for the operation of a five (5) hectares (12.4 acres) parcel. Based on average production yield of haskap plant (2.75kg/plant) and the average price per kilo (5$/kilo), the study calculates overall production yields and revenues for a five (5) Ha commercial-scale production. At this stage, the objective being to assess the potential of the revenue-share model, we will not provide the detailed costing breakdown and explain all of the revenue calculations. Should the airport decide to proceed with this scenario, a complete financial analysis shall be performed to determine with accuracy the profitability level. The following comparison analysis was based on the assumptions aforementioned. Revenues and costs for the revenue sharing model were projected assuming that the airport would contribute to a 1/3 of the operating costs, retaining a 1/3 of the revenue. These projections were pro-rated to the size of the parcel (37.6 acres) designated for haskap development at YVV. These projections should be considered as high level profit estimates and used for general budgetary purpose only. Table 28 High Level Financial projections for Haskap Culture Landlord model (20 Years) Revenue sharing model (20 Years) Variance Rev. sharing vs. Landlord Revenues Land rental $71,988 $0 ($71,998) Production value (1/3) $0 $2,802,567 $2,802,567 Total $71,988 $2,802,567 $2,730,579 Expenses Operating Costs (1/3) $0 $916,559 $916,559 Pre-Tax Profit $71,988 $1,886,008 $1,814,020 4 The CRAAQ, a Quebec-based non-for-profit organization funded by the agro-food industry, has the mandate to communicate knowledge, create and disseminate reference tools and carry out networking activities in the agriculture and agro-food sectors. 90

92 In spite of the fact that under the revenue sharing model, the cultivated land would start yielding revenue only in Year 4 (Year 1 planting phase, Year 2 and 3 sprout years), the model would generate an additional $1,886,008 in pre-tax profit for revenues of $2,802,567. The amount of revenues generated is almost 40-fold higher than developing the land under the landlord model. Given the profitability level, it is recommended that the Airport/Township considers the option of being an investing partner in the production of haskap. 7.6 Development Concept F Incentive Vehicle Parking Concept Presentation The Bruce Peninsula is one of the most visited national parks in Ontario, especially during the summer months. The Peninsula features one of the most popular National Parks, the Bruce Peninsula National Park, famous for the Grotto Shoreline, and the scuba diving capital of Ontario, Fathom Five National Marine Park. Every year, close to 138,000 people visit the Grotto Shoreline alone, and around 8,000 divers explore Fathom Five. Since 2008, Bruce Peninsula National Park visitor estimates have doubled, going from 194,000 person visits in 2008 to close to 400,000 in However, this considerable number of visitors every year brings a great deal of challenges, among which is road congestion caused by the people driving up from the GTA and London areas. It is estimated that over the last year, 150,000 people had to be turned away from the Bruce Peninsula National Park, as the park s facilities could not accommodate such a huge influx of visitors. Understanding that its 600 parking stalls capacity is insufficient to cope with the demand, the Park is searching for solutions to its infrastructure. The Park has commissioned a visitors forecast analysis for 2017 to help with the planning. In the meantime, visitors are still continuing to visit the Peninsula, and it is estimated that an average of 500 cars per day have been turned away in July and August alone, due to the lack of capacity. To help the National Parks, and the local community in developing practicable solutions to ease traffic and respond to the demand, the airport could initiate a Park and Shuttle Service (branded as Park and Play) targeted at Bruce Peninsula tourists. The idea behind this proposal would be that visitors could leave their cars at the airport, in a designated parking area, then take a shuttle that would drop them off either at the Bruce Peninsula National Park, or the Fathom Five National Marine Park for the day, and take them back to their vehicle in the evening. From our discussion with the Bruce Peninsula National Park superintendent, such an initiative would be in the parks interest, and would also contribute to reduce the region s overall carbon emissions. However, given the unknown factor regarding the park s visitor capacity, they would be first open to a small pilot project to test the concept and evaluate the response. The municipality of North Bruce Peninsula has conducted an analysis regarding the feasibility of having its own shuttle system, and the results are expected to come out in the coming months. However, certain organizations, including Bruce Peninsula National Park and the Bruce Peninsula Environmental Group doubt that the municipality will go forward with the idea representing an opportunity for the airport to build on the momentum and develop its own park 91

93 and shuttle service. Favorable to the concept, the Peninsula Environment Group believes that the main challenge will be to reach an agreement with the stakeholders (municipalities, townships, counties and Parks Canada). As for the transportation provider, the First Student Company (a local school bus operator) has shown some interest in participating in a shuttle service during the summer. With the right partnerships, this concept could prove to be very successful Positioning Markets and Clienteles End-users will be the tourists who come to the Bruce Peninsula to make the most of its natural beauty and want to visit the National Park. Instead of having to drive to the park, and run the risk of not finding any parking space, these tourists will simply drive to Wiarton airport, leave their car, then take the shuttle directly to the Park, where they will be guaranteed access. In order for this proposal to work, the airport will have to coordinate with Bruce and Grey Counties, the Municipality of North Bruce Peninsula, Parks Canada and a local bus operator such as First Student. The airport will have to promote its available land, and the little infrastructure costs required for the project to be a success. Previous attempts at a shuttle service in the region have failed, because there was not enough coordination between the stakeholders, and due to the uncertainty as to how such an initiative would materialize. By highlighting the parking area, and working with a local bus operator for the shuttle, the airport could provide local organizations with a turn-key solution addressing the congestion problem that plagues the North Bruce Peninsula in the summer season Development Site and Building Requirements The proposed development site will be situated north of the existing GA hangars and west of the airport entrance. It is suggested to initially develop 136 parking stalls under a pilot project with Parks Canada to first evaluate the feasibility and demand for shuttle and parking service. Once the demand is validated, and the service proves to be successful, the capacity could be increased by 364 spaces, with additional shuttle service. The airport should opt for gravel parking to minimize development costs. 92

94 Figure 9 - Proposed development layout for the parking area Development Timeframe The lot will be developed in two (2) installments where one 136 parking stalls will be constructed in Phase 1 (Year 2) followed by an additional 364 parking spaces in Phase 2 (Year 11). At full build-out, it is expected that the incentive parking lot will have a total capacity of 500 stalls. As depicted in Figure 9, the area right next to the airport entrance will be developed first with the second phase located further west Capital Requirements, Cost and Revenue Assumptions The construction of the incentive vehicle parking will require a total of $965,700 in capital infrastructure for site excavation, grading, canalization for storm waters, and installing the granular base. 93

95 Table 29 - Timeframe and Assumptions for the Incentive Vehicle Parking Timeframe Assumptions Phase 1 Development 136 parking stalls (Year 1-10) Infrastructure Requirements $324,300 Phase 2 Development 364 parking stalls (Year 11-20) Infrastructure Requirements $641,400 The proposed model for the incentive vehicle parking differs from the other concepts. The cost for the construction of the infrastructure will be covered with the parking and shuttle service fees charges to visitors. This approach will allow for the development of a self-sustaining model where revenue generated by the commercial activity are in sufficient amount to recoup the operating and capital costs. Revenue and Cost Assumptions Revenue and costs assumptions were based on industry standards for the transportation service sector. Data depicted in the below table are for budgetary purpose only and were used to determine to what pricing level (shuttle service and parking fees), the construction of the incentive parking was financially viable. It will be required to carry out a demand assessment surveying the visitors needs and requirements to determine in greater details daily occupancy rate and hourly volumes. Table 30 - Revenue and Cost Assumptions Item Revenue Daily parking and shuttle service fees Days and hours of operation Assumptions A average price of $45 per vehicle, per day was budgeted. $15 per vehicle was budgeted for parking. $15 per visitor for the shuttle service, assuming that for each parked vehicle, two (2) passengers will use the transportation service. Revenues projections are based on the assumption that the parking will be open from Friday to Sunday (7:30AM to 5:00PM) for a period ranging from June 1 to October 15. Total days of operation: 42. Daily occupancy rate Phase 1 The daily occupancy rate was set at 75% on Year 2 slowly increase to reach 95% on Year 6. This corresponds respectively to 102 and 129 parked vehicles. Phase 2 The daily occupancy rate was set at 50% on Year 11 slowly increase (5% per year) to reach 70% on Year 15. This corresponds respectively to 250 and 350 parked vehicles. The occupancy rate was capped at 70% for Phase 2 extension. Total parking capacity for phase 2 is at 500 stalls. 94

96 Cost Loan Payment for Supporting Infrastructure Shuttle Service cost Shuttle service number of buses Employees Marketing Site maintenance 4% interest rate / 25-year payback period. $1,500 per day, per bus Estimate was based on quotations received for 54-passenger coach vehicle used for long-distance trip (comfortable seats, toilet...). Preliminary evaluation of the expected traffic volumes estimates that a minimum of four (4) buses will be required to support the influx of visitors and ensure a shuttle departs every 30 minutes. This number of buses (4) will be able to support 200 daily visitors. An additional bus was added for every 50 visitors. A full-time equivalent (FTE) person will be hired at hourly rate of $15/hr. Another FTE resource will be added on Year 11. $10,000 per year was budgeted for the first three years to promote the service, and $5,000 per year for the subsequent years for printing of the marketing material. Distribution of brochure and flyers to visitors and word of mouth should be sufficient to capture the required volume. 10% of annual capital payment was budgeted Financial Projections 20-year projections show that at $45 per vehicle (parking and shuttle service for two persons), it is possible to be financially viable and even generate interesting surpluses. Starting on Phase 2 when total parking capacity reaches up to 500 vehicles daily, the model demonstrates solid returns. 95

97 Year 2 Year 2 to 10 Year 11 to Year Period Revenues Parking $64,260 $747,472 $2,611,350 $3,358,822 Shuttle service $128,520 $1,494,945 $5,222,700 $6,717,645 Total $192,780 $2,242,417 $7,834,050 $10,076,467 Expenses Loan Payment for Supporting Infrastructure $23,863 $214,763 $866,280 $1,081,043 Site maintenance $1,089 $11,525 $54,506 $66,031 Charter buses $252,000 $2,268,000 $4,725,000 $6,993,000 Staff $5,040 $49,163 $131,906 $181,070 Marketing $10,000 $62,145 $61,656 $123,800 Total $291,992 $2,605,596 $5,839,348 $8,444,945 Pre-Tax Profit (pre-tax profit margin) Available Public Funding Programs Green Municipal Fund for feasibility studies and pilot projects* Pre-Tax-Profit with Funding ($99,212) ($363,179) $1,994,702 $1,631,522 (16.2%) $350,000 ($13,179) $1,994,702 $1,981,523 * The pilot phase of the project (year 1-10), where 136 parking will be constructed, posts a loss of $363,179. Pilot projects are often funded through public funding to help support the operation in the first years. Given the nature of the project, the Park and Play initiative will certainly eligible to funding programs aimed at improving efficiency of transport and reducing carbon footprint. In that regard, initial researches indicate the potential eligibility of the project to the Green Municipality Fund, a program helping communities to achieve sustainable development. Sponsored by the Federation of Canadian Municipalities (FCC), this program can fund up to 50 per cent of eligible costs, to a maximum of $350,000 of capital and rental expenditures. This fund could help cover for the $363,179 loss projected for the pilot phase (Year 1-10). Research also show that the project could be eligible to other programs, such as the Gas Tax Fund sponsored by Industry Canada, and the Collective Impact Grant, a provincially-funded program led by the Ontario Trillium Foundation. Many funding opportunities exist, and it is recommended that the airport and Township of Georgian Bluffs investigate further the different options. 96

98 In conclusion, the financial projections should be interpreted as a high level estimate. Pricing structure needs to be revaluated and adjusted as per visitors price sensitivity (survey). A complete traffic forecasting analysis will also have to be performed to budget additional transportation capacity at peak hours. Nevertheless, the considerable margins totaling more than $1.6M over the 20-years period (with no funding) illustrate that it is possible for the Airport, the Township of Georgian Bluffs, and other local organizations interested in taking part in this venture, to develop a viable project. 8. Overall Capital Plan Below is the overall Capital Plan drafted by Tetra Tech representing the probable 20-years engineering and servicing costs for the general airfield upgrade and the proposed development concepts. The detailed Capital Cost Plan is presented in Appendix 6. Wiarton Keppel International Airport Highest and Best Land Use - Overall Capital Plan Development Concepts - Class 'D' Estimate of Probable Costs Phase 1 Phase 2 General Airfield Improvements Runway (5033 x 100 ft) + Aircraft Manoeuvring Surface (Mill and Pave) $ 3,385,300 Mill and pave 65mm of reduced runway dimensions and the aircraft manoeuvring surface. Replace Runway Navigation Lighting Systems $ 492,000 Replace existing ODALS, PAPIs, and Wind Direction Indicators. Runway (Pulverize and Resurface) $ 834,600 Resurface the gravel runway. Main Taxiway and Associated Fillets (Mill and Pave) $ 248,500 Mill and pave 65mm. Fillet between RWY and RWY (Mill and Pave) $ 95,950 Mill and pave 65mm. Apron (Mill and Pave) $ 864,550 Mill and pave 65mm. Airside Taxiways (Mill and Pave) $ 392,900 Mill and pave 65mm. 97

99 Runway Extension Threshold 23 (1000x100ft) $ 1,719,500 Replace existing stopway with runway pavement structure matching proposed reduced width (100 ft). Total Airside Development $4,957,250 $3,076,050 Groundside Improvements Groundside Access Road and Parking Lot Rehabilitation $ 310,260 Mill and pave 50mm. Parcel A Development Areas Water and Electrical Service $ 42,000 Stub into development lot. Parcel B AGN I Taxiway $ 304,290 Construct new AGN I taxiway. Phase 1: Water and Electrical Service Phase 2: Water and Electrical Service Parcel C $ 116,150 Electrical Services $10,000 Parcel D $ 132,600 Service to new airside developments. Service to new airside developments. Electrical Service $ 19,150 Stub into development lot. Parcel E Infrastructure costs $0 Parcel F Parking Lot Phase 1 $ 324,300 Parking Lot Phase 2 $ 641,400 Development of six (6) development concepts $511,600 $1,078,290 New gravel parking lot (114 stalls). New gravel parking lot (386 stalls). Total Costs $ 5,779,110 $ 4,154,340 $9,933,450 Notes: All estimated costs include a 20% engineering and contingency Note: Costs for the parking lots and access roads in the Agro-food incubator and Warehouse concepts will be borne by the private developer. These costs are estimated to be $352,

100 9. Ultimate Development Layout Plan The map below provides an overall view of the airport future layout with each of the development concepts Figure 10 - Development Layout Plan 99