waiting on a corn. We have Alderman waguespack and Alderman Quinn here. Uh, please be patient. Give us a few minutes. Thank you. Good morning, everybody. Time is now 10:08 a.m. the meeting of the committee on Aviation is called to order. We will now have a roll call to establish a quorum. Chairman OSHA is present. Vice chairman Curtis. Alderman Hopkins. Alderman. Dow. Alderman Robinson. Alderman. Harris present. Alderman. Lee. Alderman Quinn. Alderman Lopez. Alderman Coleman. Alderman Rodriguez. Alderman tabaris. Alderman Bernett. Alderman. Ervin. Alderman, Cardona. Alderman waguespack. Alderman mitts. Alderman spas. The 10:08. Alderman. Nugent. Alderman Napolitano. ladies and gentlemen, there are 11 members present, we have a quorum Now, I'd like to move on. Rule 59 requests, the following Alderman. Every request to remote access for today's Committee of Aviation meeting Alderman. Patel from the Third Ward Alderman. Lamont Robinson from the Fourth Ward Alderman. Michelle Harris from the 8th ward. Having a quorum already present. Can I get a motion to recommend approval of these rule of 59 requests, Alderman Bernett, so moves. I'd like to also add Alderman. Nicole Lee all in favor, say I Yes. Mr. Chairman Alderman. I didn't, I didn't hear you call. My name is, thank you so much. Thanks Alderman. We got you all in favor. Say I All opposed. Depending on the chair of the eyes, have it? Ladies and gentlemen, this time we will begin the public comment period out of respect for everybody's time. Each speaker is limited to 3 minutes. Our first speaker is Miss, Jessica Jackson. All right, good morning. so, As the patience to Aviation. I'm really going to just, you know, let you all deal with that this morning. I'm struggling with the news that I've just heard about. Those 4 black women. That lost their jobs. The Inspector General positions, 4 black women. At the same time lost their jobs, this coming from the Democratic Party. The party that tells us all about. The power of black women. The party that says that the black woman is the backbone of the Democratic Party. And we sitting here in a very Democratic town. and have fired 4 black women from Inspector General positions for and it's my understanding that the Common Thread is that they weren't connected to CTU. That's my understanding. so apparently, this teaches Union Ron City Hall. Because of the connection with Brandon Johnson, which explains why when Rosa. Broke the law and the rules with the sanctuary City. while we couldn't get rid of him, because he's connected to The teachers union. so, the teachers union, Who doesn't know how to raise test scores. Who's got the educational system in the ground? Is controlling City Hall. the teachers union that wants to put, Aggressive LBGTQ information in curriculums. Wants to be in charge of City Hall and we got a absolutely failed. Mayor. That's allowing it. Black people we are going to get enough of voting for people just because they black Brandon Johnson has messed us up. He has gotten rid of 4. Black inspected, General women. And a Hispanic chief of uh uh what Chief of Staff did it and he's going to replace everybody with Hispanics. You all have to let him mess up the city. So I'm going to go take my seat. Think about when I'm going to hit you with the next 3 minutes, the next meeting because this is atrocious, this is atrocious. Thank you. Miss Jackson. Let the record reflect Alderman. Cardona has joined us. Our next speaker is Miss, Zoe Lee. Good morning Alderman. OSHA good morning. Um, so, you know, um, Miss Jessica, I definitely feel the same way she feels. I'm just going to correct a couple of things. 3 black women that were part of the intergovernmental Affairs. RG Harding is a lady that I really was hurt to hear that she, um, was fired, because she was 1 of the nicest people who, when I first started, this journey, with fighting the city of Chicago for knocking down my property, she did whatever she could to try to get the mayor to sit down with me and the fact that she's gone, Sydney is gone. Melanie is gone 3, black women. Um that Uh were were probably could have definitely made this um failed Administration A Little Bit Stronger especially when he phrases how he has the, you know, 40. I just saw him at the way makers event lying to them. Black men over there there saying that, you know. Um, he has the most blackest, uh, Administration and you know that he's the Michael of Mayors, you know. He's he's absolutely insane but, um, to hear to then then then that was just Saturday. So then to come, And hear this. I will actually, I was Friday. So to actually come and to to hear that or see it on Twitter is is is messed up. Um, the Hispanic KKK runs, um, City Hall uh these Progressive this weird Progressive agenda. Um that's going to GI, get them. I I don't know if they think that, we, we're over in Ecuador or Mexico or wherever they're from, but we're not. This is this is, uh, the United States of America. This is a city of Chicago. This most segregated city, um, on the planet. And everybody knows that. And it's been like this and it's been fine. They've came and they infiltrated and they messing things up. Okay? They have this weird agenda that they're trying to push. That's not going to go anywhere. The CTU is a criminal organization along with a lot of these, uh, Deputy you want to fire people, why be Beatrice? Uh, pawns. Deon is not gone. She's a deputy mayor of immigrants. They're all over like roaches, so I'm trying to figure out what they can't even put them anywhere. They're everywhere. Everywhere you go, you see them but she's not gone. Katherine, whatever her name is. I got to figure out how to say that last name, but the devil his chief of staff, she needs to be gone as well. So since we firing people, That's what you need to start Rosana Rodriguez, chanchez and Carlos Rosa Ramirez, and Brian sichol Lopez who's trying to control housing zoning. Real estate. And our education is education is crazy. And we have this, this, this, these black progressives that are part of this DSA who are not Progressive enough for our communities. So I'm trying to tell y'all now. The justice department is coming. Thank you, Miss Lee. Our next speaker. Is Mr. George Blakemore? We can't beat up on the mayor. This is a culture of corruption here. and it goes back, even before Harold, Washington, they have had Black Faces in high places and uh, why would the hell Washington even entertain to have a sanctuary City? But because he didn't have the account, he needed the Hispanic for terrorists and Garcia boat. So he was he had no vision. so this n**** ISM and and Shambo ISM, it's just didn't happen here in in the city of Chicago. It's, it's a culture of these people here. They've been here. So a, a black people, you your own enemy. you're turning a a a a want to point out the Hispanic of the whites of the Asian, you know they never been our friends and you not even your own damn friend. I can look around and something very simple and it's very simple. And I watch a simple thing, I see the black woman, always a messing with our hair and then I look at what the white women they don't want that look. They don't want that Africa. Look because it's not a standard of beauty to them. My mama, what I nappy hair, she hated it. but she liked her King picture and a yellow behind but that that hair, little simple things. The standard of Beauty in America to the white woman is, is she's our own standard and the black woman. I wonder what happened on the plantation. You know what? What the white mouse to me and a n****. And we must Purge ourselves of niggerism and become strong black men and women. It's very deep and so I say you don't like your old mama. I love my auntie belly mama. She just hated her. Nothing. Hell She like the little King, a, a nose, and a little thin lift and a yellow behind host. But that hair. She hated it. Because she didn't see her beauty. of power of of she was just great, but she was brought up with that anti belly of Plantation and it passed on from 1 generation to the another generation and the day, you see the young people of the blue black kids with the the mama just sticking some little facts and stuff and half hair down. They they booty. It's it's that black people. Mine was messed up from slavery and they fell in love with the Enemy. They thank you Mr. Blakemore Our fourth and final speaker is Miss Teresa Hughes. Let the record reflect that Alderman, Robinson and Alderman. Viegas have joined the quorum. Go right ahead, Miss Hughes. Okay, thank you sir. Good morning everybody. I am Teresa Hughes and I am here to speak in regards to Aviation committee and um black contracts. Contractors. and contracts that go out that, um, Are not very reflective of the black. Contracting community. On these Aviation projects. So I would just like to go on the record to say that I will be watching very closely. What's going on in aviation especially when it comes to new projects coming out. And uh, this particular company boa, that is getting all the contracts from what I understand that are in aviation, because of some kind of tie-in with the the powers that be and I just want to go on record that I am going to be watching because I am an advocate for the contractors that are That have come to me and have been their contracts have been been canceled or terminated. So I just want to go on a record with that so you can take that back to your girl. Me Miss T. thank you, Miss Hughes This concludes the public comment, period. items before the committee item number 1 is the approval of the July 9th 2024, rule, 45 report for the committee on. Aviation, if there are no questions. Can I get a motion recommend approval of the report? Alderman, viegas so moves. all in favor, say I all opposed. Any opinion of the chair of the eyes have it? Item number 2, an ordinance 202400001104. Third amendment to phase 1 lease, Second Amendment to phase 2 lease. And First Amendment to phase 3 lease with arrows Chicago or Chicago facility operations at Chicago O'Hare International Airport. Miss Amber Ritter managing. Deputy Commissioner from the Department of Aviation is here with us this morning to explain the ordinance and to answer any questions committee members may have Redhead Amber. So much chairman OSHA and thank you council members uh for your time this morning. Uh we want to uh walk you through through this ordinance. Uh, but first, I'd like to introduce 1 of my colleagues who's here in the stand with me? Robert Rodriguez also a managing, Deputy Commissioner, uh, at the department of Aviation. Um, Excuse me here. So the first of the 2 ordinances that we're discussing today is Chairman, Noah mentioned is uh the amendments to the Northeast cargo leases. I want to talk, uh, really briefly first about the importance of our cargo operations uh, at O'Hare to the region to the city uh and and to our economies, as a whole. Um, I think it's it's a, it's a good opportunity to kind of explain a little bit about where we are with cargo and why. This is why O'Hare is such an important cargo Hub, uh, which is Germaine to this ordinance that we're introducing today. So O'Hare process is about 1.9 million metric, tons of Freight in 2023. Uh, that was, uh, good enough to have a bit ranked number 6, in the United States, for tonnage and number 13 in the world. So we are a major cargo Port. More importantly, even than the tonnage in our, in our perspective, frankly is the cargo value. We are ranked number 1 in the country for cargo value coming in and out of our hair. Meaning that the goods that were uh, receiving and shipping Out through our cargo facilities, our high-end products, a lot of electronics, a lot of pharmaceuticals, a lot of vehicles, um, and this kind of thing. So those those things together mean that we're really, you know, at the top of the, of the tier of, um, cargo airports. And in fact, we're often even number 1 in the country of all ports for value. And that includes all the shipping ports, like the port of LA and other ports that bring in uh, boats across the seas. seas. Um, we also, uh, you know, have a, we have, this is you know, made possible through our very comprehensive cargo program. We have over 2 million square feet of airside cargo buildings and another 2 million square feet of landside cargo buildings. Um we have seen the need for our cargo uh you know areas to expand and to continue developing over the decades. Obviously when we plan something uh for cargo development, it's many decades in the works and so the fruit of the works that have been done over the past 20, 30 years are really coming into fruition now. So we're we're very happy. With that we currently have about 40 jumbo freighter parking positions, any any 1 time at O'Hare. Um, we can handle the largest be 7478, F aircraft and importantly, uh, these cargo jobs support about 5,000 jobs every day at O'Hare of people that work in our cargo facilities. And then in addition to that, another 10,000 cargo jobs within a mile of the airport. So it's it's a, you know, an industry that not only impacts the airport itself, but really the entire region. So we're very Proud of our cargo facilities. What we're here today to talk about, is a few lease amendments to clean up, um, a few lease ends loose ends on our Northeast cargo facility, leases, the tenant, um, for that, those facilities is an entity tone is real-term previously known as aeroterm. Um, the history of this and this is what you're seeing on the screen here. This is on the very Northeast quadrant of the Airfield. Um, it used to be a, a military base. Uh, now in the, in the, in 2008, we put out a an RFP to develop that area into a into a cargo facility. And the idea would be that it was in 3 phases phases 1, 2 and 3, and in addition, addition, to that of fuel farm. So, the, uh, the RFP was put out, uh, the winning, uh, bidder. Uh, proposer was an entity. As I mentioned named realterm at the time, was called aeroterm just had a name change. Um, and so we error term on those uh on the development and on those leases back you know 15 years ago uh in 2008 and thereabouts. Um Phase 1 is what you can see. On the the the on your screen. That's the lower of the 2 blue uh rectangles. Um, that opened in 2016. Um, that's the the largest of the phases. Um, it's 540 thousand square Um, so that's been running, uh, for almost 10 years now. Um, Phase 2, just north of that. Also, the blue bar opened in 2017 240,000 square feet. So we brought those leases to city council for approval is in. Um I think it was in 2015 or thereabouts and then phase 3, which is the most recent phase. Which is depicted in the orange uh, rectangle on the, on the the bottom left of the screen open, just a year ago, a year a half ago in 2023. Um, that was a lease that was executed executed or authorized I should say, by City Council in 2021. Um, it's a beautiful facility, it is now, open for business, um, with an additional 125,000 square feet. So all together this northeast uh cargo campus gives us about 900000, square feet of cargo space um, with positions for Freighters at the same time. So it's it's really a significant development for O'Hare and it's been running beautifully. So, again, this is kind of what I just covered the the dates of all 3 of these phases. Uh, in the leases now excitingly, as I mentioned, the phase 3 uh facility opened in May of 2023 and there were a few things to to tie up. Um but we recently had just last week 2 weeks ago, we had a ribbon cutting so it was a beautiful building a beautiful event on August 29th. We had the official phase 3 ribbon cutting although it's been operational for some time you Can see we have, um, representative from, from the, um, from aeroterm, real term, which is the the tenant, uh, Bowa construction, which is the general contractor that built the building and I'll get to that in a minute as well. Of course, as Mayor Johnson commissioner, Ree and others. Um, I just like this picture down here in the bottom right of the screen I mentioned there's about 5,000 jobs every day. Uh, at the cargo facilities, here's the mayor with 1 of our, uh, employees. Um, they got a chance to go on the Airfield, which is Fun. The mayor commissioner Ree and uh, the president of the Aero term. Um and then we had remarks from folks including Nosa from Bowa construction, um, who was the prime contractor? Um, and this of course, is my favorite. I can't not show this, the the mayor in the cockpit of a of a cargo jet. So a really fun event and it really caps off this very successful project that we have in a beautiful new building um for cargo So uh 1 I just want to close the loop and also talk a little bit about the historic significance of this phase 3 facility that we just opened. Um it was the first major cargo facility in the United States constructed by an African-American owned prime contractor. So a huge development entirely by an African-American owned or run prime contractor, which was Bowa construction and not only are they African-American, um, you know, and that's historic in that in that regard, but they're also local of course, it's a Chicago business. Um, so we're very excited to have capped off this great project. Uh importantly the project achieved 55% on wbe participation which breaks down to 45% mve um, 20% of that. Or 20% of that total is uh, African-American owned a construction companies and design companies, 17% hispanic-owned, and 7%, Asian owned. And then, on top of that, we have 10%, uh, wbe uh, companies, the goals, of course, like most many city city, uh, contracts, this um, were 25 and 5 and we, they Significantly exceeded that at 55 45 and 10. Um so we're very happy very uh proud of our historic building. It's gotten a lot of really great press uh for that reason and also just because it's a great facility. Um so we're we're happy to have this project done. Um phase 3 as I said is now completed. So the whole uh, complex is completed. So way these leases work is um the tenant which is aeroterm. Real term puts in the capital investment to build out these cargo facilities and then at the end of the, of the uh term those the ownership of those buildings and acuter revert to the city. So to date, they have put in approximately 175 approximately 175 million dollars in buildout of these beautiful structures and, and all the, um, roadways Etc around it, um, which will come to to ownership of the city at the end of the term of the lease. Um, so that's 1 how 1 way among many others. That the city benefits from this from this facility and then another way from a monetary standpoint is rental payments, of course, um, the they every year they pay us, you know, Rent and that consists of Base rent per square footage plus a. 3% proceeds rent which is a at the off a percentage of their gross revenues. Uh, the facility that is approximately 7 million dollars a year. It'll go up each year a little bit and might fluctuate based on the proceeds, rent variables, but for the entire 35 year term of the lease that it equals about 245 million. So it's a very lucrative for the airport. Uh, from a revenue perspective as well as just being so advantageous for the re And the and the um, City's economy. um, So what we're here today though to talk about is um not as not as uh exciting as the is the whole cargo universe, but just some cleanup issues that we need to do with the phase 3 lease to amended in a way to clean up some things that happen so that we they the least comports with reality of what actually uh, help happen with the development. And then I'll get to the phase 1 and 2 in a minute, too. So the phase 3 lease amendments, I'll start with. So when we, uh, executed this lease, uh, with real term, the original plan was that Realtor would construct as a tenant infrastructure Improvement that they would construct with their contractors, uh, a taxi Lane November November. That was necessary to bring the Freighters into the facility, as well as an airside Service Road and some uh, related utility work. Um, Once the lease was executed and here we were in 2021, which of course, height of the pandemic. Lots of issues at that time with supply chain issues, uh, labor. Um, you know, getting getting the right folks to do the work. and on top of that, you might recall, the concrete strike that we dealt, with around that time, um, we decided between us that it would actually be more advantageous for, uh, for everybody if the city actually did the construction rather than having, um, real-term do it, and then reimburse them for it that we would just do it ourselves. Essentially, that's, that's it in a nutshell. So they, they had done the design work. We paid them for the design work, they did. And then we uh, just went in and self-performed the construction of Of the taxi Lane and the airside service road. So we simply need to amend the lease to reflect that reality because the lease contemplates that they that they'll build it and we'll pay them back. So that's not what occurred. It worked out great. It's a beautiful facility and so we just need to clean that up. The second thing we, uh, would like to amend is long as we're here doing. It is, you know, when we execute these leases, we don't know what the commencement date. The rents rent commencement date is going to be, because that is, uh, defined as the date of beneficial occupancy of the facility. Meaning the date that it opens for business. So obviously, when we sign the lease, it's like 2 years in the future. At that point, we don't know what that date is. But now that we do know what that date was because we've already had it, it was May 1st of 2023 as long as we're in here. Amending. This lease. We'd just like, to clean it up and and, uh, enter that that date as the official rent commencement date. Um, and that would mean, of course, that it's a 35 year term. So then the expiration date would then be April 30th of 2058 The third way, uh, we need to go go in and amend this is there's a section on credits against combined rent and we need to reflect the availability of some additional rent credits, uh, for particular improvements. And then last as we were closing out the uh project um, 1 of the ways that the city really played a big role with both, um, real-time the tenant as well as, uh, Bowa Construction in the prime was just making sure we got all of those subs, paid out and closed out. Um, a lot of our subs were local, a lot of our subs are small businesses, they're Subs, I should say, not ours, but we wanted to make sure that they were paid and that they were happy and you know, every everything was Done with the project. And so um, there was some question about some of the concrete that had been poured for a employee parking area, landside meaning pre-security um and a little bit of a debate back and forth as to whether um there are any issues with the con concrete. What the city did is what we'd like to do is go in and say, look in order to get that sub closed out which we did, get the sub closed out. Um, if there's any problem in the future, with this concrete, pour, uh, that real term would address that fixed that concrete and that we would reimburse, the city would reimburse them. The airport, would reimburse them under a reimbursable agreement. So that's just that, uh, we don't expect that to be the case, but just in case, in order to get that issue closed out, we agreed to that. So those are the 4 ways that, um, we need to, uh, amend the phase 3 release to bring bring the agreement. The legal agreement into, um, you know, to comport with, with the way that the project went. Um relatedly, we also are asking a, a amend phases, 1 and 2. So those are the 2 older phases and what we'd like to do here what we're asking for. Is to make all 3 phases co-terminus. So as I mentioned, when we put out this RFP back in 2008, the idea was the project would be in 3 phases, um, and that those phases would span, you know, 10 or so years, which they did, um, in order to get them developed. But what that means is because the Date. The date. The term runs from is the date of beneficial. Occupancy of each of each phase. Right now, what that means is we'll have 3 completely separate, uh, termination dates. So, um, phase is 1 and 2 currently terminate around 2047 and phase 3 terminates in 2058 and that's operationally problematic for the airport. Uh, we'd like to be able to plan as a whole, this whole development to either, you know, to expire on, on 1 date certain so that we can, you know, down the road plan. What we want to do with the facility next whether it's another tenant to run it, whether the city takes it back, whether we do something entirely else but it expiring in phases, um, is, you know, causes up our operational problems and also on the other side of the coin allows, the tenant, if they should. So desire to, you know, leave phases 1 and 2 earlier, but still raise, you know, run phase 3. And that's just a situation that I think was going to cause, cause a lot of problems for, you know, the next generation of the airport. Um, so this would make all 3 co-terminus unable. April 30th of 2058. So those are the least Amendment, uh, as you know, uh, Areas of of men that we're asking uh, Council to approve or the aviation committee to approve, um terminal, turn it back to you. Thank you, Mr. Uh, questions from committee members Alderman, Hopkins. Yeah, thank you, Mr. Chairman, thank you for the excellent presentation. I fully support the expansion of uh cargo operations at O'Hare. And uh at the appropriate time. I'll support the uh, lease Amendment. We are missing on page 2 though, Mr. Chairman of the uh, the lease document It's no, it just, uh, it's not in here. It's at least, it's not in mine. But anyway, I'm sure there's nothing in there that would preclude my, uh, support for it. Um, but I do have 2 questions. Uh, What is the status of our continued? Expansion of cargo operations in the context of the O'Hare noise compatibility commission. We often hear that, you know, cargo operations are in the overnight hours. And there's complaints about that some of the cargo aircraft tend to be louder. So, what is the current status of that? And also, uh, is a, is a sort of a sub issue to that. Um, the pone airport has re-entered the chat. You know, here we are once again after all these years, it's being discussed and it's being discussed in the context of uh, enhanced cargo operations that is obviously something that is not in the interest of the city of Chicago, not in the interest of this department. So, uh, what is the current status of any effort to continue? Consolidating cargo operations at O'Hare and making it the the premier cargo destination for Air Freight. Regionally, um, you know, competition notwithstanding if you could just comment on that. Thank you Alderman. Um, I'll take the the first 1 uh, first about future cargo development plans and how that could comport with noise and other. There are other development issues. So we, you know, we are always always, I should say in the phases at O'Hare and at a Midway of planning for the future and when you're talking about airport planning naturally, it's decades down the road. Um Deputy Commissioner managing Deputy Commissioner Rodriguez himself is actually over our Planning Group right now. So we work with cargo groups work, very closely with the planning groups. Uh, we do have ideas of of what the next, uh, reality of, um, of cargo at O'Hare. Could be expansion areas Could Happen. Um, if you've looked around O'hare, recently, you've noticed that it would pretty much pretty much filled up so it but, you know, there are options and they involve moving other functions. Etc. So there's sort of a longer term thing. So, to answer that question about, you know, what, the development plans are. We are, we are in the midst of of options, but we don't have anything solid yet. Certainly noise will be a factor that we are always taking into account. I think it is. Um, I was, I will say though. I think it's somewhat of a myth that, you know, so many of the cargo flights happen overnight. Certainly some do or that, you know, they're more cargo than than commercial in the overnight hours. But certainly, you know, a good chunk of the cargo flights also happen during during the day, so just for FYI. And then um, you're oh my gosh, what was your second question? I'm so sorry. About our, our efforts to, uh, push back on the notion that a third Regional Airport is necessitated by expanding cargo operation. Thank you. Well, I mean again, our job at O'Hare is to make sure that we have the cargo capabilities to meet to meet the next uh you know, decades and and and Beyond of of cargo needs. Um, I'm not here to talk about, you know, about patone today but, um, we're doing what we can to make sure that we're able to to meet all of our cargo needs at O'Hare. Okay, thank you, thank you very much. Thank you Alderman. Hopkins, Alderman Lopez thank you, chairman and good day. Good morning, excuse me, members of the committee. Um, during our previous briefings, I inquired about the language. With regards to tenant infrastructure, improvements and construction improvements as it relates to some of the abatement issues. I never got that information Alderman Lopez. That's actually on the other ordinance that we're gonna The second orders and just for your information. I've got all all of your questions answered in my presentation for on that. Okay, just making sure I saw the. I saw the same words and I'm like, wait a minute. What's so many? Same words that? Yeah, second building. Okay. But thank you. And I I do appreciate. Um, Uh the Department's work on expanding cargo operations. Um, but I do, I have a question that's related and not related shockingly? Um, as it relates to Midway. And cargo operations there, because not only does O'Hare do cargo but, so does Midway. um, and Midway obviously is more of a landlocked issue than O'Hare is uh because we have so many of our Chicago residents there. Um, are there any discussions about uh, expanding any potential cargo operations at Midway, uh, as well, maybe not to the size, but, you know, I know some of those facilities are Decades old um especially I think the only newest 1 was the 1 that's Southwest built on 63rd Street but you still have older cargo facilities on 505th Street in the old hangers there. Um so is there any talk or discussion about doing any kind of similar modernization there to keep midways cargo operations blooming and growing. Thank you for that question Alderman. Um so you know the the main limitation that Midway has for cargo and the reason why O'Hare has probably 95% of the cargo between the 2 airports is because of Runway size. Um, naturally. Oh uh, Midway is Runway restricted, um, as far as the length because of, as you say landlocked where it's located, we all know, we call it the, you know, the busiest square mile in aviation, um, but as a result of the size of the runways, the length of the runways, um, it really, really limits the size of the planes, uh, that are able to take off and land there. And so cargo is, is Um, you know, not going to be a function at at Midway that's going to grow in the same way that it's grown at O'Hare as a result of that. However, of course, there is still some cargo at at midways. We know. Um, as far as refreshing any of the cargo, uh, facilities that exist. There, certainly were always, we are in the midst of planning, you know, the next few Decades of of midways planning as well. Um, I'm not specifically sure whether there's any plan to specifically, you know, amend any of the existing buildings, but making sure that we have room for belly belly cargo at Midway. Uh along with any other cargo that might come in. There is is a priority for sure. Okay. It just seems like that is always an area, like you said the busiest square mile but I think that it's also 1. That's geographically accessible both to highways major roads, all directions. And it's just I think that having grown up over there like 2 of my colleagues right next to me. You know, it just seems like it's always been underutilized when it comes to that and having seen how beneficial cargo is to many of our partners there at Midway. Um, would do it underneath their their commercial flights. Um, it just seems like it would be a good opportunity to ensure that nobody pulls out of Midway. Um, which would be my biggest concern, especially as talks of that other potential Southern airport happens. Thank you. Thank you for that. Thank you Alderman Lopez. Um, let the record reflect Vice chairman Curtis Alderman, Dao and Alder, Alderman. Towbar have joined the quorum. Um, ultimate Rodriguez. Thank you, Mr. Chair. Um, just piggy backing on the last line of thought you just um I you know, 5% of cargo in the city. Uh forgive me between O'Hare and Midway is at Midway right approximately? Yeah, approximately, I I'd be very cautious to increase that number at Midway, uh, for a lot of different reasons. Um, and I'm very interested in happy that O'Hare is building out its capacity in the way. It is. Look, we are a logistics Hub. We all know it being number 1 in Cargo in the country is an important designation. Um, and we need to maintain that. We have increasing increasing International competition, let alone local competition. So, being on the Forefront of this, I think is think is incredibly important. I'm glad that we're entertaining this today and being Forward. Thinking on this most important of topics, I do not want to lose market share, uh, to other cities, nonetheless other countries. Uh, when it comes to this, because we're competing with Toronto on this type of stuff, as well, right? And that's Hop skipping a jump from us. So let's not forget that. Um so so we need to make sure we have the environment and also local uh investment to make sure that we maintain that status. It's incredibly important for jobs. Um, and for our local economy though, I did have a question regarding um, I saw the numbers on uh, ownership as far as the construction was concerned as the labor chair. I'm thinking about, uh, the workforce and the percentages City, Chicago, Etc. I should have thought about this earlier. You have great. Um, um, our chair has great briefings but it just didn't occur to me to ask, then I thought I'd ask now. If you don't have those numbers that's fine through the chair would be okay but I love to see the workforce numbers on City of Chicago and minority participation as well. I'm assuming we have access to that we do. So this thank you the alderman. Um, of course, uh, required. Uh, we did require the tenant to, to make sure that their contractors. Um, use their best efforts for City hiring for local hiring. Um, unlike most City contracts, because this isn't a, a, a contract where the city is spending money to build this. In fact, we're getting money. It's a, it's a lease. So it doesn't, uh, the, the city ordinance on local hiring doesn't apply but it was something that we added to their lease to make sure that they were able to use their best efforts. Um, I do think I don't have the exact numbers right in front of me, but I do know that, um, you know, the the efforts that they made, you know, during the pandemic to, to try to, you know, Make sure their local hiring numbers were were as high as possible um were extensive. Um, I the numbers themselves may have been a little bit lower than we would have liked for local hiring specifically. Um, if I'm I what I have here is a real term, um, representatives from the tenant and their, uh, consultant actually who Rachel Ivy, who worked with them on, local hiring and other issues. If you have a specific question, I can bring them up. That's oh no, I'm fine with just through the chair. I'd love to see the numbers. I don't want to, that's not going to impact my vote here today or anything of that nature. Sorry, we'll have those folks talk to you Alderman. Uh, great at the conclusion of the meeting. Thank you, Mr. Chair. Um, you know, I think that's all. That's all I really had. Um just in the workforce side of things. So thank you, Mr. Chair. And thank you for the presentation. Thank you. Thank you Alderman Rodriguez. If there are no further questions, can I get a motion to pass ordinance 202400001104 too? Alderman, Cardona. So moves, all in favor. Say I all opposed in the opinion of the chair of the eyes have it, the do pass recommendation of this ordinance will be reported out at the next city council meeting on Wednesday, septembar, 18th 2024, Our third and final item. Ordinance 2024001 0971. A lease agreement with the United States, cellular Corporation and FCA Partners LLC for Office Space. Once again, managing Deputy Commander commissioner Miss Amber Ritter is here to explain the ordinance and to answer any questions committee members may have Amber. Thank you, chairman. Um, this uh, this second and final ordinance that we're here today to discuss is a lease uh where CDA would like to lease s certain office space at an office, building located at 8240 West, brinmar in the city of Chicago. So I'll go through that. Um, just I'll get to our uses for it in the terms of that in a moment, but just understanding kind of where where it's located. Um, this is this building is called the US Cellular building because that's the name of 1 of the major tenants. You might have seen it off the Kennedy, it is in the city in the 41st Ward it's at 8420 West brinmar. Um depicted in this map as this uh sort of red circle here. It's about a 5 to 7 minute drive from there to our office building, um, and to the airport itself, of course. And so it's very well located. It's also located Located. Um, on a, uh, Corridor of commercial spaces that are in the city for lunch, you know, options for employees. And importantly, it is on a walking path that the Cumberland Blue Line stop. So it will enable the folks that will be working there to take Public public transportation. The Blue Line directly to their office building, um, which is a huge, uh, a huge, uh, Advantage. I think for those folks, and, um, we'll really encourage people to stop, uh, needing to drive all the way out to the airport every day on the Kennedy. Um, so that's where it's located and, uh, let me tell you a little bit about why, you know why we need it. So as we are, um, you know, we've talked at length in, in, in this forum and others about our tap program terminal area plan, for all the expansion that we're undertaking currently at O'Hare, um, now that we've got that sort of sorted out in the phasing of it has is more certain. Um, we're we're in the position now where we're ramping up with contractors with staff with Consultants, um, all kinds of different construction projects that will be working through currently the way it works at O'Hare is that most of our CDA employees as well as most of our contractors who need to be on site. Even the construction companies for their, like, office positions are in our Aviation Administration building, which is the office building. Many of you have probably had a chance to come up and take a tour and you've you've had a, a meeting in in our building. Uh, 80. Um, 10510. West tzumi. That's what we call the 8. Aviation building, it's very cramped. It's actually the oldest my understanding is it's the oldest uh, still in use building on the, on the airport property was built in the 40s. Um, as part of the, the military installation, I don't think it was ever expected to last, as long as it has. It's a cramped, uh, building. We don't have a lot of space, and we are needing to grow. But importantly, it's not just about the number of employees. It's also about the function because, um, as we go into our, our next phases of design and construction on the tap program, we're going to be putting on a lot of procurements, uh, for contractors Consultants Etc. And right now, a lot of those same entities who might be bidding on future opportunities are sitting right next to each other. Their files are you know right near each other. Um we would like to be able to have the ability to ensure Integrity by um you know having the right facilities to kind of while people off if we need to from you know, different contractors. Um and consultants make sure that folks aren't, you know, don't get accidentally understanding some information about an upcoming bid that you know, they might want to A bid on, so we need the space to be able to do that. So really protecting the entirety of our upcoming projects and the decades that we'll be, uh, in, in the midst of construction, um, is, is crucial to us. So, what we did is we took a look at the market around O'hare, uh, as to where we could get sort of an auxiliary office building. Um, we, we are in a really good position because it is a renter's market right now. Uh, for commercial, uh, property around O'hare, um, the rates that we're getting and we'll talk more about this in a second about 20 to, 30% below historic Market rates. Um, it's really a good position for us to be in. So we did an extensive, uh, investigation. We looked at many different buildings that were suitable and we were able to negotiate, you know, between, you know, off of them, essentially to get a really great deal. So the building that we um, finalized is, as I said, at 8240, West brenmar here is a Google Maps kind of photograph photograph of it. It looks like it's leaning. I promise it isn't, that's just the perspective of the, the Google Maps. Um, but it is as I said, right off the Kennedy right off the Cumberland Blue Line. Stop, we'd be renting 5. Uh, floors. The fifth through the 9th floor. It's approximately its 900 and I'm sorry, 99421 square feet. So approximately 100,000 square feet. It includes, uh, at no extra cost, 350 parking spaces. Um, the 1 of the great things about this is it is totally fully furnished. So, um, the tenant the main tenant in the building, which is US Cellular, rented, the whole building out in addition to some of the other buildings, I think in the area, um, like in 2016 and then hit it completely furnished. And then in the years after that, and then the pandemic hit and their plans changed. As far as of course, you know, working from home Etc. So they've had all these floors that have been sitting vacant fully furnish, With, you know, the tags on the furniture. Um, since since, before the pandemic and they are ready for us to come in and just take possession of it and to be able to use all this brand new Furnishing, uh, Etc at no extra cost. Um, the space is it would fit about 550 cubicles, plus 50 offices or so and then multiple conference rooms so it will suit our needs for, uh, the coming decades. So, the terms of the lease that we are looking at is starting November 1st of this year 2024, and to expire on December 31st of 2020 20333, excuse me. So that's a little bit over 9 years. The reason for that expiration date is that is the expiration date of our Airline use and lease agreement currently at O'Hare with the airlines. So we would like to be able to plan for the next phase of office space use sort of again coterminous with the um the the aula so that we are planning for all these things at the same time. So the way these leases would work is that because um, the The, as I mentioned US, Cellular that company had rented out all, all these floors, and then have them been using it. They have 1 more year left in their lease. So the first year is a sub lease from US Cellular. So the deal, uh, for that is a 24.50 cents a square foot and that is a gross rate. So that includes most utilities and other costs, other than electric. So that's all in 4450. A square foot so that because it's about 100,000 square feet, equals approximately 2.4 million dollars for the first year rent. Then the remaining 8 or so years of the lease would then be a direct lease with the building owner because the US Cellular lease would have expired. And the terms for that are twenty dollars, a square foot, that's net. So we would have to pay utilities and other costs above that that goes up 50 cents a square foot a year. So not a compound interest, just a simple 50 cents. The next year, it's 50 more cents, um, that equals less than 3% increase per year. Um, here's the exciting part in elderman Lopez, I have answers for you on these pieces to your question, um, because the, the market is so good for us. Right now, we also got the following, um, uh, Benefits. The first is a rent. Abatement period free rent for 11 months. Um from November 1st to 25th through september 30th the 26th, it rent free. So essentially it's a renter maintenance period, that is a value of 3.2 million. And actually, I'll just go straight to the question that elderman Lopez had, which is how it's phrased in the, in the lease. So section B 6B of the lease provides for. Um, I won't read all these words, but essentially um, tenants obligations for net, rent and tenants share of operating expenses, shall be abated in full for the 11-month period. Commencing November 1st 2025 and ending on september 30th 2026, such period being here and referred to as the free rent period. So that's something that that's how its provided for in the lease. And the second, uh, major, um, advantage that we were able to negotiate is a Dependent Improvement allowance. And so what that means is that, um, we get a rent credit for certain expenses that we might spend regarding, uh, related to construction costs, Furniture architectural it. Etc in the amount of 3.4 million. So, the way that that's phrased is that in the exhibit, B of the lease section 3A says, landlord is providing tenant with a tenant Improvement. Allowance to be applied toward any hard or soft, costs associated with tenants, relocation to the building, including without limitation construction costs, architectural Furniture fixtures equipment, wiring cabling and moving expenses as well as costs associated with improvement, work and additional work, including landlords construction management fee, as here in set forth because they they do take a fee but we could use the credit for their management fee. So and then it says that the tenant Improvement, allowance is a defined term and then you go to the definitions of the lease and here's how it's defined tenant Improvement. Allowance is defined as 3479735 and no 1 under Scholars. So 3 about 3.4 million dollars and then it says, in the definitions calculated by multiplying 35 by 999421. So, that 99421 is the square footage of the leasehold. Um, in the 35 dollars is $35 per square foot that they're giving us as this, um, tenant Improvement. Allowance, so both of those things together, along with the, the rates that we were able to negotiate. Um make this a pretty good deal for us. Um I was going to say too that the rates that we negotiated the 24 uh dollars um or 20 sorry twenty dollars a square foot that goes up 50 cents a year is about 30% lower than the advertiser rates for the other Parcels within this building that the building owner is still trying to let out. So again, we negotiated, um, a good deal of ourselves. So that's that's the, um, that is the, the piece of those are the Salient parts of the lease that lease and the sublease, let's just say, there's 2 2 documents a lease with the building owner and a sub lease with the current tenant, which is US Cellular um, that we are looking for uh, approval on. Thank you, chairman. Thank you. Amber. Uh, open up for questions. Alderman brunette. So is this so this is a awesome. This is a triple net lease so I'm sorry. Could you I assume that this is a triple net lease You know, I'm not sure. I'm familiar with that phrase. Can you explain it? Okay. When they paid the taxes, the utilities. That's right. So correct, thank you for, for that taxes. And what is it taxes? Insurance, utility and rent? Yeah, let me go back to the screen if I could do that. So the the sub lease that we we have with, uh, US Cellular is grow a grossly. So, in other words, all of those things taxes, utilities, other than electric, um, are all tied in together with the rate, which is twenty 4.50. Then that's just the first year because that we have to sublet that from, that current tenant. After that first year, starting in November of 25, we go into a direct lease with the building owner and that is a net lease so it's not, it doesn't not include the taxes. It does not include the utilities and that's at the twenty dollars a square foot rate and then. So I noticed when, when I'm at the airport, uh, coming in at different times, the cleaning people are cleaning, do they? They don't clean no spaces though, do they? That's a great question. Uh, know the intent is so right now, our office buildings at the airport are Cleaned by, uh, city employees who are City or city employee custodians. Whereas the terminals, the airport terminals are are cleaned and, and maintained by a contractor. Um, but it's a great question. I believe that the cleaning of this building would be done then by the building owner, um, they would Supply the cleaning, the cleaning service that, but I, but I will get that answer to the chair, if, if that's not correct. Thank you. Thank you. Thank you Alderman, Alderman Lopez. thank you again, chairman and again good morning members of the committee so thank you for answering my questions um and the tech and to follow up on what the vice mayor was referring. To the taxes that were paying are just for year 1. Correct. We would Uh in year 1 we we the the 2450 Cent rate is all in. So we wouldn't actually have to execute any uh, tax payments, whereas in years 2 through 9, that's when we have a a net lease instead of a gross lease that would be at twenty dollars, a square foot. So then we would be paying um, taxes and other other utility fees on top of that. and what, and if I may ask, um, What is the expected total of those taxes and fees that we're paying? Because I'm Curious, how a government agencies paying government taxes to itself. I believe we are property tax exempt and leasehold tax exempt. So there are other fees and utilities that would go into those numbers. But, uh, Alderman, I'm certainly happy to send that through the chair at those numbers. It was expected number. I should say. and then if we could go to the last slide which had to deal with the um, yes. Is there a time constraint on this? Yes. Um, it is So it's interesting because the, as I said the, the the sublease, we'll, we'll, you know, our lease hold of this space will commence on November 1st of this year. So we'll be, you know, moving and then the um, the expenses that we we would encourage that would that would apply. You know, that this would apply to would be incurred within that first year because it's the moving costs. It's, you know, any kind of cabling and wiring that, that we need to do, but it's an interesting situation because this, so again, we'll be under that sub lease for that first year with US, Cellular year 2. We start the main lease with the building owner, which is where this provision is included, so we'll have already incurred these costs. So there is a limit in the lease that you have to incur the cost within. I think, a few months of when that, um, That mainly starts. But the good thing for us is that we will already be in that building for a year, we will already have incurred them. And all those incurred costs will, will be able will be able to apply that kind of. So they're gonna sew the abatement and the allowance will run basically uh Uh, concurrent not. Not concurrent consecutively. It's supposed to concurrently so the yeah, that's a good point. Yes, they will write the abatement of the allowance will be in the same. Okay, thank you. Thank you Alderman Lopez. If there are no further questions, can I get a motion to pass ordinance 202400010971, Alderman, queneau moves, all in favor say I All opposed and opinion of the chair of the eyes have it. The due pass, recommendation of. This ordinance will be reported out at the next city council meeting next Wednesday, septembar, the 18th, 20224 folks. If I could just keep your attention for a, a quick minute, all of you should have received information about what we are. We are referring to as order up. These are concession opportunities, more than 100 Uh, in terminals, 1 and 3, I'm going to ask managing Deputy Commissioner Ritter to talk about that. Uh, and also uh thighs here, she can pass some more information out again folks, this is more information that can benefit your communities creating opportunities for entrepreneurs in your communities. Amber. Thank you chairman. And thanks for the Indulgence of uh, just a couple of minutes to to Hype our new RFP. This is truly a historic, uh, opportunity for businesses in the city of Chicago, specifically, small businesses, or, you know, anywhere. But, um, we're hoping to get a lot of local, uh, local blood here. Um, all of you should have received, uh, you know, from thighs. Wonderful team, in-person deliveries of a bunch of materials on this um, to I think both your downtown and your ward offices. We are absolutely happy to provide more Alderman. Lopez had a very I'm sorry, I'm sorry. Had a very uh, fantastic question at 1 of the briefings about why it was not translated into other languages. We are in the midst of doing that. We'll have it done just in a few business days, um, to Spanish polish Arabic and Chinese. I think so. We'll be letting all of, you know, when those are available we'll make rounds and distribute them. And certainly at request, if you'd like some more, we've got those. Um, so thank you thank you for that. Um, idea really quickly, the reason this is a historic, um, opportunity is because um, largely because of the small business opportunities Another reason it's historic though is because of the sheer size of it as chairman mentioned, it's over a hundred Stores um about 146,000 square feet of retail space. That makes it 1 of the largest concessions rfps of any airport ever. Put out all at 1 time. So it's, it's got because of its size, we're able to give opportunities for businesses of all sizes in there. We've broken the the spaces into packages, some packages are very big and require a lot of capital. Uh, outlay off the top in order to do the buildout that you know, might be attractive for a larger companies that have the access to like, you know, many many millions of dollars of capital up front um all the way down to there's medium-sized packages and then there's very small packages that are just 3 or 4 stores uh together in packages that we have importantly We have set those aside with your mark, those solely for small businesses. So we call those the group C packages, a b, and c a b in the biggest ones. B. Middle C for, uh, just a few package, just a few locations together. There are 8 of those total within their, within this RFP, in the airport. Um, you can only bid on those if you meet the definition of a small business under the small business administration, the federal assembly business administration, we're very excited about that. That means it's 10% of all the square footage of the entire commercial space that is reflected in the RFP. That is solely for small businesses. And then, on top of that, uh, the A, and B packages, have a 32% acdbe goal, and that, of course, is airport. Concession are disadvantaged business Enterprise. I know you you folks know that better than most, of course. Um, so that means that of those larger packages that we expect, you know, maybe some bigger companies to bid on, uh, because they have the capital to put up front, uh, to build do the buildout. They still need to partner, whether in a JV or other kind of ownership or or other ways that qualify with smaller businesses that are acdb, small diverse businesses and that has to reach 32% of the structure of the of of each package that, um, so that's that's really great opportunities across the board for businesses Within These spaces. We're also instituting an incubator program. So some of the biggest package winners package winners are going to have to fund and uh, build out. Um, some white box spaces for small businesses to be able to just circle in and out of Um you know TurnKey ready not a lot of capital investment of of any kind. If any at all by the time by the small business they can sell their stuff, get their feet wet in the airport and then we'll, you know, get the next get the next ones in. So that'll be a really exciting program and we'll be working with all of you on on locating some businesses, that might be a great candidates for that. Um, all tenants also need to have an Outreach and mentoring plan. We want to get interns in the spaces. We want to make sure that, you know, the very unique nature of doing business in the airport that th that knowledge is being passed along to the next generation of potential. Concession airs. Um and we've also uh importantly have a Prohibition on exclusive Arrangements which means that um no no big company can can tell it's smaller business partner. Hey you can't also put a bid together with this other company. The smaller businesses are are free to put, you know, to bid on every single package if they want to and and any kind of restriction on that is is going to disqualify a bit. Um, all of this and everything else that we could possibly want is all together at a new website that we We uh, at CDA have just launched along with this RFP which is concession, our concessions resources website. So it's flight chicago.com confession. Resources that is what is linked on the QR code, on all the stuff that we've given you posters postcards business cards. You can just put, you can get thousands of these things, just pass them out to anybody. Who wants to know, hey, how can I? I've got a restaurant. I've got a store, I've got an idea for product. Who can I talk to you about getting my stuff in the airport, where we have, You know. Dozens of millions of people coming through every single day. This is the QR code, they can click on all of the information. Is there? How to get certified as an acdbe? How to do business at an airport, concessions, 101. Um, how to make a great proposal, which is which is great like what do I need to do? To get my stuff together to propose something and then also how to get financing as a small business it's all there along with other things and links to other City departments and other entities like the small small business administration that could be helpful in addition to the RFP itself. So it's all on there and then last thing I'll say and thank you for your patience is we are having our pre-proposal meeting, uh, you know, at the kickoff um, the the RFP and and to get people ready to to respond, that will be held on Monday september 30th um at the O'Hare Hilton Hotel at the airport, uh in person but we'll also have a virtual link. So any of your uh constituents who are saying well, how do I get more information about this? They should attend the pre-proposal meeting, that's where they're going to get everything. They could possibly want to know either in person or virtually for those who are intending. Person. We're also having a in-person networking event, right afterwards. Immediately following with some, you know, uh, light refreshments and we'll facilitate getting those folks to meet each other. Because, you know what, I always say at the top of any of these Network events is that it's all about serendipity. It's all about who you happen to talk to so many things can happen because you happen to meet this 1 guy, who knows his other guy or you just happen to strike up a conversation with someone. I I can tell you I'm not going to bore you now. But um so many opportunities so many businesses that are currently at the airport who made those connections to get where they are because they met someone at a symposium or something and then next thing you know they're doing business fantastic. So that's what that's for we'll do what we can to do. Some ice breakers and things so people can meet each other and then the last thing is that's september 30th and you can sign up for that. Everyone can sign up for that at the QR code. It's all on here and then the days that follow that October 1st through October 3rd, we're also giving in-person tours of all. Thank you, Sherman of all. The concession spaces that are available, so people can go see them if they're if they're, if they would like to get a better look at, These spaces. So that's it. If you have any questions, please let me know. Let commissioner Reno, we're here to answer everything um and look forward to continuing to promote this with your constituents. Thank you. Thank you Amber. Uh, Special. Thanks to commissioner re and her entire staff many were here today. Tracy, Payne, thighs over there. She's got more information. Got any follow-up on on order up? Uh, Rob welcome to the team. Thank you, Amber. Uh, hold on Alderman Lopez. I think you've exceeded your limit, I probably. I know someone else. Who would love to tell me that at some point. But um, I just want to point out today is Mario's Birthday. Happy birthday. You would like a terminal named after him, there being no further business before the committee. Can I get a motion to adjourn? Alderman pasado. So moves all in favor. All opposed and the opinion that chair of the eyes have it. Ladies and gentlemen, the meeting committee on Aviation is adjourned. We'll see you next Wednesday, septembar, 18th here for the meeting.