Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. FEDERAL AVIATION ADMINISTRATION

AIRPORT PRIVATIZATION PILOT PROGRAM PERMIT

SAN JUAN, PUERTO RICO

DATE: SEPTEMBER 28 th , 2012, 8:00am

- 6:00pm Afternoon Session

– English Version
PLACE: VERDANZA HOTEL ISLA VERDE, PUERTO RICO

Chairman : RANDALL F I ERTZ Transcription: Aledawi FigueroaUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. Participant PAGE Randall Fiertz

-------------------------------- -------------------------------- --------- 3 Erica Garden

-------------------------------- -------------------------------- ---------- 4 Glenn Rivera Pizarro

-------------------------------- ------------------------------- 6 Federico Stubbe

-------------------------------- -------------------------------- ----- 9 José Maldonado

-------------------------------- -------------------------------- ---- 11 Carlos Rodríguez

-------------------------------- -------------------------------- --- 13 Clarisa Jiménez

-------------------------------- -------------------------------- ----- 15 Harry Narvaez

-------------------------------- -------------------------------- ------- 17 Fernando Batlle

-------------------------------- -------------------------------- ----- 20 Greg Stokes

-------------------------------- -------------------------------- ---------- 22 Luis García

-------------------------------- -------------------------------- ----------- 26 Samuel Caraballo

-------------------------------- -------------------------------- -- 28 José Gerardo Tirado Vega

-------------------------------- ----------------------- 31 Jesús Ramos Puente

-------------------------------- ------------------------------ 33 Abimael Portalatín Rosario

-------------------------------- ----------------------- 35 Noemí Cardona Tomassini

-------------------------------- ----------------------- 38 Raúl Bustamante

-------------------------------- -------------------------------- --- 41 Mariela Matías

-------------------------------- -------------------------------- ------- 42 Jorge Valdivieso

-------------------------------- -------------------------------- ---- 44 Ángel Figueroa Jaramillo

-------------------------------- ------------------------- 47 José Antonio Herrero

-------------------------------- ------------------------------ 48 Jorge Valdivieso

-------------------------------- -------------------------------- ---- 51 Emilia Barreto

-------------------------------- -------------------------------- ------- 51 Jon Borschow

-------------------------------- -------------------------------- ------- 52 Graham Castillo

-------------------------------- -------------------------------- ----- 57 Faustino Marques

-------------------------------- -------------------------------- -- 60 Rogelio Figueroa

-------------------------------- -------------------------------- --- 62 Dr. Ramón Torres Morales

-------------------------------- ----------------------- 67Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. ( 1:30 pm

– After lunch)

Randall F i ertz : Good afternoon everybody, we’re gonna start in five minutes, just to make sure it’s enough time for people to get inside the room. Thank you.
Ok, good afternoon everybody. Welcome, or welcome back for part two of this public meeting. Just a little reminder, for some of you who just arrived, some of you who weren’t here this morning: t he purpose of this meeting is for this panel

– FAA, Department of Transportation, and the Transportation Security Administration

-- to collect info rmation from interested parties
, concerns, questions , support, for this program. And we will use this information as well as any information submitted in writing to us as par t of

our
-- the decision that we need to make collectively on the proposed transaction. Unfortunately because of the number of people that are interested in speaking we need to limit people to 5 min utes

. And unfortunately, I’ve had to be pretty strict abou t that, so there is a timer here,
there are some lights on there, a fter the 5 min utes are up they will turn red
and at that point if you continue to speak I will have to ask you to
summarize and to stop

. But certainly, as I said, written comments
, supplem ents, oral comments, are certainly accepted as part of the process. I also wanted to mention that, t here is a request , that if people have a copy of what they’re going to talk about that they are able to give in advanced so
the translators could use that to work off of, that would be very helpful. Certainly not required, but if you have that, if you could turn that in to the registration table and they’ll give that to the translators. As I said, that would be helpful. Ok, thumbs up from t he translation group. Ok! VeryUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. good. Anything else I need to mention? No, ok. Alright. Well, let’s get started, I think we’re in number 35, is that right? 38 I’m sorry. 38 please.

Erica Gardner : Hi. Good afternoon. Ladies and gentlemen thank you for your time in hearing my com m ents. My name is Erica Gardner , and I’m speaking on behalf of the Corporate Ground Transportation Committee, Many of them which are here today. I would like to thank you for the opportunity to briefly express o ur thoughts and concerns as to what we call the lease of the Luis Muñóz Marín Airport. We are a committee that
consists of about 15 business people , mostly luxury ground transportation operators, that every day provides chauffer transportation service to arriving and departing passengers at the Luis Muñóz Marín Airport . Our
client ele s range from the average tourist to CEOs of companies that are
look ing to invest millions in to Puerto Rico ’s econ omy

. And even some of the most famous artists in the world. First we are looking forward to the possibility that there will be long term assurances in the much needed change for the airport to provide a positive first impression for our
customers when arriving to Puerto Rico. We are extremely e xcited at the possibility of developing new business and exploiting the growth potential
for Puerto Rico to be a destination of choice . We look forward to the fact that there will be increased operating efficiency, for n ot only inside the terminal, but also outside the terminal, for the ground transportation sector as well. It is imperative that our clientele, that we receive, will be able to walk off the airplane and connect with their chauffeur in a seeminglessly
effor tless fashion. Most of our client s might be arriving exclusively to attend important meetings, only to return to the airport hours later. Time is money for everyone involved. Our airport needs designated pick up pointsUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. and access to meet and greet our passengers as soon as they arrive in
Puerto Rico Simple things such as proper sign age have always been an issue for customers, and we are overjoyed at the fact that we might finally be able to work with proper management, to make sure that our clients are
able to locate our chauffeurs and vice versa in a very efficient manner. You’ve probably already noticed our great expectations. We know how to operate our businesses . And we do have a clear knowledge of how top world class ground transportation operate s in most of the airports in the United States and around the world. We’ve always aimed, and offered to work side by si de with any management in turns with system and pro viding greater choices in ground trans portation

. We’ve also look forward to making sure that a ll customer and visitors are offered to the high est possible safety standards as they move through the airport in order to get
into their vehicles.

On the other hand we are no experts in such complicated issues as the
lease contract t hat face the airport today. It is our firm concern that here, now, the way the airport is, it only can improve from here. A fter many years
of stagnant development in our country

-- in our industry

-- we’re looking forward to throwing out the traditional approach and creating new ways for our clientele to be serviced. So for many reasons we trust that the FAA and your staff to scrutinize every possible detail of the deal. We tru st that
the politics will not be a factor in any direction about your future decision

. We place in your hands the proper analysis to the procedures and
conditions of the lease contract. And that the m anagement will have the rights for decisions for regu lations pertaining to our industry. We need to be assured that we get the best deal that we can provide Puerto Rico withUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. the best airport transportation service. And we want to end the burocracy that overshadows how we provide service to our customers. We aim to work with new private management and assist them in providing greater
new choices in grown transportation . We look forward to making sure all of our customers are offered the high est, safety standards possible. Our customers are mutual, it is imperative that their experience from the time that they step out of the airplane to the time that they arrive to their meeting or vacation is an exceptional experience. We need a better and realistic opportunity to do what we do better , and private management seems to be the road to getting to that goal . We want to move forward from 911, we
want to provide the best standards possible to every person that comes to Puerto Rico. Thank you for your time

.
Randall Fiertz : Thank you.

Gle n n Rivera Pizarro : Good afternoon, honorable members of the federal government, representatives of the Commonwealth of Puerto Rico, legislators, representatives of the private sector, representatives of the working class of the Country, public employees and general public.

F or the record, my name is Glenn Rivera Pizarro, candidate of the PPD to Representative for the District 36, which is composed by the municipalities of Vieques, Culebra, Ceiba, Fajardo, Luquillo and Rio Grande
, for the project of privatization of the Luis M uñoz Marin International Airport. Today I want to express the feeling of the residents of these municipalities with whom I have spoken to about the project that was established by the Port Authority, with the approval of the governor, Luis G. Fortuño Burse t. I thank you for this opportunity.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. We oppose to this proposal. On the first place, the actual administration of this Country lacks the effective and positive experience in the confection,
administration an d follow up of privatization projects. The historical results of the previous initiatives indicate that the proposed objectives where never achieved, the efficiency and quality of services were not improved; the final
costs resulted higher than what was contemplated in the initial proposals and the government needed to retake the administration of the services. Such is the case of the administration of the Diagnostic and Treatment Centers (CDT’s), the Urban Railroad and the “Supertubo”, among others.
Secondly , the Dis trict I aspire to represent includes three active regional airports. The conditions that are part of this privatization proposal, of the
Luis Muñóz Marín Airport, do not allow the development of the regional airports and the nearby municipalities, limiting the free commerce in these locations. Specifically, the proposal includes a restrictive clause that establishes a penalty to be paid by the Government of Puerto Rico, if there is any initiative to increase the services at the regional airports. This penal ty will be in place, if the privatization project is approved, for a period
of no less than twenty years.
The negative effects that this clause will produce in the municipalities

w h ere the regional airports are located will be very bad for the district’s

e conomy. The proposal will eliminate the competition that could benefit the habitants’ pockets and the air services users of the zone, as well as any free commerce possibility.
As part of the application submitted by Ports Authority a plan for Regional Airp orts is included that specifies an increase in all the fees. The tourismUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. industry, which promises to the base and in which all the hopes of economic development for the East area are based upon , could be affected by this agreement that will cause an increa se in other touristic services.
The proposal of the Ports Authority will produce a great income loss in the hotel industry of the East, including those in the islands of Vieques and Culebra. The occupation report on hospices for Vieques and Culebra for
the 2012 fiscal year emitted by the Research and Statistics Office of the Tourism Company indicates that hotel occupation in Vieques only reached 55%. This occupation represents half of the total occupation available. One
of the factors that do not allow incr easing the hotel occupation in Vieques is
that the average of hospice fee is increasing. The fee per night increased
until it reach ed $163.49 per night. The annual income obtained for the sale of room/per night reached $7,107,891.24 for Vieques hotel indus try . Again,
we advert that that fee increase was the reason it wasn’t higher

. Therefore, if there is an increase in the air fee and in the hotel fees as a
result of the approval of this project, the hotel occupation will decrease to unsustainable levels for the touristic industry of the East area and the municipal islands of Vieques and Culebra. Other industries of the local economy that could be affected are the ground transport ation and the food production business like restaurants, among others.
The final result will be the possible closing of business, corporative bankruptcy, an increase in the unemployment rate of the district and the Country’s public debt; an economic and so cial crisis of big proportions in all the municipalities of the District 36.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. The actual economic profile of the district is very deteriorated. The general unemployment rate for the district for the last four years reached 16.7%,
this is the highe st rate in the last four years. The municipalities of Fajardo
and Luquillo have reached unemployment rates of 22% and 18%, respectively. The workforce keeps decreasing during this quadrennium due to discourage of the inhabitants produced by useless efforts to find a job.
On the other hand, the municipalities of the Dist rict 36 have very limited budgets and do not have the necessary funds to, in some way, alleviate
with incentives the effects of a measure of this nature.

In conclusion, with all due respect I ask the members of this panel that after a just evaluation of th e position expressed in this public hearing and in the submitted documents, do not approve the proposal for the privatization of the Luis Muñoz Marin International Airport submitted by the Ports Authority.
Thanks for your attention today; September 28, 201 2, Carolina, Puerto
Rico.

Randall Fiertz : Thank You.

Federico S tu b be: All right, good afternoon. My name is Federico Stubbe; I’m the Chairman of Prisa Group. Our enterprise is currently building 4
hotels in Puerto Rico. The Ritz Carlton Reserve, which is a 6 stars new branch from Ritz Carlton Dorado Beach, 2 Hyatt Places, one in Bayamón
and one in Manatí , and a Hyatt house in San Juan. W e are very much
committed to the growth of the Puerto Rico econ omy . Unfort unately the
Puerto Rico econ omy has not g rown in the last 12 years. If you look at Puerto Rico and you look at the region where we play and our economyUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. growth,

-- and we measure our region as three hours flight time around us,

a radius of three hours

-- the biggest econ omy certainly is Florida, which
has a 750 billion dollars economy

. The s econd one is Venezuela with 390 billion dollars economy, Colombia 290 billion dollars economy. Our

econo my is 63 bill ion

. The future
, because so far, being part of the US and having all the regulators of the US

– and you’re one of them

-- is really compet ing ag ainst Florida. If we take 5% of the market share of Florida we’ll grow 50%, and that would be great for Puerto Rico . The Florid a airports handles 66 million travelers, our airport has been in the last twenty years we have been in 4 million travelers . We could grow our traveling business. If we grow by 3 million, we should get that 50% growth in Puerto Rico, which would benefit all the people of Puerto Rico

. Unfortunately the government of Puerto Rico, both the Popular Democratic Party and the
PNP h ave not been able to manage the Ports Authority. There n o question that our airport is so standard in all ways. It’s sub

- world class and under both political parties we don’t think it will become world

- class. We, the best projects in Puerto Rico,

-- if you look at our Power Authority, Puerto Rico talking competitively

-- we have two and a half times higher energy cost s than F lorida has. We cannot compete like that , our best, in the power authority , our best production comes from a private company , ECO Electrica produces energy at six cents a kilowatt hours. We pay 26 cents,

so our private part ies have done better than the pu blic parties. If you look at Roads, the private parties are doing better than Roads. We, personally I’m an investor in a company where the management of the public housing

were privatized; we do much better than the government used to do. The government of Puerto Rico is too politized, in both parties, to handle things like that where we compete world class. So the airport being such a bigUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. part of our central economy package, where we compete globally, needs to go into private hands. I commend what has been happening, these people that are trying to manage this hotel are world

- class hotel operators. I was very much impressed by El Nuevo Día, usually papers here and the whole press doesn’t really believe too much in private enterprise. Even El Nuevo
Dí a talked good about these people that are managing this hotel

– this airport

– so I commend the action, I ask the FAA to approve this project. Thank you very much.

Randall Fiertz : Thank you.

Jos é Maldonado: Good afternoon, my name is José Maldonado. I am the owner of MN Aviation, operator of a commercial air carrier under part 135
of the Federal Avia tion Regulations; we’re also the owners of an FBO, one of the four FBOs of the airport. I am here today to express my concerns over what will happen and w hat will be available to the people and operators of our nature.
Under the present administration of the airport, under the present rules, the Ports Authority, grants us ability to stay at the airport, operate at the airport under contract. Those contracts are pretty extensive, those contracts are very specific

. A t the present time since it is under federal ai d program, companies like ours are guaranteed that we are going to operate. I am not here to argue for o r against privatization, I am here to make sure that I get

-

- that operators like myself have assurances

-- that we will be able to continue to perform our business, to grow our businesses and to perform our trade, to continue our trade. I am deeply conce rned, and I want to
make sure that should this project go through

-- and I’m sure that there areUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. good and great intentions, I have met with the people from ASUR , I’m a pilot
, I ’ ve been to many of their airports , and I see what they do, and I’m sure that their intentions are good

– but I am deeply involved in interstate

commerce

. A s the operator of a ircraft, we fly 365 days a year for the US Mail, 4 times a day for the US Virgin Islands, I fly the Life Links org ans from San Juan to various points throughout the western hemisphere
, and we are also involved in highly sensitive fede ral contract s, which involves

secur ity , pres idential visits
, and law enforcement operations . M y contract is
up for renewal , I ha ve been at the airport since 2001, and we have been an operator since 1993. I’ve been advised that the Ports Authority cannot enter into any negotiation because of this process. Therefore I’ m left in
kind of a vo i d to see if we can continue with our air l ine, to make any investments
, et c. I need to know, we need to know in the a viation community the FBOs at the airport, we need to know if the FAA rules are going to continue to be in effect, and if those FAA rules by which we have
to abide provide insurance s that we will be able to continue our business in a free and open competition environment, as we have now under the Ports Authority, under a private owner. We want to make sure that we will not end up competing or get set aside by any pri vate future owner . Therefore I
ask :

 I f federal funds are going to continue to flow for safety, air traffic
controls
, TSA, Immigration ?

 I f Federal Funds are going to be used at the airport ?

 I f federal assurance rules apply to whoever takes over the airport ? Anything that will improve our ability to do business and safely operate our
aircraft and to make sure our businesses grow
, we support. But we wantUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. to make sure that we compete in a fair and open environment . In conclusion, I just want to make sure that I don’t encounter
, under a private

owner , unfair competition

. As a provider of an FBO, we’re involved with servicing transient aircraft , which includes bigger craft commercial aircrafts as well as corporate jets, and I want to make sure that we can continue to sell our fuel . Thank you for the opportunity to address you.

Randall Fiertz : Thank you very much.
Carlos Rodriguez: Good afternoon. My name is Carlos M. Rodriguez, President and General Manager for Vieques Air Link. We are a regional
airline with operations in San Juan, Isla Grande, Ceiba, Vieques, Culebra and San Juan Luis Muñoz Marín International Airport.

First of all, I ’d like to thank the opportunity given to all of us the Airlines, Government offici als and especi ally for this opportunity to the general public to express themselves regarding the proposed 3P of International
A irport.
Vieques Air Link has been part of the San Juan Air line

- Airport Affairs Committee and we are in agreement with the letter that they have already
sent to this committee. We, although a very small airline operator at Luis Muñóz Marín, have equally suffered from the vari ous infrastructure
deficiencies that thi s airport has gone through the y ears.
We strongly believe the location of Puerto Rico and its relationship with major carriers and direct flights to the U.S. destinations continue to position

us as a major hub for Caribbean c onnections. But this privilege p osition isUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. at stake if major infrastructure investments are not made in short to
medium term at the airpo rt.
In order to take advantage this privileged position, we all need to

u nderstand that we are competing with the best a irports in the world and not only among the Caribbean airports. That said, our Luis Muñóz Marín airpo rt must be at World Class Level.

To grow our business and the tourism industry in Puerto Rico we need World Class operational ramp s and passenger facilities
, and a master design towards making the Passenger ’s experience at San Juan among the best in the world. As a country, the challenge we face is not only
mak ing these needed improvements in the short to medium term
, but it has always been to make this investment sustainable in the future. Th at sustainability requirement is what I believe that th is 3P brings and this
tr ansaction brings to u s at the airport Luis Muñóz Marín.
What I would like to request for this committee to e nsure that if this process goes throu gh that the regional airports do not get any limitation for all the small commuter airlines to grow in there, that’s where most of o ur businesses are. Thank you very much for the opp ortunity to express our opinion

.
Randall Fiertz : Thank you.

Clarisa Jimenez: Good afternoon. I’m Clarisa Jimenez, President & CEO of the Puerto Rico Hotel & Tourism Association, a not for profit trade organization which represents the shared interests of more than 580Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. corporate members, most of them businesses that are related to our island’s tourism industry.
Today, given the fact that we only have 5 minutes to present our comments, I will share with y ou some general impressions regarding the transaction currently being evaluated by the Federal Aviation Administration and that, if approved, would authorize the establishment of a Public Private Partnership for the Luis Muñóz Marín International Airport
b etween the Commonwealth of Puerto Rico and Aerostar Airport Holdings.
If Puerto Rico wants to be perceived and recognized as a world class destination, its tourism infrastructure and the services offered need to be on part with said standard and fulfill th e promise we make to our visitors. Being an island it is imperative that the facilities of our principal gateway, the Luis Muñóz Marín Airport, are kept in top condition and that the services provided by both airport officials and the concessionaires opera ting at the airport, are driven by quality principles and consistency. Unfortunately, that has not been the history of the Airport.

For more than a decade, we have voiced to Government officials our concerns regarding the deterioration of the San Juan Airp ort's infrastructure. We have also warned airport administrators about the strong competition that we are facing as a tourism destination and on the need to enhance the travel experience of our visitors once they arrive to Puerto
Rico.
Although several eff orts have been made to address some of these concerns, none of them have had a significant impact on the quality of the
facilities and services available at the airport. As a result the Luis MuñózUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. Marín Airport has experienced a notable decline in passenge r traffic. From
5.3 million enplanements in year 2005, to 4.2 million in year 2011. This is unacceptable and that is why PRHTA supports the proposal to establish a
P3 for the Luis Muñóz Marín Airport

. It is important that the people who select Puerto Rico among the numerous tourism destinations who compete for their business, are constantly reassured that they made the best decision and the condition of the airport is critical in guaranteeing their experience.
By entering into an agreement with AAH, the Commonwealth of Puerto Rico partners with a consortium that has the expertise and the financial capacity necessary to transform the Luis Muñóz Marín Airport into a world class airport. The proven records of the e ntities that integrate AAH give s us the confidence to support this important transaction. Also, the plans that AAH has for transforming the SJU which have been shared with us are in line with Puerto Rico's recent positioning as a destination that caters to more affluent and sophisticated travelers. The opening of the St. Regis Hotel in Rio Grande, the W in Vieques and the future openings of the
Vanderbilt Hotel in Condado and the Ritz Carlton Reserve in Dorado support the image of the island as a premier de stination and as such it is important that our principal airport be able to comply with the needs these
kind of travelers demand.
In conclusion, PRHTA recognizes that this is a complex transaction that requires serious consideration by the FAA before issui ng its final decision. Nevertheless, based on the information we have available and considering the background of the entities that are part of AAH, we are confident thatUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. the proposed P3 for the San Juan Airport will benefit Puerto Rico and our
tourism sec tor. If you are in need of additional information from us we will be glad to provide them in writing prior to the deadline established of November 19, 2012. Thank you very much for the opportunity.

Randall Fiertz : Thanks you.
Harry Narvaez: Good afternoon. My name is Harry Narvaez and I’m a regular officer retired from the Air Force, I’m also retired from PRPA. Unlike any other airport in the United States, the Luis Muñóz Marín International Airport is a Public Joint

- Use Airport that supports nume rous highly classified covert US military and US Government operations as well it enjoys a unique strategic geographical location between North America and Latin America. The FAA Privatization Pilot Program was established in 1997. TSA and Homeland Securi ty they were born in about 2003. To me, this means that the FAA's Airport Privatization Pilot Program needs to consider sensitive key airport security issues that are extremely critical to the national security of the United States; including our aggressi ve ongoing wars on drugs and terrorism.
A close security scrutiny is needed to prevent the compromise of classified airport security information and the inadvertent unauthorized disclosure of covert military and US Government operations.
The Airport Securi ty Program is tied into a fully integrated airport security system that encompasses all other airports in the United States.
A particular clause draws my attention: Aerostar says that they will make any necessary revisions to the approved Airport Security Plan . TheUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. approved Airport’s Security Category is Category "X". For a Category "X" you need 5,000,000 domestic enplanements plus 1,000,000 international enplanements; that’s a total of 6, 000,000.
However in calendar year 2011 , by FAA records, it showed that it only had 3.9 million enplanements. Now the Airport Security Program has to be completely reaccomplished in its entire l y , not just a little revision , and a lower Category may be awar ded.
Though current TSA regulations require lowering the Security Category, strong security measures must remain in place to insure that we maintain a strong airport security program while guaranteeing the continuity of our highly aggressive war on drugs a nd terrorism.
No need to remind you that prior to the 9/11 attacks, one of the 9/11 terrorists sought temporary shelter in Vega Baja, he was my neighbor

. Also, as recently as couple of years ago, TSA implemented tougher new and stricter security requiremen ts for foreign pilot training. ASUR is also a foreign company, so it must be closely monitored. We cannot allow the security of the United States be compromised in behalf of a beneficial
commercial transaction.
I recommend that this proposed commercial tr ansaction be first reviewed, coordinated, and approved by affected federal agencies such as the Air
Force , US Navy, US Coast Guard, US Southern Command, FBI, DEA, CIA, US Secret Service, and the US State Department.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. All critical airport security issues and concerns must be clearly clarified by affected US military and US Government agencies prior to FAA granting its final approval to this transaction.
TSA requires US Citizen a background investigation in addition to a fingerprint check to give you an ID Card . I therefore recommend that TSA examines ways to keep a foreign company under close surveillance in order to safeguard the compromise of classified information or endanger
the details of covert operations.
Procedures vary from airport to airport; therefore, the Certification Manual and the Airport Emergency Plan , which I brought, I brought both of them, are unique to each airport. Before FAA approves this final application, FAA
needs to ensure that critical documents are reviewe d, coordinated and approved by all affected federal and state agencies. Last but not least, as a federal rule stipulates that the Labor Union contract will not be abrogated and a new Labor Union Contract should be approved prior to the approval of this pr ivatization process.
I strongly recommend that all operating manuals and the new labor contract be completed prior to FAA's approval of this transaction. I’m retired from
the Air Force , I ’m retired from PRPA, I’m FAA Aviation Safety Team Lead Representat ive and I got the 2009 FAA Southern FAA aviation award. Thank you.

Randall Fiertz : T hank you very much.

Fernando Bat l le : Good afternoon ! My name is Fernando Batlle and I am
here as a concerned citizen representative of the private sector and a firmUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. believer and actor in public

- private partnerships. There are many deficient areas in the physical aspects of the Airport and also major operational aspects that need attention. I have no doubt that m any of these shortcomings will be addressed by the comments from those that have come before me or that will follow. As an architect, familiar with the ground transportation operations and problems of the airport since I992 and up to the present, I conside r this particular aspect of operations as a major issue that needs to be addressed in order to elevate the airport to a world class level facility that Puerto Rico needs and deserves as a cornerstone of our future economic development.
I come before you in full support of the concession agreement being proposed for Puerto Rico's main airport facility. I do so with the conviction that placing the operation and necessary improvements in private hands but with public oversight is the only way in which accoun table and measurable professional management will deliver the goals that Puerto Rico is striving for.
My involvement with the airport stems from a failed procurement for a parking structure proposed by the Ports Authority and that turned out to be complete ly inappropriate and ill

- conceived for the needs of the airport. This failed effort led to the present parking structure.
Unfortunately, the final implementation by the Ports Authority failed to properly address many of the ground transportation issues tha t were part of the original comprehensive concept in which I was involved and that were necessary for a successful operation. This was a significant failure of purpose by management since the real operational issue facing the airportUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. then, as it still does know, is the lack of a structured and comprehensive ground transportation management approach that must go well beyond the mere construction of a parking structure. Such approach would have affected and improved operations on the air side, the land side a nd all the way up to the curbside. This issue impacts a very broad constituency that encompasses a large and important sector of the tourism industry and includes visitors, taxis, charter busses, hotel busses, limousine services, airport and airline employ ees, tour operators, car rental operations, cruise ship luggage transport and shuttle buses. This list can go on and on and will end up spilling over into homeland security issues and concerns.
Twenty years have gone by since this issue was formally articu lated. During this long period numerous efforts and approaches have been made to the Ports Authority management by stakeholders and other interested parties in order to tackle this issue and it has been to no avail. Ironically,
this should have been a self supporting activity that would actually paid its own way and therefore there is no excuse for not having done it already. Twenty years of inaction, disregard, deterioration, lowering of standards, unaccountability , inability to decide, act or execute, abs ence of vision and purpose and an ineffective management structure that can only produce
mediocriti es and abject failures are more than enough justification for the action that is being contemplated and is the object of this hearing.
Ladies and g entlemen, there is no other solution in sight that will save our airport from further deterioration and its inept management structure. I trust
that you will come to the same conclusion and wisely impart your approval to this innovative undertaking that has proven s uccessful in o ther jurisdictions as well as in Puerto Rico. Thank you for consideration

.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. Randall Fiertz : Thank y ou.
Greg S t okes: Good afternoon and welcome to Puerto Rico. My name is Greg Stokes and I am a retiree, federal retiree, which you guys will be one day, not too soon I hope. I live here in Puerto Rico in Isla Verde, around the corner, so you made quite a bit of noise in my neighborhood today early this morning, with all the racket in the street. I don’t really have a dog in this race other than I’m a private citizen and the process is something that has disturbed me in this particular contract. First, I want to say that I am not opposed to the concept of Public

- Private partnerships when it serves
the Public interest.
Secondly, as a Northamerican living in P uerto Rico, I am not affiliated with any local political viewpoint. I do want to acknowledge that I have served

as a public interest Stakeholder of two federal grants during, both, the Acevedo Vila administration and Fortuño Administration, so I don’t care who’s in power , my interest was the federal grant and serving the needs of the people. Fo r that reason, I w as acut ely

- aware of the absence of a credible Public Interest Stakeholder in the current government’s Public

Private Partnership initiative, all of their Public

- Private Partnership
considerations
, not just this contract. And I’ll ret urn to that concern in a

seco nd, since it’s about this specific contract.
Since its beginning, I have been interested in this Administration's
Public

- P rivate Partnership Program and in fact I was an enthusiastic participant in the Oct 22 nd and 23 rd , 2009 P3 Inaugural conference at Conquistador Hotel. I was very excited about the government's initial list of 100 priority projects for expedited P 3 Projects Contract Awards

- schools,Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. roa ds, health information exchange

– which is one of the grants that I’ve worked on as a public applicant the affordable care Act Implementation in the Caribbean and Puerto Rico

-- and also construction priorities for the arts and public parking and municipalities, and affordable housing . Although Ports Authority projects w ere on the list of 100 , I didn't recall the LMM International Airport at the time. I was focused on other things.

But one observation at that 2009 conference was an absence of ethical and
conflict

- of

- int erest provisions, which several months later , after that meeting, were addressed partially by a 5

- page Conflicts of Interest and
Unfair Advantages Guidelines document dated December 19, 2009.
During the Conquistador P3 Conference I questioned the P3's private

sector c onsultant for Public

- Private Partnership Development

– his name is
Juan Santamaria

– I questioned him about the absence of a credible Public
Interest Stakeholder or any other evidence of public review in the local Authority's process to P3 Contract Awards.

There was no plan for a public interest participation or review at the Puerto
Ric o P3 Authority. I also asked Mr. Santamaria if, in the past, he had been able to work for Proponents

— or applicants

-- seeking contracts in other jurisdictions he had advised on Public

- Priv ate Partnership development, as he was doing now in Puerto Rico. His obvious discomfort and body language suggested that he, or his Associates, had probably sometimes played a dual advisory role with both a P3 Authority and Applicants seeking
contract awards.

It was some time after the October 2009 Puerto Rico P3 conferenc e that I
noted the first pub li shed criticisms of Puerto Rico’ s privileged private sectorUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. consultants having connections to P3 applicants. My fears of a failed
confli ct

- of

- interest and credible ethical review were beginning to
materialize. Later, I noted more specific charges published by opposition law makers, who’d say what practice we’re doing here, specifica ll y regarding this LMM

- Aerostar P3 Contract. And I presume all that is available to the public.
Today’s federal Federal Aviation Administration review of the P3

- Aerostar’s
40

- year Lease Award, is the first and possibly

- final opportunity for any semblance of general public or secretarian review about the Puerto Rico P3 process.
Thank you. I think most of us living in Puerto Rico are grateful for the federal presence here . Amnesty International reported last week that Puerto Rico's US District Court prosecutions for public corruption rank #2 in the United States, after New Jersey. I hope none of you live in New Jersey , but if you do you know how we feel, it’s an issue of trust in the public and the government making similes decisions, in particular one of this gravity. I am also a bit surprised at by a more obvious and unspoken concern. Puerto Rico having the isolation of an island

- the LM M International Airport is the primary access to the outside world, which becomes even
more critical in case of a Haiti

- style earthquake or other natural disaster

common to the Caribbean. We all read and saw daily reports from Haiti about the crisis at the airport when that event happened. And it’s curious
to me that nobody says anything about this. If we are to believe critics of this contract that future development of other
island reg ional airfields will be frozen or limited during first 15

- years of theUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. LMM

- Aerostar Lease , this private sector monopoly of Puerto Rico's air commerce puts the safety of our public sector , my safety, at the mercy of a foreign corporation, when local and fed eral government should be in control of such a single vital resource.
Puerto Rico is not like any of the other of the other six stat e
- side airports that you guys are or have already transacted or transacting under the Pilot Program of FAA's Public

- Private Partnership operators , where the Public

e njoys easy access to proximity and multiple access to other neighboring
states , we don’t have that here, and their public airports

- that freely compete f or air tr avelers, carriers, and capacity as alternatives in a ny kind of an emergency or disaster.
Lack ing public interest recourse in the P3 process, Puerto Rico must rely

on the US federal agencies to correct the risks of public safety and commercial monopoly implicit in this local contracting process. And, to insu re that any future deliberation regarding this singular asset include a healthy and credible public interest representation, which has
been absent until this review today

.

Thank you for your consideration and courtesy to me

. I trust that you will make th e correct review to protect the people of Puerto
Rico.

Randall Fiertz : Ok, thank you very much.

Luis Garc í a: Good afternoon, everyone. My name is Luis Garcia. I will be very brief, I will use the five minutes in two parts. The first one , on aUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. personal level as a resident of Puerto Rico and a U.S. citizen. The second, as a representative of Secure Wrap of Puerto Rico, the company that protects all baggage at almost all airports around the world, thank God. We are in 50 airports, more than 50 airports, in almost every continent and that is what I leave for later, I'll talk on a personal level first. The first thing I ask is that you consider all the statements made here; I know it will be like that, take in all the approaches and draw the best conclusions. Evaluate if it is a good deal or not, if it is good for Puerto Rico, and it has to be good for the United States. Strategically we are in the Caribbean, and I do not want to go a little further, but really we are located in an island and the airport is one of the most important places that Puerto Rico has, because in order to leave Puerto Rico, you have to fly out. The cost

- effective cruise departures

are non
- existent. So make the best judgment and make the best
decision. If it’s yes or n o, it is in your hands, and we know that you are well prepared to make that decision

. The other thing I want to say, very briefly,

as I said, is that we are in 50 airports, from Australia to Africa where there are two, in Europe, we have been in Puerto Rico for 17 years wrangling with ups and downs, ups and downs, up s and down s , we are there, and we opened in Cancun . From the 10 airports that I think ASUR has in Cancun

we are in eight. That is, we’ve had relationships with ASUR, and with
whoev er. So we have had to negotiate with the government of Puerto Rico, some for good, others for bad , it does not matter. Be it ASUR, the government, or whoever , but chose whatever is best for Puerto Rico. I understand that a private company will not do busin ess to lose money, nobody, nobody thinks that. All dealers,

- I say, I have no such problem one has to have two options, win or lo se
- they all have the fear what if the rent is raised, if it is lowered, that if... hello! That's negotiations! TheUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. government also raises and lowers the rent, that is, let's talk about what is good for Puerto Rico, and if it's good, let it be and if it is not , well then let it
not be

. That's my approach and we will be here not for 17 but 50 or until God willing we will be there. Thank you.

Randall Fiertz : Thank you.

Luis García: They say they need 5 million tourists, it’s not five, I remember when American would say "get ready because tomorrow we have nine thousand passengers" One day American, American Airlines in 2000, it is
on record. My company sold $ 92,000 in that month, which is on record; I
say it publicly that we paid $ 13,000 to Ports. Today we do not reach half of
that

. But we are there. Now what we want is that whoever comes
, improve s everything. But it is not about the bathroom, that's nonsense; anybody can
clean a bathroom, that’s a metaphor . What we want is that whoever is in
Puerto Rico ... I forgot that the representative left, he had an approach
about “Supertubo”. Just s o you kno w , a work of hydraulic engineering that was done, brought water from elsewhere, to places there wa s no availability of water supply, and it really went over budget , it happens even in one's home, one has a budget and then you spend more, so you make
your a djustments. Where I live it is a very good and comfortable neighborhood , in that moment before I bought it, there was no water, now there is water, thanks to the “Supertubo”. That is being done around the streets; I believe in the private enterprise, I com e from it ... I mean I come from another place. But I believe in private enterprise
, and the government
, only I would say the smaller the better. There should be intelligent people leading us, that’s why we are central states, states of consciousness, if n ot,Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. we would be a tribe. The less people in the government the better
, because
then they do not have to charge me taxes, because the government does not produce, the government gets your money out of the pocket. If instead
of 5 there would be 2 , perfect! B ut the work of two has to be done by 5. Do you understand me? The smaller the government the better.

Randall Fiertz : Thank you Samuel Caraballo López : G ood afternoon to the honorable representatives of the Federal Department of Transportation and the Federal Aviation Administration who are here with us, and the general public who are here with us. My name is Samuel Caraballo Lopez, I am a pastor of the Ev angelical Church of Puerto Rico, is one of the oldest
denominations in the country, I am a resident of the municipality of Ceiba and president of APRODEC short for The Alliance for Economic Development of Ceiba. APRODEC is a nonprofit organization registered with the Department of State of the Commonwealth of Puerto Rico on October 21, 2003, with the number 43.592, and whose mission is to promote the economic, social and cultural development of the municipalities of Ceiba, Naguabo and eastern Puerto Rico through actions
and initiatives. After carefully reading the proposed lease contract that the
Luis Mu noz Marin International Airport , or the Port s Authority, intends to sign with a private corporation or a P PP, I have come to this place with the
purp ose of publicizing a growing concern of my community regarding this
intention. In that contract, in section 3.22 entitled other aviation services specifically mentioned, by name, the airport located in the town of Ceiba
and which was the airfield of the fo rmer Roosevelt Road Navy Base until March 2004, this section 3.22 that I want to draw attention to represents theUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. redevelopment of the former Roosevelt Road Navy Base , the main economic development project in the east area of Puerto Rico and a
serious obst acle that threatens job cre ation and re

- development of it

. As you are aware, the former Roosevelt Road Navy Base by decree of the Congress of the United States of America closed its doors permanently on March 31, 2004, the Law "Brack" which aims to promot e redevelopment of these military installations and convert them into civilians was immediately activated, in order to recover the losses caused by this closure in the affected region, in this case the Eastern Region of Puerto Rico. The impact
of the closu re of the Roosevelt Road Navy Base was such that left many unemployed residents and from the entire island, creating an environment of economic decline in the towns surrounding these facilities mainly Ceiba and Naguabo, which endures until now. From that m oment governmental, municipal and community ac tions began so that this longed

- for redevelopment would be under the most favorable conditions for the people affected by the closure. After constant efforts for several years, last year on October 7 th 201 1 Governor Luis Fortuño signed the master plan for the site of the former Roosevelt Roads Naval Base, the authority's proposed plan for the redevelopment of Roosevelt Roads and was welcomed by the U.S. Navy, until that time, and the Planning Board of the Com monwealth of
Puerto Rico. This is an integrated plan which outlines the growth and development of the property of the former Roosevelt Roads Naval Base
and the transformation from military to civil

. This master plan includes analysis, recommendations and p roposals for the protection of natural resources, land use in a sustainable manner, the area's economic development, the provision of housing, transportation, and community facilities, among others. It is in this plan that transportation infrastructureUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. pla ys a central role in the development of the whole area. All economic and tourism development proposed is subject to the availability of communication, transportation, availability of posts and airports within the
base. The plan establishes the importance o f the former military airport and emphasizes its 11,000

- foot runway, its industrial zones and their ability to receive large

- scale international flights. It emphasizes this regional airport as one that can provide an interface between the island and the ea stern Caribbean. That is, in all 17 areas of proposed development of that plan, which was approved by the Department of Defense and the Navy, the transportation infrastructure cannot be disconnected from the desired and planned economic development in the east. The Ceiba airport development, which is essential not only for national security

- which is a priority of all airports in the U.S. territory since September 2011

- but for the protection of our shores because of the increasing crime activity in the a rea and as infrastructure for the economic development of the region

. For all
these reasons, Section 3.22 establishes that the Port Authority has to
consider this section. And especially I want to finish by saying this. Req uest number 1, in the light of wh at was stated here , section 3.22 should be
deleted because of its adverse effect on the economic, social and cultural development of the eastern region, and specia l l y in the municipalities of Ceiba and Guaynabo. Besides
, the lack of desired development wil l affect not only us, but even to the continental United States. If this section of the
contract is not amended then we request that no authorization be granted to the privatization contract of Luis Munoz Marin Airport. Thank you very much and good aftern oon.

Randall Fretz : Thank you very much.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. José Gerardo Tirado Vega: G ood afternoon to the FAA panel. G ood
afternoon to the audience. My name is Jose Gerardo Tirado Vega. I am a
former concessionaire of the Isla Grande Airport and International Airport doing business under "World Connections" which was dedicated to freight aircraft, helicopters, handling service , air ambulance plane, air ambulance helicopter . Representing Volky International Airways Helicopters and Health Center. Providing air ambulanc e service through Volky, also serving NAVY through "Air center". In 1992 I had the courage to stand up to the government of the time, not giving in to pressure and blackmail from them. I would like you to

-- before reaching a conclusion on this contract app roval

-- to visit the Department of Justice of the United States in the Puerto Rico division, and verify who were the ports ’ directors of the last 10 years1992

- 2012 and the last 4 directors of the Luis Munoz Marin Airport. The reason is
because I lived an e xperience where I was asked for money in order to
receive contracts for my services, but nobody has heard me. In November
2011 I went to the offices of the FBI and I submitted all the evidence. On the web page queréllate.com on twitter @ querellate I have expressed all
the evidence. I would like to verify all acts of corruption that took place from
1996 to this da y

. And you will see that they all belong to the political party in power. I’m not a politician, I'm not affiliated to any political party, nor do I

care. I would j ust like for you to somehow check in the Justice Department
who were the ones involved in these transac tions, because I was affected, and I lost everyth ing. Because I refused to pay $ 5,000 to a Director of Real Estate who died pleading guilty to the Federal agency. You should also verify that the Senate ’s president said a few years ago that he would
conduct an investigation about the death of Mrs. Barbara Small, at the International Airport in 2009 because there was no land ambulance service,Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. when we had a 24 hour staff. This man said he was going to do some
research and never carried it out, why? Because he ’d be finding guilty people such as a former governor. Imagine that when I went to the “Fortaleza” to introduce myself and to take this complaint, the person who assisted me, was the son of the person who died, which was the one that
tried to extort me. T hey stole my Porsche from the other airport, even when
I was a concessionaire, and did not pay me.
I disagree with the privatization of the airport because many of us who are
here today
, some who have already left, have had the courage to build the
founda tion of what we have today
, and now they want to take the best part away from us, after we strived for it anonymously, on many occasions, providing our services, now they want to sell something that belongs to all
Puerto Ricans. And I'm Puerto Rican; I am a very proud American
citizen. But I feel that there has been a violation
, why? Because many of these people will ask you for money
, and I have the names and I'm ready ... And I demand that you evaluate this before you reach a
conclusion. Quote all the cases of corruption that have occurred at the airport in PRPA. There are many, many ... I just ask you to go to the FBI,
go to the Department of Justice, I'm more than willing to help , I want this to
be clarified for me and I want them to return what was stolen from me

. Yes,
I've been robbed. I started when I was 24 years old , I will be 44, and it is
not fair that I have lost everything only because I refused to give money to a public employee who does not deserve to be paid for a service that was his resp onsibility to offer. Thank you and good afternoon.

Randall Fretz: Thank you.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. Jes ú s Ramos Puentes: Good afternoon to the FAA panel and to the entire
audience. My name is Jesus Ramos Puentes and I’m the President of the
“Paradores” of Puerto Rico Association

. And a fraternal greeting from Puerto Rico’s highest town here to the metropolitan area. Paradores of Puerto Rico are small and medium tourism guesthouses that host
tourists

. One of the peculiarities of Paradores of Puerto Rico, which is a program that be st supports the government, is that it is ran by its

owners. Right now we have 792 rooms offering all rooms’ nights to
visitors. We understand that the Luis Mu ñ oz Marin Airport has had a number of situations, most of them having to do with aesthetics and planning, there have been several things that could have been done
better. But because of the changes of government, economic situations,
the bureaucracy, unfortunately they have not been handled in the most feasible way. We as representat ives of paradore s in Puerto Rico

- that although we draw a lot of domestic tourism, however tourism also depends
on the tourists who come from anywhere around the world

- we really need
the Luis Munoz Marin Airport as a world class airport so that night im proves and the number of passengers who come here to Puerto Rico grows and
this will end up nourish ing us on nights / rooms. We know it's uphill, but you people who are thinking of leasing the airport and have the experience, and have the capital, to devel op the airport and make it a truly world

- class airport. So that all our guesthouses continue improving. Note that we cannot forget the regional airports, for regional airports are also part of our
Puerto Rico and they help the paradore s that are in differe nt parts of Puerto Rico, not necessarily in the center of the island, which may have also its air
traffic. We the Owners of “Paradores” Association and the Paradores ofUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. Puerto Rico we fully support the public

- private partnership and long term
lease of the Luis Mu ñ oz Mar í n Airport. Thank you very much.

Translation note from the translator: ”paradores” are independent small hotels/motels/bed and breakfast type of lodging places.
Randall Fretz: Ok, thank you very much.

Abimael Portalatí n Rosario: Good afternoon. My name is Abimael
Portalatín Rosario ; I'm running for mayor for the popular party in the town of Ceiba. First of all , on behalf of the residents of the town of Ceiba, I express our gratitude for the opportunity given to us to state the position of thousands of Ceiba Residents who identify with the statements that we will bring up through out these remarks

. This Commission will be evaluating during these hearings , the lease Agreement of the Luis Muñoz Marín International Airport in Carolin a, Puerto Rico. So that we all understand the concerns that we have about some commitments of this agreement and its relationship with the residents of the town of Ceiba. It’s not only about Ceiba ’s Residents , but about all the
residents of this east area , which expect from the development of the former grounds of the Roosevelt Roads Navy Base but particularly from its airport, the economic opportunities that they have been waiting for for many
years.
In 20 years or so we would see the development complete d and would end once and forever the half century of unlimited use of our soils. To ensure that development is not interrupted, the government of the Commonwealth of Puerto Rico and the U.S. signed several clauses required to be
disclosed to the record of this committee. At its thirteenth 9 (a) part entitledUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. "Federal Aviation Administration Land Use Restriction, Condition and
Conversant" the following commitment was signed : "Airport Layout
Plan" The grantee will keep up to date at all times an airport layou t plan of the airport showing boundaries of the Airport and a ll Proposed
additions thereto, together with t he boundaries of all offsite areas owned or controlled by the grantee for Airport Purposes and Proposed additions
thereto. The location and nature of all existing and Proposed airport facilities and structures (Such as runways, taxiways, aprons, buildings terminal, hangars and roads) including all extensions and Proposed Reductions of existing airport facilities, and (3) the location of all existing

an d Proposed to non

- aviation of all existing areas and improvements
thereon.
Such airport layout plans and each amendment, revision, or modification thereof shall be subject to the approval of the Secretary Which Shall Be approval evidenced by the signature of a duty Authorized representative of Secretary on the face of the airport layout plan. The GRANTEE will not make changes to permit any of Alterations in the Airport or any of its facilities are not in conformity that with the airport layout plan as appro ved by the Secretary and which might, in the Opinion on the Secretary, Affect adversely the safety, utility or efficiency of the Airport. "
Later on the following clause w as reserved:
In the event any of the aforesaid that terms, conditions, reservations, or restrictions are not met, observed, or complied with by the grantee or any subsequent transferee, whether c aused by the legal i nability of said grantee or subsequent transferee to perform a ny of the obligations hereinUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. set out or otherwise, the title, ri ght of possession and all other rights transferred by t his instrument to the grantee, or any portion thereof, shall at the option of the government revert to the government in its then

- e xisting conditions sixty (60) days following the date upon which deman d to this effect is made in writing by the Secretary or his or her successor in function, unless within said sixty (60) days such default or violation shall have been cured and all such terms, conditions, reservations and restrictions shall have been met, observed, or complied with, or if the grantee shall have commenced the actions necessary to bring it into compliance with such terms, conditions, reservations and restrictions in accordance with the compliance schedule approved by the Secretary or his
or h er successor in function, in which event said reversion shall not occur and title, right of possession, and all other rights transferred hereby, except such, if any, as shall have previously reverted, shall remain vested in the grantee, its transferees, su ccessors and assigns.
Agreement of the Government in Puerto Rico Luis Munoz Marin Airport
Recently the administration of Luis Fortuño announced an agreement to lease the Luis Munoz Marin International Airport. In it, among other things, they committed to limit the development of the airport Jose Aponte, by Section 3.22 of the Agreement. In other words, the entire development set out in the Development Plan on Roosevelt Roads Airport that had the support of the Federal Aviation Administration on October 11, 2007 will be
violated with the clause cited above.

ConclusionUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. This contractual provision is detrimental to economic development opportunities that are expected across the east coast of Puerto Rico. And that Section 3.22 is in direct contradiction to what you, the Secretary of the Navy and the Government of Puerto Rico had approved on the Development Plan on Roosevelt Roads Airport.

A l imited use of the airport will obviously limit the development of other activities such as the port area and other activiti es that are expected to be installed around the airport. You d o n’t need to be an expert to conclude that the thousands of jobs that were exp ected, the movement of tourists and the
creation of new business es , will no longer be achieved , much less will we
be able to see a potential economic development if the use of the Jose Aponte Airport is limited

. It is possible for you in completing this process...

Randall Fretz: Sir, you need to finish please.

Abimael Portalatín Rosario: Ok. We do not support the terms signed by the Government and the contractor, as being contrary to the Agreement signed by the Government of Puerto Rico and the Secretary of the Navy of the United States and which was approved by the FAA itself. Thank you.

Randall Fiertz : Thank you very much.

Noemí Cardona Tomassini: Good afternoon to the members of this
research commission. I am here as a resident from Aguadilla, as a public employee, and as the candidate running for mayor of the city of Aguadilla for the Popular Democratic Party, with particular interest in the projects that affect the population of the Aguadilla municipality. That is the case of theUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. privati zation of the Luis Muñoz Marin A irport; especially with an agreement
we understand is terrible for the development of the regional airports, including the Rafael Hernández, which is located in our city at the west part
of the island.
This contract has the intention of using the Aguadilla airport solely as a cargo airport, which would limit the access of thousands of Puerto Ricans
to a passenger airport and would contradict the NPIAS #8 statement. In this plan it is established that “the airport system should be extensive and provide convenient access to air transportation to the greater amount of people in the possible, typically at no more th an 20 miles of a NPIAS airport.

T he airport of Aguadilla has the longest runway of Puerto Rico and the Caribbean...more than 11,700 feet. It is the one with great est development potential among the regional airports , precisely for its big land that is above 1,000 acres. It is not incompatible, then, to develop its potential to move
cargo but also to move passengers. In fact, nowadays it is possible to process up to three domestic f lights at the same time and passenge r traffic increases between two and three percent each year.
Why not develop to the maximum both activities? Why not allow the citizens of Aguadilla and nearby towns to use the airport facilities to visit the principal cities of the United States where the ir relatives live and where they go for vacation?
Limiting the grow th of this and other airports in Puerto Rico as passenger airports will only contribute to the development of a monopoly of the SanUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. Juan A irport and will limit the access of Puerto Ricans t o air transportation, and it will be in contradiction with the NPIAS #8 statement.
The air space of Aguadilla has very little congestion; therefore it is possible
to bring more flights without creating security problems. This provides for a greater expans ion capacity. The Master Plan approved by the FAA incorporates a good balance of air uses like, Passengers Terminal, Cargo Terminal, Corporative Hangars, and Service Hangars.
Not allowing the development of the regional airport of Aguadilla will
constitute a delay in the development of our region. Not developing it would be a contradiction of the government, who has the constitutional obligation
to look after people’s wellbeing , and the economic development of a region
would contribute to the economic devel opment of Puerto Rico.
Finally, I would like to draw your attention to what a former governor once proposed, in this case Pedro Roselló, to a congressional committee that came to Puerto Rico to celebrate some hearings about the presence of the
Marine of th e United States in Puerto Rico. “Don’t push it” he said and I retake that. What we pretend is for you to solve this to the best interests of Puerto Rico. If you push us to a bad business we will defend our right to the development with equality and facing the future.
Thank you very much!

Randall Fiertz: Thank you.

Raúl Bustamante: Good afternoon. My name is Raúl Bustamante; I’m
the chairman of the Puerto Rico Convention Bureau. This organization has been bringing groups to Puerto Rico for the past 50 years and we are inUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. favor of this initiative because it represents new opportunities of new international airlines serving Pu erto Rico. Because it represents new
investments amounted to over two billion dollars to make the Luis Muñoz Marín Airport an airport of world

- class

. This investment will signify airport improvements to position the Luis Muñoz Marín Airport at the level o f the most important airports in the hemisphere. The present condition of the airport lacks the appearance and efficiency that an island like Puerto Rico
deserves. Another benefit is job creation; the investment will create new jobs, not only constructio n jobs, but additional ones, as much as new airlines visit Puerto Rico and start bringing new passengers for business
and tourism. Passenger traffic is estimated to increase by 200,000 people a year, or additional 140 million dollars. Air seat capacity t o Puerto Rico has decreased by approximately 18% as compared to June 2008, in spite of the new airlines serving Puerto Rico in the past three years. This, as a
result of the loss of American Airlines that has decreased more than 60% its flights to Puerto Rico as compared to 2008. The Luis Muñoz Marín Airport has lost its predominance in the Caribbean region; since 2004 when all airports have increased by 74%, and ours has decreased by 26%. We therefore support this initiative for the well being of all Pu erto Ricans. Thank you very much.

Randall Fiertz: Thank you.

Mariela Matías: G ood afternoon to everyone here, my name is Mariela Matías, I represent the POS Caribbean Company and I address you ... I am here before you this evening to express my point of view on the participation of the company Aerostar Holdings in the administration andUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. management of the Luis Munoz Marín International Airport. As an employee of the private sector and representing the interests of my company, I consider it a good choice of this administration the concession
of the operation of our most important shipp ing port. We all know that
Puerto Rico
, being an island, one of our main challenges is and always has been the movement of people and goods to and from our territory. We are highly dependent on them, and we import most of the products and raw
materials we consume while our economy also depends on the products and materials we export. It is therefore of vital importance for all who live and work here, to have adequate infrastructure to reach the standard of living and socio

- economic situation that we long fo r, and today the Luis Munoz Marin Airport is not at the height of our needs. We live in an era
where there are no boundaries ; advances in communication technology and the increasing trend towards globalization in all corners of the world have opened the do ors to a new kind of economy. Today, a Puerto Rican company competes not only with simil ar businesses and our territory, but also hundreds of other companies worldwide. This challenge is not a negative one , however, has allowed us to expand horizons and become more competitive and create more and better opportunities for doing
b usiness in Puerto Rico, and abroad. But how can a company hope to succeed in the world if you do not have the necessary tools that allow you
to be in equal conditions , or better th an your competitors? You cannot, it is very difficult, those companies that do not evolve to stay up to date with th e industry trends are left behind and die. I say this with complete certainty that in Puerto Rico we have top quality companies, but have f orgotten the main and most important thing, the one that belongs to all of us which is our island. Puerto Rico as a country competes economically with otherUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. states and countries. We compete as a tourist destination, compete as an investment destination and very important; we compete as a shipping and
transit port due to our privileged geographical location. How can we intend
to be at the forefront in the area that should be our natural strength, if our infrastructure is outdated and inadequate? The Luis Muñ oz Marín International Airport is just one of many tools that we have to be successful in our careers. That is why it is in our best interest, and I dare to speak for all private companies, to make a drastic change in the way this important port currently operates. This change at the hands of Aerostar Holdings, formed by Highstar Capital and ASUR, has great potential to be successful, when you look at both companies’ prior initiatives, you see that that’s enough to realize it . There are great needs and gaps in our country : education, security, economy and quality of life, all for which our government is responsible. Let’s let the Government of Puerto Rico focus on what interests us the most: to focus on solving these problems, and let the airport management experts manage the airport

. That way we will be working for the well being of our entire island, creating new jobs, generating new business for local companies, creating opportunities for new investment opportunities and putting the name of our island up high

. Finally, I urge everyone to always to keep in mind that the airport is still

ours, it belongs to the Puerto Ricans and to all the people who live and work in our island. Consider this a positive change that will benefit us all
and we welcome those wh o come for progress. After all, if there is anything that characterizes the Puerto Ricans in the world is our hospitality and goodwill. Thank you very much for your attention.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. Randall Fiertz: Thank you.

Jorge Valdivieso : Good afternoon. My first question is : where can we obtain a copy of the contract? I have tried to get it at the Controller’s Office where most government contracts are registered and ... they do not have it registered, and we just wondered if it’s at the Ports Authority or if it’s available there to, so we can get a copy. That’s all?
Randall Fiertz: Just a couple of thing s

. One, if you could tell us your name and if you’re representing anybody or an organization and secondly ... Jorge Valdivieso : My name is Jorge Valdivieso and I’m a private citizen.
Randall Fiertz: Ok. Jorge Valdivieso : I would like to add that I am a commercial pilot. I’m also member of AOPA, the Owners and Pilots Association. And I’m
concerned also in two cases. First of all, what is the scope of the airport arrangement? I mean, in the 1970’s the former governor, governor Luis A. Ferré ordered a study of the airport situation in Puerto Rico ... in Puerto
Rico. For that purpose they brought in one of the leading aerospace industries, which was Northrop

. Northrop, especially their division of Airport Development Corporation, undertook a study of the San Juan International Airport and they made various studies, they also made one of the new southwest, and their, and the result of the study is that the ai rport
would soon to be obsolete. And that it would be best to transfer the main
location studies. The plans were made, the funding was arranged, unfortunately there was a change of government, and like in most governments when a new one comes in past studies are just drawered
, etcetera. But nevertheless I do recall one of the main concerns was the approach, which was not of the best interest, bec ause it was ... it crossesUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. the whole city of San Juan from one end to the other. Plus, it stalls the vertical growth of San Juan. Buildings in the business area can be constructed to certain heights and unlike many countries in Latin America
who boast thei r skyscrapers etcetera, we are limited to the height of just one building in downtown Hato Rey, the Banco Popular building, no building can be taller than that. That’s a 20 story building. So, the, that is one question. What, if that study at all is to be considered, and I think it should be considered as a study for this airport. Number two, what is the scope of the arrangement? What if this airport does become obsolete for any reason at all? Are we leasing land or are we just leasing airport operatio ns? It could be as it is, I’m not very familiar with it, it could be a very reasonable rental for an airport operation. If the airport were to become obsolete, does the contract persist? And the managing operation
will have then control of the entire ac reage area, right in the center of the metropolis? This is a very valuable area, right across from the tourist area. In fact, the northern runway is about 20 feet away from the ocean; 20 meters away. So that is the question, what is the scope of the lea sing? I do not know, I do not have the plan. Now, my personal interest is I am
from Ponce. Ponce is proud of its regional airport. Ponce has a JetBlue flight which arrives in Ponce and leaves completely full. I don’t think there’s been an empty seat i n the last ... since they started flying there. I don’t know, I do not know if flights are going to be limited. I’ve heard some people say that this contract limits the regional airports. I do not know if this is going to limit the Ponce airport. Ponce i s now in the midst of construction of a mega port. All the dredging has been done, this very expensive cranes have been brought in and this airport is a complement to this super port, like have been built in various different reasons. So, it isUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. my inquir y to think that to limit any of these regional airports would be harmful to the city itself. In the United States, as a member of AOPA, and an active member, in the United States every town and city fights over an airport. They usually fight with FAA but they get along very, very well, especially under the current administration. And they realize the importance of an airport. Some people have not realized the importance of an airport. So, that is another question which I have my doubts about. In
the D ominican Republic, for example, which supposedly we are more advanced that they are, JetBlue flies to six different cities. Are we going to limit Puerto Rico to just one city? They fly to Samaná, they fly to Santo Domingo, they fly to Cape Cana, they fly to Casa de Campo, they fly to Boca Chica, they fly to six different places. And here, are we going to be limited to just one? Okay, the ... So ... Well, that’s about... I’ll close on
this. I still do not have an answer right now as to where I can get a copy of
the ... of the contract. The Chamber of Commerce of Puerto Rico would be very interested in having this also. The Chamber of Commerce in Ponce, would be very interested. So, if anybody can tell me that.
Randall Fiertz: Yeah. Jorge Valdivieso : You will get me one? Thank you very much. Thank you very much and thank you for your assistance and presence here in this very important decision which has to be made.
Randall Fiertz: Thank you for speaking to us. Jorge Valdivieso : Again, I would like to clo se. I have nothing against the PPA either, but it’s just the outreach of this airport, how it can affect others matter in this situation, which is my concern and from the little I’ve heard here is also the concern of many.
Randall Fiertz: Thank you.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. Ángel Figueroa Jaramillo: Good afternoon. My name is Angel Figueroa Jaramillo, Chairman of the Workers Union of the Electric Industry of Puerto Rico, which groups over 6,000 workers in the electric industry and over 17,000 in other government branches. I would only like to leave a thought, for the record, since our economist Jose Antonio Herrero will be giving the presentation. In 1802 Thomas Jefferson said: “ I think the banks are more dangerous for our freedom than all the armies listed for combat, if the American People were to o ne day allow banks to control their own money, the private banks and all of these entities that would flourish because of them, would deprive the citizens of what is rightfully theirs; Beginning with inflation and later with recession, until their children wake up without a house or a roof on the land their fathers conquered”. This is precisely what it would be like to hand over our airport to foreign hands. Now I will leave you with our economist, Jose Antonio Herrero.

José Antonio Herrero : Good afternoon, my name is Jose Antonio Herrero and I would like to approach the table to hand out some documents that
may be helpful in the brief presentation I am going to give.

Good afternoon. First of all thank you very much for allowing me to express myself before this commission and make some approaches that I believe to be important concerning the discussion of the preposition of the Public

Private Alliance of the Luis Munoz Marin Airport. My presentation contains two fundamental parts. One which I a m going talk about today that is based
on these note s I just handed out, that aren’t finished. The other that I shall present in writing that manages the question of risk of the project and the distribution of risk between the parts, which is one of the mo st importantUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. things and poorly treated or battered in this proposal being made. I’m referring now to the cost

- benefit financial analysis of the project in
consideration. First of all I should say, for the record, Puerto Rico has raised two important things with regard s to financing that are truly the most important ones.

1. That the emission of the debt being made is to pay off the Ports Authority debt.

-- I was going to say to my surprise, but it shouldn’ t surprise me,

-- this morning I the President of the Government development Bank say that only 55% of the debt will be paid off
, which means that 45% will be left hanging from a lamp. But it will have to be paid. On the other hand, it has been said that t he airport and Ports Authority is in a n unsustainable financial situation that the airport does not work, and that it is making a loss. I would like to say for the record, that the Puerto Rico Airport, the International Airport of Puerto Rico is a highly p rofitable airport. What happens is that we don’t stop to look at the facts. On the other hand the Luis Munoz Marin Airport generates approximately 70% of Ports Authority
income. If the Ports Authority ’s income is lost and it keeps the 45% of
the debt that supposedly was going to be paid, then Ports Authority
will be in a very bad financial situation; and so will be the othe r projects of the other small airports. To give you an idea, since I see that the red light is threatening us, I can tell you the follow ing: The value of Luis Muniz Marin Airport, valued for 40 years, using the facts published by the informational system that the Federal Aviation Administration has, the airport has a market price value from 2011 of $1.788 billion. Those are at the endnotes

.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. Now, what are the contributions that are going to be made? Or the investments said to be made? There are no investments here, only the transfer of a property from one hand to another. So now the cake can be eaten from one part when it used to be eaten f rom another, but the cake is
the same one and hasn’t grown. The present value of the contributions is going to be made nominally because everything is going to be financed through the government of Puerto Rico. On the closing day the so called private part ners aren’t going to pay a dollar. Let ’s make that clear. Even the
30 million dollars that they have said they will paid on the closing da te are subject to the paying off of the debt, and since the president of the bank said that the debt will not be paid off then the 30 million will not be paid

. To
conclude , the results of this exercise are in writing and can be verified. All I can say is that the Ports Authority will have a lost , according to calculations I have done, using published data in Official Statements of bond issues, using data from the FAA, data from Ports Authority. It is no projection of mine, it is not made it up nor have I invented it. They are borrowed official data. Through that transaction we are speaking about to the government of
Pu erto Rico, it will cost Ports Authority in net terms 1. 0 88 billion dollars without including federal contributions. If we were to include grants and PSTs we are talking about a 1.6 billion dollar loss for Ports Authority. In
conclusion , so you can see the quality of clientele we’re dealing with , I
invite you to read the first table. The first table is a piece of heaven based

on a loan that the Port s Authority will issue , with the emission of $669
million of bonds issued by AFI
, guaranteed with two irrevocab le credit
letters by the Government Development Bank
, which will to be used to pay
the debt and later the private partner will be paying off little by little. This means that the private partner is borrowing from the government in orderUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. for the government to pay its own debt. Then they make a payment plan, they divide the loan in three parts and one of the parts is specified in the first table. Let me explain the columns to you. On the second column...

Randall Fretz: Sir, you're gonna have to ...

José Antonio Herrero: Give me one minute. Just one.

Randall Fiertz: One minute.

José Antonio Herrero: Please, take a look at the second column; this is a schedule of payment. A schedule of payment proposed by the private partner. Payments .6 etc, etc
, around a million except the last two years. If you pay around 80% of the loan, what kind of the client is this? He i s asking
you for a payment plan and he use s the op p ortunity to not pay a significant amount for the first ten years and leave the most impo rtant chunk of payment for the last two years. And we are talking about only 192 million dollars. Assume what would be the approach of these people if they had to pay 1,000 million dollars. Thank you very much.
Jorge Valdivieso : Sir I consumed my turn, but could I ask one more question? I’m number 54. Ok, thank you. It’s a question for the FAA. My question was: In 1950 if I’d told anybody “well I’m going to the moon” they would say “well, you’re reading too much Buck Rogers” and ten years later we were walking on the moon. Under those under those circumstances, is it logical and correct ? Maybe this is good, this contract is good, but is it logical and correct for forty years? I mean, does anyone of you know what the aviation is g oing to be in 40 years? Well I doubt that very much. I know you’re all young but we have to consider that also. We have toUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. consider that also, maybe. Thank you very much again, and sorry to interrupt.

Emilia Barreto: Good afternoon. I’m a private citizen, I’m Nydia Barreto. I’m just concerned about some comments here from these speakers. They said: To repair and fix the airport, t o bring such people. We’ve had guests here as good as Jackie Kennedy, Miss Obama, Mr. Obama, presidents, Liz Taylor, and we enough for those people. It surprise s me when people made that kind of comments. To fix and clean to bring such a class and to bring people that come to five star hotels. It surprises me that some people
that come down here do not speak English or French or Italian. And some
of the people that were here speak very poor English. H ow can we
manage an international airport when we are not prepared and ready ? I will
ask a favor to this group to find out who is F ernando Chico; he is the president of contract from Mexico. And who is Rafaél del Pino, he is from
Madrid. Puerto Rico doesn’t need to have routes; Puerto Rico has plenty of routes. Let’s keep good routes, we don’t need to. Here is a letter from
the White House; we citizens worry about our security at Luis Muñóz Marín International Airport and the other airports around the Island. There are
around 5 or 6. I think the problem in Puerto Rico are “ los politicos ” that’s the only problem we have

. Lets maintain our prope rties
, let’s keep teaching our kids, let’s training our employees, let’s supervise our employees, and don’t play around with our properties, we need more security. What’ s cooking in Mexico today? Think about that. These people from Mexico do not manage any airport outside of Mexico. Thanks for listening and I’m very very upset.

Randall Fiertz: Do we have any other speakers? One more?Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. Jo n Borschow : Good afternoon, excuse me, good afternoon. My name is
Jo n Borschow and I’m Chairman of the Foundation for Puerto Rico. I’m very, very happy to be here and I have a few remarks for you. First of all I want to greet all the FAA officers and representatives from the Puerto Rico Public Private Partnership Authority, and the Government Development
Bank and the Puerto Rico Ports Authority and other officers here present.

I am a former, a retired businessman and the founder of a health care products distribution company here in Puerto Rico

. I am currently overseeing the scaling up of a private not for profit foundation devoted to economic and social development in Puerto Rico.
I am also an avid global traveler. I will elaborate on the perspective that has given me on the importance of a properly functioning and weII

- structured international airport at the end of this presentation.

First of all , I want to congratulate the FAA, the P3 Authority, the Ports Authority and the GDB for the level of transparency in this transacti on. I
have reviewed the FAA Final Application documents which include the Lease Agreement and the Airport Use Agreement, among others.
I am fully supportive of this prudent experimentation in private management of a key public asset, particularly given the crucial role of the Luis Muñóz Marín Airport for the overall functioning of Puerto Rico's link to the rest of
the world. It is a win

- win proposal for the entire society and economy of
Puerto Rico , passengers and users, the Ports Authority and a ll airlines operating a t Luis Muñóz Marín, which unanimously endorsed this
transaction.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. The selection of Aerostar LL C and the affiliated companies as the private operator of Luis Muñóz Marín under a 40 year lease has also been shared pub l icly by PPPA and as part of t he Final Application. The part ner has been selected from an initial pool of t welve , subsequently limited to six (6) qualified global respond ents, based on the evidence on i ts reputation, managerial, organizational and technical capabilities and experience in the operation of airports
, with specific reference to airport operations, development, maintenance and route development; safety and security;
airline and passenger customer service; and experience working with government authorities. Proponents were al so asked to submit evidence of their financial capability. The documents made p ublic provide evidence of a
full due diligence process where these finalists were given access to PRPA lease agreements with private operators and al l other material information

over an adequate time frame. A second round of due diligence was made
available to the two finalists.
The Ports Authority is currently under a fiscal oversight agreement with the Government Development Bank, since it has neithe r adequate debt service to cover the payment of ifs bonds no r will be able t o refinance $340 million in bonds due during 2013. The reduction in revenues and passengers has been widely discussed. Even when al economic and promotional strategies
need to be a ligned to boost travel, export and economic activity, having a well managed and improve Luis Muñóz Marín Airport is a key starting point. Therefore, the P3 transaction is the only way forward to secure much needed investment in this valuable asset, the key gateway in and out of Puerto Rico. Aerostar will be required by the Lease Agreement and use Agreements t o perform certain critical capital improvements during theUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. initial years of this lease and expects to perform additional capital improvements during t h is period as well.

I t is critical for the FAA to confirm that the P3 Authority, the Ports Authority
and the GDB / 3 Authority and Ports Authority to joint ly devote the appropriate effort level and quality of independent supervision of this P3 agreement. The P3 Authority has stated that these efforts would most probably require the appoin t ment of experts. The identification and appointmen t of such experts will be conducted on parallel to the pending FAA approval and transaction closing.
In this regard it woul d be most helpful for the Puerto Rico Legislature t o amend Act 125 of May 7, 1942, specifically section in order to strengthen the composition of the Port Authority Board to incl ude more civil society and private se ctor directors. Article 4 of Act 125 addr esses the Executive Govern ance o f the ports Authori ty . It states it will be govern ed by a Board
of Direct ors composed by the Secretary of Transportation, the PRIDCO Administrator, the Commerce Secretary (now DDEC), the Tourism Company
Executive Direct or and one private citizen in representation of the public interest. This private represent ative is designated by the Govern or, with the Senate's consent for a four year term appointment until a success has been designated. We recommend for the FAA to re quest the Government
of Puerto Rico to amend the governance struct ure in order to increase private sector representatives and have longer appointment periods. Such continuity and mix in the profile of directors would be of great benefit to the optimal oversight of the LMM Airport P3 Agreement.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. End orsing such improvement in govern ance would also protect th e public interest by overseeing the transformation of the Port s Authority post this P3
transaction. The specific post transaction plan (document 0039 included in the FAA Final Application package) needs careful implementation as it aims to have the Port Authority return to financial stability and have adequate debt service coverage. The income coming from the P3 transaction annually will assist in rei nvesting into the remaining regional airports, with Aguadilla as main future provider of high value added logistics and cargo services.
We believe at the Foundation for Puerto Rico that our economy cannot grow sustainab l y un l ess we p roduce something that someone who does
not live in Puer to Rico is willing to pay fo r. Restoring sustainable economic growth will depend on our ability at all levels of society to re

- visualize
Puerto Rico’s future as one deepl y engaged with the global economy.

We also bel ieve, as does the White House Task Force on Puerto Rico , as noted in its report, that P uerto Rico can and must become an Economic
and Tourism Hub and Gateway for the Carib bean and Latin America

. We are here to argue that Puerto Rico cannot be successful as a tourism
destination or as an Economic Hub for the region without efficient air connections with major population centers in the United States, Europe,
and Latin America.
Can I take a couple of minutes to finish?
The g eogra p hica l situation of Puert o Rico lends itself to becoming an excellent transit point for intern ational commercial airline traffic. I n the Car ibbean, it can provide efficient inter

- island air transport that is lackingUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. today. Many islands have some direct flights with U.S. and European airports but very spotty service between them.
More broadly, Puerto Rico is at the center of a geographic triangle between Latin America, Europe, and the United States. Furthermore, the advent of medium size long range aircraft such as the Boein g 78 7 and
Airbus A350 extends the range to 8500 nautical miles putting A sia and
Africa within reach incl ud ing cities such as Belling, New Delhi, Dubai, Tokyo, and, Cape Town.
What is required is an airport that is an international hub ...I’m almost
done... with full in

- transit capabilit ies. These are essenti al because only by permitting transit passengers can destination variety and flight frequency
be increased to ensure economic viability. All major interna tional airport s on the globe robustly support in

- transit p assengers. This is the case not

o nly of larger airports like Heathrow, Charles De Gaulle, or SchiPhol , but
there are also excellent models in much smaller airports such as Keflavik in Reykjavik, Iceland or even Tucuman in Panama City. Both of these smaller airports s hare with San Ju an a p rivileged geographical situation that makes them viable despite the lack of a large pop ulation center. Both have a great impact on the economies of their respective countries. T oday's ex pertise and technology in airport security is well advanced so a s to allow for a fu ll y

secure intern ational transit hub. Lastly, the partner selected is experienced in the management of intern ati onal airports and brings expertise, financial commitment, and access to capital that is essential to the successful expansion of the airport. We cannot overstate the importance to the economic future of Puerto Rico of the success of this project. Thank you very much.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. Randall Fiertz: Thank You. Anybody else who wishes to speak?

Graham Castillo: My name is Graham Castillo, President of Estudios Técnicos, Inc. I appreciate the opportunity to appear before the Federal Aviation Administration to offer a summary of the Economic Impact Assessment of the LMM International Airport P3 prepared by our firm for
Aerostar Airport Holdings LLC.
Estudios Técnicos, Inc supports the implementation of Public

- Private

Partnership models in the Island. For many years, we have promoted the need to implement a local PPP initiative as a tool to promote investments in
areas critical f or the Island’s long term economic development. Our firm collaborated in the development of the Local PPP Legislation, which according to the industry, is a model for other jurisdictions. Emphasis was placed on mechanisms that protect the transparency of the transactions and the public interest, and also that guarantees a process in which decision are made strictly on technical criteria.
The report , which I refer, presents how this transaction will impact local business activity, employment, income, and fiscal revenues. The economic benefits of the transaction are associated with following:

1. Aerostar’s commitment to investment over $1.8 billion over the
course of 3 0 years of which we only considered the initial 10 years, which is an investment of over 500 million dollars.

2. Aerostar’s operational plan which will result in a significant increase in passenger movement; andUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. 3. The change in ownership structure, which will r esult in new tax revenues to certain jurisdictions.
Accepted economic procedures were adopted to estimate the economic impact of the transaction. Puerto Rico has an Input

- Output Model , prepared by the Puerto Rico Planning Board that was used as the basis t o estimate the economic impact.
As presented on our report, the proposed transaction is expected to stimulate over $2.3 billion on an annual basis in new commercial activity, which will support approximately 14,500 new jobs per year and $437 million
in an nual salaries. Economic impacts increase over time, thus by the end of 2020, approximately 23,000 jobs and $765 million in salaries would be supported by a projected increase in over $4.0 billion in commercial activity. The government will benefit from clo se to a b illion dollars in new tax revenues over the ten year period.

Our estimates take into consideration three main impacts:

1. Impact of Aerostar’s 10 year investment plan
Aerostar’s construction activities and investment in machinery and equipment of $5 83 million during the initial 10 years of the agreement will support $1.4 billion in new business activity, 913 new jobs per year with associated salaries of $23.3 million per year.
The government will benefit f r om $67 million in additional taxes during the period, of which $35 million are in construction excise taxes, $2 5 .8 million in personal income taxes and over $10.3 million in sales taxes.

2. Impact of Aerostar’s Operational Plan in Puerto RicoUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. The expected increa se in passenger movement resulting from Aerostar’s operational plan will support an estimated increase of $8.8 billion dollars in additional visitor expenditures, accumulated over the period, which amount to $19 billion in new business activity accumulated over the ten year period.
This will promote 11,000 jobs per year with associated salaries of close to $ 340 million per year.
In addition, the government will benefit from close to $9 00 million in additional revenues associated with new visitor expenditur es and Aerostar’s tax burden during the initial 10 years of the lease. Of this total, $99.5 million will be paid directly by Aerostar in municipal license tax,
income taxes and the PRPA annual payment. Over $7.6 million in municipal license tax will direct ly benefit the Municipality of Carolina.

3. Economic Impact of New Fiscal Revenues

New tax revenues from the associated agreement would support $2.4 billion in new business activity during the initial 10 year term of the agreement, along with 2,257 annual job s and close to $ 77 million in annual
salaries.

Estudios Técnicos, I nc. supports the LLM Airport P3 . We trust that that the Island economy will benefit from this transaction for many years to come.
I greatly appreciate this opportunity to share our repor t with this panel.
Thank you.

Randall Fiertz: Thank you.

Faustino Marquez: Good afternoon to the panel. I’m a private citizen my name is Faustino Marquez and I ’m also a s mall operator up in Virginia andUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. looking into the future possibly will be operating seasonal down here. I got several concerns. I’m not either in favor or against it, but I really think that you guys have the opportunity to review these options that are not
considere d here, none of the discussion that I’ve heard so far. They are very simple points, only 3 points. I’m very concerned about the small operators’ future here. I’m a single pilot operator. What are the fees, the costs, the environment? Are they going to g ive the opportunity to grow even within San Juan or within the other airport around it? It’s not like in the states that we’re going to have competition, a fair competition, the mayor and the small operators; it will be not an equal opportunity now. The same thing is happening with the future operators as far as the regulati ons that they might impose
, the airport itself
, beyond the ones from the Federal
Aviation Administration. Would be like costs where the small operators would come in. I might be able to land but then all these costs might be increasing where a small, single pilot operator will not be able to afford it, like probably someone from one of the mayors, let say JetBlue . There’s not a balance in there. And the last: As the single operators , the agreement not to be able to operate within the other airports and limit this to the smaller regional airports. As a small operator, and when I mean a small one is a single pilot operator, let’s say has a small az t ect , which most of the small airport s have over here , I would be able to land. But if you limit the growth on those then you’ll have a problem where they might not be able to go San Juan landing, because let’s say the fees there is excessive. So then you’re limiting that opportunity for th at small operator may become a carrier because of the initial cost they might incur after that. And those were the points that I don’t see being addressed here, and that was it, very simple.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. Randall Fiertz: Thank you. Any other speakers?
( 3:42 pm) Silence for a while
(3:44pm) Randall Fiertz: We have one more speaker who was preregistered and they won’t be here for another 10 minutes so we can recess until then. Until they get here. Apologies for that but I think it is only appropriate to give them an oppor tunity to speak

.
Randall Fiertz : Please go ahead
Rogelio Figueroa García : May I speak in Spanish?

Randall Fiertz: You may speak in Spanish.
Rogelio Figueroa García: Greetings ! Distinguished members of the panel:

Good afternoon.
My name is Rogelio Figueroa Garcia and I come here in representation of
the Political Party Puerto Rican for Puerto Rico. Our party is an organization of citizens that are participating for second occasion in the electoral process in Puerto Rico. The eleme nt that distinguishes and
differentiates our party from other Political Parties in Puerto Rico is that it is composed of people of all status preferences working together in the economic and social development of our country, from this development,
route the solution of our political status.
It is that commitment to develop economic and social development in Puerto Rico that we stand today before this Honorable panel in strongUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. opposition to the dominated Privatization Pilot Program Project for the Luis
Mu ñoz Marín airport. The reasons for this opposition are the following:

1. The transaction has not been widely and transparently discussed and

a nalyzed, taking under consideration its impact and implications for the country.
2. Because you can see just by overlooking the contract to be signed to make possible this transaction, it is clear that it is prepared to favor private company’s investors at the expense of the interests of Puerto
Rico.
3. By approving this transaction, it will adversely affect P uerto Rico’s future development, since it guarantees investors some conditions that in practice would leave without effect the plans of regional development already in process. Specifically, it would paralyze the activities of development of the regional a irports which in turn w ould paralyze expansion activities and growth of the different regions. In my case I am from Ceiba, Puerto Rico. I have worked for the last seven years in the development of the Roosevelt Roads Navy Base, which has an airport in excellent conditions and many promising possibilities of usage. Integrating this airport with the potential
touristic activities and the economic development of Ceiba, Naguabo, Vieques and Culebra will im ply a development that my communities have not been able to have until today. Not letting tourists arrive in charter flights, not being able to have direct activities with airports from all over the world arriving at Roosevelt Roads Navy Base Airport
would imply an unprecedented waste of opportunities. We cannot
afford to lose that opportunity in Ceiba.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. 4. The Luis Muñoz Marín International Airport ’s valuable property and national heritage that would be handed to foreign companies for unlimited profits, aliena ting de country for 40 years of control and use for the purpose of such a valuable resource.
5. The privatization proposal would endanger the stability and the permanence of the current commercial operations at the airport, as
well as of the employees worki ng in the m , they would be left at mercy
of the new administration. And we know this new administration will, most probably, take the necessary measure s in order to increase their profit
, and this could mean the replacement of the actual shops “for business reasons”

. We, the people of Puerto Rico, we develop
many of our businesses in order not only to comply with economical purposes, but also with social and economic develop ment purposes that consists of our local entrepreneurs and cooperatives; and this
ai rport represents a special opportunity that we cannot let go to a private partner.
6. There are national security risks to be analyzed with more depth:

 Drug Trafficking

 Control in the hands of foreign companies
These are just some of the reasons for opposing, but in a separate
document we will elaborate on this point more widely.
We recognize that the administration of the Airport should improve and
there are alternatives for it to do so without the need to implement a type of privatization as this one; to a foreign company and with limited participation
of our entrepreneurs , cooperatives and individuals. Our organization favors
the formation of a cooperative to manage the Airport, in which the expertsUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. in aviation of Puerto Ri co and any interested people that know about cargo transportation and passenger transportation, logistics, and operating an airport can unite and compete with the actual private partner. Puerto Ricans have not been given the opportunity to do this, ther e was no open competition, so that Puerto Ricans could get organized in order to offer
better deals to the government of Puerto Rico and to the Federal Aviation Administration. The process was done with only the actual private partner and now they want to impose it. All the negotiations were done secretly, in closed rooms and without any transparency, without giving the public the opportunity to participate in such important initiative

. We understand that you have great power over this, you can ask the government to look for other alternatives in an open manner, in order for you to have more options that comply with management conditions, security conditions, and conditions that have to do with the well being of the public, not only in the local governme nt but in the federal government . This negotiation that is taking place is being called a public

- private alliance, but in reality it is a loan guaranteed with future income, it is not a public

- private alliance. The public

- private alliances build new site s, build new facilities, they are not just given a facility like the airport that we have here. Maybe it has damaged bathrooms, maybe it has some humid tiles because of humidity, maybe it needs a little caring and maintaining, but it is a complete structu re that does not apply for a public

- private alliance. This would apply for a loan other
than a loan for the finance s of the Government of Puerto Rico. We call this

a pledged loan, in which the income of the airport belongs to it with minimum benefits to the country of Puerto Rico.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. As conclusion we would like to reaffirm that this transaction is both wrong for Puerto Rico and the Unites States. We have informed the Honorable
President that it would be unfortunate that a Democratic Administration would approve of a transaction promoted by a Republican Governor with the means of a Republican ideology privileging some powerful economic sectors bias on mainstream sectors of the po pulation.
But before I go I want to point out that one of the most negative aspects of
this transactions is the stagnancy it will provok e by preventing the regional airports to develop and fulfill a public need in their region. For example the
communiti es of Ceiba, Naguabo, Vieques and Culebras, have been putting all their efforts and hopes for many years promoting projects for the airport of the Roosevelt Roads Navy Base, in order to make it a touristic place. I beg you not to approve this transaction prior to evaluating the impact it will have on the regional airports of Ceiba, Aguadilla and Ponce. Puerto Rico may be small but very intense. And every region of Puerto Rico has the potential to have its own international airport, and this will be a gre at complement in case of a natural disaster. As you all know the airport is in a very sensitive area, it is prone to tsunamis, seaquakes and other weather conditions, in case o f natural disasters

. It is very important for us to have international airports in good conditions in the four cardinal points of Puerto Rico, not only for us to survive but also for national security.
We fulfill our responsibility to report the negative of this project and express our opposition. We know that you can give it the transparency that is currently lacking

. Let’s give the different regions the opportunity to bring alternatives, that way they can come before you with development alternatives for the regions that can work parallel with the private partner’sUnedited Version Transcription and Translation by Smile Again Learning Center, Corp. interests or with future possibilities . We ask on behalf of the well being of Puerto Rico. Thank you for you for this opportunity.

Dr. Ramon Torres Morales : Good afternoon. Thank you for the opportunity to present my comments to this panel. My name is Dr. Ramón
Torres Morales; I ’m a resident of Ponce, past administrator of The Port of the Americas in Ponce, for about 8 years. Also I was a member of the federal panel of the NOA , Review Federal Panel, and a Professor in Ponce in Transportation Management, Logistics and Distribution.
I deeply appreciate the opportunity to present my comments to this panel and with all due respect I would like to present my opposition to the proposed concession agreement, as presented by the government of Puerto Rico. My position is based on four main considerations.

1. PUBLIC INFORMATION: The citizens of Ponce and the Southern Region have not been able to receive a detailed presentation of the impact of this concession agreement, not only to the airport, but to the region. On behalf of half a million citizens of the southern region I would like to present a request to this panel and the government officials to responsibly coordinate a detailed presentation to the Southern Region of the impact and the considerations behind this
concession agreement. The impact as we see it, it will certainly make more fragile an already unstable region, where the une mployment may reach 25% in some cities. Certainly the social and economic impact of this concession agreement has not been evaluated with respect to Ponce and to the citizens of the Southern Region.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. 2. CONCESSION AGREEM E NT: The document presented by the
Puer to Rico Public

- Private Partnership Agency states that growth at the Mercedita Airport will be limited for the next 15 years. That would certainly have an impact on the cargo and traffic markets at
Mercedita th at some economist has estimated in a loss of 83,000
passengers and over a 1,000 jobs will be lost because of this
concession agreement , in Ponce.

3. AIRPORT SECURITY: Once again we request to FAA and TSA officials to urge the government of Puerto Rico to clearly state how
under this conce ssion agreement the security of the airport will be managed. We all know the impact of illicit traffic , not only of drugs, of merchandise and even people, not only in Puerto Rico but all Latin
America.

4. ECONOMIC GROWTH AND TRADE: As we stated before, there is no clear evaluation on economic growth, not only Luis Muñóz Marín Airport but on regional airport such as Ponce, Ceiba, Aguadilla, and Mayaguez.
My strong interest is that we need to establish a global strategy for transpor tation development in Puerto Rico. We cannot exclude or
eliminate o ptions like Ponce, that is within 10 minutes of the Port of the Americas, that is the only port in Puerto Rico that complies with
the maritime trends of having a deeper port than in San Ju an, equipment up to date with the maritime industry, and that can provide support to our economy as recently described by a report of the
American Society of Civil Engineers, published this week.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. Transportation Infrastructure needs to be upgraded, and Ponc e is ready to provide that service , not only within the port, but certainly with the airport.
In summary, we kindly request the completion of social and economic impact studies of this PPP Process

. I am sure that people in Ponce and the Southern Region are willing to collaborate on this effort to move forward our economy, competitiveness and productivity levels. But that cannot be reached in exchange for our respectful search for a better quality of life. Thank you for this opportunity and I hope you receive my comments respectfully. Thank you very much.

Randall Fiertz: Thank you.
Any final speakers ? People who want to speak? Very good, okay. Well,
b efore we close th is meeting I just want to remind everybody that there will
be a verb atim transcript of the meeting available on the internet site regulations.gov and the FAA Docket number in which this document will be
is #2009

- 1144 and we will continue to collect written comments through
November 19th on the final application. In addition the application itself will be available at the same website as well as some other locations. So
f inally I wanted to thank everyone for their participation in this and I also wanted to thank the organizers and the Hotel Verdanza for allowing us t o hold this meeting here. Great job by the translation crew in particular, very impressive , and I appreciate all the other help by everybody else, and as I
said all the comments that we received from all of you in the audience. It is now ten minutes passe d four and the meeting is now adjourned. Thank you for your participation.Unedited Version Transcription and Translation by Smile Again Learning Center, Corp. ( 4:0 8 pm – procedures are concluded )

CERTIFICATE OF REPORTER
I, Aledawi Figueroa, from Smile Again Learning Center, Corp., CERTIFY: That the above is a true and correct transcript of the recording made during the meeting held at the place and date indicated on page one of this transcript. I also certify that I have no interest in the outcome of this matter and I have no relationship to any degree of consanguinity with th e parties involved in it. In Isabela, Puerto Rico, October 15, 2012.

Aledawi Figueroa Martínez Smile Again Learning Center, Corp. (787)872

- 5151 / (787)225

- 6332 widy.figueroa@gmail.com www.smileagainpr.com