Resolutions authorizing the City Manager and Construction Manager at Risk to solicit bids for the construction of an Air Traffic Control Tower at the Mankato Regional Airport and submitting applications for the current Federal Funding Grant Obligation and future FAA Discretionary Grant Funding.

Adoption of the attached resolutions

The funding necessary for design and engineering of the airport tower has been received and was covered by a 100% federally funded grant. On June 1, 2026, the airport tower design and engineering team provided the Issue for Bid/Permit documents finalizing the tower design. Next steps include the Construction Manager at Risk soliciting bids for the construction project.

Construction is estimated to cost $27.7 Million based on the final plans and includes construction administration, controller equipment, airfield lighting regulators, furniture, reimbursable agreement with the FAA, independent cost estimates, and city administration costs.

The City has been awarded $9.765 million in funding for construction.

$3.5 Million – Congressionally Directed Spending (FFY 2026)

• 95% Federal Funding
• 2.5% State Funding
• 2.5% Local Funding

$5.0 Million – Federal Contract Tower Program (FFY 2026)

• Funds must be obligated by September 1, 2026
• 100% Federal Funding

$1.265 Million – State Airport Fund

• Available until June 30, 2028
• 100% State Funding
• Available to cover all local share cost participation.

Staff have been working with our local FAA District Office since the Federal Contract Tower grant announcement on additional funding opportunities. FAA staff have encouraged the City to apply for remaining funding through their Discretionary Program. The FAA will be collecting unobligated funds from fiscal years 2022 and 2023 to make them available through this program. Because of the IIJA funding associated with these grant dollars, the federal share has increased to 95% funding for 2026. Beginning in Federal Fiscal Year 2027, which begins October 1, 2026, discretionary funding levels will return to the statutory 90% Federal Share. As of March 31, 2026, 47.3% of the Airport Infrastructure Grant funds were unobligated ($6.9 Billion).

In order to submit the application to obligate the current Federal FCT grant and to apply for the discretionary funding, actual bid amounts are required to be submitted to the FAA. Moving forward with the solicitation for bids does not obligate the City of Mankato to move forward with the project nor does it commit any local dollars to the project. If authorized by the Council, the bids would be advertised as being held for a period up to May 1, 2027, to allow time for additional funding to be sought. The bids would not be awarded until the funding sources have been determined, and the Council authorizes the project to proceed to construction. Below is a proposed schedule for the bidding process and application for discretionary funding.

Proposed Schedule:

June 22	Council Meeting Discussion.
June 23	Release Bids.
June 26	Pre-Bid Meeting.
July 14	Open Bids.
July 27	Guaranteed Maximum Price (GMP) due.
July 28	Share GMP with FAA along with an application for discretionary funding and an FCT grant agreement.
September 30	Receive notification of funding.

The process does deviate from the City’s standard practice of assembling a funding package for the entire project prior to releasing bids. Due to the FAA process, actual bid information is a requirement for both the grant execution for the Federal Contract Tower program and the application for discretionary funding. 

With the increased activity at the airport along with safety concerns noted during the air traffic control tower study submitted as part of the FCT application, there is risk associated with not moving the project forward at this time. In consultation with the city attorney and our consultant partners, the plan as proposed is a reasonable and necessary path forward.

Future touchpoints with the council will include the following:

• Notifications of future funding
• Formal acceptance of future grants
• Upon acceptable funding strategy, formal award of bids through the execution of the GMP amendment with Knutson Construction

Staff recommend authorizing the City Manager and Construction Manager at Risk to solicit bids for the construction of an Air Traffic Control Tower at the Mankato Regional Airport and submitting applications for the current Federal Funding Grant Obligation and future FAA Discretionary Grant Funding.