HomeMy WebLinkAboutLease Policy Staff Report 3-16-2021KITTITAS COUNTY
AIRPORT DEPARTMENT
Study Session 3/16/2021
AGENDA STAFF REPORT
AGENDA DATE: 3/16/2021 STUDY SESSION
ACTION REQUESTED: Staff is requesting approval of lease policy changes for
implementation into a new lease document.
LEAD STAFF: Ken Grannan, Airport Director
BACKGROUND: Over the last year airport staff has been working to re-write
a ground hangar lease. In this process several basic policy
questions which have been addressed in several meetings
with the Airport Advisory Committee (AAC) and
subcommittee.
DISCUSSION: By making the following determinations we will be able to
finalize a new updated lease appropriate for future
development at Bowers Field. The following
recommendations of policy change are briefly noted with
an depth explanation on the attached document from the
AAC.
• Lease Term
1. Airside leases, 30 years with extensions up
to 50 as the preferred lease term.
2. Non-Aeronautical Land leases will be on a
case by case basis with term determined by
investment of tenant.
3. T-Hangar leases 1-5 years
4. Apron space month-to-month
• Lease Rate and Escalation Airside
1. Flat rate of 7%-10% every 5 years for term
of the lease, private and corporate hangars.
2. Airside Lase rate $.16 sq. ft. Landside $.14
sq. ft.
3. T-Hangar lease rate adjustment upon
completing appropriate door repairs. (not
door replacement)
▪ North T-hangars (presently $125-
150/mo) $175/mo for first two years,
increasing to $225/mo for the next
three years.
▪ South T-hangars (presently $125-
150/mo) $190/mo for first two years,
increasing to $250/mo for the next
three years.
• Lease Assignment
1. Lease Assignment, or sale of leasehold
improvements are allowed only with prior
approval by Kittitas County
• Reversion Clause - Residual Value of Leasehold
Improvements
1. County has the right to purchase
improvements at their then fair market value
as mutually agreed or per appraisal
2. In the event the county elects to purchase,
tenant has first right to lease the property
and improvements if the county elects to
relet the property
3. In the event the county does not elect to
purchase, tenant:
• May sell improvements to a party
holding a new lease on the property as
granted by the county
• May be required to remove the
improvements and restore the land
• May surrender the improvements to the
county
4. In the event of lease termination due to
tenant’s default, all improvements revert to
county
• Land development time limits on new leases
1. Currently not in our leases. This would
require a tenant desiring to build on airport
property to develop the land within a
predetermined time. If the tenant does not
begin development within the allotted time,
the lease is terminated.
• Notary of all leases exceeding one year.
1. Needs to be implemented for all new leases.
INTERACTION: BoCC Study Session, AAC and AAC subcommittee
discussion, Prosecutors office.
STAFF
RECOMMENDATION: Airport staff requesting approval of the proposed policy
changes expressed in the discussion and AAC Lease Policy
Recommendation with the following exceptions; T-Hangar
lease to not exceed 1 year terms, Lease Rate Escalation of
10% every 5 years and upon lease termination, the
leasehold improvement reverts to airport ownership per the
FAA’s reversionary clause and provisions outlined in
section 6 of the AAC’s document.
AAC
RECOMMENDATION: Please see attached Leas Policy Recommendation as
presented by the Airport Advisory Committee.
HANDLING: None
ATTACHMENTS: Lease Policy Recommendation Document