Agenda Item Wording:
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Second reading and adoption of Ordinance No. 2022-02, authorizing four (4) individual four (4) year leases for hangar space in the newly completed four (4) unit Corporate Hangar at the Visalia Municipal Airport to Robin Martella, Rick Bissat, Juan Rodriquez, and Joe Dawkins for the purposes aircraft storage, at the rate of Twenty-One Thousand Dollars ($21,000) annually each.
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Deadline for Action: None
Submitting Department: Administration - Airport
Contact Name and Phone Number:
Jody Miller, Airport Manager, 713-4282, Jody.Miller@visalia.city
Nick Mascia, Assistant City Manager, 713-4323, Nick.Mascia@visalia.city
Department Recommendation:
Staff recommends that Council conduct the Second Reading and adoption of Ordinance 2022-02 and authorize the City Manager to execute separate Hangar Lease Agreements with Mr. Martella, Mr. Bissat, Mr. Rodriguez, and Mr. Dawkins, with each prospective Lessee occupying one (1) of the four (4) new box hangars recently constructed at Visalia Municipal Airport. Each Lease would be for four (4) years with an option at the completion of the initial term to extend for up to six (6) additional years with the total Lease term not to exceed ten (10) years after which the prospective Tenants would hold no further first claim to rent the space. The Lease rate would be Twenty-One Thousand Dollars ($21,000) annually, to be paid in twelve (12) equal monthly installments of One Thousand Seven Hundred and Fifty Dollars ($1,750), further adjusted annually based on the California Consumer Price Index.
Background Discussion:
When construction began on the new four (4) unit Corporate Hangar at Visalia Municipal Airport a waiting list for a unit in the Hangar became available to the public, Mr. Martella, Mr. Bissat, Mr. Rodriguez, and Mr. Dawkins are the first four (4) names on the waiting list and each has been offered and accepted the opportunity to lease a unit now that the project has been officially completed, and a prospective lease has been approved by the City Attorney’s Office.
Each unit available is an identical Five Thousand (5,000) square foot space that will be leased for Twenty-One Thousand Dollars ($21,000) annually to be paid in twelve (12) equal monthly installments of One Thousand Seven Hundred and Fifty Dollars ($1,750), further adjusted annually based on the California Consumer Price Index. Each prospective Tenant will be responsible for paying all utility charges as well as Tulare County Possessory Interest Taxes in addition to their Lease rate. Each Unit is fully plumbed for either a restroom or kitchenette, which if the Tenant decides to put in, they are responsible for all cost and permits associated with the improvement. Any such permanent improvements may only be done with written approval of the Airport Manager and with all proper permits, additionally when the Tenant vacates the unit whether at the end of the Lease term or at any point prior, all improvements would remain in place in the unit. The Tenant is responsible for maintaining the premises, and keeping them in good order, condition, and appearance, with the City being responsible for the maintenance and repair of the structure itself, the roof, roof system, hangar doors, gutters, the foundation, parking areas, exterior lighting, and utilities up to connection at the building. The City is guaranteed permission to inspect the Premises at all times to ensure that they are being properly maintained.
Priced at just over Four Dollars and Twenty-Five Cents ($4.25) per square foot the Lease rate is priced higher than our standard T-Hangar Lease rate, however this rate is priced competitively with similar premium level hangar space in the Valley.
Typically, a four (4) year lease would not require an Ordinance, however the prospective Lease for all four (4) units contains an option to extend the Lease term up to six (6) additional years for a total term not to exceed ten (10) years which triggers the need to introduce the attached Ordinance.
Fiscal Impact:
Visalia Municipal Airport would receive Twenty-One Thousand Dollars ($21,000) annually for each of the four (4) hangar Leases for a total anticipated revenue of Eight-Four Thousand Dollars ($84,000). The monthly lease payments will be deposited into the Hangar Rentals Revenues fund along with all current Hangar and T-Hangar lease payments for general use within the airport.
Prior Council Action:
January 18th 2022 - Council introduced and held the first reading for Ordinance 2022-02.
Other: N/A
Alternatives: None Recommended
Recommended Motion (and Alternative Motions if expected):
recommendation
I move to conduct the Second Reading and adoption of Ordinance No. 2022-02 and authorize the lease of one unit each in the newly completed Four (4) Unit Corporate Hangar to Robin Martella, Rick Bissat, Juan Rodriguez, and Joe Dawkins for the annual rate of Twenty-One Thousand Dollars ($21,000) for each unit.
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Environmental Assessment Status: NA.
CEQA Review: N/A
Attachments: Click or tap here to enter text.
1. Proposed Ordinance 2022-02
2. Proposed Lease (Identical for all four (4) units.)