09 Municipal Airport Property - taxes

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.' 'is located. The City Attorney advised that the only compensation that the city receives is the hangar itselfwhen the lease expires. He said that almost all of the cities require the payment of ground lease payments for private hangars, and also indicated from TxDot that future leases should include the requirement for ground lease payments. City Attorney Schenk told the City Council that the survey shows the ground lease charge anywhere from a nickle per square foot per year to being based on the appraised value. He further advised that the Board recommendation was for a ground lease payment of$0.12 per square foot per year adjusted every five years from the Consumer Price Index adjustment, and advised this is for future leases only. A motion was made by Councilman Bell, seconded by Mayor Pro Tern Manning, to accept the recommendation of the Airport Advisory Board. The motion carried 7 ayes, 0 nays. ,t,.... City Attorney Schenk told the City Council that the next issue for consideration was whether the lease should place the burden for taxes, if any taxes are due, on the hangar tenant. He advised that the current policy is silent on the issue of who would be responsible for taxes, if any taxes are determined to be due. The City Attorney advised that other cities said, if there are ever taxes to be paid, the tenant pays the taxes, and the Board made no recommendation. City Attorney Schenk advised that it was his recommendation that this needs to be a provision of the lease. After discussion, a motion was made by Mayor Pro Tern Manning that, in accordance with the results of the survey, that if there are ever taxes to be paid, the tenant pays the taxes. The motion was seconded by Councilman Bell and carried 7 ayes, 0 nays. City Attorney Schenk advised that the next question was on insurance, stating that the current lease requires $250,000.00 personal injury, $500,000.00 event, $100,000.00 property damage coverage in each policy. The question is whether or not more extensive insurance coverage, including fire and casualty insurance. on the actual hangar, should be an obligation of the tenant. He said at this time MINUTES CITY COUNCIL MEETING AUGUST 13, 2001 410 ~ r"