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Recommendations of Airport Advisory Board <br />DISCUSS POLICY CONSIDERATIONS AND PROVISIONS OF LEASE AGREEMENTS <br />FOR NEW PRIVATE HANGARS. <br />1. Term Length. <br />Size versus amortization. <br />The Advisory Board recommended a policy for term lengths using a sliding <br />scale based on the size of the hangar being constructed by the tenant. The <br />Board also recommended there be minimum standards set for the construction <br />of airport hangars so all hangars will meet minimum requirements, such as <br />gage of inetal insulation, air conditioning, heating, etc. The Board <br />recommended this sliding scale based on size in lieu of a sliding scale based <br />on cost versus amortization because they felt the size of the hangar more <br />accurately reflected long-term usability of the hangar, whereas cost could <br />reflect the expense of adding certain items to the structure itself which would <br />not have long-term applicability. Subsequently, the Board made a specific <br />recommendation that leases for hangars up to 5,000 square feet in size would <br />be for a twenty-five (25) year term; leases for hangars sized larger than 5,000 <br />square feet but no larger than 20,000 square feet would be for a thirty (30) <br />year term; and all hangars sized in excess of 20,000 square feet would be for <br />a term negotiated between the hangar owner and the City. <br />2. Options <br />The Board recommended there be no options specified in the lease agreement <br />and the term be for the original term only. <br />Right of first refusal after end of term <br />Thereafter, the Board recommended a process similar to that process used for <br />Hangar H, whereby the subsequent rental of the hangar after the City took it <br />over following expiration of the initial term would be based on a competitive <br />bidding process for a rate for use of the hangar, and the tenant who had <br />originally built the hangar would then have the opportunity to exercise, within <br />thirty (30) days, a right-of-first-refusal to rent the hangar for whatever period <br />of time the City desired to rent it out at the rental rate which was bid in the <br />competitive bidding process. Again, no options would be provided in the <br />contract. <br />Page 1 of 3 <br />