08 - Airport Ground Lease Agreement with Larry Ervin - Hangar PItem No. 8
TO: Mayor & City Council
FROM: Grayson Path, City Manager
SUBJECT: GROUND LEASE AGREEMENT FOR PRIVATE HANGAR - COX FIELD
DATE: November 9, 2020
BACKGROUND: Mr. Larry David Ervin is interested in building a private hangar at Cox Field
Airport and has requested a ground lease agreement in order to proceed with his project.
STATUS OF ISSUE: Mr. Ervin is proposing to construct a 60' x 70' hangar located north of the
existing Hangar M. The ground lease agreement is the template form, and is for a 40 -year period
at an annual payment of $840.00 based on the square footage. The city will retain ownership of
the land, and as is typical with a ground lease, once it expires the city can reclaim any fixed assets
remaining on the site. The FAA has approved of the proposed hangar location, and the airport
advisory board recommends approval of the attached ground lease with Mr. Ervin.
BUDGET: Upon completion, will generate new revenues at the airport.
RECOMMENDATION: Authorize the city manager to execute a ground lease agreement with
Mr. Larry David Ervin for construction of a private hangar at Cox Field Airport.
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THE STATE OF TEXAS §
§ KNOW ALL MEN BY THESE PRESENTS
COUNTY OF LAMAR
This Lease Agreement (AGREEMENT) is made by and between the City of Paris, Texas, a home
rule municipal corporation (LESSOR) and
(LESSEE).
For and in consideration of the construction of a new airplane hangar(s) and related improvements,
as further described herein, and for the payment of monthly ground lease rental to LESSOR,
LESSOR does hereby lease, rent, and let unto LESEE that portion of Cox Field real property as
described in Exhibit A, attached hereto and made a part hereof.
LESSEE hereby leases said real property from LESSOR subject to the terms, covenants, and
conditions state below, and shall have the right and privilege to construct and maintain certain
improvements of said property. LESSEE accepts property "as is.”
Except to the extent provided herein and subject to the provisions hereof, LESSEE shall have and
hold the leased premises, together with all rights, privileges, easements, appurtenances, and
immunities belonging to or in any way appertaining to said leased premises, including, but not
limited to, any and all easements, rights, title and privileges of LESSOR now or hereafter existing in,
to, or under said leased premises, and additionally LESSEE shall be permitted to use in common
with others all streets and other rights of ingress and egress and all runways, taxiways and designated
aprons which are or may hereafter be provided at the Airport.
LEASE TERMS:
1. Subject to the provisions contained herein, LESSEE shall pay to LESSOR an annual ground
lease payment of $0.20 per square foot, to be paid in advance, beginning on the commencement date
of this lease and continuing regularly thereafter during the term of this lease and any extensions
thereof. At its sole option, LESSEE may prepay any of the rental installments.
2. Rental rates may be adjusted by LESSOR at the end of each five-year lease period, computed
according to the Consumer Price Index (CPI) for Dallas -Fort Worth, Texas, or other rates prevailing
in the Paris area for similar facilities.
3. Should LESSEE fail to make payments in a timely manner, a late penalty of 10% shall be
'f #' on the tenth calendar day after the due date. Should payments remain past due
for more than thirty (30) days, AGREEMENT is in default and may be terminate& as provided
herein below. 0
4. In order to encourage development of the Airport by providing sufficient time for investors to
amortize their investments, the term of this AGREEMENT shall be forty (40) years. This lease may
be extended by Lessee for an additional five (5) year period, provided all requirements of this
aeleement have been met: Lessee owes no taxes fees. or.,-Denalties to the CitV of
makes known its desire to extend the lease no later than six months before expiration of the
AGREEMENT.
5. LESSEE shall have the right at anytime and from time to time during the term of this lease,"
-L.rect,
the leased premises, and correct and change the contour of the leased premises as necessary.
,f,. The full expense of any such construction, reconstruction, demolition, or any change, alteration
*r improvements shall be borne and paid by LESSEE.
7. A'o new structure or other improvement, nor any material addition to, or alteration of, any
building or structure shall be commenced unless and until plans, specifications, and proposed
location(s) have been submitted to and approved by LESSOR. Said plans and specifications shall be
prepared by LESSEE, at its own expense, at least thirty (30) days prior to the planned
commencement of such project.
8. LESSOR shall, in a timely manner, review and approve the plans or note in writing any required
chanues or corrections that must be made to 6&Dla-vs.
thirty (30) days shall constitute LESSOR's approval of the changes.
WJ er to comply with legal requirements,, shall not T��tuire submi�.,_% Morww,4
plans and specifications.
10. The approval by LESSOR of any plans and specifications refers only to the conformity of such
plans and specifications to th%aeneral archite _V'AfMftT IGO-MM01M�_
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all applicable codes and ordinances, and such approval shall not be withheld unreasonably, Such
�,Ians and specifications are not approved for architectural ginveria
such plans and specifications LESSOR assumes no liability o responsibility therefor or f y
T or an
fefect in any structure constructed from such plans or specifications,
11. Construction of improvements shall be conducted in full conformance with the City's Building
Codes and other pertinent ordinances, includinq!�- - -
"AMMY77TA"uministration ana 1'exas AepaTtment
of Transportation standards and requirements.
12. Any and all improvements constructed shall be consistent with the purposes provided for in this
AGREEMENT and contribute to furthering the City of Paris's Airport Master Plan or airport
development objectives.
13. LESSEE shall require all contractors and sub -contractors to maintain general commerci
liability and workers' compensation insurance, or in lieu thereof provide such coverage itself I
14. All improvements shall be substantially complete within eighteen (18) months of execution of
AGREEMENT. Failure to timely complete construction of the hangar shall be considered a breach
of the lease ayZeement and subiect the fte_n_an4w1.,&_%YA 2t cznutU�
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termination. In the event that construction has commenced, but will not be completed in a timely
manner, LESSEE may apply to LESSOR for an extension of time, said application to include an
zpproved construction timing plan. LESSOR is under no obligation to grant the extension in the
?bsence of the valid excuse, but such extension will not be unreasonably withheld.
15. LESSEE shall provide as -built yJ�an�vWW
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this AGREEMENT.
16. LESSEE shall not erect, paint upon, attach, exhibit or display in, on, or about said leas
premises any sign without the prior written consent of LESSOR. I.
17. All permanent building and improvements placed upon the ]eased premises by LESSEE sh
become the ad property of LESSEE, and will be classified for ad valorem tax purposes as prop
belonging to LESSEE; provided, however. that LESSOV-4g.- -
any of �such iniprover rients except fllwou1 authorized condemnation procadures, and I...ESSET shall
knave the ffill mid peaceffil use and enjoyment thereof during the primary to of this lease. All
perrnanent improvements shall become ride pToperty of I...ESSOR upon the ten nination of the initial
fort), (4-0)'year period of AGREEMENT,without compensation to 11' MEE.
MAINTENANCIZ & USE
18. LESSEE shall, at its own (gust and expense at all times during the term of'AGREEMENT, to
keep, and madant ain property arid facilities in good condition and repair, reasonable wear and tear
alone except(;;A, complying with all fire, building, and property maintenance, codes and zoning
regulations now in force,, or that may be hereafter enacted with regard to the use of the airport
prernises, maintainirij..d roofs and walls free frm'n leaks nd damage, painting as necessary to prevent
and retard rusting and to entwnez add earmice as the onginal finishes detexiorate, and maintaining
property clear of clutter, junk,wf....,eds and hi& p
.;rass,
19. IMSEIZshall co,nduct its operation and maintain the le%sehold in such a manner as to be ffee of
environmental contarnination., and shall store neither fiiel Amor defuel any aircraft inside any hangar.
20. LESSEE shall nf.)t cause or permit any use or activity that, would create a hazardous condition
for aircraft operating at the airport.
21. LESSEE shall pay or cause to be paid all rharges for water, gas, elechicity, sewer, er ble, and
mry and all. other utilities used on the leased prernises tlirouj,.�)Iout the tcmi of AGRE EMENT,
incliading cormection feffi,
22. The primary purpose for which the ]eased premises have been leased is for the developme, nt mid
construction of an airplarw, hangar to be used for the storage
,. of airplanes and relatexi aeronautical
equipment and offier items of personal prope.fty pertaining to that use and OWTied by the IMSEE. In
afidition to the provisions and limitations set forda below, LESSE13 shall have thif,.,, tiLdit tO use tbe
leased premises fbr lawful purposes of private use only which are related to aviation or the aviation
industTy, in conformancewith the requirements of the City"s master plan, and in such a manner so as
not to materially and advexsely affbet the developunt,-,rit and improvement, operation, or maintemance
s"e"ams +airport.
23, No hangar shall be used as a residence orsball be used for residential perp osm, I lowe.ver, such
facilities as a sink, bathroom., or associattld features to provide for peream di.ctempc.)rii--yov.eand f.IJIt stays
or social uses within a portion of the hangar shall be pennitted.
24. No commercial activity is authorized unless it is first approved by the Paris City Council.
25. LESSEE shall at no time use or permit the use of leased premises in a manner contrary to
federal, state, or local laws, ordinances, rules, or regulations.
26. LESSOR possesses the right to periodically inspect improvements and in no case less often than
annually, accompanied by LESSEE, to ensure all use requirements, including those relating to use,
are being met.
27. LESSEE shall be responsible for all taxes, if any, including without limit sales, use and excise
taxes, ad valorem taxes or other similar taxes, taxes on personal property, and other charges of every
description which are levied on or assigned against the leased premises, which maybe assessed upon
the hangar and other improvements, or any other equipment or property associated with the hangar.
28. LESSEE may, at any time and from time to time, encumber the leasehold interest, by deed of
trust, mortgage or other security instrument, without obtaining the consent of LESSOR, but no such
encumbrance shall constitute a lien on the fee title of LESSOR, and the indebtedness secured thereby
shall at all times be and remain inferior and subordinate to all the conditions, covenants and
obligations of this lease and to all of the rights of the LESSOR hereunder.
INDEMNITY & INSURANCE:
29. LESSEE COVENANTS AND AGREES TO INDEMNIFY AND DOES HEREBY
INDEMNIFY, HOLD HARMLESS AND DEFEND CITY, ITS OFFICERS, AGENTS, SERVANTS
AND EMPLOYEES, FROM AND AGAINST ANY AND ALL CLAIMS OR SUITS FOR
PROPERTY DAMAGE OR LOSS AND/OR PERSONAL INJURY, INCLUDING DEATH, TO
ANY AND ALL PERSONS, OF WHATSOEVER KIND OR CHARACTER, WHETHER REAL
OR ASSERTED (INCLUDING, WITHOUT LIMITATION, REASONABLE FEES AND
EXPENSES OF ATTORNEYS, EXPERT WITNESSES AND OTHER CONSULTANTS)
ARISING OUT OF OR IN CONNECTION WITH, DIRECTLY OR INDIRECTLY, THE
NEGLIGENT OR OTHERWISE WRONGFUL ACTS OR OMISSIONS OF LESSEE, ITS
AGENTS, SERVANTS, CONTRACTORS, OR EMPLOYEES IN CONNECTION WITH THE
DESIGN, CONSTRUCTION OR INSTALLATION OF THE IMPROVEMENTS, INCLUDING
BUT NOT LIMITED TO INJURY OR DAMAGE TO CITY PROPERTY. SUCH INDEMNITY
SHALL SURVIVE THE TERM OF THIS AGREEMENT. THERE IS NO JOINT ENTERPRISE
BETWEEN LESSOR AND LESSEE.
30. During the period of construction of any building or other improvement on the leased premises
and at all times thereafter during the lease term, LESSEE shall keep the improvements insured
against loss or damage by fire, with extended coverage endorsement or its equivalent, in such
responsible insurance companies as LESSEE shall select and LESSOR shall approve, and in
amounts not less than 80% of the fair insurable value of the buildings and other improvements.
31. In the event any building or improvement constructed on the leased premises is damaged by fire
or any other casualty, regardless of the extent of such damage or destruction, LESSEE shall within
one year from the date of such damage or destruction commence the work of repair, reconstruction or
replacement of damage or destroyed building or improvement and prosecute the same with
reasonable diligence so that the building, to the extent originally constructed by LESSEE, shall be
restored to substantially the condition it was in prior to the happening of the casualty, provided,
however, that if the commencement, construction or completion of said repair, reconstruction or
replacement work shall be prevented or delayed by reason or war, civil commotion, acts of God,
strikes governmental restrictions or regulations, or interferences, fire or other casualty, or any other
reason enumerated or not, the time for commencing or completing, or both, of the construction of
said building, as the case may be, shall automatically be extended for the period of each such delay.
32. LESSEE shall maintain, during the life of AGREEMENT, general liability coverage with
minimum limits for damages resulting from bodily injury or death of $250,000 per person and
$500,000 per occurrence, and $100,000 per occurrence for property damage, or a combined single
limit of $500,000, or in such other amounts mutually agreed upon to fully and reasonably protect
both LESSEE ad LESSOR. LESSOR shall be named as an additional insured with a waiver of
subrogation in favor of LESSOR. All costs of such insurance shall be borne by LESSEE. Such
insurance policy or policies must be issued by a reputable provider licensed to write such policies in
the State of Texas.
DEFAULT & TERMINATION:
33. Should LESSEE default in the performance of any covenant or condition in AGREEMENT, and
such default is not corrected within thirty (30) days after receipt of written notice from LESSOR to
LESSEE, LESSOR may declare AGREEMENT, and all rights and interest created by it, to be
terminated. Upon LESSOR electing to terminate, AGREEMENT shall cease and come to an end as
if that were the day originally fixed herein for the expiration of the term hereof. LESSOR, its agent
or attorney, may resume possession of the premises and release LESSEE of all liability or relet the
same for the remainder of the term at the best rent LESSOR, its agent or attorney may obtain for the
account of LESSEE, who shall make good any deficiency
34. Any termination of this lease as herein provided shall not relieve LESSEE from the payment of
any sum or sums that shall then be due and payable to LESSOR hereunder, or any claim or damages
then or theretofore accruing against LESSEE hereunder, and any such termination shall not prevent
LESSOR from enforcing the payment of any such sum or sums or claim damages by any remedy
provided for by law or from recovering damages from LESSEE for any default thereunder. No
termination shall relieve LESSEE of the obligation to deliver and perform on all outstanding
obligations and requirements prior to the effective date of the termination.
35. In the event of the failure on the part of LESSEE upon termination of AGREEMENT to
immediately remove from the leased premises all property owned by it, LESSOT may effect such
removal and store such property at LESSEE's expense.
36. LESEE shall pay and discharge all reasonable costs, attorney's fees, and expenses that may be
incurred by LESSOR in enforcing the covenants and conditions of AGREEMENT.
37. Notwithstanding the foregoing, no failure to perform or delay in performance which is caused by
any war, civil disorder, or other national emergency or which is due to an intervening act of God
shall be deemed an event of default during the pending force majeure event.
38. Tenants of hangars which are built by LESSEE as consideration for a long-term ground lease
shall be given the right -of -first -refusal for the lease of such hangar upon the termination or expiration
of the initial lease, the rental rate for such hangars to be determined as set out herein.
I
39. Nothing herein contained shall be construed to grant or authorize the granting of an exclusive
right except as to the premises leased herein.
40. LESSOR reserves the right to further develop or improve the landing area of the airport as it
sees fit, regardless of the desires or view of LESSEE, including the temporary closing of the airport,
and the granting of an exclusive right.
41. The parties agree that LESSOR has not waived its sovereign immunity by entering into and
performing its obligations under this AGREEMENT.
42. LESSOR will maintain and keep in repair the landing area of the airport and all publicly owned
facilities of the airport, together with the right to direct and control all activities of LESSEE in this
regard.
43. During a time of war or national emergency, LESSOR shall have the right to lease the landing
area or any part thereof to the United States Government for military use, and, if such lease is
executed, the provisions ofthis instrument insofar as they are inconsistent with the provisions ofthe
lease to the Government shall be suspended.
44. LESSOR reserves the right to take any action it considers necessary to protect the aerial
approaches of the airport against obstruction, together with the right to prevent LESSEE from
erecting, or permitting to be erected, any building or other structure on or adjacent to the airport
which, in the opinion of the LESSOR, would limit the usefulness of the airport or constitute a hazard
to aircraft.
45. During the final 180 days of the term of AGREEMENT, LESSSOR shall have the right to erect
and maintain on or about the leased premises customary signs advertising the premises for sale or
lease.
46. This lease shall be subordinate to the provisions of any existing or future agreement between
LESSOR and the United States, relative to the operation or maintenance ofthe airport, the execution
of which has been or may be required as a condition precedent to the expenditure of Federal funds
for the development of the airport.
47. Holding over by LESSEE of the airport premises after the expiration of this Agreement shall
operate and be construed as a tenancy from day to day at a rental rate computed from the rental rate
then prevailing under this lease.
48. LESSOR may, at its option, and following a ninety (90) day written notice period, terminate
AGREEMENT as to the land, the hangar building, or any parts thereof, which may be necessary in
the event LESSOR desires to use the property, or any portion thereof, for any governmental purpose
as determined by LESSOR, such as but not limited to, extension of runways or taxiways, utility or
drainage improvements, or the expansion of existing buildings or the erection of other airport
facilities. If LESSOR so terminates all or a portion of AGREEMENT, LESSOR shall pay to
LESSEE 2.5% of the total construction costs of all improvements multiplied by the number of years
remaining in the lease term.
49. Nothing herein contained shall be construed to deny the LESSOR its right to condemn the
leased property through its power of erninent domain. In the event of condemnation of all or any
portion of the leased premises, the leasehold interest of LESSEE shall be deemed to include all rights
under this lease including, but not limited to, the right to occupy the improvements placed on the
leased premises.
MISCELLANEOUS
50. The undersigned officers and/or agents ofthe parties hereto are the properly authorized officials
and have the necessary authority to execute this AGREEMENT on behalf of the parties hereto, and
each party hereby certifies to the other that any necessary resolutions or other acts extending such
authority have been duly passed and are now in full force and effect.
51. This Agreement represents the entire and integrated agreement between LESSOR and LESSEE
and supersedes all prior negotiations, representations and/or agreements, either written or oral. This
Agreement may be amended only by written instrument signed by both LESSOR and LESSEE.
52. If any clause, paragraph, section or portion of this AGREEMENT shall be found to be illegal,
unlawful, unconstitutional or void for any reason, the balance of the AGREEMENT shall remain in
full force and effect and the parties shall be deemed to have contracted as if said clause, section,
paragraph or portion had not been in the Agreement initially.
53. This AGREEMENT is executed by the parties hereto without coercion or duress and for
substantial consideration, the sufficiency of which is hereby acknowledged.
54. Waiver by either party or any breach of this AGREEMENT, or the failure of either party to
enforce any of the provisions of this Agreement, at any time, shall not in any way affect, limit or
waive such party's right thereafter to enforce and compel strict compliance of the AGREEMENT.
55. This AGREEMENT shall be drafted equally by all parties hereto. The language of all parts of
this AGREEMENT shall be construed as a whole according to its fair meaning, and any presumption
or principle that the language herein is to be construed against any party shall not apply. Headings in
this AGREEMENT are for the convenience of the parties and are not intended to be used in
construing this document.
56. This AGREEMENT maybe executed in a number of identical counterparts, each of which shall
be deemed an original for all purposes.
57. This AGREEMENT shall not be assigned without the written consent of LESSOR, which shall
not be unreasonably withheld, conditioned or delayed. Any amendment to this AGREEMENT shall
be in writing and signed by all parties to the AGREEMENT.
58. The rights and remedies provided by the AGREEMENT are cumulative, and the use of anyone
right or remedy by LESSOR shall not preclude or waive any right to use any or all other remedies.
59. Where the terms of this AGREEMENT require that notice in writing be provided, such notice
shall be deemed delivered three (3) days following the deposit of the notice in the United States mail,
postage prepaid, and sent by certified mail, return receipt requested and properly addressed as
follows:
Lessor: City of Paris
P. O. Box 9037
Paris, TX 75461-9037
Lessee.
....'............
60. This AGREEMENT shall be binding upon, and inure to the benefit of, the parties of this Lease
and their respective heirs, executors, administrators, legal representatives, successors, and assigns
when permitted by this Agreement.
61. This AGREEMENT shall be construed under, and in accordance with the laws of the State of
Texas, and all obligations of the parties created by this Lease are performable in Lamar County,
Texas.
EXECUTED on this N day of, 20 Xto be effective , 20
ATTEST: ``����"'� COURTNEY D. STRAIN
?a°t ems= Notary Public, State of Texas
v Comm. Expires 03-14-2023
�'�uo;10`�� Notary ID 131931392
City Clerk
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City Attorney
STATE OF TEXAS
COUNTY OF LAMAR
This instrument was acknowledged before me on the day of , 20, by
Notary Public, State of Texas
STATE OF TEXAS
COUNTY OF LAMAR
This instrument was acknowledged before me on the X day ovwmol Z oby
COURTNEY D. STRAIN
Notary Public, State of Texas
Nr AE Comm. Expires 03-14-2023
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SCALE: 1"=3
N: 33`38'20.311.2"
W: 095'27'23,6968"
------ti 7R 73-4
io
PROPOSED
HANGAR "P"
LOCATION
7
01
1y 0 131 ti I
BAR SC;All'
s8713
N: 33 L__8'19.(3187„
W: 095'27'216858”
N: 3.1'38'20,3190"
W: 09527'22.9871"
—1 LEGLND
x 60D NAIL SET
EXISTING HANGAR
IlROPOSFD HANGAR
'NOTES
1. THE REYERENICE SOLIPCT- FOR ME BEAWINGS SHOWN
HEREON IS TEXAS S'1 PLANE COORDINATE SYS [I -A4
ZONF 4202 %ND WAS ESTABLISHED ON-srrk. ]'SING GPS
OBSERVATIONS.
2. THIS ORIGINAL DRAWING IS ON AN 8,5"X I I" SJZhD SHEET..
3. HANGAR P DESIGNATION WAS PREVIOLISLY ASSIGNED TO
A DnrFRENTHANGAR BUT IS BEING] TRANS] f RRED ONYER
TO 12HIS HANGAR.
HA/TER
E N G I N E E R I N G
T.8- F-lw2m I TC., F-31510601-
aw6selnapzai.arauc r<
ERV I'
PROPOSED HANGAR P
COX FIELD
CITY OF PARIS
LAMAR COUNTY, TEXAS
SEPTEMBER 2020
M. 33'38'19.62650!
W: 095'27'22,9761."
1, KEVIN K. WHITLF- Y. RPOIS IFRED PROFESSIONAL
LAND SURVEYOR FOR THE STATF Of TEXAS, RPLS
45892, DO HEREBY ('LR:rIFY THAT TI FF WGS 84
COORDINATES SHOWN HEREON ARE THE RESUI.. I'S OF
AN ACTUAL ON -THF GROUND SURVEY CONDUCTED
BY NIE. COMPLETED ON 2]1, 2020.
K, INk. — RPI -9
PAGE I OF I