HomeMy WebLinkAbout2007-07-12 Airport Commission PacketKENAI AIRPORT COMMISSION
JULY 12, 2007
KENAI CITY COUNCIL CHAMBERS
7:00 P.M.
AGENDA
YTEM 1: CALL TO ORDER AND ROLL CALL
ITEM 2: AGENDA APPROVAL
ITEM 3: APPROVAL OF MEETING SUMMARY -- June 14, 2007
ITEM 4: PERSONS SCHEDULED TO BE HEARD
ITEM 5: OLD BUSINESS
a. Discussion -- Final Taxiway Designations
ITEM 6:
a. Discussion/Recommendation -- Supplemental Master Plan/Commercial
Lease Lot Development at Float Plane Basin
b. Discussion/Recommendation -- Ordinance No. 2230-200/Amending
KMC 21.10.090(d)(1) and (2) by Establishing Different Requirements for
Determining the Length of a Lease Extension and Extending the
Maximum Term of Lease Including any Extension from 35 to 55 Years.
ITEM 7: REPORT
a. Commission Chair
b. Airport Manager
c. City Council Liaison
STEM 8: COMMISSIONER COMMENTS AND OUESTYONS
ITEM 9: PERSONS NOT SCHEDULED TO BE HEARD
ITEM 10:
a. Kenai City Council Meeting Action Agendas for June 20 and July 3, 2007.
b. Composition of the Airport Commission
c. Holiday Closures for the Kenai Cafe
STEM 11: ADJOURNMENT
PLEASE CONTACT U5 IF YOU WILL NOT BE ABLE TO
ATTEND THE MEETING:
CAROL -- 283-8231 OR, MARY -- 283-7951
It~3
KENAY AIRPORT COMMISSION
JUNE 14, 2007
KENAI CITY COUNCIL CHAMBERS
7:00 P.M.
AGENDA
ITEM 1: CALL TO ORDER AND ROLL CALL
ITEM 2: AGENDA APPROVAL
ITEM 3: APPROVAL OF MEETING SUMMARY -- May 10, 2007
ITEM 4: .PERSONS SCHEDULED TO BE HEARD
ITEM 5: OLD BUSINESS
a. Discussion -- Air Fair 2007
b. Discussion/Recommendation -- Supplemental Master Plan/Airport
Lease Lot Development
ITEM 6: NEW BUSINESS
a. Discussion/Recommendation -- Draft Ordinance Amending KMC
21.20.070/Leasing Decisions Within the Airport Reserve.
b. Discussion/Recommendation -- Draft Ordinance Amending KMC
21.20.010/Airport Commission Recommendations Related to Airport
Budget.
c. Recommendation -- Lease Application/Arctic Barnabas Ministries, Inc. -
- Lot 9A, Block 5, General Aviation Apron Subdivision No. 5.
ITEM ?: REPORT
a. Commission Chair
b. Airport Manager
c. City Council Liaison
YTEM 8: .COMMISSIONER COMMENTS AND OUESTYONS
ITEM 9: PERSONS NOT SCHEDULED TO BE HEARD
ITEM 10: INFORMATION ITEMS
a. Kenai City Council Meeting Action Agendas for May 16 and June 6, 2007.
b. Updated Kenai City Council Policy for Commission, Committee, Board and
Council on Aging Meetings and Work Sessions.
c. 5/2007 Monthly Enplanement Report
ITEM 11: ADJOURNMENT
KENAI AIRPORT COMMYSSYON
.JUNE 14, 2007
KENAI CITY COUNCIL CHAMBERS
7:0o P.M.
VICE CHAIR JAMES BIELEFELD, PRESIDING
ITEM I: CALL TO ORDER AND ROLL CALL
Chair James Bielefeld called the meeting to order at approximately 7:05 p.m. The roll
was confirmed as follows:
Commissioners present: J. Ziru1, J. Bielefeld, E. Mayer, L. Porter, D. Haralson
Commissioners absent: H. Knackstedt, C. Versaw
Others present: Acting Airport Manager Bondurant, Council Member R. Molloy
A quorum was present.
ITEM 2: AGENDA APPROVAL
MOTION:
Commissioner Haralson MOVED to approve the agenda as presented and
Commissioner Porter SECONDED the motion. There were no objections. SO
ORDERED.
ITEM 3: APPROVAL OF MEETING SUMMARY -- May 10, 2007
MOTION:
Commissioner Porter MOVED to approve the May 10, 2007 meeting summary and
Commissioner Bielefeld SECONDED the motion. There were no objections. SO
ORDERED.
ITEM 4: PERSONS SCHEDULED TO BE HEARD -- None
ITEM 5: OLD BUSINESS
5-a. Discussion -- Air Fair 2007
Acting Airport Manager Bondurant reported another successful event with good
weather, food and entertainment. The FAA breakfast set record attendance and over
300 people were served at the Kenai barbeque. There were 56 participants in the Poker
Run.
5-b. Discussion/Recommendation -- Supplemental Master Plan/Airport
Lease Lot Development
There was general discussion on the. fourconfigurations provided by Wince Corthell
Bryson.
The commission recommended configuration #2 with the following changes:
1. Removal of the new paved areas south of Taxiway F.
2. Possible lease lot sizes should be expanded to those shown in configuration # 1 with
the ability to subdivide to accommodate both commercial and general aviation
development.
MOTION:
Commissioner Haralson MOVED to recommend the council accept Configuration #2
with the above changes. Commissioner Mayer SECONDED the motion.
VOTE:
Zirul YES ~ Bielefeld YES , Knackstedt I ABSENT i
Versaw ABSENT ~ Mayer YES ; Haralson i YES
Porter YES T
MOTION PASSED UNANIMOUSLY.
YTEM 6:
6-a. Discussion/Recommendation -- Draft Ordinance Amending KMC
21.20.070/Leasing Decisions Within the Airport Reserve.
General discussion followed with questions of City Attorney Graves.
MOTION:
Commissioner Zirul MOVED to recommend Council's passage of the draft ordinance
amending KMC 21.20.070. Commissioner Haralson SECONDED the motion. There
were no objections. SO ORDERED.
6-b. Discussion/Recommendation -- Draft Ordinance Amending KMC
21.20.010/Airport Commission Recommendations Related to Airport
Budget.
General discussion and questions to City Attorney. Graves clarified that if the Airport
Manager had one version of the budget and the Commission had another version; both
versions could be presented to Administration for consideration. Comments were very
supportive.
MOTION:
AIRPORT COMMISSION MEETING
- JUNE 14, 2007
PAGE 2
Commissioner Zirul MOVED to recommend Council's passage of the draft ordinance
amending KMC 21.20.010. Commissioner Porter SECONDED. There were no
objections. SO ORDERED.
6-c. Recommendation -- Lease Application/Arctic Barnabas Ministries, Inc. -
- Lot9A, Block 5, General Aviation Apron Subdivision No. 5.
Commissioner Mayer requested to abstain from voting on this issue. There were no
objections. General discussion of the project. Questions were asked of Graves
clarifying the terms of the lease.
MOTION:
Commissioner Bielefeld MOVED to recommend council approval of the lease
application from Arctic Barnabas Ministries, Inc. Commissioner Porter SECS
the motion. There were no objections. SO ORDERED.
ITEM 7: REPORT
?-a. Commission Chair -- no report
'7-b. Airport Manager -- Acting Airport Manager Bondurant gave an update
on the runway switchover and she asked that all safety issues be relayed
to her. Bondurant handed out a layout depicting the temporary air carrier
movement map.
7-c. City Council Liaison -- Council member Malloy reported on actions
taken at the June 2, 2007 council meeting.
YTEM 8: COMMISSIONER COMMENTS AND QUESTIONS
Questions were asked of Bondurant related to the final designations of the taxiways.
She will follow up and email the commission members.
ITEM 4: i'ERSONS NOT SCHEDULED TO 8E HEARD
ITEM 10: INFORMATION ITEMS
10-a. Kenai City Council Meeting Action Agendas for May 16 and June 6, 2007.
10-b. Updated Kenai City Council Policy for Commission, Committee, Board and
Council on Aging Meetings and Work Sessions.
10-c. 5/2007 Monthly Enplanement Report
ITEM 11: ADJOURNMENT
MOTION:
AIRPORT COMMISSION MEETING
JUNE 14, 2007 -
PAGE 3
Commissioner Bielefeld MOVED to adjourn and Commissioner Porter SECONDED the
motion. There were no objections. SO ORDERED.
There being no further business before the Commission, the meeting adjourned at
approximately 9:15 p.m.
Meeting summary prepared and submitted by:
Corene Hall, Deputy City Clerk
AIRPORT COMMISSION MEETING
JUNE 14, 2007
PAGE 4
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Suggested by: City Manager
CITY OF KENAI
ORDINANCE NO. 2230-200'7
AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, AMENDING
KMC 21.10.090(d)(1) and (2) BY ESTABLISHING DIFFERENT REQUIREMENTS FOR
DETERMINING THE LENGTH OF A LEASE EXTENSION AND EXTENDING THE
MAXIMUM TERM OF LEASE INCLUDING ANY EXTENSION FROM 35 TO 55 YEARS.
WHEREAS KMC 21.10.090(d)(1i provides for a maximum lease term of 35 years; and,
WHEREAS, KMC 21. 10.090(d)(2) provides that lease extensions may be granted for
one year for each $25,000 of additional investments in permanent improvements; and,
WHEREAS, KMC 2 L 10.090(d)(2) also provides that the maximum term for a lease
including any lease extension, shall be 35 years; and,
WHEREAS, it is in the best interest of the City of Kenai to provide for lease criteria
that encourage new permanent improvements on the airport; and,
WHEREAS, increasing the possible maximum term of a lease, including any extension,
from 35 to 55 years will encourage investment in permanent improvements at the
airport.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI,
ALASKA, that KMC 21.10.090(d)[1] and (2) are amended as follows:
2].10.090 Length of lease term.
(a) Unless the City determines a shorter lease term is in the best interest of the City, the length of
team for a lease granted 'for land within the Airport Reserve will be based on the amount of investment the
applicant proposes to make in the construction of new permanent improvements on the premises during
the first twenty-four (24) months following The beginning date of the lease or lease extension.
(b) Unless the City determines a shorter lease term is in the best interest of the City, the length of
term for a lease renewal shall be based on aCity-approved appraisal of the value of the permanent
improvements on fhe property as set forth in the fable in subsection (d)(1) of this section. The appraisal
shall be performed by an independent appraiser certified under Alaska Statute 8.87 with experience
appraising airport improvements. The appraisal shat] be paid for by the lessee.
(c) If the applicant proposes to make less than one hundred thousand dollars ($100,000:00) in new
permanent improvements on the premises, the maximum term of a new lease shall be five (5) years.
(d) If the applicant proposes to invest one hundred thousand dollars ($100,000.00) or more in new
permanent improvements on the premises:
(1) The maximum term of a new lease or a renewal of an expiring lease shall be determined
according to the following table:
Ordinance 2230-2007
Page 2 of 4
[APPLICANT'S INVESTMENT/ MAXIMUM
VALUE (IN U.S. DOLLARS) TERM OF
IS AT LEAST YEARS
LESS THAN $100,000 5
$100,000-$199,000 15
$200,000-$299,000 20
$300,000-$399,000 25
$400,000-$500,000 30
MORE THAN $500,000 35]
Annlicant's Investment/ Maximum
Value (in U.S. Dollars) Term
InYears
Less than $ ]00.000 5
$ 100,000 - $199.000 ] 0
$ 200 000 - $299,999 I S
$ 300.000 - $399 999 20
$ 400 000 - $499 000 25
$ 500 000 - $599.000 30
$ 600 000 - $699 000 35
$ 700 000 - $799 000 40
$ 800.000 - $899.000 45
$ 900 000 - $999 000 50
More than $1 000,000 55
[(2) THE MAXIMUM TERM EXTENSION FOR AN EXISTING LEASE SHALL BE ONE
(1) YEAR FOR EACH TV/ENTY-FIVE THOUSAND ($25,000.00) OF ADDITIONAL
PROVIDED THAT THE TOTAL OF THE REMAINING LEASE TERM AND THE
EXTENSION SHALL NOT EXCEED THIRTY-FIVE (35) YEARS.]
The maximum term for a lease (initial ]ease plus extension(s)) shall be fifty-five years.
The length of the extension(s) shall be determined according to the followin tg ahle:
Ordinance 2230-2007
Page 3 of 4
Applicant's Investment/ Maximum
Value (in U.S. Dollars) Extension
is at Least Term of
Years
$ 75.000 - $100,000 5
$ 100.000 - $199.000 10
$ 200,000 - $299,999 15
$ 300,000 - $399 999 20
$ 400 000 - $499 000 25
$ 500.000 - $599,000 30
$ 600.000 - $699.000 35
$ 700,000 - $799.000 40
$ 800 000 - $899,000 45
$ 900,000 - $999,000 50
(3) A bona fide third. patty purchaser of airport improvements may get an extension for am
existing lease acquired with improvements based on aCity-approved appraisal of the
improvements purchased. Unless the City determines a shorter (ease term is ht the best
interest of the City, the extension shall be based on the table in subsection (d)(1) of this
section provided no extension shall extend a lease Term past thirty-five (35) years. The
appraisal shall be performed by an independent appraiser certified colder Alaska Statute
8.87 with experience appraising airport improvements. The appraisal shall be paid for by
the lessee.
(e) In the lease granted to the applicant, the City Manager will include a provision requiring the
applicant to substantially complete the proposed permanent improvements within a reasonable periad,of
time, considering the cost and nature of the improvements. Provided however, that the time allowed shall
not ordinarily exceed Twenty-Four (24) months after the effective date of the lease.
(f} In the tease extension granted to the applicant, the City Manager wilt include aprovision
requiring the applicant fo complete the additional proposed permanent improvements within a reasonable
Time period, considering the cost and nature of the improvements provided that the time period shall not
ordinarily exceed twenty-four (24) months after the effective date of the lease extension.
(g) The City Manager will include a provision in a lease or lease extension requiring the lessee to
provide a performance bond, deposit, personal guarantee, or other security if the Manager determines
security is necessary or prudent to ensure the applicant's completion of the permanent improvements
within the time period set under subsections (e) or (f) of this section. The City Manager will determine the
form and amount of the security according to the best interest of the City, considering the nature and
scope of the proposed improvements and the financial responsibility of the applicant.
(h) The applicant shall, within thirty (30) days after completion of the permanent improvements,
submit to the City Manager written documentation that the improvements have been completed as
required under subsection (e) or (t) of this section.
(i) Tf the applicant shows good cause to the City Manager, and The Manager determines the
action is not inconsistent with the City's best interest, the Manager may grant an
Ordinance 2230-2007
Page 4 of 4
extension that is sufficient to allow For the completion of the permanent improvements or
for submission of documentation that the permanent improvements have been completed
under this section. No extension or combination of extensions granted will exceed twelve
(12) months.
(j) If, within the time required under subsection (e) or (f) of this section, including any extension
granted under subsection (i) of this section, the applicant fails to complete the required permanent
improvements, the City Manager will execute the forfeiture of the performance bond, deposit, personal
guarantee, or other security posted. by the applicant under subsection (g) of this section to the extent
necessary to reimburse the City for all costs and damages, including administrative and legal costs,
arising from the applicant's failure to complete the required improvements, and initiate cancellation of the
lease or reduce the Yerm of the lease to a period consistent with the portion of the improvements
substantially completed in a timely manner according to the best interests of the City.
(k) The City Manager shall review rates, charges and the investmentJvalue in the chapter every five
(5) years to see if adjustments should be made.
(I) When used in this section, the following terms shall have the meanings given:
(1) "Expiring lease" means a lease with less than one (1) year of tear. remaining;
(2) "Existing lease" means a lease with at least one (L) yea,' ofteim remaining;
(3) "Permanent improvement" means a fixed addition or change to land that is not temporary
or portable;
(i) "Permanent improvement" includes;
(A) A building, building addition, retaining wall, storage Yank, earthwork, fill
material, gravel, and pavement, and
(B) Remediation of contamination for which the applicant is not responsible;
(ii) "Permanent improvement" excludes items of ordinary maintenance, such as glass
replacement, painting, roof repairs, door repairs, plumbing repairs, floor covering
replacement, or pavement patching.
PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 16th day of May,
2007.
PAT PORTER, MAYOR
ATTEST:
Carol L. Freas, City Clerk
Introduced: May 2, 2007
Adopted: May 16, 2007
Effective: June 16, 2007
~~~\
-- -
tl~e city a f'
K~NAI~ SKA
"I/tlla9e with a Past, Gc°ty with a Future"
210 Fidalgo Avenue, Kenai, Alaska 99611-7794
Telephone: (907) 283-7535 /Fax: (907) 283-3014
www.ci.kenai.ak.us
MEMORANDUM
TO: / Kenai Airport Commission
FROM: ~'~-6 Cary R. Graves, City Attorney
DATE: July 2, 2007
RE: Lease Terms under the Existing Airport Code
Councilor Molloy thought it would be useful to the Airport Commission if I stunmarized KMC
21.10.080-090 which covers lease terms wifhin the Airport Reserve. This memorandum outlines
the existing code provisions, not the proposed amendments.
An applicant's lease term is based on the dollar value of improvements to the property according
to the scheduled outlined in KMC 21.10.090(d)(1), unless the City determines a shorter lease
term is in the best interest of the City.' Currently, The maximum Lease term is for 35 years ~
Investment of more than $500,000 in improvements would ordinarily get the applicant a 35 year
iease.3 The value of the improvements must he confirmed by an independent appraiser paid for
by the lessee.' The City may require the lessee to provide a performance bond, deposit, personal
guarantee or other security if the City Manager determines such sectu~ity is necessaay to ensure
the improvements are made.5
If the lessee does not make the improvements, or invests less than promised, the Citys options
are to execute the forfeiture of the security provided. (if applicable) and either cancel the lease or
reduce the Term to correspond to the appropriate length.6 Let's say and applicant gets a 35 year
lease based on his promise to make $600,000 in improvements, but the lessee only makes
$250,000 in improvements. The City could execute on any security guarantee provided and
reduce the term of lease to 20 years or seek cancellation the lease entirely.
~ KMC 21.10.090(a).
~ KMC 2 L 10.090(d)Q ).
3 Ibid.
`KMC 21.10.090(b).
s KMC 21.10.090(g).
e KMC 21. ] 0.090Q).
Leased lands must be utilized in a manner substantially in compliance with the airport master
plan and the City's comprehensive plan.? Leases not in substantial compliance with the airport
master plan or the comprehensive plan are subject to cancellation.8
Lessees ordinarily have 24 months to complete the improvements.9 An extension of that
deadline can be granted, but no extension or combination of extensions can go beyond 12 months
so the maximum time period for completion is 36 months, io
A lease extension can be granted. based on the value of additional improvements (one year for
every $25,000 of additional improvements}.1 ~ However, any extension cannot extend past 35
years when combined with the remainder of the lease term.12 If a lessee had 25 years left on
his/her lease and was added $500,000 insmprovements, he/she could only get an extension often
years on the lease term for the $500,000 worth of improvements.
A bona fide third party purchaser of airport improvements may get a lease extension. based on the
appraised value of the improvements unless the City determines a shorter term is in the best
interest of the City. is The extension and remaining term camiot exceed 35 years.14 If a lessee
had ten years left on his/hex lease and sold the improvements for $500,000, the purchaser could
get an extension for a total lease term of 35 years, unless the City determined a shorter extension
was in its best interest.
An existing lessee may also apply for a lease renewal or extension under largely the same
process as the initial application.ls Any such request may be denied if it does not meet the
criteria set forth in the code or is not in the best interest of the City.l~
Also, a lessee may negotiate for a contractual right of renewal not to exceed 20 years. Under that
section a lessee could get a lease term up to 55 years.~~ The Council must authorize any
contractual renewal right by resolution with auy terms and conditions it deems appropriate.18
Please fee free to let me know if you have any further questions or would like any more
information.
I4vtc 2 t.I0.120.
s Ibid..
~ KMC 21.10.090(e).
10 KMC 21.10.090(1).
~ ~ Ibid.
'~ Ibid.
"KMC 21.10.090(d)(3).
1° Ibid.
is KMC 21.10.080.
°6 KMC 27.10.070.
'~ KMC 21.10.080(2)
is Ibid.
AGENDA r~ lea
KENAI CITY COUNCIL - REGULAR MEETING
JCTNE 20, 2007
7:00 P.M.
KENAI CITY COUNCIL CHAMBERS
httn: / fwww.ci.kenai.ak.us
YTEM A: CALL TO ORDER
1. Pledge of Allegiance
2. Roll Call
3. Agenda Approval
4. Consent Agenda
*All items listed with an asterisk (*) are considered to be routine and non-
controversial by the council and will be approved by one mofion. There will be no
separate discussion of these items unless a council member so requests, in which case
the item will be removed from the consent agenda and considered in its normal
sequence on the agenda as part of the General Orders.
ITEM B: SCHEDULED PUBLIC COMMENTS (10 minutes)
1. Janice Chumley, Kenai Soil & Water Conservation Service/UAF
Cooperative Extension Service -- Alaska Weed Awareness Week........ .
2. Maya Johnson -- 4-H Activities update ............................ .
ITEM C: UNSCHEDULED PUBLIC COMMENTS (3 minutes)
ITEM D: REPORTS OF KPB ASSEMBLY LEGISLATORS AND COUNCILS
ITEM E: PUBLIC HEARINGS (Testimony limited to 3 minutes per speaker,)
,,~~~. Ordinance No. 2237-2007 -- Amending KMC 23.50.010(b) by Creating the
U ~j ~~ Job Class/Title of "Admin.istrative Assistant IV" (Class Code 217J and Placing
~~ it at Range 14 .................................................. 1
24~ Ordinance No. 2238-2007 -- Amending Title 11 of the Kenai Municipal Code
by Eliminating the City of Kenai Harbor Commission, Reassigning its Dufies to
~ ~ other Entities Within the City of Kenai and Updating Regulation of the Harbor
~~ Area ...........................:............................. 7
~~ Ordinance No. 2239-2007 -- Increasing Estimated Revenues and
~ a' Appropriafions in the Water and Sewer Fund -and the Wildwood Water Main
~ Capital Project Fund to Provide Adequate Funding for the Project........... , 54
~~
v~ V Resolution No. 2007 34 -- Directing the Continuation of the Project Entitled
' Shamrock Circle Paving District" and Designating What Smprovements Are to
n be Included in this Project ........................:........... . ... 56
,I"
5. Resolution No. 2007-35 -- Authorizing -the Purchase of Tract A, Alaska State
R~ ~ Land Survey No. 2004-25 from the State of Alaska, for Market Value, fora
:
bli
~~-
~
58
......... .............................
c Purpose ...........
~
Pu
6. Resolution Na. 2007-36 -- Transferring $10,000 in the Street Lights
~v Department for a New Street Light and Other Improvements ............... 61
7. Resolution No. 2007-37 -- Awarding a Janitorial Contract for the Kenai
~
r
,~p~' ~ Municipal Airport to Integrity Janitorial Service, LLC for the Period July 1,
`
~'
62
irough June 30, 2010 ......... .............................
~ 200~
pt
J
solution No. 2007-38 --Supporting the Development of a Copper, Gold and
1~ Molybdenum Mine at the Pebble Porphyry Prospect Northwest of Lake Iliamna,
.
~,~~ Alaska . ......................... .......:....:................ 63
Resolution No. 2007-39 -- Rejecting All Bids for the Project Entitled
~~/ Wildwood Water Main - 2007 ......... ............................. 64
0. Resolution No. 2007-40 -- Authorizing Arctic Baznabas Ministries, Inc. be
~
p Granted the Contractual Right fora 20 gear Lease Renewal fora 35 Year
5
i
i
i
i
N
"
65
.........
v
s
on
o.
on Apron Subd
Lease on Lot 9A, Block 5, General Aviat
_~
NUATION OF
O
'(n~1"' ~
F LIQUOR LICENSE CONTI
~THDRAWAL OF PROTEST
OPERATIONS -- Kings Inn Property Management LLC, d/b/a Kings Inn Hotel,
~~ Restaurant 8s Lounge, LLC (License #2457) ............................ 66
22. *APPROVAL OF LIQUOR LICENSE -- Grifnn Golf Enterprises, LLC, d/b/a/
Kenai Golf Course (License #4708) ..... :...........:................ 68
YTEM F: MINUTES
1. *Regulaz Meeting of June 6, 2007 ................................... 71
/
ITEM G: UNFINISHED BUSYNESS
ITEM H: NEW BUSYNESS
`"U "vim Bills to be Ratified .....:......................................... 93
~~ 2. Approval of Purchase Orders Exceeding $15,000 ....................... 94
YTEM I: COMMISSION/COMMITTEE REPORTS
1. Council on Aging .................. ............................
2. Airport Commission .....................................:...... .
3. Harbor Commission ............................................. 96
4. Library Commission ............................................. 98
5. Parks & Recreation Commission .................................. .
6. Planning &, Zoning Commission ....... ........:... . ......... . .. . .. .
7. Miscellaneous Commissions and Committees
a. Beautification Committee ................................. . .... .
b. Alaska Municipal League Report .... ............................ .
c. Joint Kenai River Working Group ..... . ........................... .
d. Mini-Grant Steering Committee .... ............ . ......:........ .
ITEM J: REPORT OF THE MAYOR
ITEM K: ADMYNISTRATION REPORTS
1. City Manager ..................... ............................. 102
2. City Attorney ....... . ............. ............................. 115
3. City Clerk ........................ .........:.................. .
ITEM L:
1. Citizens (five minutes)
2. Council
ITEM M: PENDING LEGISLEiTION (Items listed below are legislafion which
will be addressed at a later date as noted and are not action items
for this meeting.)
Ordinance No. 2202-2006 -- Amending KMC 11.05.090 to Limit the Use of
the City of Kenai Boat Launch, Located at the Municipal Harbor, to Vessels
and Boats Powered by Four-Cycle or Direct Injection Two-Cycle Engines.
(1/17/07, Tabled, no time certain.)
Ordinance No. 2220-2007 -- Amending the Official Keriai Zoning Map by
Rezoning Approximately 241.4 Acres in the City of Kenai to the Central Mixed
Use Zone, Including Parcels Currenfly Zoned General Commercial, Central
Commercial, Light Industrial and Suburban Residential and is Generally
Located North and South of the Kenai Spur Highway and Includes Properties
Between Bridge Access Road and Upland Street and Properties Along Main
Street Loop, North Willow Street and Airport Way. (4/4/2007, Tabled, no time
certain.).
Reconsideration of Ordinance No. 2230-2007 -- Amending KMC
21.10.090(d)(1) and (2) by Establishing Different Requirements for
Determ;n;ng the Length of a Lease Extension and Extending the Maximum
Term of Lease Including Any Extension From 35 to 55 Years.(6/6/07, Tabled
to July 18, 2007.)
EXECUTIVE SESSION -- Annual Evaluation of City Manager
ITEM N:
AGENDA
KENAI CITY COUNCIL -REGULAR MEETING
JULY 3, 2007
7:00 P.M.
KENAI CITY COUNCIL CHAMBERS
http: /lwww.ci.kenai.ak.us
ITEM A: CALL TO ORDER
1. Pledge of Allegiance
2. Roll Call
3. Agenda Approval
4. Consent Agenda
*All items listed with an asterisk (*) are considered to be routine and non-
controversial by the council and will be approved by one motion. There will be no
separate discussion of these items unless a council member so requests; in which case
the item will be removed from the consent agenda and considered in its normal
sequence on the agenda as part of the General Orders.
ITEM B: SCHEDULED PUBLIC COMMENTS (10 minutes)
1. Sgt. Gus Sandahl, Kenai Police Department -- Youth Services Officer
Award.
a, vCIP,.y~t^~ ~D/~~ lfi~i7~DriG~e .dir. ~ic-ti ~~,h%r45
ITEM C: UNSCHEDULED PUBLIC COMMENTS (3 minutes)
ITEM D: REPORTS OF KPB ASSEMBLY LEGISLATORS AND COUNCILS
YTEM E: PUBLIC HEARINGS (Testimony limited to 3 minutes per speaker.)
~~~ ~ 1. Ordinance No. 2239-2007 -- Increasing Estimated Revenues and
Appropriations in the Water and Sewer Fund and the Wildwood Water
Main Capital Project Fund to Provide Adequate Funding for the Project.
(Clerk's Note: Ordinance No. 2239-2007 was introduced at the June 6, 2007
.meeting. A motion. to adopt is on the table from the June 20, 2007 meeting when
it was subsequently postponed to July 3, 2007. The motion to enact is active.)
~~ ~ 2. Resolution No. 2007-41 -- Awarding Janitorial Contracts for the Kenai
Community Library building to Precious Janitorial Services for the Period
July 1, 2007 Through June 30, 2008.
Q~~ ~ 3. Resolution No. 2007-42 -- Authorizing the City of Kenai to Issue
d ~, i$/~~ General Obligation Bonds in the Principal Amount of Not to Exceed
$2,000,000 to Finance the Cost of Planning, Designing, Acquiring
Property for, and Constructing Kenai River Bluff Erosion Control Capital
Improvements and to Submit the Question of the Issuance of Such
Bonds to the Qualified Voters of the City at the October 2, 2007 City of
Kenai General Election.
Q~~~~4. Resolution No. 2007-43 -- Authorizing the City of Kenai to Issue
/~ ~/~~`~r~ General Obligation Bonds in the Principal Amount of Not to Exceed
$2,000,000 to Finance the Cost of Planning, Designing, Acquiring
Property for, and Constructing Library Capstat Improvements, and to
Submit the question of the Issuance of Such Bonds to the Qualified
Voters of the City of Kenai at the October 2, 2007 City of Kenai General
Electon.
p~,~, ~ , 5. Resolution No. 2007-44 -- Granting a Partial Exception to the
Subdivision Regulations Contained in KMC 14.10 for Eagle Bluff
Subdivision as Allowed Under KMC 14.10.090.
P~ ~ 6. Resolution No. 2007-45 -- Approving a Contract to Northstar Paving 8v
Construction for the Project Entitled Wildwood Water Main -June 2007
for the Total Basic Bid Amount of $359,873.00.
~~~. 7. Resolution No. 2007-46 -- Designating Department Assistant II Lorene
Hall as Deputy City Clerk.
/~~y~ ~ 8. Resolution No. 2007-47 -- Transferring $6,500 in the General Fund
/!l Land Department to Purchase Land.
G~9. Resolution No. 2007-48 -- Authorizing the Purchase of 5.44 Acres of
~~ Property Described as: TSN Rl1W Section 4 Seward Meridian KN
/~/~ 0880053--Central View Subdivision Tract B, Third Recording District,
Kenai, Alaska for $7,500 for Wetlands Mitigation and to be Retained by
the City and Reserved for Park Purposes.
P ~/, 10. Resolution No. 2007-49 -- Transferring $140,000 in the Runway
Improvement Capital Project Fund to Cover Anficipated Change Orders.
~~ ~ 11. Resolution No. 2007-50 -- Transferring $18,340.24 in the 99 Street
Improvements Capital Project Fund to Close Out a Grant.
ITEM F: MINUTES
ITEM G: UNFINISHED BUSINESS
ITEM H: NEW BUSINES5
~/~~~ t~!~ 1. Bills to be Ratified
' !" /~N'~//'~Gd -2-~1s1srtsva~~~~ Orders ce~eding X15;060- - ----
3. *Ordinanoe No. 2240-2007 -- Amending KMC 21.10.070 to Give the
Airport Commission More Authority Over Leasing Decisions Within the
Airport Reserve.
4. *Ordinance No. 2241-2007 -- Amending KMC 21.20.010 to Authorize
the Airport Commission to Make Recommendations to the City Manager
on the Airport Budget.
~(J®J-yt, 5. Discussion -- Schedule Work Session
ITEM I: COMMISSION/COMMITTEE REPORTS
1. Council on Aging
2. Airport Commission
3. Harbor Commission
4. Library Commission
5. Parks & Recreation Commission
6. Planning & Zoning Commission
7. Miscellaneous Commissions and Committees
a. Beautification Committee
b. Alaska Municipal League Report
c. Joint Kenai River Working Group
YTEM J: REPORT OF THE MAYOR
ITEM K: ADMINISTRATION REPORTS
1. City Manager
2. Attorney
3. City Clerk
ITEM L:
1. Citizens (five minutes)
2. Council
ITEM M: PENDING LEGISLATION (This item lists legislation which will be
addressed at a later date as noted.)
Ordinance No. 2202-2006 -- Amending KMC 11.05.090 to Limit the Use of the City of
Kenai Boat Launch, Located at the Municipal Harbor, to Vessels and Boats Powered
by Four-Cycle or Direct Injection Two-Cycle Engines. (1/17/07, Tabled, no time
certain.)
Ordinance No. 2220-2007 -- Amending the Official Kenai Zoning Map by Rezoning
Approximately 241.4 Acres in the City of Kenai to the Central Mixed Use Zone,
Including Parcels Currently Zoned General Commercial, Central Commercial, Light
Industrial and Suburban Residential and is Generally Located North and South of the
Kenai Spur Highway and Includes Properties Between Bridge Access Road and Upland
Street and Properties Along Main Street Loop, North Willow Street and Airport Way.
(4/4/2007, Tabled, no time certain.)
Y2econsideration of Ordinance No. 2230-2007 -- Ordinance No. 2230-2007 --
Amending KMC 21.10.090(d)(1) and (2) by Establishing Different Requirements for
Determining the Length of a Lease Extension and Extending the Maximum Term of
Lease Including Any Extension From 35 to 55 Years. (6/6/07, Tabled to July 18,
2007.)
Ordinance No. 2238-2007 -- Amending Title 11 of the Kenai Municipal Code by
Eliminating the City of Kenai Harbor Commission, Reassigning its Duties to other
Entities Within the City of Kenai and Updating Regulation of the Harbor Area.
(6/20/07, Postponed to July 18, 2007.)
Ordinance No. 2237-2007 -- Amending KMC 23.50.010(b) by Creating the Job
Class/Title of "Administrative Assistant IV" (Class Code 217) and Placing it at Range
14. (6/20/07, Postponed, No Time Certain).
EXECUTIVE SESSION -- Annual Evaluation of City Manager and City Clerk.
ITEM M: ADJOURNMENT
~~~\_
theu~of
KENA~ SKA
°V'lfa~ye witti a Past, Gc~ witti
210 Fidalgo Avenue, Kenai, Alaska 99611-7794
Telephone: (907) 283-7535 1 Fax: (907) 283-3014
www.ci.kenai:ak.us
MEMORANDUM
TO: Mayor Porter and the Kenai City Council
FROM: ~ ~"~ Cary R. Graves, City Attorney
DATE: June 13, 2007
R>/: Composition of the Airport Commission
The issue of the composition of the Airport Commission came up during the last Council
meeting. The Airport Commission is made up of seven members and anon-voting Council
liaison. Commission members do not need to be residents of the city ~ They serve three year
terms s The membership of the commission is structured as follows>4
(a) One member, fixed base operator (FBO).
(b) One member, lessee of airport aeronautical lands or terminal facility.
(c) One member, with expertise in Federal Aviation Administration functions.
(d) One member, representing the Civil Air Patrol.
(e) Three members, at-large, representing the business and professional community.
(f) One non-voting member, representing ad hoc member of the Kenai City Council.
Historically, in Kenai the at-large members representing the business and professional
community have been persons with an interest in general aviation.
In Soldotna the Airport Commission is made up of five members.' They are appoimed for three
year terms.b One is a member of The Planning and Zoning Commission, two are airport users,
and two are at-large members. One of the at-large members may be a sitting council member.
The City Manager is anon-voting ex-officio member and provides staff support.
~ KMC 21.20.030
~ KMC 21.20.020
' KMC 1.90.040
`KMC 21.20.030
s SMC 2.50.040
~ SMC 2.50.010
In Juneau, the Airport Board is made up of seven members.' They are appointed for three year
terms. The composition is "to the extent possible'' made of persons having aeronautical,
engineering, financial or other skills related to airport issues.
Please let me laiow if you have any questions or need any more information.
' csJ os.os.oio
w~~';, C,
K
Letter of Transmittal
Date: June 25, 2007
Inc
__ __ __
To: From: _ _
Kenai Municipal Airport Kenai Cafe
City of Kenai: Sherry McBride -Owner/Manager
Kenai City Manager and City Council 305 N. Willow Street, Ste. 100
Kenai, Alaska 99611
__
The Kenai Cafe will be scheduling holiday closures for the remainder of the 2007
calendar year:
• 4th of 3Uly
• Thanksgiving eve open 10:00 am to 2:00 pm
• Thanksgiving Day
• Christmas Eve
• Christmas Day
s
~~~.
_ _ -
tG,e~~~yaf
KENA1~ SKA
"V lla~e wit~r a Past, Gl~ witiLr a Future"
210 Fidalgo Avenue, Kenai, Alaska 99611-7794
Telephone: 907-283-7535 /FAX: 907-283-3014 1'I~~I
1992
MEMO:
TO: Airport Commission
FROM: Rick Koch
DATE: July 5, 2007
SUBJECT: Lease Term Within the Airport Reserve
The purpose of this correspondence is to discuss the above referenced subject. Through
the course of the last several months as administration has attempted to amend the code
to provide fora 55 year leasing schedule I have heard comments from members of the
Airport Commission and City Council in support of the existing 35 year leasing program.
I have attempted to accurately re-state those comments and provide administration's
responses below:
STATEMENT/CONCERN
A 35-year lease will protect the AirportJCity from someone securing a lease, not
developing the property, and holding onto the property for speculation purposes.
KMC 21.10.090(e) states "In the lease granted to the applicant, the City
Manager wilt include a provision requiring the applicant to substantially
complete the proposed permanent improvements within a reasonable period
of time, considering the cost and nature of the improvements. Provided
however, that the time allowed shall not ordinarily exceed 24 months after
the effective date of the lease.
The AirportlCity does not want leases granted for land speculation,
regardless of whether it is for a term of 35 years or 55 years. HIVIC
21.10.090(e) already provides the appropriate protection.
A 35-year lease will protect the Airport/City from someone securing a lease and not
developing what was agreed to in the lease agreement.
KMC 21.10.120 states, "Lease utilization. Leased lands shall be utilized for
purposes within the scope of the application, the terms of the lease and in
conformity with the ordinances of the City, and in substantial conformity
with the Comprehensive Plan and Airport Master Plan. Utilization or
development for other than the allowed uses shall constitute a violation of the
lease and subject the lease to cancellation at any time. Failure to substantially
complete the development plan for the land shall constitute grounds for
cancellation."
The AIRPORT/CITY does not want leases utilized for other than the
purposes agreed upon in the lease regardless of whether it is for a term of 35
years or 55 years. KMC 21.10.120 already provides the appropriate
protection.
A 35-year lease will protect the Airport/City from someone securing a lease and
developing something of less value than what was agreed to in the lease agreement.
KMC 21.10.120 states, "Lease utilization. Leased lands shall be utilized for
purposes within the scope of the application, the terms of the lease and in
conformity with the ordinances of the City, and in substantial conformity
with the Comprehensive Plan and Airport Master Plan. Utilization or
development for other than the allowed uses shall constitute a violation of
the lease and subject the lease to cancellation at any time. Failure to
substantially complete the development plan for the land shall wnstitute
grounds for cancellation:'
The AIRPORT/CITY does not want leases utilized for a development off less
value than what agreed upon in the lease regardless of whether it is for a
term of 35 years or 55 years. KMC 21.10.120 already provides the
appropriate protection. The City could act to cancel the lease, or based on
the specific conditions negotiatelimpose alease of a decreased term.
STATEMENT/CONCERN
The airport industry norm is a 25 to 35 year lease.
Airport Max.Initial
Lease Term Tenant
O tion s) ~ Total Term
Anchora e 55 0 55
Fairbanks 55 0 55
Juneau* 35 0 Determined by Board
Nome 55 0 55
Barrow 55 0 55
Kotzebue 55 0 55
Sitka 55 0 55
Ketchikan 55 0 55
Kodiak 55 0 55 '
Merrill
Field* 55 0 55
'
Pendleton* 20 0 Determined by Council
Pullman 40 0 40
Walla Walla* Ne otiated
Wenatchee* 5 25 30
Yakima* 30 20 i 50
Palmer* 20 20 40
Soldotna 5 25 Ne otiated
Bend 20 30 50
Bethel 55 0 55
Dillingham 55 0 55
Birchwood 55 0 55
Wasilla* ( Determined by Council
i50+Alaskan
Airports 55 0 55
The industry norm is not 25 to 35 years based on my research. Certainly not in
the State of Alaska, and not in Alaskan communities with similar populafions
providing similar services. I have spent several hours researching this issue on
the Internet and the majority of airports are in the 45-55 year range, or the term
is negotiable based on the requirements placed on the leaseholder in order to
secure financing.
STATEMENT/CONCERN
A 35 year lease will protect the Airport/City from someone securing a lease to be used for
something other than "aviation" purposes.
ICVIC 21.10.120 states "Lease utilization. Leased lands shall be utilized for
purposes within the scope of the application, the terms of the lease and in
conformity with the ordinances of the City, and in substantial conformity
with the Comprehensive Plan and Airport Master Plan. Utilization or
development for other than the allowed uses shall constitute a violation of
the lease and subject the lease to cancellation at any time. Failure to
substantially complete the development plan for the land shall constitute
grounds for cancellation."
The AIRPORT/CITY does not want leases utilized for a development that is not
for an "aviation" purpose regardless of whether it is for a term of 35 years or 55
years. KMC 21.10.120 already provides the appropriate protection. The City is
prahibited from entering into a long term lease for other than "aviation"
purposes. Ashort-term lease, or special use permit for "non-aviation" purposes
could be granted as long as there is not a competing aviation use.
STATEMENT/CONCERN
A 35-year lease period is more than adequate to support amortization and financing of
lessee-constructed improvements.
The City Council and Airport Commission have heard testimony from
professionals in the banking/finance fields and this statement is simply not
accurate.
STATEMENT/CONCERN
Fora 55-year lease period a leaseholder should provide additional. assurances to the
Airport/City for their planned development.
I have given this more than a little thought. The application process is fairly
thorough, and the amount of information required to be submitted can be very
detailed, depending on the nature of the proposed development.
I do recognize the risk/benefit of a lease of a 55-year term. To provide assurance
to the City the development will be constructed on-schedule in compliance with
the terms of the lease, I suggest requiring a performance bond for the full value
of the proposed development for any lease exceeding a 35-year term.
STATEMENTlCONCERN
By allowing an applicant to request and negotiate an option fora 20-year extension we do
not require a 55-year leasing program.
While I agree allowing a process fora 20-year lessee option does provide
some degree of assistance in addressing the issue, it makes it problematic as
every applicant will request an option to extend their lease. Adopting a 55
year leasing schedule based on development provides specific performance
criteria idenfifying lease term.
STATEMENT/CONCERN
What happens if the city manager doesn't enforce the terms of the lease?
The city manager not enforcing the terms of a lease really isn't germane to
this issue, but I did hear this comment in the context of the 35155 year leasing
program discussion. Were this to happen, the Airport Commission could
bring it to the attention of the Council and the Council could direct the
manager to enforce the terms of the lease.
Attached please find The information submitted to the Council by the administration in
support of a SS-year leasing program for properties within the Kenai Municipal Airport
Reserve Boundary.
It is my opniion that a 35-year leasing program will significantly hinder development at
the Kenai Municipal Airport. Even with a past 55 year leasing program the Kenai
Municipal Airport has not been successful in attracting anchor tenants for aviation leases.
Time and again I have heard members of the airport commission say "we have to look 50
years in the future acid ensure we have available land". I agree, but really, what would be
the problem with having to condemn a lease 35 years from now to construct new
infrastructure as a result of the demand for expanded/new/modified lease lots. The
conflicts that could occur in the future can only be a by-product of a successful and in-
demand airport. Isn't that what we all want?
In the case of airport lease properties there has to be a balance between protection of the
asset and availability as arevenue-generating vehicle. We haue strengthened substantially
our lease requirements relating to development and development schedule milestones.
Requiring performance bonds, as administration has suggested, for all leases in excess of
35 years strengthens these protections even further.
Thank you for your attention to this important issue, and I encourage you to recommend
the approval of a 55-year leasing program to the City Council.
j "I/iffa~e with a Past Gi~y wit~i a Futr~re"
.~ „~~~ 210 Fidalgo Avenue, Kenai, Alaska _99611-7794 .~~ ~~
Telephone: 907-283-7535 /FAX: 907-283-3014 i I I
__ _ , _ .~
- _ - 1992
EI~C LI~/Of
KENA~ SKA
MEMO:
TO: City Council
FROM: Rick Koch
®ATE: May 31, 2007
SUBJECT: Reconsideration Regarding Airport Reserve Land Lease
Term
The purpose of this correspondence is to discuss the above referenced subject.
Administration recommends that the term of leases, meeting required conditions, be for a
maximum term of 55 years.
Attached you will find specific information for each. of the following:
Ted Stevens International Aimort
Term of Lease: Maximum of SSyears
Fairbanks International Airport
Term of Lease: Maximum of 55 years
Juneau Municipal Airport
Term of Lease: 35 Years unless otherwise (longer term) approved by the airport board.
State of Alaska Aimorts (Over 180 airports including Nome, Barrow, Kotzebue, Kodiak,
Sitka, Ketchikan, etc.)
Term of Lease: Maximum of 55 years Includes interesting terms regarding the sale of
improvements.
Soldotna Aires
Term of Lease: Maximum of 30 years and renewal may be made thereafter on a time
basis agreeable to both city and lessee.
Wasilla Airport
Term of Lease: In accord with the policy of the Federal Aviation Administration
Bend Oregon Airport
Term of Lease: ZO Years with Tenants option to renew for three(3) terms often years
each.
I looked at a number of airports outside and generally their leases were for 50-55 years,
or built in tenant options provided for that term.
I think it just makes sense to allow fora 55 year tem for a tenant to more fully amortize
significant investments.
I'm sure there are better examples, but please take into account the following when
considering a 35 versus 55 year lease term:
1. You invest $ 2,000,000 in an improvement on airporC property.
2. You receive 30 year financing for your improvements at 8% interest.
3. Over the term of the 30 year loan you will have repaid $ 5,248,00.
4. In the case of a 35 year lease term, only sixty months (5 years) after you have
made your last loan payment you must relinquish your lease and walk away
from the improvements you. have constructed with no compensation for any
residual value.
5. In the case of a 55 year lease you have 25 years to conduct business after
making your final loan. payment, by which to fully amortize the investment in
the improvements.
h1 addition to the above, the re-sale value of a lease with significant improvements is
significantly diminished by the short term of the lease with a 35 year lease term.
Again, administration recommends the previous council action establishing a 55 year
lease period be re-confirmed. IT is also administration's intent to review the State of
Alaska's regulation as it relates to the lessor receiving compensation for improvements at
the end of the lease period. This appears to be a fair process that would promote continual
investment in leaseholder properties.
Thank you for your attention in this matter.
attachments
`j.~( ~teve~- ~-w`f( ~~ur-r
FREQUENTLYASKED QUESTIONS
Q. What kinds of activities can airport land be used for?
A. Generally, airport landshould only be used for an activity that must be on airport property due to its use and proximity to aviation facilities. The
Alaska Administrative Code, Title 17, Chapter 42, Section 990, Definitions, describes land uses and privileges as follows:
1. "Aviation Use" means any business, service, or other function that directly involves, or is necessary for, the normal operation of aircraft that use
an airport. Aviation use includes the following: aircraft loading, unloading, tietlown, parking, storage, sales, services, rental, maintenance, or
repair; sale or storage of aviation fuel and aviation petroleum products; pilot training; air charter or air taxi service; airport terminal building; air
carrier operations; aircraft ground handling; aircraft parts sales; and air traffc control tower, air navigation aid, and aviation weather
instrumentation.
2. "Auxiliary Use" mans any business, service, or other function that is neither an aviation use nor a nonaviation use and is located and carried out
on an airport for the convenience of the air traveling public, aviation businesses on the airport, or the employees necessary to the maintenance
and operation of an airport. Auxiliary use includes the following: air freight forwarding; ground transportation services not operated by the
department, such as a taxicab service, an airport limousine or shuttle service, a rental car agency, or a vehicle parking business; in-Bight
catering; hotel accommodation; restaurant service; in-terminal concessions.
3. "Nonaviation use" means any business, service, or function that is (i) not an aviation or auxiliary use; (ii) is not directly or indirectly related to
aviation or to the air traveling public; (iii) does not offer a product or service that is specially related to aircraft operations or to air transportation;
or (iv) is located or operated to derive revenue primarily from members of the public not using air transportation services. Nonaviation use
includes: grocery store, liquor store, lumber yard, agricultural activity, golf course, automobile service station, shopping center, bowling alley.
G~. What areas on the airport are available to lease?
A. We highly encourage potential tenants to contact the Leasing & Property Management Office before submitting a lease appVication for a particular
parcel or terminal building space so that our staff can work with you to help you find the right fit for your activity.
Q. Is there a list of available lots and terminal building space for lease?
A, Yes. However, you must visit the Leasing & Property Management Office to discuss your proposed activity and we will work on finding a space if
your proposed activity requires being located on Airport land or in one of the terminal buildings.
Q. Haw is the term of an Airport lease established?
A Generally, an Airport land lease term is based upon the dollar amount of investment proposed by the lessee and can be issued for up to a~
maximum of 55 years. A terminal building space lease term is usually established based on specifc business criteria and can range from 120 days (CC(((
to 5 years.
Q. May I sublease space to someone elsel
A. Generally, yes. If you are subleasing to a company or person for the same authorized uses in your original lease v~ith the Airport, the sublease is
controlled by the Airport's lease, and you must receive the Airport's prior written consent of the sublease agreement. For more detailed information,
please review the Alaska Administrative Code, Title 17, Chapter 42, Section 270.
Q: Can I assume someone's existing lease?
A. Yes, but we highly recommend you contact the Leasing & Property Management Office to determine if the lease is in good standing and if there
are any problems associated with the existing lease. Regardless of any private transactions between individuals, the existing lease remains in the
original owner's name until assignment papers are submitted and consented to by the Chief of Leasing & Property Management. For more detailed
information, please review the Alaska Administrative Code, Title 17, Chapter 42, Section 260.
Q. Can f look at a lease file?
A. Yes, lease files are public information, but we ask that you call the Leasing & Property Management Office (907-266-2420) in advance so we can
have the file available for you to review. You can request copies of files; the cost is $.25 per page (the first 10 pages are free).
Fairbanks International Airport, Transportation & Public Facilities, State of Alaska Page 1 of 5
Employee Directory DOT&PF Home.
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a FAI Brochure as
Airport Fees P[}f
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General Aviation
t Pilots Lounge
v Aircraft Tiedoti
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Leasing Airport Property
Fairbanks International Airport occupies approximately 3,550 acres and
is located about 4 miles southwest of downtown Fairbanks. The Airport
is owned and operated by the State of Alaska and is administered by the
Department of Transportation and Public Facilities (DOT&PF). The
Leasing Office at the Airport oversees approximately 188 land, terminal
building, and other contracts such as Business Activity Permits,
Commercial Passenger Vehicle Permits, and Vehicle Rental Business
Permits, and 396 aircraft tiedowns.
Frequently Asked Questions
Q. What kinds of activities can airport land be used for?
A. Generally, airport land should only be used for those uses that must
be on airport property due to its use and proximity to aviation facilities.
The Alaska Administrative Code, Title 17, Chapter 42, Section 990,
Definitions, describes land uses and privileges as follows:
1. "aviation use" means any business, service or other
function that directly involves, or is necessary for, the
normal operation of aircraft that use an airport; "aviation
use" includes the following: aircraft loading, unloading,
tiedown, parking, storage, sales, service, rental,
maintenance, or repair; sale or storage of aviation fuel
and aviation petroleum products; pilot training; air charter
or air taxi service; airport terminal building; air carrier
operations; aircraft ground handling; aircraft parts sales;
and air traffic control tower, air navigation aid, and
aviation weather instrumentation.
Airpark
b Airline Agreemel
} FAI News
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• Leasing Airport Property • Forms
• Frequently Asked Questions • Links
• Lease Application Process • Contacts
Fairbanks International Airport, Transportation & Public Facilities, State of Alaska Page 2 of 5
2. "auxiliary use" means any business, service, or other
function that is neither an aviation use nor a nonaviation
use and is located and carried out on an airport for the
convenience of the air traveling public, aviation business
on the airport, or the employees necessary to the
maintenance and operation of an airport; "auxiliary use"
includes the following: air freight torwarding, ground
transportation services not operated by the department,
such as a taxicab service, an airport limousine or shuttle
service, a rental car agency, or a vehicle parking
business; in-flight catering; hotel accommodation;
restaurant service.
3. "nonaviation use" means any business, service, or
function that is (i) not an aviation or auxiliary use; (ii) is
not directly or indirectly related to aviation or to the air
traveling public; (iii) does not offer a product or service
that is specially related to aircraft operations or to air
transportation; or (iv) is located or operated to derive
revenue primarily from members of the public not using
air transportation services; and includes a grocery store,
liquor store, lumber yard, agricultural activity, golf course,
automobile service station, shopping center, and bowling
alley.
Q. How do I find out what lots or terminal building areas are available for
lease?
A. Contact the Leasing Office to discuss your proposed activity and we'll
show you what's available and work with you to find an appropriate
space, provided that your proposed activity requires being located on
Airport land or in the terminal building. We highly encourage potential
tenants to contact the Leasing Office before submitting a lease
application for a particular parcel or terminal building space so that our
staff can work with you to help find the right fit for the activity you'd like
Q. How is the term of an Airport Lease established?
A. Generally, an Airport land lease term is based upon the dollar amount
of investment proposed by the lessee and can be issued for up to a
maximum of 55 years. Lease term tables show the maximum term that
will be considered for a dollar amount of investment. A terminal building
space (ease term is usually established on specific business criteria and
may range from 120 days to 5 years. More infoPtkF
Q, May I sublease space to someone else?
A. Generally yes, provided that 1) you sublease to a company or person
for fhe same authorized uses in your original lease with the Airport; 2)
the sublease is controlled by the Airport's lease; and 3) you receive the
Airport's prior written consent to the sublease agreement. More
infot'tr
Q. Can 1 assume someone's existing lease?
A. Yes, but we highly recommend you contact the Leasing Office to
determine if the lease is in good standing and if there are any problems
associated with the lease you are interested in assuming. Regardless of
any private transactions between individuals, the existing lease remains
in the original lessee's name until assignment papers have been
submitted and consented to by the Chief of Leasing. More infoPO~
Q. What costs associated with leasing land at the Airport is a lessee
responsible for?
A. The lessee is responsible for all costs associated with development
of the property, including a site survey, bringing utilities onto the site,
driveways, taxilane access, all costs of construction, as-built drawings
Juneau Municipal Airport
(b) Leasing authorized. Land or facility space shall be leased as provided in chapter
53.20, provided that the provisions of sectiorr53.20.020 relating to a declaration of
availability and identification in the land management plan shall not apply.
Notwithstanding any provision of this Code, lei es maybe awarded without review by
the plamling commission and by negotiation, provided that such negotiation is subject to
he nand annr_ a~minimum rental and other requirements of chapter 53 20,x.-----
. otwithstanding any provision ofthis Code, the maximum term for a lease at the airport
Z~shall be 35 yearsunless otherwise approved by the airport board. The airport manager-
shall maintain a master plat of the airport depicting a ease ots and areas, and shall
have the authority to negotiate leases subject to approval by the airport board. Airport
],eases. shall not include a term which requires airporC purchase or reversion of leasehold
improvements for less than 100 percent of fair market value. No lease for real property
shall be offered unless such real property is surveyed and identified on the master plat.
All ],eases shall contain a description of the leased property consistent with the master
plat. The master plat shall be changed, amended, or created by a registered land surveyor.
Grades for structures shall be consistent with the airport master plan. Lessees proposing
construction shall bear the responsibility for building to grades specified by the airport
manager.
State of Alaska
2006 Alaska Statutes
Title 2
Sec. 02.15.090. Operation and use privileges.
(a) In operating an airport or air navigation facility owned or controlled by the
state, the department may enter into contracts, leases, and other arrangements
covering periods not exceeding 55 years with a person, municipality, or the
United States, granting the privilege of using or improving an airport or air
navigation facility or a portion of it or space in it for commercial, governmental, or
other public purposes, including private plane tie down, or conferring the privilege
of supplying goods, commodities, services, or facilities at an airport or air
navigation facility. The department may establish the terms and conditions and
fix the charges, rentals, and fees for the privileges or services that are
reasonable and uniform for the same class of privilege or service. Charges,
rentals, or fees authorized by this subsection may be fixed for the international
airports by order of the commissioner or by negotiated or competitively offered
contract. Notwithstanding AS 37.14.050 (a), the fixing of charges, rentals, or fees
as permitted under this subsection is not subject to the adoption of regulation
provisions of AS 44.62 (Administrative Procedure Act). The terms, conditions,
charges, rentals, and fees shall be established with due regard to rile property
and improvements used and the expense of operation to the state. A charge,
rental, or fee imposed on a person who is not a lessee or concessionaire of the
airport may not have the effect of charging a percentage of the gross revenue of
the person as a condition of on-site access to customers who use the airport
facility unless the charge, rental, or fee was in existence before January 1, 2006,
and this exception is not affected if the department amends, increases, or
decreases a charge, rental, or fee that was in effect before January 1, 2006. Use
of state land and buildings by the Alaska Wing, Civil Air Patrol and its squadrons
shall be permitted without rental charges. If the department permits space in
state-owned or state-controlled airports to be used as lounges for members of
the United States armed forces, the Alaska National Guard, the Alaska Naval
Militia, or the Alaska State Defense Force, and if the lounges are operated by
persons exempt from taxation under 26 U.S.C. 501(c)(3)(Internal Revenue
Code), rent may not be charged for the use of the space. The department shall
provide for public notice and an opportunity to comment before a charge, rental,
or fee is fixed by order of the commissioner as permitted under this subsection.
The public may not be deprived of its rightful, equal, and uniform use of the
airport, air navigation facility, or a portion of them.
(b) The department may by contractor other arrangement, upon a
consideration fixed by it, grant to a qualified municipality or person for a
reasonable period of time the privilege of operating, as agent of the state or
otherwise, an airport owned or controlled by the state. A municipality or person
granted that privilege may not operate the airport other than as a public airport or
enter into a contract, lease, or other arrangement in connection with the
operation that the department may not have undertaken under (a) or (c) - (e) of
this section.
(c) Notwithstanding the right of the public to rightful, equal, and uniform use
under (a) of this section, before the expiration of a land lease, including the
termination of a lease in holdover status, entered into under this section, the
lessee may apply for a new lease, or for an extended term under the existing
lease, for the same land. The commissioner shall approve the application for a
new land lease or an extended term under this section without offering the land
to other persons for leasing if
(1) the lessee is in compliance with the terms and conditions of the existing
or holdover lease; and
(2) the continued use of the leasehold is consistent with written airport
operation policies and is in the state's best interest.
(d) A land lessee owns title to the permanent improvements that the lessee
constructed or purchased during the term of the (ease, unless the lease
expressly provides that the state is the owner of the permanent improvements.
(e) At the expiration, termination, or cancellation of a land lease entered into
under this section,
(1) a lessee who owns the improvements under (d) of this section shall
continue to own the permanent improvements that the lessee constructed or
purchased on a leasehold if the lessee is granted under (c) of this section a new
lease or an extended term for the same land;
(2) a lessee may sell the permanent improvements owned by the lessee to a
succeeding lessee of the same land;
(3) at the option of the lessee, the permanent improvements owned by the
lessee may be sold by the state at public auction with the proceeds from the sale
of the improvements going to the lessee, less administrative costs of the auction
and obligations owed under the lease to the state; the successful bidder has the
same right to enter into a new lease under (c) of this section without the
department offering the land to other persons for leasing;
(4) after notice by the department, the permanent improvements owned by
the lessee shall be removed at the lessee's sole expense if
(A) the permanent improvements do not comply with written airport
operational policies or are not in the state's best interest;
(B) the permanent improvements are not sold under (2) or (3) of this
subsection; or
(C) the department makes written findings that the permanent improvements
are a hazard to the public health and safety;
(5) title to the permanent improvements vests in the department if the state
purchases or otherwise contracts for the ownership of the permanent
improvements, or if the lessee abandons the permanent improvements.
C~`f~ o~ ~~~~~o-f-~~
93.04.330 Commercial lots and aviation service leases.
Leases for aviation related services may be entered into for a maximum of thirty years,
and renewal may be made thereafter on a time basis agreeable to both city and lessee.
The rental for such a lease shall be equitable and comparable to current commercial or
business lease rates. Any building or development plans by the lessee shall be submitted
to the city council for approval and shall state the intent of such building or development in
writing. (Ord. 97 (part), 1976: prior code § 28.07.050).
~~~~~~1~
5.32.120 Lease of airport property.
A. General. This section applies to the lease of airport property, to
the exclusion of the provisions of all other sections of this chapter.
/-lirport property may be leased through an application or sealed bid
process.
B. Application Process. An applicant desiring to lease airport
property shall submit an application to the city. The application shall
contain:
1. Name, address and phone number of applicant;
2. Identification of area requested;
3. A description of the activity to be conducted;
4. A scale drawing depicting the proposed development,
including but not limited to location, size and height of
buildings, identification of materials to be installed on the
property, and proposed location of all utility connections. This
drawing must show the relationship between the development,
the property lines, and any relevant development on adjacent
or other properties,
5. If the proposed use is commercial, a written business plan
for the activity to be conducted; and
6. Any and all additional information which may be requested
by the city.
C. Action On Application. The city shall process applications
depending upon use as follows:
1. For private use, such as a hanger or tie-down, where the
building is less than ten thousand (10,000) square feet, and the
term of the Isase is Yen (10) years or less, the application and
lease may be approved by the mayor after administrative
review and evaluation.
2. For a small commercial use, where the building is less than
ten thousand (10,000) square feet and the term of the lease is
ten (10) years or less, the application and tease may be
approved by the mayor after administrative review and
evaluation.
3. For any other use, the application will be reviewed by
administration, submitted to the planning commission for
review and recommendation, and then submitted to the city
council for final action. Private or small commercial use may
also be submitted to the planning commission and the city
council if, in the opinion of the mayor, such submittal is
appropriate under the circumstances.
4. For all uses, the city may accept, reject or place conditions
on the acceptance of any application to lease airport property.
The city may also require the prepayment by applicant of
certain necessary costs such as administrative costs,
surveying, subdividing, utility installation, soils testing, etc.
D. Sealed Bid Process. The city council may make specific areas
of the airport available for lease for general or specific development
through a sealed bid procedure under conditions to be specified by
the city council. In this process, the city reserves the right to take
into consideration factors other than tease rate, and may award the
property to any bidder whose proposal is deemed to be in the best
interests of the city, regardless of lease rate proposed. In addition,
the city reserves the right to reject any and all bids or proposals.
E. Lease Form. A lease for irp~Ort property shall include certain
provisions, as follows:
1. A requirement that the use of the property be in accord with
the airport development plan, and that the use of the property
shall not violate any condition or requirement placed on the
property or the airport itself by the city, the state of Alaska, or
the Federal Aviation Administration;
2. Lease rate, term, rental adjustment and other provisions
5.32.120 Lease of airport property.
A. General This section applies to the tease of a~rpprG property, to
the exclusion of the provisions of all other sections of this chapter.
P~it-port property may be leased through an application or sealed bid
process.
B. Application Process. An applicant desiring to lease a~rpoit
property shall submit an application to the city. The application shall
contain:
Name, address and phone number of applicant;
2. Identification of area requested;
3. A description of the activity to be conducted;
4. A scale drawing depicting the proposed development,
including but not limited to location, size and height of
buildings, identification of materials to be installed on the
property, and proposed location of all utility connections. This
drawing must show the relationship between the development,
the property lines, and any relevant development on adjacent
or other properties;
5. If the proposed use is commercial, a written business plan
for the activity to be conducted; and
6. Any and all additional information which may be requested
by the city.
C. Action On Application. The city shall process applications
depending upon use as follows:
1. For private use, such as a hanger or tie-down, where the
building is less than ten thousand (10,000) square feet, and the
term of the lease is ten (10) years or less, the application and
(ease may be approved by the mayor after administrative
review and evaluation.
2. For a small commercial use, where the building is less than
ten thousand (10,000) square feet and the term of the lease is
ten (10) years or less, the application and lease may be
approved by the mayor after administrative review and
evaluation.
3. For any other use, the application will be reviewed by
administration, submitted to the planning commission for
review and recommendation, and then submitted to the city
council for final action. Private or small commercial use may
also be submitted to the planning commission and the city
council if, in the opinion of the mayor, such submittal is
appropriate under the circumstances.
4. For all uses, the city may accept, reject or place conditions
on the acceptance of any application to (eae at1'pQ property.
The city may also require the prepayment by applicant of
certain necessary costs such as administrative costs,
surveying, subdividing, utility installation, soils testing, etc.
D. Sealed Bid Process. The city council may make specific areas
of the ajrpork available for (ease for general or specific development
through a sealed bid procedure under conditions to be specified by
the city council. In this process, the city reserves the right to take
into consideration factors other than lease rate, and may award the
property to any bidder whose proposal is deemed to be in the best
interests of the city, regardless of ease rate proposed. In addition,
the city reserves the right to reject any and all bids or proposals.
E. Lease Form. A (ease for ejrpQrf property shall include certain
provisions, as follows:
1. A requirement that the use of the property be in accord with
the airport development plan, and that the use of the property
shall not violate any condition or requirement placed on the
property or the airport itself by the city, the state of Alaska, or
the Federal Aviation Administration;
2. pease rate, term, rental adjustment and other provisions
that are in accord with the requirements and policy of the
Federal Aviation Administration;
3. A provision prohibiting assignment or sublease without the
approval of the city; and
4. A provisian authorizing the granting of a security interest by
the lessee in the leasehold interest for the purpose of securing
financing for the construction of improvements on the property.
F. No Warranties. By classifying or ~easipg a[rj~ork property, the city
expressly does not warrant that the land is suited for the use
proposed or authorized under the classification or lease; and no
express or implied warranty or guaranty is given as to the present
or any future condition of the property or that it shall be profitable to
employ the land for the proposed or authorized use. (Prior code §
7.16.125)
that are in accord with the requirements and policy of the
Federal Aviation Administration;
3. A provision prohibiting assignment or sublease without the
approval of the city; and
4. A provision authorizing the granting of a security interest by
the lessee in the leasehold interest for the purpose of securing
financing for the construction of improvements on the property.
F. No Warranties. By classifying or leasrrjg ~jcPQlt property, the city
expressly does not warrant that the land is suited for the use
proposed or authorized under the classification or teaae;, and no
express or implied warranty or guaranty is given as to the present
or any future condition of the property or that it shall be profitable to
employ the land for the proposed or authorized use. (Prior code §
7.16.125)
~w~ V ~ bn
1.3.10 The sole right to determine the level, methods and schedules of any maintenance or
improvements at the Airport; and shall have the right to close the Airport whenever
Landlord deems it necessary for reasons of public safety or convenience.
1.4 No Limitation. on Landlord's Authority: Nothing stated herein shall be construed as to
limit in any way the general power and. right of Landlord to exercise its governmental or
proprietary powers in any way, including such as may affect the Airport, the Premises,
the Common Areas, or any other area under the jurisdiction of Landlord.
1.5 Restrictions on Use. Except as necessary and incidental to the use specifically
authorized for the Premises pursuant to Section 1.2 of this Leasa, and without limiting the
generality of the restriction on the use set forth in Section 1.2 of this Lease, no use may
be made of, on, or from the Premises relating to the use, handling, generation, storage,
disposal, transportation, or discharge of Hazardous Substances as defined in Article 6 of
this Lease. Under no circumstances shall any use be made of, or conduct occur on, the
Premises which would cause the Premises, or any part thereof, or the improvements
constructed on the Premises, to be deemed a hazardous waste treatment, storage, or
disposal facility requiring a permit, interim status, or any other special authorization
under any Environmental Law as defined in Article 6 of this Lease.
1.6 Access to Premises. Landlord shall at all times during ordinary business hours have the
right to enter upon the Premises and Improvements for the puzposes o£ (i) inspecting the
same; (ii) confirming the performance by Tenant of its obligations under this Lease; (iii)
doing any other act which Landlord maybe obligated or have the right to perform under
this Lease, or reasonably related thereto; and (iv) for any other lawful purpose. Such
inspections shall be made only on 48 hour advance notice except in cases of emergency.
Such notice shall be sufficient if prominently posted on the primary building for 48 hours
prior to the inspection. n _.-,
Article 2. Term
2.1 Term. The term of this lease is for a period of 20 years, commencing May 1, 2005, and
continuing through Apri130, 2025, unless sooner terminated under the provisions of this
Lease.
2.2 Options to Renew.
2.2.1 Subject to the terms of this Section 2.2, Tenant shall have the option to renew the term of
this Lease for Three (3) terms often years each, to run concurrent with the expiration of
the Primary Term, and each renewal term.
3 - BBST, LLC Ground Lease