Coversheet

ADMINISTRATIVE REPORT

MEETING DATE: 6/28/2023

Consent – Agreements ai.

TO:	Honorable Mayor and City Council
FROM:	Gregg Strakaluse, Public Works Director
DATE:	6/7/2023
WARD:	Ward 1
SUBJECT:	Amendment No. 3 to Agreement No. 93-102 (extending term) for Bakersfield Municipal Airport Long-Term Ground Lease Agreement with Alex Goff for Hangar Space A7.
STAFF RECOMMENDATION: Staff recommends approval of the amendment.
BACKGROUND: The Long-Term Ground Lease Agreement for Hangar A-7, currently leased to Alex Goff, has completed the full term of the lease and will terminate on May 31, 2023. At the end of the term, the lease agreement allows Alex Goff to remove Hangar A-7 at his expense. It is desirable for Hangar A-7 to remain at the airport to continue to have aviation-related use under airport ownership. This will allow the airport to continue to lease Hangar A-7 to produce income that can be used to pay for airport expenses and maintenance. Staff recommends one (1) additional five (5) - year extension exchange for the addition of a reversion clause at the end of the five (5) - year extension. That would allow the hangar to become the property of the City at the end of the five (5) - year lease and the City could then rent out the hangar at the fair market rate for the remaining life of the hangar. Alex Goff benefits because he would only pay the land lease rate (which is a smaller rate) for the next five (5) years and not the fair market rental rate.