MORE FROM THE FAA ON HANGAR RENT

This is from the previous post, “THE FAA ON HANGAR RENT”.

In order to demonstrate compliance with federal grant obligations, a corrective action plan is required which documents that the City’s current lease agreement with AirEvac is consistent with the City’s rental structure for businesses operating at the Airport. An acceptable corrective action plan would also include a City commitment to modifying its lease with AirEvac at the next available opportunity to include an escalation provision which would increase AirEvac’s rent at the same rate as the other airport tenants in order to work towards achieving airport self-sufficiency.

After reading AirEvac’s lease I do not think the city can raise their rental rate.   I have read decisions in the part 16 database where the FAA could not enforce a change in a signed lease.  The Airevac lease might have an automatic renewal, and an increase apparently must be mutually agreeable between the two parties.   So if Airevac does not agree to an increase, it looks like the city cannot push the issue.  Who knows?

 So as it stands now, if the city can raise the Airevac rate, Airevac and the city must mutually agree on a lease rate, but the fixed wing tenants do not have that option.  The mayor stated in the last meeting that the city sets the hangar rates, not the tenants, but that does not apear to be true for Airevac.