HomeMy WebLinkAbout10983RESOLUTION NO. 10983
A RESOLUTION APPROVING A HANGAR LEASE AGREEMENT BETWEEN THE CITY OF
PUEBLO, A MUNICIPAL CORPORATION, AND STEEL CITY AVIATION, LLC, AND
AUTHORIZING THE PRESIDENT OF CITY COUNCIL TO EXECUTE SAME
BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO. that:
SECTION 1.
A certain Lease Agreement, a copy of which is attached hereto and made a part hereof by
reference, after having been approved as to form by the City Attorney, by and between the City of
Pueblo, a Municipal Corporation, and Steel City Aviation, LLC, for land, hangar and other
improvements located at Pueblo Memorial Airport, by and the same is hereby approved, subject to
the conditions as set forth in said Lease Agreement.
SECTION 2.
The President of City Council is hereby authorized to execute said Lease Agreement on
behalf of Pueblo, a Municipal Corporation, and the City Clerk shall affix the Seal of the City thereto
and attest the same.
INTRODUCED April 23, 2007
BY Randy Thurston
Councilperson
APPROVED:
RRESIDIENTof City Council
ATTESTED BY:
CITY CLERK
,Ri- S. /09 y3
Background Paper for Proposed
RESOLUTION
AGENDA ITEM # 5
DATE: April 23, 2007
DEPARTMENT: AVIATION - JERRY BRIENZA
TITLE
A RESOLUTION APPROVING A HANGAR LEASE AGREEMENT BETWEEN THE
CITY OF PUEBLO, A MUNICIPAL CORPORATION, AND STEEL CITY
AVIATION, LLC, AND AUTHORIZING THE PRESIDENT OF CITY COUNCIL TO
EXECUTE SAME
ISSUE
Should the City Council approve a Hangar Lease Agreement for land, hangar and other
improvements at Pueblo Memorial Airport between the City and Steel City Aviation,
LLC?
RECOMMENDATION
Approval of this resolution.
BACKGROUND
Steel City Aviation will use and occupy the facility to conduct business activities
associated with a flight school and aircraft maintenance. The lease is for a term of one
month commencing May 1, 2007 and will automatically be renewed each month unless
terminated by either party.
FINANCIAL IMPACT
Steel City Aviation will lease the land, hangar and other improvements for the rental of
$860 per month, a combined service fee of $41.77 per month, and 2% of the monthly
gross revenues.
PUEBLO MEMORIAL AIRPORT
HANGAR "F" LEASE AGREEMENT
This Lease Agreement entered into this 23rd day of Apr 1 , 2007, between the City of Pueblo, a Municipal
Corporation, herein called Lessor, and Steel City Aviation, L.L.C. a Colorado corporation, herein called Lessee,
Witnesseth:
That in consideration of the payment of rent hereinafter provided and the keeping and performance of each of the
covenants and agreements of the said Lessee hereinafter set forth, said Lessor has and does hereby lease unto the
said Lessee the real property marked "Lease Boundary" on the plot plan, Exhibit "A ", attached hereto and made a
part hereof, together with the following structures thereon, at the Pueblo Memorial Airport, hereinafter called
Airport, in the County of Pueblo, State of Colorado, to wit:
A one -story hangar /shop /office building of approximately three thousand nine hundred forty five square
feet (3,945 SF). (Collectively, the real property and structures are herein referred to as "leased premises'.
To have and hold the same unto the said Lessee for a term of one calendar month, commencing May 1, 2007.
Said term shall automatically be renewed each month unless terminated by either party by written notice delivered
to the other party at least 14 calendar days prior to the date of termination, at a rental of $860.00 per month for
the leased premises. In addition, Lessee shall pay a monthly fee to Lessor for the Lease herein granted of two
percent (2 %o) of Lessee's monthly gross revenues derived from all sales, operations and services made, furnished or
conducted on or from the leased premises.
Lessee shall also pay combined service fee for services and facilities now furnished by the Lessor at the Pueblo
Memorial Airport, namely: public street maintenance, fire protection and Street lighting based upon the amount
established by Lessor which is currently $499.92 per acre per year. The Lessor may, from time to time, reduce,
alter, or eliminate any or all of the services or facilities presently being furnished and may modify, increase, or
decrease the annual combined service fee therefore and the manner by which it is calculated, including making
separate charges, therefore, provided (1) such services and fee shall be nondiscriminatory among other tenants and
owners of land at Pueblo Memorial Airport receiving such services and facilities then being furnished and (2) such
fee shall be reasonable in relation to the Lessor's actual cost and expense of furnishing the services and facilities
then being furnished. The Lessor's cost may include the cost of capital improvements amortized over the useful
life of the improvements. Only domestic wastewater shall be discharged from the leased premises to Lessor's
sanitary sewer system. Lessee shall be subject to the same restrictions, conditions, fees and charges as other users
of Lessor's sanitary sewer system.
All such rent and fees shall be paid in advance without notice on or before the tenth day of each calendar month
throughout the effective term, at a place to be designated by the Lessor.
RIGHTS AND PRIVILEGES OF LESSEE
A. The leased premises shall be used and occupied by Lessee as a facility to conduct aeronautical
business activity associated with a flight school and aircraft maintenance operation including, but
not limited to, the following services: aircraft storage, rental and sales; flight training; aircraft
service and maintenance and other such incidental purposes directly related to such use including
storage of aircraft equipment and parts. Lessee shall have no right to utilize the leased premises,
or any improvement thereon, other than as specifically allowed under this subsection, and it is
specifically understood that the leased premises shall not be used for an aviation fixed base
operation, for the sale of aviation fuel, or to dispense aviation fuel in aircraft other than aircraft
owned or leased by Lessee. Lessee shall not assign nor sublet the leased premises without the
prior written approval of the Lessor.
B. Lessee, it's employees and invitees shall have the right to ingress and egress between the main
entrance of the airport as the same now exists or may hereafter be relocated and the leased
premises over, upon and through such streets and no other as from time to time shall be
designated by the Director of Aviation.
2. RIGHTS AND PRIVILEGES OF LESSOR
A. All rights not herein granted to the Lessee are reserved to Lessor and nothing herein contained
shall be construed to grant or authorize the granting or an exclusive right within the meaning of
Section 308 of the Federal Aviation Act of 1958.
B. Lessor shall have full and unrestricted right to enter upon the leased premises, and Lessor, it's
agents or representatives shall be permitted to inspect same at any reasonable hour.
C. Lessor reserves the right to maintain and keep in repair the landing area of the Airport and all
publicly owned facilities of the Airport but shall not be obligated to the Lessee for any failure to
so maintain or keep in repair.
D. There is hereby reserved to the Lessor, it's successors and assigns, for the use and benefit of the
public, a right of flight for the passage of aircraft in the airspace above the surface of the
premises hereby leased, together with the right to cause in said airspace such noise as may be
inherent in the operation of aircraft, now known or hereafter used for navigation of or flight in
the au, using such airspace or landing at, taking -off from, or operating on Pueblo Memorial
Airport.
E. It is further understood and agreed that this agreement is subject to written prior approval of the
Federal Aviation Administration and that the provisions hereof cannot be modified without prior
written approval by said Federal Aviation Administration.
3. OBLIGATIONS OF LESSEE
A. The Lessee agrees to indemnify, defend, and save the Lessor, it's agents, officers, representatives and
employees, harmless from and against any and all penalties, liability or loss including costs and
attorney fees resulting from claims or court action, whether civil, criminal or in equity, and arising
directly or indirectly out of acts of the lessee, his agents, employees, or servants in connection with its
use or occupancy of the leased premises, or through any injury or casualty occurring on the leased
premises. The provision of this section shall survive the termination of this Lease.
B. Except as provided in 4.A. below, Lessee shall maintain and keep the leased premises in good
condition and repair. Lessee shall be responsible and liable for all fuel releases and spills occurring on
the leased premises including clean -up and remediation thereof.
4. OBLIGATIONS OF LESSOR
A. Lessor shall maintain the floor, walls, roof and doors of said premises, except that the cost of
repairs for any damages to the same caused by Lessee, his employees, agents or invitees shall be
home solely by Lessee.
B. All risk of loss or damage to aircraft and other personal property in or upon the leased premises
is assumed by Lessee, and Lessor shall not be liable or responsible for any loss or damage to such
aircraft and other personal property regardless of the cause thereof, including, without limitation,
the negligence of Lessor, its officers, agents or employees.
5. GENERAL CONDITIONS
A. The terms and conditions of this lease and Lessee's rights hereunder are hereby made subject to
the provisions of Title III Chapter 1 of the Pueblo Municipal Code and as same may be
subsequently amended. In the event of conflict between said Code and any provision herein,
said Code shall control.
B. The Lessee in the operations to be conducted pursuant to the provisions of this lease and
otherwise in the use of the Airport, will not discriminate or permit discrimination against any
person or class of persons by reason of race, color, religion, sex, or national origin in any manner
prohibited by Part 21 of the Regulations of the Office of the Secretary of Transportation, or any
amendments thereto. The Lessor reserves the right to take such action as the United States
Government may direct to enforce this covenant
C. The Lessee by accepting this lease expressly agrees that it will not make use of the leased
premises in any manner which might interfere with the landing and taking -off of aircraft from
Pueblo Memorial Airport or otherwise constitute a hazard. In the event the aforesaid covenant
is breached, the Lessor reserves the right to enter upon the premises hereby leased and cause the
abatement of such interference at the expense of the Lessee.
D. This lease and all the provisions hereof are subject to all rights the United States Government
now has or in the future may have or acquire, affecting the control, operation, regulation, re-
entry upon and taking over of the said Airport including the leased premises.
E. The Lessee shall observe faithfully all rules and regulations affecting use of the Airport, whether
established by the Director of Aviation, by the City, or other political subdivision having
jurisdiction, by the State of Colorado or the United States, or agencies thereof, including but not
limited to rules affecting the operation of motor vehicles upon, to and from the Airport.
F. The Lessee, and all officers, agents and employees of Lessee, hereby agree to be bound by and
subject to all the Police Ordinances of Pueblo, a Municipal Corporation, at all times while on the
Airport, whether acting in the course of Lessee's business or otherwise, to all intents and
purposes the same as though the leased premises were located within the City Limits of Lessor.
G. The Lessee represents that it has inspected the leased premises, the Airport and all of it's
premises and facilities and that it accepts the conditions of same and fully assumes the risk
incident to the use thereof. Lessee acknowledges and agrees that the leased premises are being
leased in the present condition, "AS IS WITH ALL ITS FAULTS" without warranty or
representation of any kind, express or implied including, without limitation, any warranties of
fitness for a particular purpose. The Lessor shall not be liable to the Lessee for any damages or
injuries to the property or personnel of the Lessee which result from hidden, latent or other
dangerous conditions on the Airport or leased premises.
H. Lessee agrees that no inflammable liquids or hazardous materials shall be used or stored in the
premises, except the fuel in the aircraft and fuel trucks.
It is expressly understood that no person other than the Lessee or his regular employee may
perform services (including, but not limited to, maintenance and repair) on any aircraft on the
leased premises.
J. Lessee agrees to provide drip pans of a non - inflammable material under the aircraft to prevent
damage to the floor from dripping oil or fluid.
K. It is expressly understood by Lessee that security in the hangar area as elsewhere on the
Airport is vital. Only owners of aircraft hangared therein, their employees or invitees will be
permitted in the area and the aircraft owner shall be responsible for the actions of these
people. Violations of Airport Security Rules shall be sufficient grounds for termination of
this agreement.
6. Mobile Refuelers (Fuel Trucks
A. Lessee shall:
(1) maintain mobile refuelers in good operating condition and repair. All refuelers
are subject to inspection by City personnel to ensure compliance with FAR
Part 139 standards;
(2) immediately notify the Lessor of any fuel release or spills during the loading or
unloading of the fuel when fueling or maintaining aircraft. Lessee shall be
responsible for clean up to the satisfaction of Lessor of any such fuel releases
or spills whether caused by Lessee, its officers, agents, employees, or
contractors.
B. Lessee shall maintain pollution liability insurance covering the mobile refuelers which
are being used by Lessee. Such insurance shall be in limits of $1 million each incident,
$1 million aggregate, with a $10,000 deductible.
C. Lessee's mobile refuelers and Lessee's use thereof shall meet and comply with all
applicable EPA spill prevention control and countermeasure regulations including, if
required, drafting and implementing SPCC Plan therefor.
Taxes and Licenses
Lessee covenants and agrees to pay promptly all valid taxes and other government charges of
whatever nature assessed against or applicable to the leased premises, Lessee or Lessee's property
or operations thereon. Lessee shall not make any improvements to the leased premises without
prior written consent of Lessor. Lessee also covenants and agrees not to permit any mechanic's
or material man's lien to be filed against the leased premises or any part or parcel thereof by
reason of any work or labor performed or materials furnished by any contractor, subcontractor,
mechanic or material man. Lessee further covenants and agrees to pay promptly when due all
bills, debts and obligations incurred by it in connection with its operations on the leased premises
and not to permit the same to become delinquent and to suffer no lien, mortgage, judgment or
execution to be filed against the leased premises which will be in any way an impairment of the
rights of Lessor under this Lease Agreement.
8. Insurance and Damage
A. At all times during the term of this Lease Agreement, and of any renewal or extension
hereof, Lessee agrees that it will, at its own costs and expense, provide and keep in force
airport and commercial general liability insurance which includes personal injury,
products liability, hangar keepers general liability, and property damage with a combined
single limit of not less than one million dollars ($1,000,000). Lessee shall insure the
structures and other improvements in an amount equal to their full insurable value
naming Lessor as a loss payee. Lessee shall provide workers' compensation insurance
complying with the Colorado Workers' Compensation Act. Lessee shall provide Lessor
with copies showing proof of such insurance and subsequent renewals or changes as
might occur during the term of this lease. With respect to any insured loss to the leased
premises, structures and property thereon, including aircraft, Lessee releases Lessor, it's
officers, agents, and employees from any claim or liability Lessee may have on account
of such loss and waives any right of subrogation which might otherwise exist in or occur
to any person on account thereof.
B. Such polices shall provide that they may not be materially changed, altered, or canceled by the
insurer during its terms without first giving ten (10) days written notice by certified or registered
United States mad to the parties to this lease.
C. The parties shall not violate the terms or prohibitions of any insurance policy herein required to
be furnished.
D. If the structures or other improvements (the "Improvements' are damaged or destroyed by fire
or other casualty, Lessee shall within one hundred twenty (120) days from the occurrence of such
casualty either (1) repair and restore the damaged or destroyed Improvements, (2) demolish the
damaged or destroyed Improvements, restore the leased premises to their original condition, and
terminate this Lease, in which event the net proceeds of the property damage insurance required
to be provided by Lessee pursuant to Section B.A. shall be retained by Lessor, or (3) demolish
the damaged or destroyed Improvements and commence construction of replacement
Improvements, and thereafter complete such construction within nine (9) months from the
occurrence of such casualty. All repairs to or restoration of Improvements and /or construction
of replacement Improvements shall be in compliance with applicable laws and codes, and in
accordance with plans and specifications therefore approved by Lessor, which approval will not
be unreasonably withheld. Except in the event of (2) above, the net proceeds of property
damage insurance provided by Lessee pursuant to Section B.A. shall be released by City and
paid to Lessee for the purpose of Lessee repairing, restoring or replacing improvements damaged
or destroyed by such insured fire or other casualty. Rent shall be proportionately abated during
the period from the date of the occurrence of such casualty to the completion of repairs,
restoration or replacement based upon the square feet of the improvements damaged by such
casualty.
9. MISCELLANEOUS PROVISIONS
A. That no assent, expressed or implied, to any breach of any one or more of the covenants and
agreements hereof, shall be deemed or taken to be a waiver of any succeeding or other breach.
B. Lessee shall pay all utilities and fees supplied to and used in or on the Leased Premises, and shall
enter into separate agreements with the utility organizations for metering such services.
C. In the event of any litigation arising out of this Lease, the court shall award to the prevailing party its
costs and expense, including reasonable attorney fees. Venue for any such litigation shall be Pueblo
County, Colorado.
D. That all covenants and agreements in this lease contained shall be binding upon and inure to the
benefit of the heirs, successors, assigns and legal representatives of said Lessor and said Lessee.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed as of the day and year
fast above written.
LESSOR
CITY OF PUEBLO,
A Municipal Corporation
By
Judy \ aver
Title: Presi ent of City Council
LESSEE:
STEEL CITY AVIATION, LLC
7
By' I/
Derek G(fova, President /Owner
Attest:
City (26rk
Approved as to form:
City Attorney