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HomeMy WebLinkAbout13663 RESOLUTION NO. 13663 A RESOLUTION APPROVING A HANGAR LEASE FOR SPACE WITHIN HANGAR 522 AT PUEBLO MEMORIAL AIRPORT BETWEEN THE CITY OF PUEBLO, A MUNICIPAL CORPORATION, AND DB AERO, LLC, DBA STEEL CITY AVIATION AND AUTHORIZING THE PRESIDENT OF CITY COUNCIL TO EXECUTE SAME WHEREAS, the City of Pueblo is the owner and operator of the Pueblo Memorial Airport together with the land on which said Airport is situated; and WHEREAS, DB Aero, LLC, dba Steel City Aviation is desirous of utilizing office and hangar space in a hangar owned by the City of Pueblo; NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1. A certain Hangar Lease, 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 DB Aero, LLC, dba Steel City Aviation for non-exclusive use of space within Hangar 522 at Pueblo Memorial Airport, is hereby approved, subject to the conditions as set forth in said Hangar Lease. SECTION 2. The President of the City Council is hereby authorized to execute and deliver said Hangar Lease in the name of the City and the City Clerk is directed to affix the seal of the City thereto and attest same. SECTION 3. The officers and staff of the City are directed and authorized to perform any and all acts consistent with the intent of this Resolution and the attached agreement to implement the transactions described therein. SECTION 4. This Resolution shall become effective immediately upon final passage and approval. INTRODUCED April 24, 2017 _____ BY: Robert Schilling City Clerk’s Office Item # M-3 Background Paper for Proposed Resolution COUNCIL MEETING DATE: April 24, 2017 TO: President Stephen G. Nawrocki and Members of City Council CC: Sam Azad, City Manager VIA: Gina Dutcher, City Clerk FROM: Ian Turner, Director of Aviation SUBJECT: A RESOLUTION APPROVING A HANGAR LEASE FOR SPACE WITHIN HANGAR 522 AT PUEBLO MEMORIAL AIRPORT BETWEEN THE CITY OF PUEBLO, A MUNICIPAL CORPORATION, AND DB AERO, LLC, DBA STEEL CITY AVIATION AND AUTHORIZING THE PRESIDENT OF CITY COUNCIL TO EXECUTE SAME SUMMARY: DB Aero, LLC, dba Steel City Aviation is desirous of utilizing office and aircraft storage in Hangar 522 at the Pueblo Memorial Airport on a month-to-month basis commencing April 1, 2017. PREVIOUS COUNCIL ACTION: None. BACKGROUND There is currently vacant space available in Hangar 522 that can be leased. DB Aero has requested the use of 147.87 sq. ft. of office space and aircraft storage space to store a Diamond DA20 aircraft. FINANCIAL IMPLICATIONS: DB Aero will pay $221.79 per month for the office space and $172.80 per month for the aircraft storage space. BOARD/COMMISSION RECOMMENDATION: Not applicable. STAKEHOLDER PROCESS: Not applicable. ALTERNATIVES: If City Council does not approve this Resolution, the space will remain vacant. RECOMMENDATION It is the recommendation of the Aviation Department that City Council approve this Resolution. Attachments: Hangar Lease – Hangar 522 HANGAR LEASE HANGAR 522 THIS LEASE made and entered into as of April 1, 2017 between the City of Pueblo, a municipal corporation, "Lessor", and DB Aero, LLC, dba Steel City Aviation, "Lessee." WITNESSETH: WHEREAS, the Lessor is the owner and operator of the Pueblo Memorial Airport ("Airport"), together with the land on which said Airport is situated, and WHEREAS, Lessee is desirous of utilizing office and hangar space of the Lessor on a short-term basis in Lessor's hangar, generally known as 522 Skyway Street, NOW THEREFORE, in consideration of the mutual covenants set forth herein, the parties agree as follows: 1. Leased Premises: A. The Lessor hereby leases unto the Lessee and Lessee hereby leases from Lessor for the term and upon the rental and conditions hereinafter stated, 147.87 square feet of office space generally defined as the northeast office in a hangar located at 522 Skyway Street, situated in the County of Pueblo, State of Colorado subject to existing easements; and, B. Hangar space within 522 Skyway Street to store a Diamond DA20 aircraft, tail number: N 2'i 1P . C. It is understood that the leased premises are non-exclusive. Lessor reserves the right to remaining office and hangar space with the leased premises at its sole discretion. 2. Term: A. This Lease is made on a month to month basis and commences on April 1, 2017 ("Commencement Date"), and shall continue until either party terminates this Lease as provided herein. B. All conditions and covenants contained herein shall remain in full force and effect during any and all extension periods. C. Either party may terminate this Lease at any time and for any reason upon thirty (30) days written notice to the other party. 3. Rental Rate and Other Fees: A. Lessee shall pay to Lessor as rent for the office space, a sum of$1.50 per square foot times the total square footage rented, equal to $221.79 per month. -1- B. Lessee shall pay to Lessor, as rent for aircraft hangar space, a flat rate of$172.80 per month. C. In consideration of the non-exclusive use of the hangar and office space, lessor shall not charge lessee for utilities supplied to the leased premises. 4. Improvements and Use: A. Lessee shall make no alterations or adjustments to the leased premises. B. Lessee shall not sublease any portion of the leased premises. C. The leased hangar space shall be utilized as aircraft storage only. No maintenance shall be performed other than that which is required prior to flight. Office space shall be used for flight instruction, preparation, and other office work incidental to those uses. 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 or for the sale of aviation fuel. D. Lessee grants to the Lessor the right to enter the leased premises to do what is necessary for the purposes of repairing, replacing and/or maintaining any and all utility lines under the leased premises which serve other uses at the Pueblo Memorial Airport, it being understood that the Lessor will repair, in a good and workmanlike fashion, any and all damage done to the leased premises as the result of work done hereunder. E. Lessee shall maintain the leased premises in accordance with the requirements and regulations of the Lessor and Lessor's fire code. The Lessee shall be responsible for all costs, fees, charges and penalties associated with the discharge or release of any hazardous material (including petroleum products) or mitigating the containment or removal of any contamination or hazardous material (including petroleum products) on, over or under the leased premises which is caused by the Lessee, its officers, agents, or employees. It is understood that the Lessee is not responsible for any conditions, which may be determined to have existed prior to October 14, 1997. The storage and accumulation of aviation fuel, flammables, explosive liquids, or solids, waste, debris or other hazardous materials within or on the leased premises shall be in an environmentally sound manner and comply with all Federal, State and Local laws and regulations. F. Lessee will not modify, alter, paint or improve the completed Hangar except to the extent required to maintain its original state. Any additional modification, painting or improvements to the Hangar or leased premises must receive prior written approval from the Lessor, which approval shall not be unreasonably or arbitrarily denied or withheld. -2- G. Lessee shall not park or leave or allow to be parked or left aircraft on the taxiways or on pavement adjacent to the Hangar in a manner which interferes with or obstructs access to adjacent hangars or public ramp area. Parking of automobiles will be permitted only designated spaces outside of the airport fence. 5. Maintenance Obligations: Lessee, at its expense, shall keep the leased premises and utilities extended to the leased premises in good repair and condition, and in a safe, sanitary, orderly, and sightly condition. 6. Utility Cost Recovery: A. In consideration of the non-exclusive nature of the leased premises, lessor agrees that utility use is included in the rental rate. B. Any additions,deletions, or adjustments to utilities extended to the leased premises shall not be made. 7. Signs: Lessee shall not erect, paint or maintain any signs whatsoever upon the leased premises without first securing the written consent of the Lessor. Any such signs shall comply with all ordinances and regulations of the Lessor or standards which might be developed by the Department of Aviation. 8. Right of Inspection: The Lessor reserves and retains for its officers, employees and authorized representatives the right to enter the leased premises during reasonable business hours, and after prior notice, for the purpose of inspecting and protecting the leased premises, and of doing any and all things which the Lessor may deem necessary for the proper general conduct and operation of the Pueblo Memorial Airport,and in the exercise of the Lessor's police power. 9. 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 or Lessee or Lessee's property or operations on the leased premises. 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. -3- 10. Indemnification: Lessee assumes the risk of loss or damage to the leased premises and property thereon, whether from windstorm, fire, earthquake, snow, water run-off, or any other causes whatsoever. Lessee covenants and agrees that it will indemnify and save harmless Lessor, its officers, agents and employees from all demands, claims, costs, causes of action or judgments,and from all expenses incurred by Lessor,in investigating or resisting the same, including reasonable attorney fees, arising from or growing out of the negligent acts or omissions of Lessee, its contractors, agents, members, stockholders, employees, invitees, servants, subtenants, successors or assigns in connection with its use or occupancy or their use or occupancy of any portion of the Pueblo Memorial Airport, including the leased premises. The provisions of this Paragraph 10 shall survive the termination of this Lease Agreement. 11. 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 cost and expense, provide and keep in force commercial liability insurance which includes personal injury and property damage with a combined single limit not less than$1,000,000. Lessee shall insure the Hangar and other improvements in an amount equal to their full insurable value naming the Lessor as a loss payee. 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 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 policies 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 mail to the Lessor. C. Lessee shall not violate the terms or prohibitions of any insurance policy herein required to be furnished by Lessee. D. If the Hangar 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 13.A. shall be retained by Lessee, 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 -4- specifications therefor 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 13.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. 12. Waivers: No provision of this lease may be waived except by an agreement signed by the waiving party. A waiver of any term or provision shall not be construed as a waiver of any other term or provision. Should Lessee hold over the use of or continue to occupy the leased premises after the termination or cancellation of this Lease Agreement, such holding over shall be deemed merely a tenancy for successive monthly terms upon the same conditions as provided in this Lease Agreement subject to termination upon thirty (30) days prior written notice. 13. Inconvenience During Construction: Lessee recognizes that from time to time it will be necessary for the Lessor to initiate and carry forward programs of construction, reconstruction, expansion, relocation, maintenance and repair at and to the Pueblo Memorial Airport in order that the Pueblo Memorial Airport and its facilities may be suitable for the volume and character of air traffic and flight activity which will require accommodation, and that such construction, reconstruction, expansion, relocation, maintenance, and repair may inconvenience or interrupt Lessee's operations at the Pueblo Memorial Airport. Lessee agrees that no liability shall attach to Lessor, its officers, agents, employees, contractors, subcontractors and representatives by reason of such inconvenience or interruption, and for and in further consideration of the premises, Lessee waives any right to claim damages or other consideration therefore, provided, however, that this waiver shall not extend to, or be construed to be a waiver of, any claim for physical damage to property resulting from negligence or willful misconduct of the Lessor, its officers, agents,employees,contractors, subcontractors and representatives. 14. Place and Manner of Payments: In all cases where Lessee is required by this Lease Agreement to pay any rentals, rates, fees or other charges or to make other payments to Lessor, such payments shall be made at the office of the Director of Aviation at the Pueblo Memorial Airport, or at such other place as Lessor may hereafter designate by notice in writing to Lessee and shall be made in legal tender of the United States and any check shall be received by Lessor subject to collection. Lessee agrees to pay any bank charges made for the collection of any such checks. All payments of rent shall be made on the first of each month. 15. Assignments and Subletting: A. Lessee shall not assign this Lease or any interest therein nor sublet the leased premises or any portion thereon. Any assignment may be conditioned upon the -5- payment of an assignment fee and/or an increase in rent to be determined by the Lessor in its sole and absolute discretion. Any assignment or subletting without the prior written consent of Lessor shall be void. No subletting of this Lease or the leased premises shall release or discharge Lessee from its obligations under this Lease. 16. Agreements with United States: This Lease Agreement is subject and subordinate to the terms, reservations, restrictions, provisions, and conditions of the deed of conveyance from the United States Government to the Lessor and of any other existing or future agreement between the Lessor and the United States,relative to the use,operation or maintenance of the Pueblo Memorial Airport and its appurtenant facilities, the execution of which has been or may be required as a condition precedent to the participation by any Federal Agency in the extension, expansions, or development of said Airport and facilities. 17. Lessee's Default: A. Any one of the following shall constitute an event of default by Lessee hereunder: (1) Failure of Lessee to pay in full all delinquent installments of rent and/or combined service fees for a period of fifteen (15) days after written notice and demand therefor are given by Lessor to Lessee. (2) Failure of Lessee to perform or comply with any obligation, covenant or agreement of Lessee hereunder other than payment of money for a period of thirty (30) days after written notice specifying such failure is given by Lessee to Lessor, except that if such obligation, covenant or agreement is not capable of being performed within said thirty (30) day period, Lessee shall not be in default if Lessee shall commence such performance within said thirty (30) day period and thereafter prosecute the same with diligence and continuity to completion. B. In the case of a continuing event of default by Lessee, Lessor shall have the following remedy in addition to all other rights and remedies provided by law or in equity, including without limitation, damages and specific performance: (1) Terminate this Lease by fifteen (15) days prior written notice given to Lessee specifying the date of termination and Lessee shall within said 15- day period vacate the leased premises and surrender possession thereof to Lessor. 18. Notices: All notices,required to be given to Lessor hereunder, shall be in writing and be sent by certified mail to Pueblo Memorial Airport, Administration Office, 31201 Bryan Circle, Pueblo, Colorado 81001. All notices required to be given to Lessee hereunder shall be in writing and sent by certified mail, addressed to -6- DB Aero, LLC, Donald R. Brosh, 945 Dewey Street, Canon City, CO 81212, provided that the parties, or either of them, may designate in writing from time to time subsequent or supplementary persons or address in connection with said notices. The effective date or service of any such notice shall be the date such notice is mailed by Lessee or Lessor. 19. Law, Rules and Regulations: A. Lessee, its officers, agents and employees shall faithfully observe and comply with all applicable federal, state and local laws,regulations and ordinances now existing or hereafter adopted relating to the use and occupancy of the Airport or leased premises including without limitation Chapter 1 of Title III of the Pueblo Municipal Code. B. Lessee, its officers, agents and employees shall faithfully observe and comply with all minimum standards and rules regulating operations and activities from and upon the Airport adopted from time to time by Lessor. Such minimum standards and rules shall not be applied arbitrarily,discriminatorily,or unreasonably. Except with respect to matters of public health and safety, if any provision of this Lease shall conflict with any provision of the minimum standards and rules adopted or amended by Lessor after commencement date, the conflicting provision of this Lease shall control. 20. F.A.A. Lease Requirements: A. The Lessor reserves the right,without any obligation on its part to do so,to develop, modify, change, improve or abandon the Pueblo Memorial Airport or any part thereof, as it may determine in its sole discretion, at any time, regardless of the desires or view of Lessee, and without interference or hindrance from Lessee or liability to Lessee. B. The Lessor reserves the right,without any obligation on its part to do so,to maintain and keep in repair the landing area of the Airport and all publicly owned facilities of the Airport, together with the right to direct and control all activities of Lessee in this regard. C. This Lease Agreement shall be subordinate to the provisions and requirements of any existing or future agreement between the Lessor and the United States, relative to the use, development, operation, or maintenance of the Airport. D. Lessee shall comply with the notification and review requirements covered in Part 77 of the Federal Aviation Regulations with respect to the construction of any structure or building on the leased premises, or in the event of any planned modification or alteration of any present or future building or structure on the leased premises. -7- E. It is understood and agreed that nothing contained in this Lease Agreement shall be construed to grant or authorize the granting of an exclusive right within the meaning of Section 308 of the Federal Aviation Act. F. Lessor reserves 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 leased premises, 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 or flight in said airspace, and for use of said airspace for landing on,taking off from, or operations on or over the Pueblo Memorial Airport. G. Lessee by accepting this Lease Agreement expressly agrees for itself,its successors and assigns that it will not erect nor permit the erection of any structure, building or object nor permit the growth of any tree on the leased premises to a height not to exceed 25 feet above ground level. In the event the aforesaid covenant is breached, the Lessor reserves the right to enter upon the leased premises and to remove the offending structure or object and cut the offending tree, all of which shall be at the expense of the Lessee. H. Lessee shall not make use of the leased premises in any manner which might interfere with the landing and taking off of aircraft at Pueblo Memorial Airport or otherwise constitute a hazard to aviation. In the event the aforesaid covenant is breached,the Lessor reserves the right to enter upon the leased premises and cause the abatement of such interference at the expense of the Lessee. If during the term of this lease, all or part of the leased premises should be taken or threatened to be taken for any public or quasi-public use under any governmental law or by right of eminent domain,or sold to the condemning authority under threat of condemnation, this Lease shall terminate and the proceeds, if any, from such taking or sale shall be allocated between Lessor and Lessee in accordance with applicable condemnation law. J. Lessor reserves the right to grant and to take easements or rights of way in, under, over and across the leased premises, in which event, Lessor shall only be entitled to compensation for damages to Hangars and other improvements of the Lessee destroyed or damaged thereby, but not to damages for loss of use of the leased premises. 21. Nondiscrimination Assurances A. The Lessee, for itself, its successors and assigns, as a part of the consideration hereof, does hereby covenant and agree as a covenant running with the land that in the event facilities are constructed, maintained, or otherwise operated on the leased premises or ramp, for a purpose for which Department of Transportation program or activity is extended or for another purpose involving the provision of similar services or benefits,the Lease shall maintain and operate such facilities and services in compliance with all requirements imposes pursuant to 49 CFR, Part 21, -8- Nondiscrimination in Federally Assisted Programs of the Department of Transportation, and as the regulations may be amended. B. The Lessee, for itself, its successors and assigns, as a part of the consideration hereof, does hereby covenant and agree as a covenant running with the land that(i) no person on the grounds of race, color, religion, sex, disability or national origin shall be excluded from participation in, denied the benefits of, or be otherwise subjected to discrimination in the use of the leased premises or ramp; (ii) that in construction of any improvements on, over or under such land and the furnishing of services thereon,no person on the grounds of race,color,religion, sex, disability, or national origin shall be excluded from participation in, denied the benefits of, or otherwise be subjected to discrimination; and (iii) that the Lessee shall use the leased premises and ramp in compliance with all other requirements imposed by or pursuant to 49 CFR, Part 21, Non-discrimination in Federally Assisted Programs of the Department of Transportation, and as the regulations may be amended. C. The Lessee assures that it will undertake an affirmative action program as required by 14 CFR, Part 152, Subpart E, to insure that no person shall on the grounds of race, creed, color, religion, disability, national origin or sex be excluded from participating in any contracting, leasing or employment activities covered in 14 CFR, Part 152, Subpart E. The Lessee assures that no person shall be excluded, on these grounds, from participating in or receiving the services or benefits of any program or activity covered by this subpart. The Lessee assures that it will require that its covered suborganizations provide assurances to the Lessee that they similarly will undertake affirmative action programs and that they will require assurances from their suborganizations, as required by 14 CFR, Part 152, Subpart E, to the same effect. D. Lessee agrees to operate the leased premises for the use and benefit of the public and to furnish good,prompt and efficient services adequate to meet all the demands for its services at the Airport, to furnish service on a fair, equal and not unjustly discriminatory basis to all users thereof, and to charge fair, reasonable, and not unjustly discriminatory prices for each unit of service,provided that Lessee may be allowed to make reasonable and nondiscriminatory discounts, rebates or other similar types of price reductions to volume purchasers. 22. Miscellaneous: A. This Lease and all of its covenants and provisions shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, personal representatives, successors, subtenants and approved assigns. B. No waiver by the Lessor of any failure by Lessee to comply with any term or condition of this Lease shall be or shall be construed to be a waiver by the Lessor of any other failure by Lessee to comply with any term or condition of this Lease Agreement. -9- C. This Lease and any amendments hereto are subject to prior approval of the Federal Aviation Administration. D. Lessee is leasing the leased premises "AS IS" in its present condition. Lessor makes no representation or warranties with respect to the present or future condition, or suitability for a particular use of the leased premises or the Pueblo Municipal Airport. Lessor shall be under no obligation to maintain the Pueblo Memorial Airport or any part thereof in a particular location or condition. If the Pueblo Memorial Airport shall permanently close or relocate, the use restrictions stated in paragraph 4.C. shall not apply, and the Lessee may use the leased premises for any lawful use or purpose allowed by the then existing Pueblo Municipal Code, or in the alternative, Lessee may terminate this Lease upon thirty (30) days prior written notice given to Lessor. E. This Lease is expressly made subject to the limitations of the Colorado Constitution. Nothing herein shall constitute, nor be deemed to constitute, the creation of a debt or multi-year fiscal obligation or an obligation of future appropriations by the City Council of Pueblo, contrary to Article X, §20 of the Colorado Constitution or any other constitutional, statutory or charter debt limitation. Notwithstanding any other provision of this Lease, with respect to any financial obligation of Lessor which may arise under this Lease in any fiscal year after 2017, in the event the budget or other means of appropriations for any such year fails to provide funds in sufficient amounts to discharge such obligation, such failure shall not constitute a default by or breach of this Lease, including any sub- agreement, attachment, schedule or exhibit thereto, by the Lessor. F. Nothing in this Lease is intended, nor should it be construed, to create or extend any rights, claims or benefits or assume any liability for or on behalf of any third party, or to waive any immunities or limitations otherwise conferred upon the Lessor under or by virtue of federal or state law, including but not limited to the Colorado Governmental Immunity Act, C.R.S. §24-10-101, et seq. -10- IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed as of the day and year first above written. LESSOR: LESSEE: CITY OF PUEBLO, DB AERO, LLC A Municipal Co •o . By By Step en G. Nawrocki Donald R. Brosh Title: President of City Council Title: Owner Attest: aAilletir. 4 U City Clerk Approved as to form: City Attorney / -11-