The City entered into an Automobile Parking Concession Agreement with Standard Parking Corporation on October 12, 2004, to operate the public parking lots at Billings Logan International Airport. The Agreement was for a five-year term commencing November 1, 2004, and ending on October 31, 2009. The Airport recently completed its Master Plan, which included a preliminary study of the Airport's parking. The Airport will now do a comprehensive review of all parking facilities and needs to evaluate and plan for overall parking for the public, employees, and ready and rental parking for the car rental companies that operate at the Airport. The Airport worked with Standard Parking on Amendment One to extend the term of the Agreement for an additional year and setting a new expiration date of October 31, 2010, to permit the Airport adequate time to complete its comprehensive parking review. Additionally, due to both the recession and downturn in the aviation industry, parking activity in the public lots has been negatively impacted. Therefore, Amendment One also provided assurance to Standard Parking that it can meet its operating costs of operating the public parking lots by setting a guaranteed minimum annual revenue amount of $304,000 to Standard Parking. The City Council approved Amendment One on January 11, 2010. Leigh Fisher has been retained to assist the Airport with the parking study, which should be completed in the next six months. The Airport has once again worked with Standard Parking on Amendment Two to extend the term of the Agreement for an additional year, setting a new expiration date of October 31, 2011, and continuing the guaranteed minimum annual revenue for Standard Parking for the additional year. This extension will allow the Airport adequate time to review the results of the study, develop an implementation plan, and then bid the parking concession with any changes that may need to be included as a result of the study, including possible participation in capital costs as part of the concession agreement.

The Airport considered two alternatives: (1) extending the Agreement for an additional year, which would provide time for the comprehensive parking review prior to bidding another multi-year agreement, and including any of the potential changes in the bidding packet, or (2) bidding the parking concession operation before the completion of the comprehensive parking review and potentially having to make amendments later, once the parking study was completed.

The City Council may:

• Approve Amendment Two with Standard Parking, extending the term an additional twelve (12) months and continuing the guaranteed minimum annual revenue to Standard Parking; or
• Not approve Amendment Two with Standard Parking and direct Staff to place the concession out for bid prior to the completion of the parking study.

The Airport's parking concession generates significant annual revenue for the City. The rental revenue is based on gross receipts and a graduated percentage of gross receipts at certain gross receipt thresholds. During the last year of the Agreement, November 1, 2009 through October 31, 2010, the concession is expected to generate approximately $1,722,000 in parking revenue for the Airport. The projected revenue for the additional year of the Agreement is estimated to be approximately the same.

Staff recommends that the City Council approve Amendment Two, which extends the term of the Automobile Parking Concession Agreement with Standard Parking Corporation for one year, establishes a new expiration date of October 31, 2011, and provides the Airport with a guaranteed minimum annual revenue amount of $1,300,000.