On March 10, 2008, the Council approved a Limited Commercial Aviation Building and Ground Lease with Big Sky Ground Support Industries as Lessee, for the Airport facility commonly known as the former Operations/ARFF building, a warehouse-type facility located on the east end of the airfield. The 3,429 square foot warehouse comprises the north one-half of the building with the south one-half currently housing the rental car wash facilities.

Buck Smith, the owner/operator of Big Sky Ground Support Industries sold the business and its assets to Alpine Aviation, Inc., and the Lease was subsequently assigned to Alpine Aviation, Inc., DBA Big Sky Ground Support Industries on June 23, 2008. Alpine Aviation also leases IP-5, a large hangar facility in the Airport Business Park. Mr. Smith has remained with the company post sale and continues to be in charge of Alpine's maintenance services. The term of this Lease expired on February 28, 2009. However, the Lease had a provision giving the Lessee an option to extend the term for one additional year. Alpine Aviation exercised the option to extend the Lease, which now expires on February 28, 2010.

Alpine Aviation wishes to renew the Lease to continue its maintenance services. Staff has negotiated a new Lease with a one-year term commencing March 1, 2010, and ending February 28, 2011. The new Lease also contains an option to extend the term for one additional year, contingent on the development status of this facility and the adjoining rental car wash facility. This parcel is one of the last remaining development sites at the Airport that has direct access to the taxiway/runway infrastructure. The Airport anticipates constructing a new quick-turn rental car wash facility on the west end of the Airport sometime in 2010, and relocating the rental car companies' wash operations to the new facility when it is completed. The short-term Lease would allow Alpine Aviation to continue its maintenance operations without interruption until such time that a new use is found for this prime development site.

The Council may:

(1) Approve the renewal of the Limited Commercial Aviation Building and Ground Lease with Alpine Aviation, Inc., DBA Big Sky Ground Support Industries, or
(2) Not approve the Limited Commercial Aviation Building and Ground Lease with Alpine Aviation, Inc., DBA Big Sky Ground Support Industries and require Alpine Aviation to move its maintenance operations elsewhere.

The initial year of this Lease will generate $12,226.08 of rental revenue for the Airport. Should the renewal option be exercised, the subsequent year will be adjusted using the Consumer Price Index for all Urban Consumers (CPI-U) to keep pace with annual inflation.

Staff recommends that Council approve the one (1) year Limited Commercial Aviation Building and Ground Lease with Alpine Aviation, Inc., DBA Big Sky Ground Support Industries for the term beginning March 1, 2010, and ending February 28, 2011.