The City Council approved a Lease with the U.S. Government on behalf of the Transportation Security Administration (TSA) on November 28, 2011 for 8,057 square feet of office space, and a five-year term that expired on November 30, 2016.  The TSA wishes to continue to lease space in the Airport's office building located at the west end of the Airport near the water tower. The Lease has been in holdover since the November 2016 expiration, and TSA continues to pay for and occupy this office space.  Staff has been working with the General Services Administration (GSA), TSA's leasing agent, on a new Lease.  The new Lease is for the same 8,057 square feet of office space, and will be for a ten-year term, with the first five years a firm term, and the second five years a non-firm term, which allows the Government to opt out of the Lease after the first five years.  The Lease commences December 1, 2016 and expires on November 30, 2026.

City Council may:

• Approve a new ten-year Lease with the U.S. Government on behalf of the TSA; or
• Disapprove a new ten-year Lease with the U.S. Government on behalf of the TSA.

The rent for the first five years is a fixed rate, with the rental for the last five years to be re-calculated and determined no less than 90 days prior to the new rate becoming effective.  The Lease will generate $139,627.80 per year of revenue for the City's Airport, and $698,139.00 for the initial five-year term.  Should the TSA opt to continue with the Lease for the additional five years, a new rental rate would be determined for years 6-10 of the Lease term.

Staff recommends Council approve the Lease with the U.S. Government for the benefit of the TSA for a new ten-year Lease beginning December 1, 2016 and ending November 30, 2026.