The State of Montana Department of Environmental Quality (DEQ) currently rents office space on the first and second floors of IP-9, the City owned office building located in the Airport Business Park.  The DEQ also rents storage space in the basement of IP-9, as well as some ground space for vehicle storage, with the vehicle storage ground space being shared with the Department of Natural Resources and Conservation, another tenant in IP-9.  The leased premises include 7,496.81 square feet of building space and 22,680 square feet of ground space.  The previous Lease expired on February 28, 2019. This State of Montana agency desires to renew the Lease for this space for another five-year term.  Staff has been working with the agency on a five-year renewal lease.

City Council may:

• Approve a new five-year Airport Business Park Building and Ground Lease with the DEQ; or
• Disapprove a new five-year Airport Business Park Building and Ground Lease with the DEQ.

The Lease will generate $66,357.60 per year of revenue for the City's Airport and $331,788.00 for the five-year term.  Should the DEQ opt to extend the Lease for additional years, a new rental rate will be determined for the extended period.

Staff recommends that the City Council approve a new five-year Airport Business Park Building and Ground Lease with the DEQ for the term beginning March 1, 2019, and terminating on February 28, 2024.