|
Item 1.F.
|
| City Council Regular | |
| Date: | 07/12/2021 |
| Title: | Amendment One to Automobile Rental Concession and Leases |
| Presented by: | Kevin Ploehn, Director of Aviation and Transit |
| Department: | Airport |
| Presentation: | No |
RECOMMENDATION
Staff recommends that City Council approve Amendment One to each of the Automobile Rental Concession and Leases, extending the term of each Lease to June 30, 2022.
BACKGROUND (Consistency with Adopted Plans and Policies, if applicable)
The current Automobile Rental Concession and Leases with the five car rental concessionaires at the Airport expire on June 30, 2021. The current concessionaires are: (1) Overland West, Inc., DBA Hertz Rent A Car, (2) Enterprise RAC Company of Montana/Wyoming, LLC DBA Enterprise Rent-A-Car, (3) Larson Enterprises, Inc. DBA Avis Rent a Car and Blackfoot Rentals Inc. DBA Budget Rent A Car, (4) Enterprise RAC Company of Montana/Wyoming, LLC DBA Alamo Rent A Car and National Car Rental, and (5) Overland West, Inc. DBA Thrifty Car Rental and Dollar Car Rental. Given the current shortage of available automobiles, and the other unique, challenging, and continuing impacts to the travel and car rental industries resulting from the COVID-19 pandemic, the Concessionaires desire to extend the existing Leases for an additional year to allow more time for the travel and car rental industry constraints to return to more normal conditions.
In February 2021, the Airport issued and advertised a Request for Expression of Interest (RFI) for interested parties to operate an automobile rental concession in the Terminal Building. The RFI was advertised in the Yellowstone County News on February 19 and 26, and posted on both the City Website and the Airport Website. The purpose of the RFI was to determine if any other companies were interested in operating an automobile rental concession in the Terminal. If there were numerous new companies with an interest in operating an automobile rental concession in the Terminal, the Airport would proceed with the Request for Proposal (RFP) process. Six responses to the RFI were received; five of the responses were from the five current concessionaires already operating in the Terminal and one additional new respondent. As the availability of vehicles for the car rental fleets became increasingly difficult to obtain, staff followed up with the single new respondent, a small company that had never operated an airport automobile rental concession, to inquire about their ability to provide vehicles under a concession lease. Staff received no further response or interest from the new respondent. As a result, staff determined that a one-year extension to the existing Leases was in the best interest of all parties, to allow time for conditions to normalize. Amendment One to each Lease extends the term of each Lease by one year for a new expiration date on June 30, 2022.
In February 2021, the Airport issued and advertised a Request for Expression of Interest (RFI) for interested parties to operate an automobile rental concession in the Terminal Building. The RFI was advertised in the Yellowstone County News on February 19 and 26, and posted on both the City Website and the Airport Website. The purpose of the RFI was to determine if any other companies were interested in operating an automobile rental concession in the Terminal. If there were numerous new companies with an interest in operating an automobile rental concession in the Terminal, the Airport would proceed with the Request for Proposal (RFP) process. Six responses to the RFI were received; five of the responses were from the five current concessionaires already operating in the Terminal and one additional new respondent. As the availability of vehicles for the car rental fleets became increasingly difficult to obtain, staff followed up with the single new respondent, a small company that had never operated an airport automobile rental concession, to inquire about their ability to provide vehicles under a concession lease. Staff received no further response or interest from the new respondent. As a result, staff determined that a one-year extension to the existing Leases was in the best interest of all parties, to allow time for conditions to normalize. Amendment One to each Lease extends the term of each Lease by one year for a new expiration date on June 30, 2022.
ALTERNATIVES
City Council may:
- Approve Amendment One to each of the Automobile Rental Concession and Leases; or
- Not Approve Amendment One to each of the Automobile Rental Concession and Leases.
FISCAL EFFECTS
The one-year extension maintains all concession terms and conditions, the existing space, fee structure, and Minimum Annual Guarantee (MAG) as expressed in each of the expiring Leases, and only extends the Concession and Lease period for each Automobile Rental Concession for one year.