Authorize the Director of General Services to adopt new airport lease rates at the Yolo County Airport. (No general fund impact) (Pistochini)

The County's airport contains a mix of county-owned hangers and privately owned hangers.  The County has not conducted a rent study to determine the current market rate for county-owned hangers.  The County conducted a new hanger rate study consistent with Federal Aviation Administration standards.  To ensure the new lease rate for county-owned hangers meets this standard, the County contracted with Aviation Management Consulting Group.  AMCG performed an onsite survey of the County airport, conducted a comparative survey with other similar general aviation airports and other nearby airports.  Based on the surveys, AMCG calculated a market rate for county-owned hangers.   Currently, the 11 county-owned hangers are leased at $275 a month and the proposed market rate is $375 a month.  Additionally, the County owns two aviation storage units.  The proposed market rate is $3.85 per square foot per year.  The County's Aviation Advisory Committee has reviewed this rate increase and did not object to this new rate.  The Committee did request that the increased revenue be used for a matching increase in airport maintenance.

Staff request authority to increase the market rate annually to offset the effect of inflation.  Staff propose increasing the market rate by the increase in the US Bureau of Labor Statistics' Consumer Price Index for the San Francisco-Oakland-Hayward region, all urban consumers, not seasonally adjusted (series ID CUURS49BSA0,CUUSS49BSA0).  This specific index is the closest to Yolo County, and provides an objective means to increase rates annually to help offset the cost of maintenance and operations at the airport.

Finally, staff request the ability to negotiate a one-time transitional lease rate for those existing tenants with expiring leases who wish to renew their leases to transition from the old lease rate to the new market rate.  This one-time rate would only be in effect for the current fiscal year and be the midpoint between the old rate and the new rate.  This is a request of the Aviation Advisory Committee.  New lessees will be required to pay the full market rate.  Given that the current budget did not forecast an increase in lease rates, this will still have an unanticipated positive impact to airport revenue.

The Aviation Advisory Committee received a presentation on the proposed rate increase at its August 8, 2024 meeting.

Not Applicable.