HomeMy WebLinkAbout09/03/2024 07.K. Resolution authorizing an amendment to Airport Lease Agreement between the City of Yakima and McAllister Museum of Aviation to allow for tax-exempt status and rental credit i4
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BUSINESS OF THE CITY COUNCIL
YAKIMA, WASHINGTON
AGENDA STATEMENT
Item No. 7.K.
For Meeting of: September 3, 2024
ITEM TITLE:
Resolution authorizing an amendment to Airport Lease Agreement
between the City of Yakima and McAllister Museum of Aviation to
allow for tax-exempt status and rental credit
SUBMITTED BY: Robert Hodgman, Director of Yakima Air Terminal
SUMMARY EXPLANATION:
The City and McAllister Museum of Aviation entered an Airport Lease Agreement on July 1, 2000, to rent
property and facilities. The parties wish to amend that agreement to allow tax exemption as McAllister
Museum is a non-profit organization.
ITEM BUDGETED: Yes
STRATEGIC PRIORITY 24-25: A Thriving Yakima
RECOMMENDATION: Adopt Resolution.
ATTACHMENTS:
2024_McAllister_Museum_Rent_Credit_Resolution- 8-12-2024.docx
2024_McAllister Amendement #5_Signed.pdf
129
RESOLUTION NO. R-2024-
A RESOLUTION authorizing an Amendment to Airport Lease Agreement between the City of
Yakima and McALLISTER MUSEUM OF AVIATION
WHEREAS, the City and McALLISTER MUSEUM OF AVIATION entered into an Airport Lease
Agreement effective July 1, 2000 for rental of property and facilities; and
WHEREAS, the LESSOR and the LESSEE entered into an Airport Lease Agreement at 2008 S
16th Ave effective July 1, 2000; and
WHEREAS, the parties wish to amend that agreement to allow for Tax Exempt Status and
Rental Credit; Now, Therefore
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA:
The City Manager is hereby authorized to execute the attached Amendment to Airport Lease
Agreement Between Yakima Air Terminal-McAllister Field/City of Yakima and McALLISTER
MUSEUM OF AVIATION, attached hereto.
ADOPTED BY THE CITY COUNCIL this 3rd day of September, 2024.
Patricia Byers, Mayor
ATTEST:
Rosalinda Ibarra, City Clerk
130
AMENDMENT#5 TO
LEASE AGREEMENT
BETWEEN
CITY OF YAKIMA
AND
McALLISTER MUSEUM OF AVIATION
THIS AMENDMENT TO THE AIRPORT LEASE AGREEMENT is made and entered into
by and between the City of Yakima as the owner and operator of Yakima Air Terminal-
McAllister Field, hereinafter referred to for purposes of this Amendment and the
underlying Agreement as the "LESSOR", and McALLISTER MUSEUM OF AVIATION,
a non-profit corporation in Washington State hereinafter referred to as "LESSEE":
WHEREAS, the LESSOR and the LESSEE entered into an Airport Lease Agreement at
2008 S 16th Ave effective July 1, 2000; and
WHEREAS, the parties wish to amend that agreement to allow for Tax Exempt Status
and Rental Credit;
NOW, THEREFORE, in consideration of the mutual promises set forth herein and the
benefit to be derived by each party, it is agreed by and between LESSOR and OPERATOR that
the lease shall be amended as follows:
Each party acknowledges this is a new amendment to the underlying lease dated July 1, 2000,
between the LESSOR and the LESSEE, and that this amendment supersedes and replaces all
prior amendments. As used herein, "underlying Lease" is defined as the Lease Agreement dated
July 1, 2000, and absent any amendment later released. The Lease in effect at any given time is
defined by the underlying Lease and all active amendments.
This amendment is effective October 1, 2024 through December 31, 2025.
1) Under Section 3. RENT, replace current paragraph 3.A and 3.B with the following:
3.A LESSEE promises and agrees to pay rent to LESSOR at the rate of $806.36 per
month for the leased premises, made in advance on or before the 10th day of each month.
Payments shall be made to the Yakima Air Terminal - McAllister Field in care of the Airport
Manager's office. Any rental payments past due shall accrue a delinquency charge of
eighteen percent (18%) per annum.
The above rent reflects the current Standard Rate of $0.22 per square foot of land per
year for aeronautical uses (65,236 square feet equates to a monthly rent of $1,195.99),
reduced by a monthly Rent Credit of $389.63 given as a concession for in-kind services
provided by McAllister Museum as noted in Exhibit D. LESSEE agrees to provide
LESSOR with a written annual report no later than October 1st on the actual in-kind
services provided compared to those described in Exhibit B. As a result of this annual
report, the Rent Credit may be adjusted by subsequent Amendment to the underlying
Lease. This credit is allowed under Federal Register/Vol. 64, No. 30 Section VII—Policies
Regarding Requirement for a Self-Sustaining Airport Rate Structure, Sub-Section E. Use
of Property by Not-for-Profit Aviation Organizations as noted in Exhibit C.
Yakima Airport—McAllister Field Ground Lease Amendment—Amendment#5 for 2008 S
16th Ave "McAllister Museum of Aviation" 131
3.B The lease rental rate as provide for above shall be subject to review and
modification January 1 of every year and shall be set at the then current Aviation Rate.
2) At the end of document, add Exhibit C and Exhibit D as described below:
Exhibit C
Frderrl Register L ul ti t. Nei ;>t` I:te....ts I•rtne.irt lb. reel \o,imu r., 7721
to(ling(fair mtuariet riles to capacth s urily.elle y to epee/hove with aeronautical missions may Include
arroruutical users /fathet.for charge to of the airport Examples of acceptably the Ale National Curd aviation units of
aeronautical users,tier F,%t tundras teas nxfude pttbitr parks.rectrailon the Army National Guard.US.Air
the self sustaining assurance to be factllurs.and bike orpiment pants. Force Rrsrrnr-and tinal Reserve an
satisfied by alrpoll charges that telex Example%of uses that would riot be units operating aircraft at the airpart-
the cost to time sponsor of prosidtrg elletble are rued maintenance Resers r and Guard units es Meath has r
aeronuutt<al tenter't and fectllttes to cqulpnwol storage;and paper.fur an historical presence at ter airport that
ewers A fee for acronattical users set drpartreert,and orlur Igrrscrnnx'nr ppirrrdrs the.Lupin and Airway
pursuant to a residual rosatrg farther*if they to not directly support ltnprenem nt Act of 1982_and prostdr
tnrthodolrai'salttfles the requitement the oprtattc n of the aispon senate that directly benefit airport
for a self-sustaining airport rate 2 the property-:molted would not ape-retfons aced safety earth an eras
structure, reawcubly be expected to produce mutt renws Al and supplementary.I1trF
tI.In establishing two firs and than dr mhrlmfs revenue at the time the capability.
RrneratMng revenues front all unite es coomountty use is mrdemplated_and p; Use of fen oprrrh for Trrtmxxr Irrlecis
airport owners and operators should not the properly is raw reaermalaly,expected
seek to create rrirrwc sauphascs Ih at to be used by an aeronautical taunt or Mekte l a'rptlit property et alehk el
reared the amounts to be used for catenate be needed fen atspwt lets ilwi tau market rental for public
airport es stem pus and!w relict operations in the forrsreabk figure. transit ternunals<tight of way.and
purposes for winch airport mrrturs Paten airport properly reasonably may related facilities will not be considered
may be speret under 19 U S.C.. be expected to earn more than rirultrnal a stole:ben of 49 U.S.0 55 471071b1.
§47107(b111).including reasonable revenue.it tun may be used for 47133 or 47107141131 if the trans/*
reserves and ocher funds to facilitate comnaut1y put-pees at less than FMV system is Public!)owned and operated
financing and to cover contingencies if the ref rnur earned from the for operated by contrail on behalf od der
%lute fees cl ea Warsarranmulcal roarrtaarmity me appraximem the public tuner/.and the facilities are
Lasers are not sit l to the revenue dart could otherwise be directly and suntan telly related to the
reasonableness requirement or the generated.pros triers/that the other air Iran of passengers or
Wrenn-ore at Transpremall rn Poh<y cam ForotilyNnn of till D air nit property.including use by airport
airport tales and c hews the surphri 3 ilrr communes use dccs not s tilt WV and employees.1 Lease of
funds accumulated tram thou`fees roast preclude erase of the property tat nominal value in flee circumstances
be used in accafdanre with 19 L''S C airport purposes if.In the optnion of the described In this section would be
947107(b). airport sponsor.such rester will pros tar considered consistent with the sell
C.Dliii- tel Charges for grater benefits to liar airport than sustaining requirement
.1:'otrarronaurica]Feet/wee And Serie- s ioo fflum!on of the camrnunuty use 11 Peewee 7'ratm:System%
I Anpmt revenue is rats to or used
Sub)rrt to the griiet l guxdaatte set to support the capital or operating acmes G'raorafly-private ground
forth alert a and the specific exception smith the rontmmetity Inc. trarnpuxsatlon so-Wm art c Is-lcp d.as a
rioted below.the FAA interprets the nonactunsutiral Inc of the airport In
wit sustaining asswa ter to t rim er that L.L se of Proprft1 by but far hare cases where publicly ow toed transit
the airport receissr fair market value for .1u tarter'tJrXrnlieflotes services are eras-newly limited and
the provision of nanaeronauUeal I .1n atrpan operator they charge whtere a pr1%arr vamst son ice et e-inn
facilities and services,to the ebtero tether eel rental ryes and fees to the rauL or ferns preetdes the Former
prw enable carsideftng the follow mg not for pallet aviation source of pubic transpcttatlon nuking
circumstances at the airport tryat1 ratlrtss.to the extent that the property as abide at Int than fair
If Prot ehti,Prop env leer Pubhe mate then it reasonahls justified by the nuriu-t rental to this private service
CmanunY3-Aurpxiso's tangible al mean ibk bowfin to the would not be considered inconsistent
an putt of to cis el as tatlon- with 19 U.S.C-§§471071b1.47133 or
Making airport property as atlaler at a.Aviation mul.cums. 47107(ap(13l
less than fair starlet rental value for b-Aeronautical sccrmdars and post
public recreational and other secondary education prograttns Sertkei\'11l Reporting and Audit
community anus.for the purpose of crwtductrd by accrnfited educational Regtlre'nntsls
maintaining positive airport eornrn.nilty tomato too,:or The Federal Aviation Administration
relations.can be a legitimate funs don of c.Cu it Air Patrol trots operating ./idiot warzioci Ate of I994 established a
an airport proprietor to operating the aircraft at the airport: new rrquurrtserur for aupwds to submit
angora Accordingly.in certain 2 Police or fire tmp)uine units annual fin.anrearl neerts to the
circumstances,prnsidutg airport land operating aircraft at the airport generally Sec retain and the list rcquarrd the
for such paepcncs will not be will be es peeled to pay a reasonable rate Scoriae)to cotriprfe the reports and to
considered a violation of the self for aerurtaattral use od airport p eopers}'- submit a summary,report to Compress
xrstaiitunq rr•qurrrnrcnt Gcnrtally,the but the saloe of any services provided The Federal Astaton Reanthnnratwn
CU.,ti .sianc vc in whit h below market by the unit ha tmr airport one be disci Act of 1996 established a new
use of airport land for community agalnut the applicable reasarrable rate requirement far airports toire lode is
pi Toms will be cotistdrrrd cnrsluerat 4x Y.,.�1,r�r..r..ttl.r.s c tau, pant cad their audits under the tiuigk
side the grant assurrtx es are Audit Act•a resins and reunion on the
I.The contribution of the aup en a The FAA etirtctwledges that many use of a rpot revenue.
property rnhanrrt public acceptance or airports peensde facilities to military
the auporr Ina cocrnountly in the units with aeronautical missions at Annual Ffiiarx-uf Report*
immediate area of the aupoet.the nominal lease rates The FAA dos.not Section 111(a)0)of the 1994
property is put to a general public rise coristriei this practice Into ststent with Authorization Act,49 U.S.0
desiredbr the lot al ronnmruuiy.and the the requirement for a sea sustaining 94710741(19).requires airport owners
public use drx-s not acisersely West the airport rar stntxture Mtlttars unlit or operators to tubnue to the Sacrstars
e
Yakima Airport—McAllister Field Ground Lease Amendment—Amendment#5 for 2008 S ,,
16th Ave "McAllister Museum of Aviation"
132
Exhibit D
LESSEE, as a non-profit aeronautical-related enterprise, agrees to deliver the aeronautical
services noted below at no charge. In support of the goal of supporting and growing the
aeronautical community in the Yakima area, LESSOR agrees to contribute the noted portion of
the estimated annual value of these services in the form of a Rent Credit as described in
Paragraph 3.A herein.
Estimated %Supported by $Amount
Credited to
Description Annual Value YKM Rent
(EAV) Reduction McAllister Rent
_ (Annual)
Conduct Youth and School Programs that
demonstrate the working of aviation along with an 50% $1,500.00
explanation of the values of an airport in your $3,000
community
Host community functions related to aviation $1,200 50% $600.00
Host Veterans' Day activities for the military o
veterans $500 0% $0.00
Host other group meetings such as non-profit o
organizations $1,200 0% $0.00
Host Flight Training and Flight Safety activities for $450 50% $225.00
_pilots and prospective pilots
I Provide a display that depicts significant historical
aviation activities for the main airport terminal. $1,200 50% $600.00
(We have done in the past-will reinstall once
terminal remodel is done)
Refresh the display at the terminal on a regular o
basis as suggested by the Airport Board $600 0/ $0.00
Host the EAA Young Eagles program providing a $0
place for the children to access and exit the aircraft 50% $0.00
in a safe manner (No longer hosting)
Provide meeting space for all aviation related $400 50% $200.00
organizations _.
Continue to represent and display the rich aviation o
history of the Yakima Valley $3,500 10% $350.00
Host and provide a backup meeting area for o
Airport Board meetings $150 0% $0.00
Provide space for a backup Emergency Operations o
Center at the airport, in the event of an emergency $2,000 10% $200.00
Provide space for special airport operations such as
visiting aircraft of significant historical or $1,500 50% $750.00
technological importance
Serve as a secure access point for the East end of
the field (might be a TSA option or wildland fire $2,500 10% $250.00
fighting), in the event of an emergency
Yakima Airport—McAllister Field Ground Lease Amendment—Amendment#5 for 2008 S
16th Ave "McAllister Museum of Aviation"
133
Provide CAP Hangar Space for$1.00 per year.
Search & Rescue and Cadet Program.5-Star $1 50% $0.50
Community Service
Support local restaurant by food for Museum $0 50% $0.00
activities (Did not provide EAV) _
Free Parking for visitors $0 50% $0.00
(Did not provide EAV)
Annual Total $4,676
Monthly Total $389.63
Report Provided
by: Roberta Dell Rent Credit Calculation By: Shelby Barrett
Date: 25-Jul-24 Date: 8-Aug-24
3) Under Section 5. TAXES AND LIENS, replace current paragraph with the following:
In addition to the rent payable above, LESSEE promises and agrees to pay, as the same
become due and payable, all licenses, fees and taxes, including but not limited to the
leasehold excise, required to be paid by LESSEE by reason of this Lease and by reason
of LESSEE's use and occupancy of the leased premises and by reason of LESSEE's
construction or ownership of improvements to the leased premises. LESSEE shall
neither suffer nor permit the attachment of any lien or other encumbrance on the leased
premises by reason of LESSEE's occupancy thereof. LESSEE agrees to indemnify
LESSOR and shall hold LESSOR harmless from any such taxes and liens. LESSEE
maybe exempt from paying Leasehold Tax if a Tax Exemption Report is provided to
the airport annually, no later than October 1st, for Non-Profit Activities.
Yakima Airport—McAllister Field Ground Lease Amendment—Amendment#5 for 2008 S
16th Ave "McAllister Museum of Aviation"
134
LESSOR
CITY OF YAKIMA
AIRPORT
YAKIMA AIR TERMINAL— MCALLISTER FIELD
2406 W. Washington Avenue, Suite B
Yakima, Washington 98903
(509) 575-6149— phone
(509) 575-6185—fax
By_ Date:
Victoria Baker, City Manager
ATTEST:
By:
Rosalinda Ibarra, City Clerk
STATE OF WASHINGTON )
) ss
County of Yakima )
I certify that I know or have satisfactory evidence that Victoria Baker signed this instrument, on
oath stated that he was authorized to execute the instrument and acknowledged it as the City
Manager of the City of Yakima, Washington to be the free and voluntary act of such party for the
uses and purposes mentioned in the instrument.
Date
By:
Notary Public for the State of Washington
Residing at:
Appointment Expires
Yakima Airport—McAllister Field Ground Lease Amendment—Amendment#5 for 2008 5
16th Ave "McAllister Museum of Aviation"
135
OPERATOR
McALLISTER MUSEUM OF AVIATION
2008 S 16th Ave
Yakima, WA 98903
509-457-4933
T"
By:
Greg B c'dck, Chairman
Date �7 f
STATE OF WASHINGTON
7 ss
County of YAKIMA
I certify that I know or have satisfactory evidence that Greg Babcock signed this instrument, on
oath stated that he was authorized to execute the instrument and acknowledged it as Museum
Chairman, to be the free and voluntary act of such party for the uses and purposes mentioned in
the instrument.Date 1 lrr l -6`1
By:
',��e�►�IIiIH+f��i�� Not r Pu is r e State of WASHINGTON
` *—PY M 6.1% Resi g a : VOl IK Gl/14-
=` �q?�,pnl r' .� � Appointment Expires �Y1I 13 ((3 (Q
�a= : E
7 •: �t►c
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Yakima Airport—McAllister Field Ground Lease Amendment—Amendment#5 for 2008 S
16th Ave "McAllister Museum of Aviation"
136