Title
Airport Fuel Farm Expansion Lease
Action
Action:
A. Approve a 30-year ground lease with Charlotte Fuel Facilities, LLC for the purpose of constructing a new fuel facility, and
B. Authorize the City Manager to renew the lease for up to two, five-year terms with possible price adjustments and to amend the contract consistent with the purpose for which the contract was approved.
Body
Staff Resource(s):
Haley Gentry, Aviation
Ted Kaplan, Aviation
Explanation
§ The airlines have developed a fueling consortium that maintains and operates the Airport’s existing fuel storage facility and fuel delivery system.
§ The new fuel storage facility will operate in conjunction with the existing fuel storage facility and will increase the fuel reserves from 3.8 days of fuel on hand to approximately 11.6 days of fuel on hand.
§ Charlotte Fuel Facilities, LLC will operate and maintain the new and existing fuel storage facilities through a separate agreement with Menzies Aviation, which is the current operation and maintenance provider for the fuel facility.
§ Charlotte Fuel Facilities, LLC is responsible for the completion of all design, construction work, and funding for this new fuel storage facility, with oversight and approvals required by the Aviation Department.
§ The lease terms include the following payments to Aviation:
- Reduced ground rent in the amount of $92,604 per year for the period commencing on the effective date through the earlier of (a) the date that construction is completed on the new fuel facility or (b) two years from the date that Charlotte Fuel Facilities, LLC commences construction; and
- Ground rent in the amount of $234,289.60 annually with adjustments every five years.
Fiscal Note
Funding: Revenues will be deposited into the Aviation Operating Fund