DATE: January 15, 2019
TO: Mayor and City Council
FROM: Interim Director of Public Works
SUBJECT
Title
Hayward Executive Airport Hangar Rental Rates - Amendment to FY 2019 Master Fee Schedule
RECOMMENDATION
Recommendation
End
That the Council adopts the attached Resolution (Attachment II) authorizing an amendment to the FY 2019 Master Fee Schedule, which increases Airport standard hangar rental rates by 5% in FY 2019 through FY 2022 and all other sized hangars by 2.5% in the same years.
End
SUMMARY
In May 2017, staff recommended 10% increases per year on rental rates for City-owned hangars at the Hayward Executive Airport for five consecutive years, beginning in FY 2018, to implement recommendations of a City-sponsored hangar rate study to move a step closer to parity with comparable and competitive airports and financial self-sufficiency at the Airport. The City Council approved a 10% increase for FY 2018 and conditioned consideration of future increases upon continued demand for hangar space as indicated by occupancy rates and waiting list lengths. In the more than a year following the last rate increase, occupancy rates have remained at 100% and waiting list volumes have remained generally consistent before and after the rent increase. The adopted FY 2019 City budget indicates operating deficits at the airport in future years, so implementation of rate increases is still necessary.
Staff has had numerous meetings with tenants, received their concerns and comments, and has developed an alternative rate adjustment structure that would result in increases of substantially less than 10% annually, and which would be implemented over the next four years. For standard sized hangars, which had the largest deviation from market rates at 51%, staff proposes increases of 5% per year for the next four years. For other sized hangars, given their smaller deviation from the market rates and further input from the tena...
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