cover
TO: Mayor Irvin and City Council
FROM: Alex Alexandrou
Chief Management Officer & Chief of Staff to the Mayor
Martin Lyons
Chief Financial Officer & City Treasurer
Rick Veenstra
Corporation Counsel
DATE: July 13, 2020
SUBJECT:
Consideration of a proposed amended and restated lease between the City of Aurora and Lumanair, Inc. for certain real property located at Aurora Municipal Airport.
PURPOSE:
To enter into a comprehensive lease agreement with an existing airport tenant that is consistent with terms offered to its competitors, embraces modern standards, and resolves ongoing litigation.
BACKGROUND:
Lumanair, Inc. has been a tenant at the City's airport since 1982 and operates as one of the airports two fixed-base operators (FBO), providing, among other things, fuel service to the airport's general aviation customers. The City and Lumanair have amended their original lease several times since 1982 to include additional facilities at the airport.
Lumanair utilizes underground fuel tanks which is not consistent with the minimum standards for FBOs operating at the airport as established by the City. Lumanair's continued use of those tanks in violation of the minimum standards led to several years of litigation between the City with each side accusing the other of violations of the lease agreement. The litigation is still ongoing.
Despite the litigation, Lumanair has repeatedly expressed a desire to remain at the airport. While there is some uncertainty as to whether Lumanair successfully renewed its existing lease in 2018 (which would further broaden the scope of the litigation) it has remained current in its rent payments to the City.
The proposed lease, which was drafted and negotiated by Klein, Thorpe & Jenkins, Ltd., would amend and restate the existing agreements between the City and Lumanair for as long as thirty (30) years. The lease requires Lumanair to promptly remove its underground storage tanks, construct a new, above ground f...
Click here for full text