Title 17 . Transportation and Public Facilities

Chapter 42 . Miscellaneous Provisions

Section 225. Land lease term or term extension

17 AAC 42.225. Land lease term or term extension

(a) This section does not apply to a land lease or to an extension of an existing land lease if the lessee is a government agency.

(b) In setting or extending the term for a land lease, the airport manager shall consider

(1) the applicant's actual or proposed development and use of the premises;

(2) sound airport planning and anticipated needs for security, safety, maintenance, and operation of the airport;

(3) future development needs of the airport;

(4) applicable covenants running with the land and restrictions in the state's title to airport property;

(5) the amount of investment, purchase price, fair market value, useful life, or remaining useful life of permanent improvements documented in the application, as applicable;

(6) the applicant's plan for remediation of any environmental contamination if the applicant did not cause or materially contribute to the contamination; and

(7) the proposed method and terms of financing the applicant's investment.

(c) Subject to the limitations in 17 AAC 42.215 and in 17 AAC 42.220, after considering the factors described in (b) of this section, the airport manager shall grant a term for a new lease or a term extension that will not exceed the greatest of

(1) the number of years shown in the table in (h) or (i) of this section, as applicable, that corresponds to the amount of the applicant's initial investment or additional investment, as applicable and excluding financing costs, in

(A) premises, boundary, and as-built surveys;

(B) site preparation, including excavating, filling, grading, fill material, gravel, and pavement;

(C) permanent improvements on the premises or, if constructed for immediate state ownership, off the premises; and

(D) remediation of contamination on or that migrated from the premises and that was not caused or materially contributed to by the applicant;

(2) the number of years shown in the table in (h) or (i) of this section, as applicable, that corresponds to the appraised fair market value or purchase price of permanent improvements owned by the applicant on the premises, as applicable and excluding financing costs; or

(3) the number of years of useful life of proposed permanent improvements on the premises or the number of years of remaining useful life of existing permanent improvements owned by the applicant on the premises; if more than one applicant-owned permanent improvement is proposed or exists on the premises, the improvement with the longest useful life or remaining useful life shall be used to determine the length of a new lease or term extension.

(d) If more than one of the methods provided in (c) of this section for determining the maximum term length could be applied, the lessee has the option to choose which method the airport manager must use to determine the allowable term of the new lease or lease term extension.

(e) Subject to the limitations in 17 AAC 42.215 and in 17 AAC 42.220, the airport manager may grant a lease term extension before the last year of the term of a lease only if and to the extent the applicant satisfies the requirements of this subsection and (f) of this section. To qualify for a lease term extension before the last year of the term of a lease, an applicant must

(1) either do or commit in writing to do one of the following that the manager did not previously consider in setting the initial term of the lease or any subsequent lease term extension:

(A) make an additional investment in the premises that is approved by the manager in an airport building permit issued under 17 AAC 42.280; or

(B) purchase existing permanent improvements on the premises; or

(2) have made an additional investment in the premises that the manager approved in an airport building permit or other written approval issued, under 17 AAC 42.280 or under 17 AAC 40 in effect before January 14, 2001.

(f) An applicant who seeks to qualify for a lease term extension under (e) of this section must support the request with the information required under 17 AAC 42.210(b) , as applicable.

(g) Subject to 17 AAC 42.220, the term of any extension that the airport manager grants under this section must be added to the end of any remaining term of the lease, including any earlier extensions.

(h) If the premises is located in a general aviation use area, the airport manager shall use the following table, subject to 17 AAC 42.220, to determine the lease term or lease term extension the manager shall grant under (c)(1) or (2) of this section:

Fair Market Value, Purchase Price, or Investment of at Least the Following Dollar Amount Term of Years ________________________ _____________ ___________

$0 5 7,500 6 15,000 7 22,500 8 30,000 9 37,500 10 45,000 11 52,500 12 60,000 13 37,500 14 75,000 15 82,500 16 90,000 17 97,500 18 105,000 19 112,500 20 120,000 21 127,500 22 135,000 23 142,500 24 150,000 25 157,500 26 165,000 27 172,500 28 180,000 29 187,500 30 195,000 31 202,500 32 210,000 33 217,500 34 225,000 35 232,500 36 240,000 37 247,500 38 255,000 39 262,500 40 270,000 41 277,500 42 285,000 43 292,500 44 300,000 45 307,500 46 315,000 47 322,500 48 330,000 49 337,500 50 345,000 51 352,500 52 360,000 53 367,500 54 375,000 55

(i) If the premises is not located in a general aviation use area, the airport manager shall use the following table, subject to 17 AAC 42.220, to determine the lease term or lease term extension that the manager shall grant under (c)(1) or (2) of this section:

Fair Market Value, Purchase Price, or Investment of at Least the Following Dollar Amount Term of Years ________________________ _____________ ___________

$0 5 25,000 6 50,000 7 75,000 8 100,000 9 125,000 10 150,000 11 175,000 12 200,000 13 225,000 14 250,000 15 275,000 16 300,000 17 325,000 18 350,000 19 375,000 20 400,000 21 425,000 22 450,000 23 475,000 24 500,000 25 525,000 26 550,000 27 575,000 28 600,000 29 625,000 30 650,000 31 675,000 32 700,000 33 725,000 34 750,000 35 775,000 36 800,000 37 825,000 38 850,000 39 875,000 40 900,000 41 925,000 42 950,000 43 975,000 44 1,000,000 45 1,025,000 46 1,050,000 47 1,075,000 48 1,100,000 49 1,125,000 50 1,150,000 51 1,175,000 52 1,200,000 53 1,225,000 54 1,250,000 55

History: Eff. 1/14/2001, Register 157; am 2/10/2001, Register 157

Authority: AS 02.15.020

AS 02.15.060

AS 02.15.090

AS 02.15.210

Editor's note: A map showing general aviation use areas at each international airport is maintained in the airport manager's office at the respective airport at the address provided in 17 AAC 42.005.