21.10.090 Principles and Policy of Lease Rates.
(a) Annual rent shall be computed by multiplying the fair market value of the land by the lease rate percentage for each parcel inside the airport reserve. The annual rent for each parcel inside the airport reserve shall be published in the City’s schedule of fees adopted by the City Council; and
(b) The City shall determine the fair market value of all land within the airport reserve annually based on the latest appraisal conducted for the City by a qualified real estate appraiser and adjusted annually based on the rate of inflation determined by the consumer price index; and
(c) The City shall conduct an airport market analysis once every ten (10) years to determine whether a market adjustment in either fair market value or lease rate percentage is in the best interests of the City; and
(d) If the City determines from the airport market analysis that a market adjustment to the lease rate percentage is in the best interests of the City, the new lease percentage shall be utilized to compute annual rents for the next fiscal year; and
(e) If the airport market analysis or extraordinary circumstances determine a fair market value adjustment is in the best interests of the City, the City shall retain the services of an independent, real estate appraiser certified under Alaska state statutes with experience in appraising airport property to determine the fair market value of all land within the airport reserve and shall use these values to compute annual rents for the next fiscal year; and
(f) The City shall adjust the annual rent of a lease by giving the lessee written notice at least thirty (30) days in advance of the expiration of the previous adjustment period; and
(g) The annual rent of any individual lease may not increase by more than fifty percent (50%) based on CPI in any given five (5) year time period for leases for aeronautical purposes. The annual rent may be adjusted by an airport market analysis or appraisal resulting in an increase greater than fifty percent (50%) in any given five (5) year period for all leases; and
(h) If a lessee disagrees with the proposed change in rent, (excluding CPI determinations, which cannot be appealed) and cannot informally resolve the issue with the City, the lessee must:
(1) Provide notice of appeal in writing within ninety (90) days supported by the written appraisal of a qualified real estate appraiser, selected and paid for by lessee (the “second appraiser”); and
(2) The City and the lessee shall promptly meet to attempt to resolve their differences between the first appraiser and the second appraiser concerning the fair market value of the premises or lease rate percentage; and
(3) If the City and lessee cannot agree upon such value then, with all deliberate speed, they shall direct the first appraiser and the second appraiser to expeditiously and mutually select a third qualified real estate appraiser, paid for jointly by the parties (the “third appraiser”); and
(4) Within thirty (30) days after the third appraiser has been appointed, the third appraiser shall decide which of the two (2) respective appraisals from the first appraiser and the second appraiser most closely reflects the fair market value or lease rate percentage of the premises; and
(5) The fair market value or lease rate percentage of the premises shall irrefutably be presumed to be the value contained in such appraisal selected by the third appraiser, and the rent shall be redetermined based on such value; and
(6) Notwithstanding anything to the contrary herein, rent shall continue to be paid at the then-applicable rate until any such new rental rate is established, and lessee and the City shall promptly pay or refund, as the case may be, any variance in the rent, without interest thereon accruing to the extent to be paid/refunded in a timely fashion.
(Repealed and Reenacted Ord. 2998-2018)