This action will approve a ground lease with Umatilla-Morrow County Head Start (UMCHS) on a non-aviation portion of the airport property for use as classroom space.

The airport has approximately 28 acres of land north of Airport Way which has never been developed, and is recognized on the currently adopted Airport Layout Plan as an area for non-aviation related developments.  Staff has further developed a conceptual lot-layout for the area in order to accommodate commercial/light-industrial uses which need approximately 1 acre. 

UMCHS would like to construct classrooms on the Lot identified as Lot #4 in the attached Lot Layout Plan.

For Land Use purposes, Lot #4 is located in the “Airport Zone,” which allows all uses permitted outright in both the C-2 Commercial Zone, and the M-1 Light Industrial Zone.  Any use which is conditionally permitted in the C-2 zone is also conditionally permitted in the Airport Zone.  Schools are conditionally permitted in the C-2 Zone.

UMCHS has been working on this project through the winter to secure necessary funding, and is still awaiting some final authorizations.  Therefore, a legal survey, which is included in all Airport Leases as “Exhibit ‘A’” has not yet been completed.  Additionally, a Conditional Use Permit (CUP) has not yet been sought. 

The need for a CUP creates a slightly cumbersome process because the City Council is wearing two hats, one as the “landlord” hoping to attract a tenant, and one as the land use authority for the area.  To aid the process in moving forward, you are being asked to only consider this issue with your “landlord” hat and approve this lease contingent upon two things:

-       Filing a legal survey substantially similar to the dimensions shown for Lot #4 in the attached Lot Layout Plan. 

-       Approval of a CUP for this use. 

This action will allow UMCHS to move forward with the process of applying for a CUP, after which you will in the future be asked to only consider the CUP issue with your land use authority hat on.  If UMCHS does not complete their facility by December 31, 2020, the lease will automatically terminate.

Workforce Development Goal 6: Early childhood development forms a foundation for later learning.  Assisting UMCHS to expand and meet the needs of providing early childhood development will help in long-range workforce development.

This will also add another ground lessee at the Airport to assist in continued financial self-sufficiency of the airport.

This lease will generate approximately $2,090 per year in new airport lease revenue, based on a ground lease rate of $0.05/square foot.  This rate was verified by comparing similarly situated property at the Pendleton Airport, as well as extrapolating it to a purchase price equivalent to $43,560/acre.  This price appears to be comparable to similarly situated land in the area.  This rate will also rise to $0.06/square foot after 10 years, and $0.07/square foot at year 15.

1.  Agree to the proposed lease contingent upon filing a legal survey and approval of a CUP.

2.  Agree to the proposed lease with additional contingencies.

2.  Deny the proposed lease outright.

Agree to the proposed lease contingent upon filing a legal survey and approval of a CUP.

Motion to authorize the City Manager to execute the proposed lease with Umatilla Morrow County Head Start for Airport Lot #4 contingent upon the filing of a legal survey for an area substantially similar to Lot #4, as well as approval of a Conditional Use Permit for the operation.