St. Thomas City Council has deferred staff’s recommendation for the small lot hangars at the St. Thomas Municipal Airport.
Staff’s report on Monday night (October 7) recommended that Council stop leasing the small lot hangers at the airport as the current rates are well below market value and do not maximize the City’s revenue potential. Staff proposed that Council move to a monthly rental policy.
The recommendations come as Staff say that 10 hangar leases will be expiring in the near future. 10 of the current 12 hangars have monthly lease rates ranging from $157 – $168. Staff say that these rates are well below other airport rental rates in the area and leave them little margin to recover any of their costs. The other two hangars are being rented at the City’s rate of $250 per month.
Staff have learned that some of the hangar tenants rent out their hangars and make a profit ranging between $200 – $700 per month, per aircraft.
Councillor Steve Peters brought forth the motion for deferral as he and other councillors want to ensure that all of the tenants and interested parties have a chance to be heard. Peters also proposed looking into the possibility of forming an ad hoc committee on the airport.
Councillor Linda Stevenson says that while she is in favour making sure all voices are heard, she wants to make sure the process does not drag on.
Stevenson says that this has been an ongoing issue for council, as the previous council also had many debates on the topic.
Councillor Gary Clarke says that he feels the report comes down to making a financial decision.
Staff’s report indicates that some of the tenants have said that they are interested in renewing their leases under the current terms. Staff say that all but one of the hangars need to be replaced as they are not viable because of their condition.
Staff say that the proposed change in policy would result in the tenants with expiring leases having to pay the City’s rental rate of $250 per month until the hangars are demolished. New hangars are being submitted in the 2020 budget for council’s consideration. The existing tenants would be offered rental space in any new small lot hangar areas on a first-come first-serve basis.
The City estimates that the proposed change will add $10,000 in revenue for the airport next year which they say is much needed. The matter will be on the next free reference committee agenda.
