MEMORANDUM 05-64

TO: Mayor Hornaday and Homer City Council

THRU: Walt Wrede, City Manager

FROM: Sheri Hobbs, Personnel/Airport Terminal Manager

DATE: March 31, 2005

RE: Polar Car Rental Lease

During 2003 and 2004 as leases were due to be renewed we began setting up lease terms to expire at the same time for all three car rental agencies. This will allow the City the option to change fees or leasing policies for all three car rentals at the same time.

Polar Car Rental is the third and final car rental lease. The lease term is May 1, 2005 until December 31, 2006. At that time all three car rental lease terms will expire and the City can negotiate new leases. It is our intention to increase fees at that time.

Polar’s current rent is the same as the other car rental agencies. A flat fee of $166.50 per month for the rental of 111 square feet of terminal space and 10 parking spaces with a 5% commission for car rental sales.

RECOMMENDATION: Approve Polar Car Rental lease and authorize the City Manager to sign.

FISCAL IMPACT: Car Rental Revenue estimated at $7,500 annually.