Committee recommends extension and amendment of five airport rental-car leases

The Budget and Finance Committee recommended approval of a set of amendments to five existing rental-car company leases at San Francisco International Airport. Kathy Widener, representing the airport, said the modifications exercise a five-year option to extend lease terms through December 2018, change the minimum annual guarantee to a percentage of prior-year gross revenues (8.5 percent), allow early termination if construction or substantial renovations are needed, exclude toll-collection charges from the definition of gross revenues, and allow the airport director to approve inter-company subleases to increase space efficiencies.

Widener said the five named agreements — with Hertz Corporation, Avis Budget, EAN Northern California, DTG Operations and Fox Rent A Car — were awarded from a competitive bid and that the grouping of multiple brands under parent bidders provided financial strength during procurement. In response to a supervisor question, she said the airport already includes clean-vehicle goals in leases and offers financial incentives to rental firms and customers that favor low-emission vehicles.

Budget analyst Mr. Rose summarized historical rent totals of $221,345,993 for the initial four years of the current agreements (2009–2012) and estimated minimum rent payable over the five-year extension at $282,005,500. The committee moved the item forward without objection and it will be considered by the full Board of Supervisors.