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City authorizes below‑market leases for Head Start and YMCA; aldermen seek clarity on valuation
Summary
Council approved resolutions authorizing below‑market leases of city space to Community Action of South Mississippi Head Start and the Mississippi Gulf Coast YMCA, and aldermen asked staff how the city determines fair‑market value for those leases.
At the June 16 recess meeting the Board of Aldermen approved two resolutions authorizing below‑market leases of city space: one renewing a lease of space in the Annie Taconite Building to Community Action of South Mississippi Head Start, and a second authorizing space in the NEET County Building for the Mississippi Gulf Coast YMCA.
Aldermen asked staff how the city calculates fair market rent for those below‑market arrangements. Staff responded that the city rents similar large commercial spaces for significantly more than the $5-per-square-foot figure cited in the lease, and that the $5/ft² rate has been in place for several years; staff said the resolution documents that the leases are effectively a donation but did not provide an estimate of the annual value of that donation during the meeting.
Both resolutions were moved, seconded and approved by voice vote; the mayor was authorized to execute the lease agreements and related documents. Aldermen suggested periodically reviewing the city’s approach to below‑market leases so the city can track the fiscal impact as market rents change.
Staff compared the Head Start lease to an existing YMCA arrangement and said both have been handled similarly in recent years. The motions did not specify dollar totals of the annual subsidy; staff said the rate has been stable for several years but did not provide a current aggregated estimate at the meeting.
