Legal Considerations for General Aviation Lease Development at Airports (2024)
Chapter: II. LITERATURE REVIEW
LEGAL CONSIDERATIONS FOR GENERAL AVIATION LEASE DEVELOPMENT AT AIRPORTS
Timothy R. Karaskiewicz, Midwest Airport Consultants, Glendale, WI
I. INTRODUCTION
This legal research digest collects and analyzes 16 of the most significant topics in the development of general aviation (GA) leases at airports of various sizes across the United States. Although GA leases include many additional provisions, these 16 topics are the lease terms that are most often discussed, written about, and that generated the most discussion during interviews with airport Lessors and Lessees. Each section of this digest includes annotated examples of lease provisions taken from airport leases that were analyzed during research for this project. This digest also provides (1) an analysis of the legal rules that affect the selected lease terms; (2) a description of the history and common law origins of the rules that provides helpful context; and (3) a checklist that identifies the interests, concerns, preferences, and strategies of Lessors and Lessees during lease negotiations. Altogether, the information presented in this digest will assist airport counsel, staff, and current and prospective airport Lessees, in understanding, developing, negotiating, and drafting GA airport leases.
II. LITERATURE REVIEW
This digest is the first Transportation Research Board (TRB) Airport Cooperative Research Program (ACRP) publication that focuses exclusively on the subject of the legal aspects and analysis of developing and drafting general aviation leases at airports.1 Here are listed several previous ACRP projects that address subjects related to GA lease development that proved helpful in researching this topic.
- ACRP LRD 1: Compilation of Airport Law Resources (2008) collects in one place the research sources that review, analyze, and comment on airport legal issues.
- ACRP LRD 10: Analysis of Federal Laws, Regulations and Case Law Regarding Airport Proprietary Rights (2010) describes the sources in state law of an airport’s authority to enter into leases and, in the context of the federal law, of airport proprietary rights.
- ACRP LRD 11: Survey of Minimum Standards Commercial Aeronautical Activities at Airports (2011)2 contains source material related to the drafting, adoption, and enforcement of airport minimum standards and describes current practices.
- ACRP LRD 41: Legal Issues Relating to Airport Commercial Contracts (2021) at 2-3 briefly explains the authority of airport sponsors, grounded in state law, for acquiring, holding, and leasing real property on airports.3
- ACRP Synthesis 30: Airport Insurance Coverage and Risk Management Practices (2017) describe both the variables that affect the purchase of insurance for airport operators and the range of risk management practices used at U.S. airports.4 Synthesis 30, when combined with two additional articles, provides a comprehensive introduction to risk management issues generally, with some specific application to airports.5
- ACRP Synthesis 86: Airport Operator Options for Delivery of FBO Services (2018) explores how airports deliver FBO services with traditional third-party leases or by engaging a contract manager, or how the airport can self-operate an FBO.6
- ACRP Synthesis 108: Characteristics of the FBO Industry 2018-2019 (2020) provides a data profile of the FBO industry as of December 2018 and provides a quantitative snapshot of the FBO industry that is intended to serve as a baseline of information for tracking FBO trends in the future7 and was followed by a 2022 update: ACRP 11-03/Topic S01-26, The Landscape of the FBO Industry in 2022.8
- ACRP Synthesis 11-03/Topic S01-20: Compilation of Data on the State of FBOs (2022) presents updated data on the state of FBOs at airports.9
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1 There are only a few academic or research publications that focus exclusively on GA lease development and even fewer published cases addressing GA lease issues at airports. There are, however, several industry trade journal articles authored by GA commercial operators and consultants addressing GA lease issues that proved helpful in understanding the perspective on GA Lessees. The most relevant of these publications are cited in the footnotes.
2 Available at https://www.trb.org/Publications/Blurbs/165017.aspx.
3 Available at https://www.trb.org/Publications/Blurbs/181703.aspx.
4 Available at https://apps.trb.org/cmsfeed/TRBNetProjectDisplay.asp?ProjectID=2901.
5 Myles Hannan, Using Property Insurance, Mutual Waiver, and Waiver of subrogation Clauses in Commercial Leases (with Model Clauses), in ALI-ABA’S PRACTICE CHECKLIST MANUAL FOR DRAFTING LEASES IV (ALI-ABA 2003); Wm. L. Nusbaum, The “Three-Legged Stool”: The Interplay of Property Insurance, Mutual Waivers and Waivers of Subrogation in Commercial Leases, https://www.williamsmullen.com/news/three-legged-stool-interplay-property-insurance-mutual-waivers-and-waivers-subrogation-commercial.
6 Available at https://apps.trb.org/cmsfeed/TRBNetProjectDisplay.asp?ProjectID=4108.
7 Available at https://apps.trb.org/cmsfeed/TRBNetProjectDisplay.asp?ProjectID=4458.
8 Available at https://apps.trb.org/cmsfeed/TRBNetProjectDisplay.asp?ProjectID=5267.
9 Available at https://apps.trb.org/cmsfeed/TRBNetProjectDisplay.asp?ProjectID=4458.
