The New Bedford Finance Committee convened on June 11, 2025, to discuss a significant ground lease agreement for the development of hangars at the local airport. The proposed lease, which is set to begin around June 1, is structured as a 50-year agreement with a primary term of five years and nine potential renewals, contingent upon the property not being needed for other airport purposes.

The lease covers an area of 28,160 square feet, with the lessee responsible for the construction of the building on the site. The monthly rent is set at $7.51 per month, amounting to approximately $9,000 annually. However, the committee discussed a rent abatement plan to support the lessee during the construction phase. For the first nine months, the rent will be reduced by 90%, followed by a 70% reduction for the subsequent nine months. This arrangement is intended to alleviate financial pressure during construction, which is expected to take around 12 to 13 months.

Committee members raised concerns about the long-term financial implications of offering such significant rent reductions, especially given the airport's current financial challenges. The airport management emphasized that this strategy aims to attract new development and ultimately enhance revenue through increased airport activity, including fuel sales and maintenance services.

The committee also addressed the lease's adjustment mechanisms, which include a review every five years to align rent with fair market value or apply cumulative Consumer Price Index (CPI) adjustments. This approach is designed to prevent the airport from falling behind on rental income over time.

Additionally, discussions highlighted the importance of ensuring that the lease agreement includes provisions for the airport to reclaim the property if necessary. The committee requested further clarification on these clauses to ensure that the airport's interests are protected.

As the meeting progressed, the committee reviewed a revised document related to the lease, which included changes to the parties involved in the agreement. Concerns were raised regarding the clarity of the entities listed in the lease, prompting a request for additional information before proceeding to the city council for approval.

In conclusion, the Finance Committee's discussions underscored the balance between incentivizing development at the airport and safeguarding the airport's financial future. The committee plans to revisit the lease agreement with the necessary clarifications before advancing it to the city council for further consideration.