Res 2015-013/Amendment to and renewal for an additional five years of an Agreement for Airport Management Services with Texas Aviation Partners, L.L.C.;

Home Browse Search

recognized by law. The purpose of the incentive compensation is to encourage the creative and aggressive marketing and promotion of the Airport with the goal of making the Airport self - sustaining within five years. 6.1.4 Disincentive. The City's issuance of two or more documented written notices of default that the Operator fails to satisfactorily correct according to Articles 8 or 10 during any contract year shall result in a financial disincentive in the amount of 10% reduction of the incentive compensation for the year in which the uncured default occurs. The City's right to impose the disincentive shall neither limit its other remedies or rights under this Agreement nor its right to terminate as provided herein. 6.1.5 Base Year Revenue related to Airport Leases has been calculated based under the current contractual leases currently negotiated at the City of San Marcos and is comprised of T -hangar rents, shelter rents, agricultural land leases, storage area rents, private hangar land rents and commercial facility rents. Base Year Revenue is based off of 2010 actual Gross Revenues. The City will determine the actual amount of Base Year Revenue for the fiscal year ending September 30, 2010 on or before December 31, 2010. a. For each Fiscal Year this Agreement remains in effect, the Operator will be eligible to receive two types of incentives as follows: 1. Profit Incentive i. The Gross Revenues of the Airport as defined in Section 1 herein shall be calculated annually at the end of each Fiscal Year. ii. For any Fiscal Year in which actual Airport Gross Revenues exceed the sum of actual Airport Operating Expenses established in the Approved Operating Budget, the city's expenditures for capital improvements at the Airport, the city's matching funds for any state or federal grants, and any Revenue Incentive paid for that Fiscal Year, the Operator will receive an Airport Profit Incentive equal to twenty five percent (25 %) of the excess of revenues. 2. Revenue Incentive i. For each Fiscal Year of the contract in which actual Airport Gross Revenues exceed Base Year Revenues for that Fiscal Year, Operator shall be eligible to receive an "Airport Revenue Incentive" calculated annually at the end of each Fiscal Year equal to 25% of the excess of Fiscal Year actual revenues for the contract year over Base Year Revenues. A hypothetical example of how to calculate the Revenue Incentive is used for illustrative purposes only: