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other remedies or rights under this Agreement nor its right to terminate as provided <br /> herein. <br /> 6.1.4 Base Year Revenue related to Airport Leases has been calculated based under the <br /> current contractual leases currently negotiated at the City of San Marcos and is <br /> comprised of T-hangar rents, shelter rents, agricultural land leases, storage area <br /> rents,private hangar land rents and commercial and non-commercial facility rents. <br /> Base Year Revenue is based off of 2010 actual Gross Revenues of $195,367.70 <br /> adjusted by 4% annually <br /> a. For each Fiscal Year this Agreement remains in effect, the Operator will be <br /> eligible to receive two types of incentives as follows: <br /> 1. Profit Incentive <br /> i. The Gross Revenues of the Airport as defined in Section 1 herein <br /> shall be calculated annually at the end of each Fiscal Year. <br /> ii. For any Fiscal Year in which actual Airport Gross Revenues <br /> exceed the sum of actual Airport Operating Expenses <br /> established in the Approved Operating Budget, the city's <br /> expenditures for capital improvements at the Airport, the city's <br /> matching funds for any state or federal grants,and any Revenue <br /> Incentive paid for that Fiscal Year, the Operator will receive an <br /> Airport Profit Incentive equal to twenty five percent (25%) of <br /> the excess of revenues. <br /> 2. Revenue Incentive <br /> i. For each Fiscal Year of the contract in which actual Airport <br /> Gross Revenues exceed Base Year Revenues for that Fiscal <br /> Year, Operator shall be eligible to receive an "Airport Revenue <br /> Incentive" calculated annually at the end of each Fiscal Year <br /> equal to 25%of the excess of Fiscal Year actual revenues for the <br /> contract year over Base Year Revenues. A hypothetical example <br /> of how to calculate the Revenue Incentive is used for illustrative <br /> purposes only: <br /> Fiscal Year Base Revenue Adjusted by <br /> 4% Annually <br /> FY 26 $365,920.04 <br /> FY 27 $380,556.84 <br /> FY 28 $395,779.11 <br /> FY 29 $411,610.27 <br /> FY 30 $428,074.68 <br /> ii. The total of all compensation (including but not limited to the <br /> Airport Revenue Incentive) shall never exceed the fair and <br /> reasonable value of the services, or impair the City's ability to <br /> issue bonded indebtedness for the Airport under FAA <br /> Page 23 of 34 <br />