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26 Guidebook for Developing and Leasing Airport Property
regulations are prevalent at all airports, while a mix of local, state, and other federal regulations
exist and vary depending on location. The regulatory compliance section of an airport lease
agreement must acknowledge and require the tenant, as one member of an airport's commu-
nity, to adhere to the same standards for compliance as the other members of the airport and the
airport community as a whole.
2.2.22 Hold Harmless Provision
The lease between the airport sponsor and the tenant should include a hold harmless or
indemnity clause that protects the airport sponsor from any legal action, suits, proceedings,
claims, damage, loss, liability, cost, or expense that may be filed against the lessee for any reason
arising from the operation and/or negligence of the lessee. In the spirit of quid pro quo, the air-
port sponsor is typically asked and often evaluates reciprocal language that considers the lessee's
position. Many airport leases include some level of hold harmless protection for the lessee as well,
protecting them in the case of negligence on the part of the airport sponsor.
2.2.23 Nondiscrimination
Part 21 of 49 CFR (Code of Federal Regulations) outlines the mandate for nondiscrimination
in federally-assisted programs of the Department of Transportation. Airport sponsors that
receive federal grant funding through the Airport Improvement Program (AIP) are bound by
grant assurances that prohibit discrimination on the grounds of race, color, or national ori-
gin. Tenants leasing property that is part of an airport's lands fall within the parameters of a
federally-assisted transportation program, so the airport sponsor should include nondiscrimi-
nation language in its lease agreements, which is typically found under a "nondiscrimination"
heading of the lease document
2.2.24 Living Clauses
Living clauses play an important role in the lease document. These clauses allow existing agree-
ments to evolve as associated regulations and laws change during the course of the lease term
(e.g., wildlife, security, and environmental). Rules and Regulations, Minimum Standards, Rates
and Charges, and Schedules of Insurances are other examples of documents that will likely
change over time and that can be addressed through living clauses to maintain consistency.
Airport sponsors should always be aware of ongoing regulation amendments and changes. It
is the airport sponsor's responsibility to ensure the airport and all encompassing aspects conform
to state and federal laws. Airport tenants should remain current on these laws, as the changes may
require substantial financial obligations or a complete change of operating standards.
2.2.25 Force Majeure
The force majeure provision of an airport development and/or airport lease should consider
unavoidable causes for delay due to acts of God and natural disaster, which may set the stage for
failures to perform the provisions of the agreement. Force majeure clauses are often provided to
address delays in construction due to weather and should consider both the developer/tenant
and the airport sponsor perspectives. Specifically, agreements should include force majeure lan-
guage when the airport sponsor has agreed to do certain things or make certain improvements.
For example, the airport sponsor may agree to construct a taxiway extension to meet the needs
of a new development, but the agreement should include force majeure language that protects it
