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Summary of Best Practices 71 Finally, the airport should establish policy for rent increases. For example, an airport may decide to increase rents on some periodic basis, assuming rents are at fair market value, to keep pace with inflation. 6.2.1 Airport Leasing Policy A recommended best practice is that airport sponsors develop a standard Airport Leasing Policy that applies to both facility and land leases. The Leasing Policy must be flexible enough to allow for unanticipated development opportunities while being comprehensive enough to account for multiple tenant types and operations. A standard, comprehensive Leasing Policy provides for the equitable treatment of all airport tenants and will minimize questions, concerns, and potential conflict between the airport and its tenants. The Leasing Policy should include, at a minimum, the following provisions: · Land lease rates (per square foot), differentiated by area. Aeronautical versus nonaeronautical, for example, and consideration of the land's proximity to infrastructure. · Hangar lease rates (per square foot), with consideration to the gauge of aircraft that the hangar will accommodate in terms of hangar doors size, height, and clear span distance. · Building and facility lease rates (per square foot). · Standard lease terms that are compliant with state and local law. · FBO/SASO lease requirements, which are consistent with an airport's Minimum Standards. · Process for adjusting rents and fees (living clause). · Insurance requirements, preferably in one document and adopted by official action, of the gov- erning body. Consolidation of all insurance requirements applicable to the airport allows an air- port to review, update, and have them reconsidered by the governing body from time to time. · Obligations of lessee, covered in a Rules and Regulations document. · Routine inspection provisions for safety and compliance of airport tenants and users. · Construction and improvement standards that outline pre-approval by the landlord and the airport sponsor, local permitting agency requirements, and FAA notification of proposed construction once all other approvals are secured. · Subletting policy. 6.2.2 Minimum Standards As with the Airport Leasing Policy document, the airport sponsor should have Minimum Standards that apply to all lessees. This document is necessary to ensure that lessee improve- ments conform to the operational standards set forth by the airport, and that the level of ser- vices provided to the aviation community is appropriate. Minimum Standards are especially relevant to leasing and developing airport property because they speak to what facilities are required for a specific activity. For example, if a parcel of land is less than one acre in size and surrounded by other development, and the Minimum Standards require more than an acre of land for FBO and other commercially-intense business activities, the value of that property, and any improvements on the property, may be affected by the fact that only certain activities will be allowed on a parcel of that size. Therefore, comparables used to value the property and improvements should only include examples with uses that would be allowed on the airport where the subject land resides. (Section 3.3 offers additional detail regarding the elements of a Minimum Standards document.) 6.2.3 Lease Rate Determination It should always be the goal of the airport sponsor, in line with FAA guidance, to maximize rev- enue for the airport. An appraisal of airport property should be conducted in order to determine