Okaloosa County BOCC — June 17, 2014 — Action Item Printout — reading text

BOARD OF COUNTY COMMISSIONERS AGENDA REQUEST DATE: June 17, 2014 TO: Honorable Chairman and Members of the Board FROM: Sunil Harman SUBJECT: Approval of Assignment of Lease to DTG Operations, Inc. DEPARTMENT: Airport BCC DISTRICT: All STATEMENT OF ISSUE: The Board of County Commissioners is requested to approve the assignment and assumption of the Advantage Rental Car concession and service facilities leases at Northwest Florida Regional Airport (VPS) to DTG Operations, Inc. BACKGROUND: When Avis and Budget rental car companies (Cendant Corporation) decided to consolidate brands at VPS and share the Avis facilities, Advantage Rental Car was competitively selected and assigned the former Budget concessionaire and service facilities leases. Subsequently, Advantage entered bankruptcy, and Hertz Corporation (through DTG Operations, Inc.) has recently purchased, at a court sanctioned auction, the rights to Advantage's leases at VPS. Now, Hertz, which had to divest its ownership of Advantage in order to purchase Thrifty-Dollar, has requested the County assign Advantage’s leaseholds to DTG, which will act to assume the on-premises rental car concession through its Thrifty-Dollar brand. Although the former Thrifty-Dollar operator at the VPS is indebted to the County for what we contend are rather substantial amounts due to non-payment of various rents, fees and user charges relating to its past tenure as an on-premises rental car concessionaire, it was a franchise for which debt the corporate DTG Operation, Inc. is not legally responsible. The County is presently in litigation over that debt. Since the bankruptcy court has approved the auction purchase, Hertz/DTG has the right to have the assignment take place as ordered. Official Board acceptance of the assignment and assumption is necessary, and it is viewed as beneficial in filling the on- premises space left vacant by Advantage and securing a continued stream of rental and fees income. DTG will provide the County with a fully executed copy of the Assignment upon the Closing of the Asset Acquisition. OPTIONS: Approve, disapprove or table. RECOMMENDATIONS: The Airports staff recommends approval of the assignment and assumption of the two leases (concession and service facilities). A copy of the Assignment and Assumption Agreement to be considered is attached. RECOMMENDED BY: APPROVED BY: Ernie Padgett, County Administrator RECOMMENDED BY: APPROVED BY: Ernie Padgett, County Administrator