17 AAC 45.250 - Disposition of removable improvements on a building lease or concession

(a) This section applies to building leases on the airport and on-airport concessions.

(b) Unless the applicable building lease or concession or other written agreement between the department and the building lessee or concessionaire provides otherwise, improvements that the building lessee or concessionaire constructs or purchases on the premises and that the department determines can be removed without material damage to a state-owned building or land remain the lessee's or concessionaire's property while the building lease or concession remains in effect, including any period of extension or holdover.

(c) Unless the applicable building lease or concession provides otherwise, at the expiration, termination, or cancellation of the building lease or concession, the department will take one or more of the following actions with respect to the departing building lessee's or concessionaire's improvements that can be removed without material damage to the building or land:

(1) allow the departing building lessee or concessionaire to sell those improvements to a succeeding lessee or concessionaire of the premises, remove all personal property, remediate any contamination for which the departing lessee or concessionaire is responsible under this chapter, and leave the premises in a clean and neat physical condition acceptable to the department within 30 days after notice from the department that the department has approved an application for a lease of the premises to another person or by such earlier date stated in the notice, but in no event more than 90 days after the expiration, termination, or cancellation date of the lease or concession;

(2) allow or direct the departing building lessee or concessionaire to remove those improvements, remediate, consistent with applicable law, any contamination for which the departing lessee or concessionaire is responsible under this chapter, and restore the premises to a clean and neat physical condition acceptable to the department; or

(3) allow the departing building lessee or concessionaire to transfer title to those improvements to the department, with or without payment of consideration, remove all personal property, remediate any contamination for which the departing lessee or concessionaire is responsible under this chapter, and leave the premises in a clean and neat physical condition acceptable to the department.

(d) A departing building lessee or concessionaire to which the department has issued a direction under (c)(2) of this section shall comply with the department's direction within 60 days after the direction is issued and at no cost to the department. If the lessee or concessionaire shows good cause and if it is not inconsistent with the best interest of the state, the department will allow in writing a longer period that is sufficient to permit the lessee or concessionaire to comply with the department's direction. A lessee or concessionaire who fails to comply with a direction issued by the department under (c)(2) of this section shall, within 30 days of being billed by the department, reimburse the department for any costs, including legal and administrative costs, reasonably incurred by the department to do any of the following:

(1) enforce the department's direction;

(2) remove and dispose of that person's unremoved improvements;

(3) remediate any contamination for which the departing lessee or concessionaire is responsible under this chapter;

(4) restore the premises to a clean and neat condition acceptable to the department.

(e) If a departing building lessee or concessionaire does not timely remove or sell the improvements on a premises in accordance with the terms of this section, the improvements will be considered permanently abandoned. The department may sell, lease, demolish, dispose of, remove, or retain the abandoned property for airport use as the department determines is in the best interest of the state. A departing lessee or concessionaire shall, within 30 days of being billed by the department, reimburse the department for any costs, including legal and administrative costs, reasonably incurred by the department to do any of the following:

(1) remove and dispose of the abandoned property;

(2) remediate any contamination for which the departing lessee or concessionaire is responsible under this chapter;

(3) restore the premises to a neat and clean condition acceptable to the department.

(f) A departing building lessee or concessionaire will not be considered to have relinquished possession and completely vacated the premises until

(1) the lessee or concessionaire has

(A) remediated, consistent with applicable law, any contamination for which the lessee or concessionaire is responsible under this chapter; and

(B) restored the premises to a clean and neat condition acceptable to the department; and

(2) either

(A) all of the lessee's or concessionaire's improvements and personal property on the premises have been removed, subject to (g) of this section, or sold to the succeeding lessee or concessionaire; or

(B) title to any of the lessee's or concessionaire's improvements and personal property that remain on the premises has vested in the department.

(g) Unless otherwise provided in the building lease or concession, site development work and site development materials and any improvements that the department determines cannot be removed from a building lease or concession premises without material damage to a state-owned building or land become part of the state-owned realty and property of the state upon completion or placement by a building lessee or concessionaire. The building lessee or concessionaire

(1) must maintain the site development work and site development materials throughout the term of the lease, including any extensions and periods of holdover; and

(2) may not remove the site development work and site development materials unless the department approves in writing.

(h) In this section, "departing building lessee or concessionaire" means a building lessee or concessionaire who occupies airport property and whose building lease or concession has expired, been terminated, or been canceled and to whom a new building lease or concession or a building lease or concession term extension has not been granted.

(i) After the expiration, termination, or cancellation of a building lease or concession, including any holdover under 17 AAC 45.252, the departing building lessee or concessionaire loses all right to occupy or use the premises without the express or implied consent of the department. Except as the department notifies the departing building lessee or concessionaire otherwise in writing, the department consents to continued use and occupancy of the premises by the departing building lessee or concessionaire to diligently accomplish the requirements of this section. Until the departing building lessee or concessionaire relinquishes possession of and completely vacates the premises under (f) of this section, and notifies the department in writing that it has relinquished and vacated the premises, the departing building lessee or concessionaire shall perform the following as if the building lease or concession were still in effect:

(1) pay rent to the department;

(2) maintain the premises;

(3) provide the department with evidence of each insurance coverage, if any, required under the lease; and

(4) cease using the premises other than to diligently accomplish the requirements of this section, and to comply with the other requirements of the building lease or concession.

Notes

17 AAC 45.250

Eff. 3/28/2002, Register 161; am 3/22/2008, Register 185

Authority:AS 02.15.020

AS 02.15.060

AS 02.15.090