By Seth Daniel
The City has negotiated a deal with Enterprise Rent A Car to extend its lease for the full 20 years to 2034 in exchange for guaranteed payments of excise tax to the City.
Currently the City is guaranteed about $1 million per year in excise taxes, but the new deal would give the City a guarantee of $5 million.
The City first put out an RFP for the lot in 2013, and Enterprise won the bid in 2014. It was first a five-year deal, with a five year option. The new lease extends that out for 20 years. The land is located on the parking lot next to Highland Park.
“It’s more to have the guarantee for budgeting because it gives us a number that’s locked,” City Manager Tom Ambrosino said. “This will guarantee excise payments at a higher level.”
Excise taxes are paid to the City on all motor vehicles registered within the City, per state law. It is a major revenue source for all municipalities, in addition to property taxes.
Ambrosino said he wasn’t worried that the land would be tied up with Airport-related parking uses and preclude and better development from coming. He said the land is near the Designated Port Area (DPA), which precluded most development that isn’t water-related.
A hotel proposal in the area has since been thwarted because of that DPA designation, which was confirmed once again last year.
“No one has proposed anything like that there now,” he said.
Enterprise will also install a more permanent building on the site.
Council President Leo Robinson said he supported the lease extension, saying it made a good deal of sense to guarantee the payments made to the City at five times the previous levels.