REPORT TO THE CITY COUNCIL
FROM: HENRY THOMPSON, Director of Aviation
Airports Department
BY: MELISSA GARZA-PERRY, Airports Properties Manager
Airports Department
MARCOS AYALA, Airports Property Specialist II
Airports Department
SUBJECT
Title
Actions related to the Request for Proposals to manage and operate Non-exclusive On-airport Rental Car Concessions at Fresno Yosemite International Airport (FAT). The potential revenue of the three contracts is $4,846,238 annually. The total anticipated revenue for the five-year term of the three contracts is approximately $24,231,190. (RFP No. 12501615). (Council District 4).
1. Adopt a finding of Categorical Exemption pursuant to Section 15061(b)(3) (Common Sense) and Section 15301 (Existing Facilities) of the California Environmental Quality Act (CEQA) Guidelines; and
2. Award Avis Budget Car Rental, LLC., a five-year term Agreement for Non-exclusive On-airport Rental Car Concessions (RAC Concession Agreement) at FAT and authorize the Director of Aviation (Director) to execute the contractual document(s); and
3. Award Enterprise Rent-A-Car of Sacramento, LLC., a five-year term RAC Concession Agreement at FAT and authorize the Director to execute the contractual document(s); and
4. Award The Hertz Corporation a five-year term RAC Concession Agreement at FAT and authorize the Director to execute the contractual document(s).
Body
RECOMMENDATION
Staff recommends that City Council (Council) award three (3) five-year RAC Concession Agreements to: (1) Avis Budget Rental Car, LLC. (ABG); (2) Enterprise Rent-A-Car of Sacramento, LLC. (ERAC); and (3) The Hertz Corporation (Hertz) at FAT; and authorize the Director of Aviation to execute all documents related to RFP No. 12501615.
EXECUTIVE SUMMARY
The City of Fresno Airports Department (Airports) solicited proposals through the Request for Proposals (RFP) process for non-exclusive on-airport rental car concessions at FAT’s terminal. The RFP was advertised on March 28, 2025. Proposals were due May 20, 2025. The current RAC Concession Agreements expired on August 31, 2024, and have been in holdover while Airports completes this RFP process.
Please be advised RFP No. 12501615 allowed for award(s) up to four (4) rental car concessionaires. However, Airports received a total of three proposals. Each of the proposals were from an existing incumbent rental car company that currently operates at FAT.
The concession agreements being awarded, in accordance with RFP No. 12501615, each have a five-year term, with one optional five-year extension. These agreements ensure that rental car companies are available as a ground transportation option for visitors arriving at FAT and locals who rent cars at the airport due to the convenience of having multiple brands all in one location.
The potential revenue of the three contracts is $4,846,238 annually. The total anticipated revenue for the five-year term of the three contracts is approximately $24,231,190.
BACKGROUND
The current RAC Concession Agreements on holdover expired on August 31, 2024. Airports began preparing for new RAC Concession Agreements one year before they expired. Prior to work commencing on this RFP, the Airports Department issued a Request for Letters of Interest in October 2023 to gauge the level of interest of the rental car industry in operating at FAT. Airports received responses from incumbent and non-incumbent RACs. Since there was interest beyond the incumbent operators, Airports began working on this RFP.
This RAC Concessions RFP is the first of its kind in ten years. The last RAC concession agreements were executed in 2014 when there was only interest from the incumbent operators (ABG, ERAC, and Hertz) and allowed for direct negotiations with the incumbent operators. In June 2024, Airports enlisted the help of Ricondo, a consulting company with RAC RFP experience across various airports in the country, to assist with the development and execution of this RFP and assist with updating the concession agreement and drawing the reallocation of existing rental car areas.
This RFP was released on March 28, 2025. It was publicly posted on Planet Bids and advertised through national and regional trade group websites (American Association of Airport Executives [AAAE], Airports Council International - North America [ACI-NA], and the Southwest Chapter of the American Association of Airport Executives [SWAAAE]). A virtual Pre-Proposal Meeting was held via Zoom on April 10, 2025. Airports published seven addendums answering 138 questions from potential bidders during the open period. Proposals were originally due April 29, 2025. This due date was extended to May 20, 2025, at which time they were revealed in a public bid opening. Eleven (11) RFP specifications were distributed to prospective proposers, and two (2) Building Exchanges received Notice Inviting Proposals. Three (3) proposers submitted proposals: Avis Budget Car Rental, LLC., Enterprise Rent-A-Car of Sacramento LLC., and The Hertz Corporation. Proposals will expire within 120 days of proposal opening, September 17, 2025.
The Evaluation Committee (Committee) reviewed all proposals and determined the best value for FAT’s terminal based on each proposal. The Committee completed a comprehensive review, guided by the Purchasing Division in the General Services Department, of the three proposals received and determined that all three proposals met the needs and requirements of Airports.
There are three identical RAC Concession Agreements being requested for award approval. Each will have a term of five years, with one optional five-year extension for total term of ten (10) years. In addition to the ten percent (10%) concession fee paid to Airports that is based on the RACs gross revenues, RACs will also provide payment for their use of the terminal counters located in baggage claim and the ready-return lot (this is the lot next to baggage claim where passengers pick up and
drop off their rental cars).
A proposed agreement was included as part of this RFP. Airports would like to move forward and award three concession agreements and begin the negotiation process pertaining to the proposed agreement with the successful proposers. It is the Airports Department’s intention to return to City Council for approval of the final concession agreements.
The City Attorney’s Office has reviewed and approved the proposed RAC Concession Agreement.
ENVIRONMENTAL FINDINGS
The awards of these contracts falls within the Common Sense Exemption Section 15061(b)(3), and Section 15301 (Existing Facilities).pursuant to CEQA Guidelines.
FISCAL IMPACT
The RAC Concession Agreements will provide monthly rental revenue in the form of space rental per square footage and 10% gross revenue at each of the rental car concession locations. All revenue will be deposited into the Airports Enterprise Fund and will contribute to the operation and maintenance of FAT. There is no impact to the General Fund or ratepayers of the City of Fresno from this item.
Attachments:
Bid Evaluation Form
Evaluation Committee Report
Proposed Concessions Agreement
Categorical Exemption