Department of Natural Resources - Lease of Lake Erie Submerged Lands - Rental.

Published: 1999-07-04

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The rent rates herein determined shall be applied equally throughout the entire lake Erie shoreline, including Sandusky bay, Maumee bay and the islands. Rates will be determined by the director using the description of the development, improvement or activity provided by the applicant according to the following schedule:

(A) Existing fill - any artificially filled area or filled portion of any area of the territory existing on March 15, 1989, shall be charged $0.01 per square foot per year for the term of the lease or renewals. This rental rate shall apply only to the use of the filled area as it existed on March 15, 1989. If the lessee or its assigns change the use of the filled area, the rent may be modified to reflect the rent rate in effect for the new use at the time of the change of use.

The rental rate for any artificially filled area of the territory existing on March 15, 1989, which qualifies as a governmental non-income producing facility as determined by the director, shall be $1.00 per year.

(B) Private floating dock - $50 per year.

(C) Private structure - $50 plus $0.02 per square foot of leased area per year.

(D) Private erosion control structure - $50 plus $0.01 per square foot of leased area for the first year, and $0.01 per square foot of leased area per year thereafter.

This rental rate shall be applied to all qualifying leases, or qualifying portion of the leased area for leases executed on or after the effective date of this rule. For existing leases executed after the April 30, 1992 effective date of the original rules, this lease rate will apply upon the rent renewal date for the lease, unless the lease is modified prior to such date. This rate shall not apply to leases executed prior to April 30, 1992 unless the lease is modified on or after the effective date of this rule.

(E) Semi-private and small commercial facility occupying no more than four acres - $0.03 per square foot of leased area per year.

(F) Large facility and an industrial facility - $0.04 per square foot of the leased area per year.

(G) Utility - $500 per year.

(H) Governmental income producing facility shall pay the rent for the category of the facility.

(I) Governmental non-income producing facility shall pay $1.00 per year. Where practicable, a lease for all such governmental uses or purposes shall be covered in one instrument for each political subdivision.

(J) "Escalator clause" - the rental rates as provided for in paragraphs (B) to (H) of this rule, shall be recalculated every five years beginning on the fifth anniversary of the effective date of this rule and any increase shall be at the same rate of increase as the "National Consumers Price Index" (C.P.I.). The annual base rate for calculation purposes shall be the rate established by the U.S. department of labor for the city of Cleveland, Ohio, urban, all categories (C.P.I.U.) for February, 1992. That annual base rate is 136.2. The new rate shall be most recent C.P.I.U. annual rate established to the nearest month prior to the date of recalculation by the U.S department of labor. Once the new annual rate has been determined and the amount of increase has been calculated, then the new annual rate shall become the base annual rate for calculation purposes for the next five year period of time. This change in rates shall continue until such time as the C.P.I.U. is no longer used or the director determines that another method may be more accurate. The rental rate percentage increase shall be the lesser of the following:

(1) The base annual rate shall be subtracted from the new annual rate, the base rate shall be divided into the difference between the base rate and the new rate and the answer will be the percentage of increase or decrease over that five year period of time:

example:new rate (nr)140.2
- base rate (br)136.2
difference (df)4.0
df 4.0
___________= .0293 or 2.93% increase
br 136.2

current rent: $10,000.00 .0293 increase = $293.00

new rent: $10,293.00

(2) At no time shall the increases of the rental rate exceed 20 percent in any given five year period of time, nor shall the aggregate increase of the rental rate exceed 150 percent over the term of the lease. Also at no time shall the rental rate charged in any lease written by the state of Ohio pursuant to sections 1506.10 and 1506.11 of the Revised Code or by these rules be lowered.

Should the United States department of labor discontinue the use of C.P.I. the director shall select as nearly compatible a statistical formula on the purchasing power of the consumer dollar as is then available and published in some responsible governmental publication.

This escalator method shall not affect the rent charged under paragraph (A) of this rule existing fill or paragraph (H) of this rule governmental non-income producing facility.