Agenda Item AGENDA STAFF REPORT ASR Control 23-000510
MEETING DATE:	06/27/23
legal entity taking action:	Board of Supervisors
board of supervisors district(s):	5
SUBMITTING Agency/Department:	John Wayne Airport (Approved)
Department contact person(s):	Charlene V. Reynolds (949) 252-5183
	Kim Kitko (949) 252-5291

Subject: Approve Peer-to-Peer Vehicle Sharing License with Turo Inc.

ceo CONCUR

County Counsel Review

Clerk of the Board

Concur

Approved Agreement to Form

Discussion

4/5 Vote

Budgeted: N/A

Current Year Cost: N/A

Annual Cost: N/A

Staffing Impact:

# of Positions:

Sole Source: No

Current Fiscal Year Revenue: See Financial Impact Section

Funding Source: N/A	County Audit in last 3 years: No
Levine Act Review Completed: Yes

Prior Board Action: N/A

RECOMMENDED ACTION(S):

Find that the proposed project is Categorically Exempt from the California Environmental Quality Act (CEQA), Class 1 (Existing Facilities) pursuant to CEQA Guidelines Section 15301.

Approve and execute a license with Turo Inc. for Peer-to-Peer Vehicle Sharing for a term effective August 1, 2023, through July 31, 2024, with an option to extend for up to one year.

Authorize the Airport Director or designee to make minor modifications and amendments to the license that do not materially alter the terms or financial obligations to the County and perform all activities under the terms of the license.

SUMMARY:

Approval of the Peer-to-Peer Vehicle Sharing License will provide a safe environment for John Wayne Airport guests and Turo Inc.’s hosts to conduct peer-to-peer vehicle sharing.

BACKGROUND INFORMATION:

Turo Inc. (Turo) is an American peer-to-peer vehicle sharing company based in San Francisco, California. The California Court of Appeals ruled Turo is not a rental car company, stating Turo does not own, rent or control the vehicles listed on the platform and therefore is not considered a rental car company. The company allows private car owners to share their vehicles for a fee via an online and mobile interface. Turo has 14 million members, 450,000 shared vehicles and operates at approximately 70 airports, including Ontario International Airport (ONT), San Jose International Airport (SJC) and Sacramento International Airport (SMF).

Turo was launched as RelayRides in the year 2009. It was featured as one of the top 15 on-demand startups by Forbes in 2015. A pioneer of the vehicle sharing marketplace, Turo offers the world’s largest vehicle sharing marketplace. The peer-to-peer vehicle sharing company allows guests to choose from a unique selection of nearby cars, while local hosts can offset the costs of car ownership with extra income. By placing vehicles on the platform, revenue is put back into the hands of the community and helps perpetuate cycles of investment and growth in Orange County.

As a Peer-to-Peer Vehicle Sharing operator, Turo does not require employee presence or facilities, such as terminal ticket counters, car wash space, or a kiosk service area, as a typical rental car company. Vehicles are pre-booked and delivered to the Airport upon guest arrival.

License Agreement Terms

John Wayne Airport (JWA) seeks Board of Supervisors (Board) approval of the Peer-to-Peer Vehicle Sharing License (License) for a one-year term with a one-year option to extend. The short-term allows JWA flexibility in adjusting the license terms depending on potential changes in this new peer-to-peer vehicle sharing market. The License area is confined to the JWA parking garages, except for the Rent-A-Car (RAC) area located on Level 0 of parking garages A2 and B2, and the Valet Parking area located in parking garage C. In-person exchanges must be made in the Transportation Network Company (TNC) pick-up areas. Administrative fees for violations are included in the License and will be monitored and enforced by JWA staff. Examples of listed violations include unsafe driving practices, failure to maintain proper insurance, and parking in restricted areas. Continued violations, or two of the same violations in any 30 day period, may result in increased fees.

The License has a percentage of gross receipts fee structure of 10 percent. Based on the data collected, Turo projects JWA’s monthly revenue to be in the range of $40,000 - $60,000 per month.

Compliance with CEQA:

The proposed project is Categorically Exempt (Class 1) from the provisions CEQA pursuant to Section 15301 (Existing Facilities) because it involves a license agreement for the use of JWA existing facilities to conduct vehicle drop off or handoff of rental vehicles within specified license areas of the airport, involving negligible expansion of existing use.

FINANCIAL IMPACT:

The estimated annual revenue to JWA for Turo’s License term of August 1, 2023, through July 31, 2024, will be approximately $480,000 - $720,000. Revenue for this License is not included in the FY 2023-24 Budget for Airport Operating Fund 280 but will be absorbed in the FY 2023-24 Budget. The revenue will be included in the budgeting process for future years.

The County may terminate this License and all of its obligations hereunder with or without prior notice to Licensee. As a courtesy, the Airport Director will attempt to give 30 days written notice to Licenses.

STAFFING IMPACT:

N/A

ATTACHMENT(S):

Attachment A - Peer-to-Peer Vehicle Sharing License Agreement with Turo Inc.