The proposed Trinity Site lease makes no provision to protect Los Alamos Schools from inflation.
It’s easy to understand how time will erode the value of our community’s income. The basic rent is $511,000 per year.
First, from the terms of the lease, the best-case income after 25 years is $539,310. Second, what would the value of $511,000 be after 25 years of inflation?
Call this X. We then take the ratio of 539,310.10/X to compute the fraction of $511,000 that our schools will earn in 25 years.
Since we don’t know what inflation will do over the next 25 years, let’s consider historical data to get a range of possible outcomes.