CITY COUNCIL STAFF REPORT
MEETING DATE: FEBRUARY 15, 2017
PREPARED BY: Anthony Eulo, Program Administrator/Community Services
APPROVED BY: City Manager
TITLE
AMENDMENT TO CROWN CASTLE PROPERTY USE AGREEMENT
END
RECOMMENDATION(S)
RECOMMENDATION
Authorize the City Manager to Execute the First Amendment to Crown Castle's Property Use Agreement.
BODY
COUNCIL PRIORITIES, GOALS & STRATEGIES:
Ongoing Priorities
Maintaining fiscal responsibility
REPORT NARRATIVE:
The City of Morgan Hill has allowed cellular facility installations at the Nob Hill Water Tank site since 1995. Currently, both Sprint and Verizon operate facilities on this site. Verizon's agreement with the City was assumed by Crown Castle International, a worldwide cellular property management company. Crown Castle's current agreement for that site expires June 30, 2020. The current annual revenue from Crown Castle is $28,400 and is increased annually by 4%. The agreement also allows Crown Castle to locate up to three additional cellular carriers on the Nob Hill site, with the City receiving 50% of the revenue for each additional carrier. Any such installations would go through the current Conditional Use Permit process which would evaluate the visual impact of additional carriers on the site, as well as the extent to which the proposed installation meets City building requirements.
With the end of the agreement coming in three years, Crown Castle has approached the City to ask for an extension. After a series of negotiations during the past year, the following deal points are proposed:
* Renewal Term: 20 years with a new expiration date of June 30, 2040;
* Compensation: Immediate increase in annual site rent from $28,400 to $38,500;
* Termination: Clarification that the City can terminate the agreement, if needed, with adequate notice (four years) provided to allow for the cell facilities to be relocated;
* Bonus Payment: An incentive payment of $10,000 due upon full execution of ...
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