Town Council Regular Session


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  Item # H.       
Meeting Date: 09/08/2021  
Submitted By: David Gephart, Finance
Department: Finance  

SUBJECT:
Resolution No. (R)21-44, authorizing and approving renewal of a communications equipment site lease between T-Mobile and the Town of Oro Valley at 10555 N. La Canada Drive
RECOMMENDATION:
Staff recommends approval.
EXECUTIVE SUMMARY:
The Communications Equipment Site Lease with T-Mobile for their equipment on the Town's Community Center rooftop is set to expire on December 29, 2021.  This agreement was originally entered into by "Sheraton El Conquistador Resort and Country Club" in December 1996.  As part of the Town's acquisition of this property in 2015, the lease was assumed by the Town.

T-Mobile, with the proposed Lease Amendment One, is requesting two additional five-year terms that, if both are exercised, will extend the term of this lease through December 2031.  T-Mobile is proposing an increase to the lease amount paid to the Town totaling $20,700 per year, with a 10% escalator at every five-year renewal.  This amounts to about a 6% increase over what is currently being paid to the Town under the legacy agreement ($19,502.41).
BACKGROUND OR DETAILED INFORMATION:
The Communications Equipment Site Lease with T-Mobile for their equipment on the Town Community Center rooftop is set to expire on December 29, 2021.  This agreement was originally entered into by "Sheraton El Conquistador Resort and Country Club" in December 1996.  As part of the Town's acquisition of this property in 2015, the lease was assumed by the Town.  The annual lease payment was $13,200, escalated by 5% for every five-year term renewal.

T-Mobile, with the proposed Lease Amendment One, is requesting two additional five-year terms that, if both are exercised, will extend the term of this lease through December 2031.  T-Mobile is proposing an increase to the lease amount paid to the Town totaling $20,700 per year, with a 10% escalator at every five-year renewal.  This amounts to about a 6% increase over what is currently being paid to the Town under the legacy agreement ($19,502.41).

As with all communications providers having equipment on Town property (excepting those who have equipment in Town right-of-way), T-Mobile is contending that in order to ensure continuity of services within their geographic service area, they are requesting the amendment to the existing lease be approved well in advance of the December 29 expiration.
FISCAL IMPACT:
Revenue of $20,700 per year, with a 10% escalator at every five-year renewal.
SUGGESTED MOTION:
I MOVE to APPROVE Resolution No. (R)21-44, authorizing and approving renewal of communications equipment site lease between T-Mobile and the Town of Oro Valley at 10555 N. La Canada Drive.
Attachments
(R)21-44 Resolution Comm. Site Lease
Original site lease agreement
Proposed renewal agreement


    

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