11 - Ground & Tower Lease with T-Mobile-East Water Tower-Bonham Street

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Item No. I I TO: City Council FROM: John Godwin, City Manager SUBJECT: Ground and 'rower Lease Agreement with T -Mobile West LLC related to placement of telecommunications equipment on the West water tower and grounds. DATE: November 6, 2017 BACKGROUND: At the October 9, 2017 City Council meeting, Council approved a Ground and Tower Lease Agreement with T -Mobile West LLC ("T -Mobile") that allows T -Mobile to place telecommunications on the City's East water tower and grounds in exchange for reasonable monthly lease payments. T -Mobile now wishes to lease space on the West water tower on Bonham St. as, well, The terms in the attached proposed lease are identical to the lease approved by Council last month for the East water tower, STATUS OF ISSUE: As with the Lease for the East tower, this proposed Lease provides for an initial 5 year term with the possibility of an additional three renewal ten -ns of 5 years each. The rental fees for the first year will be $1,850,00 per month, and the fees will escalate by 3% each successive year of the initial terrn and any renewal terms. Other terms of the Lease govern, access to the ]eased site; provide for an escalation of rent of 150% should T -Mobile improperly hold over after expiration of the final renewal terrn; and provide for inderrinification and insurance coverage, among other typical lease provisions. Besides providing for a new source of revenue for the City, the arrangement will allow T -Mobile to better serve the residents of Paris who are there customers. BUDGET: In the first year alone, the Lease will produce $22,200.00 in revenues, and the rentals increase by 3% for every year of the lease thereafter. This is in addition to the identical revenues that will result from the Lease on the East Tower. RECOMMENDATION: Authorize the City Manager to execute the attached Ground and Tower Lease Agreement on behalf of the City.