15 - Conveyance of Tower Lease with Suddenlink on 9.1 acre tract to American Spiralweld PipeItem No. 15
TO: Mayor & City Council
Grayson Path, City Manager
FROM: Stephanie H. Harris, City Attorney
SUBJECT: TELECOMMUNICATIONS TOWER LEASE WITH
SUDDENLINK/ALTICE ON 9.1 ACRE TRACT TO BE CONVEYED TO
AMERICAN SPIRALWELD PIPE COMPANY UNDER 2018 MASTER
ECONOMIC DEVELOPMENT AGREENET
DATE: July 7, 2020
BACKGROUND: The city has owned, for several decades, an approximately 9.1 acre tract located
west of 19th St. NW, a tract once referred to as the Legion Airport properties. In 2005, the city
leased this tract to Cox Southwest Holdings, L.P. for the site of a telecommunications tower. The
lease was amended in February, 2006 and assigned from Cox Southwest Holdings, L.P. to
Cebridge Acquisitions Co., LLC in March of that same year. The cable television tower erected
on the site was operated by Suddenlink cable company, which in turn has been acquired by Altice.
The lease was for ten years subject to 4 additional renewal terms of 5 years each. The second such
renewal term expires on September 30, 2020.
The tract was the city's contribution, along with a tax abatement, to the economic development
package offered to American SpiralWeld Pipe Company ("ASWP") in 2018, and it is included in
the Master Economic Development Agreement to be conveyed subject to the lease. As the lease
covers the entire tract, rather than the area immediately around the tower, the lease has made it
difficult for ASWP to use the tract, which they intend to use as a laydown yard.
STATUS OF ISSUE: I began trying to contact Altice over a year ago to attempt to renegotiate
the lease to cover the area around the tower only, with easements to and from the tower for access.
Altice finally responded to my letter of June 3, 2019 in early 2020, and after discussing the issue
over a period of months over which Altice was very unresponsive, Altice informs me that the tower
was removed some time ago (which we have verified), and that they have no use for the property.
The option to renew belongs to the city, but because they have no use for the property, Altice is
not willing to renegotiate the lease, and the city has no means of compelling them to do so.
At this point, in order to honor the spirit of the city's agreement with ASWP, and so that ASWP
can have full use of the tract, the city's best option is to terminate the lease and require
Suddenlink/Altice to remove any remaining equipment and structures from the site.
BUDGET: The rental payments on the lease escalate slightly each year based on the Consumer
Price Index. At this time, the rental rate is $7,826.64 per year. That is an increase of $1,826.64
over the original rent of $6000.00 in 2005. As there are two more potential 5 year terms, this would
result in a loss of revenue of at least $78,266.00 spread out over the 10 year period.
RECOMMENDATION: Authorize termination of the Amended Lease Agreement with
Suddenlink/Altice regarding the 9.1 acre tract formerly known as the Legion Airport properties.
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AMWIPlEARAGRUMM
STATE OF TEXAS 0
This amended lease agmement (the -Lease- or the
- made w'
entereiy R by f between CITY OF PARJS, a i. M `+; e 1
Thate [easedpremises of the
kF R h described k "OPof Lessor. Iwated
pact of
properties located West of North West 19th Street iq the Ci!X of Pa i ds,
' i M
r. •R � r fr11= R � �, a
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1
The term of this Lease shalf be rr rive (5))x -am beginning Rthe I stday oWcto2065,ber.
r ending on 1. day of +' r 2010. al�y renew'able thereafteron
October date thereor, r"' fbur (4) a4ditionalr
finally on the 3011 day of Seotember 2030. wirvided
1 s. i f sr f 1 T
No -
termination
4Lessee it Ssixty ) days advancedate
InitialThe einnualrentdue and payableRLessor4Lessee.for the leaseof above
uns a % ai Ria" w - RW I
a
m + r PMerLY and Premises ufltc the mid COX SOUTHWEST HOLDINGS.
the tem ofyeais as stated herein, uponand conditions
Six ThousetW'Dollars ($6,000-00) arutually, the first installment of Six ThousandDollgM
(56,000.00) having been paid in'advance by said Lessee to Lc%sor. the -receipt of utich is
hereby ackno-Aledged, and a like installmebt shall be due and 1payable on the JQ day of
October, 2006 und! day of October f !„ to r; including
day of October, 2029.- Provided however. cominencing on October 'I. 20D6, and annually
thereafter on ewh anni%vrsary date of the Lean, the amount payable by the Lessor to the
Lessee shall be f ftreflect changes4 Consumer i
Dallas/Ft. Worth MeRroplex Reglion 6 Bureau of Labor Statistics for each contract year. For
each )Var's adjustment. the CPl bw month used for cilculating each adjustment shall be
shallMarch of said )var.
4. Lessee 3 toLessoror orderR'the City Clerk. in the City orparis.Lamar
promptlyCounty. Texas, the above described and mentioned anntml payments when due strictly and
f derault or delay.
5. Any buildings. installations orimprovemenis ofany kind orcharactermada and erected upon
` ]easedpmperlyfi premises byLessee shall beandremainproperty
not attach! or• f A 4 ofrealtyand3 f byLessee removed at any timeprior
tothe expiration orothertermination of
*'Lesw shall ..-1 Snmy not assign / leased i 1. li premises or
any pan thereofWithouthavinghad and obtained
Body G`.. Pads.
7. Except as otherwise provided Lessee not or peirnit the use1 anypart of
2
thereofleased p6pedy prid P110mises fbr any purpose whamver other than the use
incident .i
,,aintenanceOPerafl0I Of a communily
Lesseeack,..f ixLessoris !«.
ernmental entity, and theproperty the
subjectorthis
1 Publicly
4 "Imed
'f f iCfW- As further considemdon
fOr the Use'of said property,
to COOPemtefullyduringofthis
Lease.subjeattoreasonable
logistical, regulatory, and e4neering considerations and limitatIOPA with the
efTbrIs of
Lewor and other entities to co-lome
varlousantenna or, ofther'. •
of Zohirig
f 3 1 of of orother` ,a,s«
r legislation, 10 M, , ize the
pmueraflon orsuchtowers the City ofpa& Failure
M ! •:ly ith this provision
shall constitute material i 1w 4i ■
MLemee shall
9al I times keepthe leased property1
Premises f f
ofweeds,
IRIIYr A ! #- 1 r•
1 1
-- other condition
of actioll Of TxW
AroperwoccLirringon the leasedf
agents,or ! andLessornot liable A
a Ah 4 f #t « f
k7 1 4
building. towff, or any other condition or tiie premises beinge improperly constructed.
2
qWnfained or beingor
CC
149 out of repair,hereby
and
AgmingA hi f And save Lessor harmless
from WI claiftls
for AnY such
damages or
irguries; Lessee must at all
tirnesduring the 1 f'. this
Agreement.and any
9A
thereor. keepand maintain in ftill
force♦ef&vt apolicy or policies Ofinsurance, Providing
at lent f R% Per Petsonand S500,000.001
r any single occurrence for b
odilyftlury
or deathand.$1 00,W0.00 ibr any single occurrence for injury to of
destruction o r 1 ♦ f ,
•indemnl6ringthe Lem. officers.
employees.# all Pe6ons
for f all
damages. personal
..iaiinjuriesf property 1 • sustained in 4 upon
leased property, or any pan thereof. as the result
of
apats, servants or employees, f sliall
-pay Premiums due thereon
It is
e.V-resslyprovided L:such insuranc*policy or Ii.
olicies shall.1mme theLessor
additional insured and shall contain a clause that the insurer will
1cancelordecrease
without h Lessorthirty (30) daysnotice
♦ must
1 and !I by freputablew'•. f or
companies. f
Approval
by- the City Attorney orthe Cityof Paris. Lessee or its insurance carrier or carriel-s &V -all
offtris.or , sail
City Clerk, actinent letterorcertificate N_
forcethntsuch insurance is In Rill
and
♦ I f
IL 1 f Lessee at any time dersult In any or the covenants. conditions, PMvislons and
stipulations herein contained, this Agreement may be terminated at Lessors option and it
I 4 i 4 4"NF
f wM f 1 f , i property
1
andeffects thererrorn• hidice_ l 1 ai
dluu�aa�eq�a.6 IL���� ����o��&� • I�du�� � ..,
r
El
�br the collection of �enta Is or otherwise. on pAnfid eye —6 *ig!
♦ as f 'e-"10118
htrcbY
OxPresslYI' s by
12. A firit lien is hereby : I 1 ■retained
Oil all
Of Lissft*s
Property and eflicts
%slhich may be located up, 1 u Prefflimm to
Lessor
Lease Agreement by Lessee according to its fk* and
teaor, effect andresdin&
13. 7bere shall be ,r t 1 over ofsuchpremises or anypart thereof
expiration #
Leon %V"thcut tht 04iress Wfitten sareernent of Lessor In advance dswh holdover. and at
the rete specified by lessor.
14. It is specifically understood. agreed
and stipulgled that this Lnw is made.. executed and
entered « by panicsexpress, and
intdrition that it
shall , for 1 , 4 of distribution television4 to the residents of the City of
Paris,
IN WITNESS WHEREOF.
Of Paris.
IMuniclPalcorporation. t f these
1 by
whority D1>re.soludon#1. 1 fdie CitvCouncil
�knwmw-BJA
a'wsc presents to be ewcuted by Its Preside . L k: a
CITYOF
d
Y �o [ 00
0MarwWw
Jwiice Ellis, 0ty Clerk,
miunrdvd Leaw. Algreemw -'Page 5
FIV Oil
.11
Secrelwy
THE STATE OF TEXAS
4
COUNTYOFLAMAR
M'
m
pX, ME, the undersigned authorltv. in and tbrsikid
.4
.2ta I 1Lit-A 11114.1ilL �riljlltm FIR '(T4qlT*!lJr'q 1$1 lif-4,4111,971
LESSEE
CIVEN UNDER MY -RAND AND SEAL OF OFFICE, this — day ombmaiy. zoori.
S'"
STATE OF TEXAS rl
COUNTY OF SMITH
BEFORE ME, the underflipied authority, on this ditypersonallyappLved
President of Cox
2006. CIVEN UNDER MY HAND AND SEAL OF OFFICE, this day or.___
& "nulvel Lcaw Agrement -- Pap 6