Title
Consider/Discuss/Act on Authorizing the City Manager to Execute a License Agreement with Cellco Partnership d/b/a Verizon Wireless (“Verizon”), a Delaware General Partnership, that will Allow Verizon to Place Certain Specified Antenna Facilities and Equipment on the City’s Elevated Water Storage Tank Located at 1800 W. University Drive, McKinney, Texas 75069, (the “EST”) and within the EST Compound in Accordance with the License Agreement
Summary
COUNCIL GOAL: Operational Excellence
MEETING DATE: January 3, 2023
DEPARTMENT: Public Works Department
CONTACT: Ryan Gillingham, P.E., Public Works Director
Alan Lathrom, Assistant City Attorney
RECOMMENDED CITY COUNCIL ACTION:
• Authorization of City Manager to execute a License Agreement between Verizon and the City of McKinney
ITEM SUMMARY:
• The proposed License Agreement between Verizon and the City of McKinney provides Verizon a license to install certain specified antenna facilities and equipment on the City’s elevated water storage tank located at 1800 W. University Drive, McKinney, Texas 75069. The proposed License Agreement also licenses Verizon to place an equipment facility within the EST compound together with such other equipment as is necessary to the proper use of the antenna facilities. Verizon’s installation and replacement of and access to the antenna facilities and equipment on the EST and the equipment facility and equipment within the compound around the base of the EST is controlled by and through the License Agreement.
BACKGROUND INFORMATION:
• The City of McKinney entered an automatically renewing lease agreement with Verizon that permitted Verizon to install equipment on the City’s EST and a supporting equipment facility inside the fenced-in EST compound to support Verizon’s provision of cellular communications to Verizon’s customers some twenty or twenty-five years ago.
• Different lease agreements were entered into by the City with Verizon and other cellular companies or their related leasing agents over the past thirty plus years for each City-owned EST on which they placed antenna facilities and equipment.
• Given the designation of ESTs as critical infrastructure following the September 11 attacks on the World Trade Center and the Pentagon and the heightened need to restrict access to and work performed upon and about the ESTs a move away from leases to license agreements was necessitated.
• The City has worked with the cellular companies having antenna facilities situated on City-owned ESTs to develop a standardized license agreement for use on each of the City’s ESTs on which antenna facilities and equipment are placed.
• AT&T has previously executed a very similar license agreement for one of the City-owned ESTs on which it has antenna facilities and equipment installed.
• The attached License Agreement is the first standardized License Agreement between the City and Verizon for that purpose.
• The proposed standard License Agreement affords Verizon the continuing opportunity to operate, maintain and upgrade Verizon’s antenna facilities while also providing the City more control over the use of the EST for such purposes.
• It is anticipated that each cellular company will sign the attached standard license agreement for each EST site rather than insisting on individual leases as in the past, which change will simplify the City’s oversight and management of such agreements.
FINANCIAL SUMMARY:
• The License Agreement requires the cellular company to bear the cost of confirming that its proposed equipment and the associated impacts related thereto will not negatively impact the City’s operation and use of the EST as an EST or the structural integrity of the EST. The License Agreement also requires the cellular company to pay a recurring market-based fee initially, with a consumer price index escalator, for the company’s use of the EST. It is anticipated that this recurring fee will help defray the City’s costs and expenses in overseeing the cellular company’s access to and use of the EST and related maintenance costs. The License Agreement also requires the cellular company to pay the City’s costs of providing access to the EST.
• The intent of the financial component from the City’s perspective is to avoid using City funds for the benefit of the for-profit entity and keep the City’s expenses cost neutral.
BOARD OR COMMISSION RECOMMENDATION: NA