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Item Number: H.6. CITY COUNCIL REPORT SUBJECT: Sixth Amendment to Verizon Wireless Lease Agreement MEETING DATE: January 14, 2025 TO: Mayor and Council FROM: Kevin Artz, Chief Financial Officer REVIEWED: Reyes Medrano Jr., City Manager PURPOSE: To approve the sixth amendment to the lease agreement with Cellco Partnership d/b/a Verizon Wireless for the lease of real property at the City's wastewater treatment plant for the operation of a cell tower. BACKGROUND: On December 3, 1980, the city entered into an agreement for an option to lease real property, for the construction of a cell tower site, at property located at the City's wastewater treatment facility. The agreement has been modified on 5 occasions since the original agreement was authorized. The following are the amendments to the original agreement: • First Amendment, April 27, 1982 - Provided a more specific description of the property. • Second Amendment, June 9, 1983 - Extension of the option and refinement of the description of the property. • Third Amendment, March 13, 1984 - Updated the property description. • Fourth Amendment, April 11, 2001 - Extended the original lease term of 20 years for an additional 25 year to 2029. • Fifth Amendment, August 6, 2019 - Provided for the installation of 2 new Fiber Routes at the property. DISCUSSION: The sixth amendment to the lease agreement provides for financial incentives, extension of the lease terms, lease payment escalators and potential revenue sharing. A one-time payment of $15,000 will be provided to the City upon execution of the agreement. The term of the agreement provides for an extension from 2029 until 2064 (seven five-year extensions). The lease payment escalates 15% at each of the seven extensions. The current lease rate is $26,972 per year and would be $71,746 by the seventh extension. The agreement also provides for revenue sharing if Verizon sub-leases portion of the tower to other providers. The City Attorney also updated the provisions for termination, insurance and indemnification to further protect the City. BUDGET IMPACT: The lease revenue has been included in the budget. RECOMMENDATION: Staff recommends Council approve the sixth amendment to the lease agreement with Cellco Partnership d/b/a/ Verizon Wireless. ATTACHMENTS: 1. 01 14 24 Sixth Amendment to Lease Agreement - Cellco.Verizon - American Tower