TO: Mayor and City Council
THROUGH: Keith Stahley, City Manager
FROM: Ryan Zink, Franchise Administrator
SUBJECT:
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Right-of-Way Use Agreement with New Cingular Wireless, PCS, LLC.
Ward(s): All Wards
Councilor(s): All Councilors
Neighborhood(s): All Neighborhoods
Result Area(s): Good Governance; Safe, Reliable and Efficient Infrastructure; Strong and Diverse Economy.
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SUMMARY:
summary
The Right-of-Way-Use Agreement grants New Cingular Wireless, PCS, LLC (more commonly known as AT&T) the non-exclusive right to access City rights-of-way to install, construct, repair, replace, upgrade, maintain, and operate small wireless facilities. The agreement is effective July 1, 2023, through June 30, 2028, with one automatic five-year extension.
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ISSUE:
Shall City Council authorize the City Manager to execute the Right-of-Way Use Agreement between the City of Salem and New Cingular Wireless, PCS, LLC for the placement of small wireless facilities in the City rights-of-way?
RECOMMENDATION:
recommendation
Authorize the City Manager to execute the Right-of-Way Use Agreement between the City of Salem and New Cingular Wireless, PCS, LLC for the placement of small wireless facilities in the City rights-of-way.
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FACTS AND FINDINGS:
Salem Revised Code (SRC) Chapter 35 requires public utilities to have an agreement with the City to occupy the City’s rights-of-way (ROW) and to pay a fee to the City for its use of the ROW.
The Right-of-Way Use Agreement (Agreement) grants New Cingular Wireless, PCS, LLC (Cingular) the non-exclusive right to access City ROW to install, construct, repair, replace, upgrade, maintain, and operate small wireless facilities. The Agreement is effective July 1, 2023, and will continue until June 30, 2028. The Agreement will automatically renew for one five-year term, unless terminated by either party as set forth in the Agreement.
As compensation for the benefits and privileges granted in the Agreement, and in consideration of permission to use the City ROW, Cingular shall pay to the city $316 per year for each structure on which Cingular has small wireless facilities attached. This annual fee increases 4% annually beginning July 1, 2024. Additionally, Cingular will pay a one-time pre-agreement negotiation and administration fee of $1,000. Wireless communication revenue received as compensation for use of the ROW is used to support General Fund services.
All wireless equipment, including small wireless facilities, when installed in the ROW are to be placed on existing or replacement poles, as regulated by the design and construction standards provided for in SRC Chapter 703 of the Unified Development Code (Wireless Communications Facilities). Unless installed for use as a streetlight, no new poles are allowed in Salem’s ROW. In addition to the Agreement, wireless providers must gain permission from the pole owner(s) prior to attaching equipment to the pole. Applicants wishing to place small wireless facilities on City-owned poles are required to obtain an encroachment license and pay fees for the use of City infrastructure.
Section 332(c)(7) of the Federal Communications Act preempts local governments from regulating the placement, construction, and modifications of wireless service facilities based directly or indirectly on the environmental effects of radio frequency (RF) emissions, to the extent that the provider is in compliance with FCC’s RF rules.
BACKGROUND:
In July 2018, Cingular was granted a non-exclusive Right-of-Way Use Agreement for the placement of wireless facilities in the City ROW. The initial five-year term of that agreement expired on June 30, 2023. In accordance with that agreement, Cingular notified the City prior to the expiration of the five-year term of their decision not to renew the agreement. Cingular wished to renegotiate the terms of the agreement, particularly for the per/pole compensation to be in-line with the 2018 FCC Declaratory Ruling, Report and Order regarding wireless infrastructure deployment.
The annual fee for small wireless facilities negotiated in the previous agreement was $1,250 per pole, escalated 4% annually over the five-year term. The 2018 FCC Order, set a presumptive annual fee for small wireless attachments to a maximum of $270 per pole. In the new Agreement, Cingular agrees to pay an annual fee of $316 per pole, calculated by escalating $270 by 4% annually over a five-year period.
Further, the July 2018 agreement considered the installation of larger macro wireless facilities in the ROW. Cingular has not installed and has no plans to install macro wireless facilities in the ROW. Therefore, the new Agreement, only considers the installation of small wireless facilities in the ROW. To date, Cingular has installed 16 small wireless facilities in the city’s ROW.
RYAN ZINK
FRANCHISE ADMINISTRATOR
Attachments:
1. Right of Way Use Agreement between the City of Salem and New Cingular Wireless, PCS, LLC