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HomeMy WebLinkAbout10 ATS COMMUNICATIONS~ ~~~ ~~'~ °,}, Agenda Item 10 -- : ~ AGENDA REPORT Re~;eWea: .: ~ City Manager ~~~ _,~ ,~ Finance Director MEETING DATE: APRIL 20, 2010 TO: WILLIAM A. HUSTON, CITY MANAGER FROM: REDEVELOPMENT STAFF SUBJECT: FIRST AMENDMENT WITH TELECOM COMMUNICATIONS) TO CONSULTANT SERVICES AGREEMENT PARTNERS GROUP, INC (DBA ATS SUMMARY: City Council approval of a proposed First Amendment to the Consultant Services Agreement with ATS Communications (the "Consultant", also "Telecom Partners Group, Inc.") is requested. RECOMMENDATION: It is recommended that the Tustin City Council authorize the City Manager or a designee of the City Manager to execute the proposed First Amendment to the Consultant Services Agreement with Telecom Partners Group, Inc. (dba ATS Communications) clarifying the method and manner under which the Consultant is to be compensated. FISCAL IMPACT: No change is proposed to estimated revenues from wireless carriers under the terms and conditions of the existing Consultant Services Agreement with ATS, the City's Consultant. The Consultant is compensated from net revenues derived from each new wireless carrier located on City-owned property. As currently estimated, gross revenues per license would likely range from $21,600 to $28,800 annually depending on the location, the investment required of the carrier in the construction of the facility, and the number of antennas. The City will not incur costs for the installation of the carrier's facilities; all costs of construction, maintenance and operation will be the responsibility of the carrier. ATS will receive twenty-five percent (25°/0) of net revenues from each license as compensation for procuring carriers, processing carrier applications, inspecting the installation of new facilities, inspecting the maintenance of existing wireless facilities under the new licenses, and related issues impacting the terms and conditions of the license agreement as directed by the City Council Agency Report April 20, 2010 First Amendment -Telecom Partners Group, Inc. Page 2 City. In addition, ATS will be responsible for updating the Wireless Master Plan, as requested by the City. BACKGROUND: In November 2007, the City entered into an agreement with ATS Communications to develop and implement a Wireless Communications Master Plan (WMP) for the City and to act as the City's agent in procuring qualified wireless carriers wanting to locate facilities on City-owned property. ATS Communications completed the Wireless Master Plan in June 2009 and the City Council received and filed the WMP in August 2009. ATS Communications is in the processing of procuring wireless carriers and assisting in the negotiation process with potential carriers at Cedar Grove Park, Tustin Sports Park, Citrus Ranch Park, and Pine Tree Park. All qualified proposals for wireless facilities on City-owned property will be brought forward to the City Council for consideration. In review of the existing Consultant Services Agreement, an issue has arisen as to future compensation to ATS. In accord with Section 2 of the existing Agreement, the Consultant can only be compensated from net revenues distributed under lease agreements with wireless carriers. The Agreement does not address Consultant compensation for revenues derived from license agreements, the preferred legal form under which new agreements with wireless carriers are proposed as recommended by the City Attorney and as indicated in the City's Wireless Master Plan. The proposed changes to the Consultant Services Agreement would allow the Consultant to be compensated under the same terms and conditions as specified under lease agreements. In addition, the proposed change to the Consultant Services Agreement will clarify that one time payments made by wireless carriers, referred to as capital contributions, are to be wholly retained by the City. The City Attorney has reviewed and approved the attached First Amendment to the Consultant Services Agreement Christine A. Shingleto Assistant City Manage ~~. ~w Jo n Buchanan development Program Manager Attachment AMENDMENT NO. 1 TO CONSULTANT SERVICES AGREEMENT This AMENDMENT NO. 1 TO CONSULTANT SERVICES AGREEMENT ("Amendment No. 1 ") is made and entered into as of , 2010 by and between the CITY OF TUSTIN, a municipal corporation, ("City"), and TELECOM PARTNERS GROUP, INC., a California Corporation, (dba ATS Communications) ("Consultant"), pursuant to Section 2 "Compensation" of the Consultant Services Agreement. WHEREAS, City and Consultant entered into a Consultant Services Agreement on November 14, 2007 (the Original Agreement and all amendments shall be collectively referred to herein as the "Agreement".) The Agreement provided for consulting services to the City for special skills and knowledge in the field of wireless communication technology to assist the City in marketing and facilitating the development of cell towers on City-owned property to provide a wireless communication network throughout the City; and WHEREAS, the Consultant and City have identified the need to clarify Section 2 COMPENSATION of the Original Agreement. Under the Original Agreement, compensation to Consultant would only be derived from net revenue collected from the leases of the wireless carriers as the only contractual form under which Consultant would be entitled. With advise from the City Attorney's Office and as identified in the City's Wireless Master Plan, the preferred contractual form with wireless carriers is a license; and THEREFORE, it is agreed that the Original Agreement be amended as follows to reflect the modifications requested by Telecom Partners Group, Inc. and authorized by the City of Tustin: 2.0 MODIFICATION OF COMPENSATION. 2.1 Pertaining to Compensation of Consultant shall be modified to define all references of "Lease" to also mean "License". Paragraph 2 shall also include a new section as follows: "(c) For purposes of calculating Compensation of Consultant, all revenue not part of the net lease or net license revenues shall be excluded from the New Lease or New License revenues including, but not limited to monies referred to as capital contributions or in-kind contributions made to the City in the form of physical improvements or infrastructure." 3.0 GENERAL REQUIREMENTS. All other provisions contained in the Agreement shall continue to apply. IN WITNESS WHEREOF the parties have executed this Amendment No. 1 as of the dates stated below. DATED: "City" City of Tustin, a municipal corporation By: William A. Huston City Manager APPROVED AS FORM: Doug Holland City Attorney "Consultant" Telecom Partners Group, Inc. dba ATS Communication y~ f _. Tony I geg e i President