In November of 1991, the City Council approved a Communications Lease with Tochikogyo USA, Inc. for a radio repeater site on the roof of the Tower building at 3900 W. Alameda (the �Lease�).  The City constructed a radio room on the roof of the Tower and installed four antennas.  The Lease provided for a monthly rental of $400 per month.  In combination with a second hillside repeater, the radio repeater site on the Tower has provided excellent radio coverage for safety and non-safety personnel throughout the City.

The initial term of the Lease was for five years. The first amendment to the Lease extended the term an additional five years with no increase in the monthly rent.

The Lease expired at the end of November 2001 and automatically became a month-to-month agreement by the terms of the Lease.

In 2002, Tochikogyo USA, Inc. sold the property to West Alameda Avenue Property, LLC.  After the sale of the property, the City was informed by the new landlord that it wanted the renewal of the Lease to be at market value and offered a renewal at the monthly rental of $3,250.  The landlord indicated that it would be open to a reduced monthly rental below market because the Lease was with the City.

Burbank Municipal Code � 9-502 requires the City to obtain an appraisal of the fair market value of the property.  This is required because Burbank Municipal Code � 9-503 prohibits the lease of any property for City purposes if the lease payments exceed the appraisal.  The City has obtained an appraisal and the proposed monthly rental is less than the appraised monthly rent.

We have now concluded negotiations and the proposed lease renewal is attached to this memo.  In summary, the lease renewal provides:

• For a term of ten years to 2013.  At anytime after June 30, 2008, the City may terminate the Lease upon 30 days notice and pay a termination payment equal to the next twelve months rental payments.

• The monthly rental payment is $2,500 a month commencing July 1, 2003 with an annual increase of 4% effective July 1, 2004.

• The City has the right to terminate the lease without penalty if it establishes that interference caused to the City�s communications equipment by the Lessor and/or its licensees, lessees, and or third parties to the City�s equipment or operations at the Building cannot be corrected.

The renewal of the Lease is exempt from the provisions of the California Environmental Quality Act (CEQA) pursuant to Section 15301 of the California Code of Regulations, Title 14, Chapter 3.

RECOMMENDATION

BWP staff and the City Attorney�s Office recommend that the City Council adopt the Resolution entitled:  �A Resolution of the Council of the City of Burbank Approving the Renewal of the Rooftop Communications Lease between the City of Burbank and West Alameda Avenue Property, LLC.�

RED:GLS:TS:tm:gm

Communicaitons lease-open sess 4-22-03

Attachment

c:          Ronald Davis, General Manager, BWP

            Sue Georgino, Community Development Director

            Gaye Mains, Administrative Secretary, BWP