CITY OF SANTA CLARITA
AGENDA REPORT
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CONSENT CALENDAR |
City Manager Approval: |
__________________________ |
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Item to be presented by: |
Kris Markarian |
DATE:
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June 12, 2012
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SUBJECT: |
ADOPT A RESOLUTION CONSENTING TO THE CHANGE OF OWNERSHIP CONTROL BETWEEN NEXTG NETWORKS OF CALIFORNIA, INC., AND CROWN CASTLE INTERNATIONAL CORP., IN ACCORDANCE WITH THE CITY’S AGREEMENT WITH NEXTG NETWORKS OF CALIFORNIA, INC. |
DEPARTMENT: |
Public Works |
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RECOMMENDED ACTION
City Council adopt a resolution consenting to the change of ownership control of NextG Networks of California, Inc., and Crown Castle International Corp. in accordance with the City’s Agreement with NextG Networks of California, Inc.
Authorize the City Manager or designee to execute the attached Consent to Change in Control of NextG Networks of California, Inc., subject to City Attorney approval.
BACKGROUND
The proposed resolution provides the City Council’s consent to the merger between NextG Networks of California, Inc. (NextG), and Crown Castle International Corp. (CCI) under the terms of the City’s Right-of-Way Use Agreement (Agreement) with NextG, which was executed in May 2011, and is currently in force and effect.
The Agreement allows for the installation of antennae nodes on select City traffic signal poles or third-party poles located within the City’s right-of-way for the purpose of operating the NextG network and improving wireless coverage and capacity within the City. Section 11 of the Agreement requires City consent for “assignment” of control of NextG that may result from a merger, consolidation, reorganization, business combination, or other transaction, whereby 20 percent or more of NextG’s ownership interests will change. The City received a request from CCI for consent to such a merger with NextG, as is required by the Agreement.
Based on the information received from CCI, staff anticipates no conflicts or violations of the terms of the City’s Agreement with NextG, who will survive the merger and continue to own and operate its facilities within the City. Accordingly, all documents, bonds, permits, and insurance associated with the Agreement and with the remaining installation work to be performed are anticipated to remain in the name of NextG and will remain subject to the same terms and conditions as described in the original agreement.
ALTERNATIVE ACTIONS
Deny the consent for merger between NextG and CCI and terminate the Agreement with NextG to use the City’s right-of-way for NextG antennae installations.
FISCAL IMPACT
There is no fiscal impact if the resolution is adopted. If the resolution is not adopted, the fiscal impact is a loss of revenue at five percent of the adjusted gross revenue received annually from installations made within the City, which is estimated to total $2,100 per year.
ATTACHMENTS
Resolution
Letter Request on behalf of Crown Castle International Corp.
FAQs Regarding Merger
Consent to Change of Control of NextG Networks of California, Inc.