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BACKGROUND The City of Livermore is the owner of real property located at 3801 Doolan Road in the County of Alameda. Livermore and Pleasanton jointly own a communications antenna tower constructed on the property. The tower services the 800 MHz radio communications system used by both Pleasanton and Livermore for operations carried out by law enforcement, fire, and public works, including the delivery of municipal and industrial water and treatment of waste water. Zone 7 is a public municipal/industrial water supplier with operations in the Tri-Valley that has requested a Lease Agreement to utilize this property and tower. The cities have leased space on the Tower to third parties previously to provide communication and data retrieval systems within Livermore, Pleasanton, and the Tri-Valley area. On August 30, 2003, the City and Pleasanton cooperated with Zone 7 with the installation of a Global Positioning System and Supervisory Control and Data Acquisition radio and telecommunications network ("SCADA Communications Network") on the tower and the property. Due to ongoing construction and testing, a lease agreement has not been executed pending final understanding of all uses and impacts. Technical issues are now resolved and Zone 7 desires to continue locating its SCADA and Communications Network equipment on the tower and the property. The equipment will not disrupt City radio operations. Both cities are presenting this lease agreement to their respective councils for approval. DISCUSSION Upon Council approval, the cities will enter into the attached lease agreement with Zone 7 for an initial five-year term commencing on October 1, 2008, with an option of two consecutive five-year extensions, at the initial base rent of $1,400 per month with payment to be made annually to the City and Pleasanton ($16,800). Annual adjustments to the base rent will be the greater of four percent (4%) or the year-to-year change in the Consumer Price Index, All Urban Consumers (CPI-U), San Francisco- Oakland-San Jose Area, All Items Index. Because Zone 7 has had the beneficial use of space on the tower and property prior to entering into a lease agreement, Zone 7 has agreed to pay to the cities $76,200 as "Catch-Up" rent in five equal annual installments during the initial five-year term of the contract. Submitted by: 'Hance R i Approv by: ~~~ ~~--- Steven Bocian a e Culver ~ Nelson Fialho Assistant City Manger Director of Finance City Manager Attachment: 1. Lease Agreement with Zone 7 Page 2 of 2