City of Alexandria, Virginia
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MEMORANDUM
DATE: NOVEMBER 6, 2024
TO: THE HONORABLE MAYOR AND MEMBERS OF CITY COUNCIL
THROUGH: JAMES F. PARAJON, CITY MANAGER
FROM: ADRIANA CASTEÑADA, DIRECTOR, TRANSPORTATION AND ENVIRONMENTAL SERVICES
DOCKET TITLE:
TITLE
Public Hearing, Second Reading and Final Passage of an Ordinance to Grant a Non-exclusive Franchise to Crown Castle Fiber LLC for use of the public rights-of-way by companies to design, install, provide, operate, maintain, repair, control, upgrade, construct, and remove a fiber network for the purpose of providing Telecommunications Services within the City. [ROLL-CALL VOTE]
BODY
ISSUE: Consideration of an Ordinance to grant a Franchise to Crown Castle Fiber LLC (“Crown Castle”) for use of the public rights-of-way to design, install, provide, operate, maintain, repair, control, upgrade, construct, and remove a fiber network for the purpose of providing Telecommunications Services within the City.
RECOMMENDATION: That City Council:
1. Introduce and pass the proposed Franchise Ordinance for Crown Castle Fiber LLC on first reading on November 12, 2024; and
2. Schedule the Ordinance for second reading, public hearing, and final passage on Saturday, November 16, 2024.
BACKGROUND: Crown Castle was the only responsive proposal to the City’s request for Franchises to for use of the City right-of-way to design, install, provide, operate, maintain, repair, control, upgrade, construct and remove a non-exclusive fiber network for the purpose of providing Telecommunication Services within the City that was issued pursuant to an Ordinance adopted by City Council on June 15, 2024. Pursuant to the Ordinance, the City Clerk placed advertisements in local newspapers over the course of two consecutive weeks. The preferred deadline, which as published and made known to prospective respondents for the receipt of proposals was July 15, 2024, with an additional opportunity for bidders to submit proposals at the City Council meeting on October 8, 2024.
On October 8, 2024, the City Council referred the proposal from Crown Castle to the City Manager for evaluation, review, and consideration in the manner prescribed by law, including the negotiation of a franchise agreement; and directed the City Manager to return to City Council with a recommended bidder to award a franchise.
DISCUSSION: Crown Castle has operated a Telecommunications System in the City for over five years. It has an existing license agreement with the City which expires in October 2027, and this Franchise will replace the license agreement.
Crown Castle acts as an intermediary for wireless carriers and transports other carriers’ signals over its systems. Currently, Crown Castle has deployed approximately 12 miles of fiber throughout the City. Its wireless equipment is attached to utility poles in the City; therefore, the fiber is necessary to connect the equipment.
The significant terms of the proposed Franchise are as follows:
1. The term is 15 years, and there is the ability for the City and Crown Castle to negotiate two subsequent five-year renewals for an overall total term of 25 years. This is consistent with the terms of other Franchises in the City, i.e., the Ting broadband franchise agreement.
2. Crown Castle will be required to remove its equipment at the end of the Franchise term.
3. The compensation for the Franchise will be the state right-of-way fee. Upon adoption of this ordinance, that fee is $1.88 per access line.
The Franchise also requires that Crown Castle provide a $500,000 surety bond and a general surety bond of $250,000. Crown Castle will also be required to maintain commercial general liability insurance, auto liability insurance, and workers’ compensation insurance.
FISCAL IMPACT: Crown Castle will continue to be required to pay the City the proposed statutory right-of-way fees of $1.88 per access line as of July 1, 2024, through June 30, 2025.
ATTACHMENTS:
1. Ordinance Cover Sheet
2. Proposed Ordinance to Crown Castle
3. Proposed Franchise Agreement
STAFF:
Emily A. Baker, P.E., Deputy City Manager
Alicia Wright, Acting Assistant Director, T&ES
Lalit Sharma, P.E., Deputy Director, Engineering and Right-Of-Way, T&ES
Alex Boulden, Division Chief, Permits and Inspections, T&ES
Cheran Ivery, City Attorney
Karen S. Snow, Senior Assistant City Attorney