05-25-2005 Council Agenda - Laserfiche WebLink

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Cingular and AT &T Cell Tower Lease Renegotiations Now that Cingular and AT &T have merged, they are in the process of determining where they have redundancy in their operations. One of the main areas where they are looking to reduce expenditures is the operation of cell towers. They are currently evaluating their cell tower locations and need for individual cell tower sites around the US. To that end, many landowners have been receiving letters from an organization that is working for AT &T and Cingular to evaluate and terminate those cell towers and cell tower ground leases that are no longer needed. The letters basically offer an extension on the lease in exchange for the owner reducing the ground rent by 30 -75% and agreeing to no increase in the lease over time. Yet, AT &T offers nothing in return. The extension can be terminated completely at will, so in essence it is a one sided offer. The "offer" if you can call it that, comes with the veiled threat that if the landowner does not comply, the lease will be terminated and the landowner will lose all revenue from his AT &T Wireless cell tower lease or his Cingular cell tower lease. There is a plea made that the site will become too expensive to operate if the lease is not adjusted. That the cost of moving Cingular's or AT &T's equipment to the other site is too expensive. In some cases, AT &T and Cingular are intent on terminating the lease and only a reduced rate and extended term will make the lease make financial sense. This occurs when there actually is overlap and one of the sites is redundant. In other cases AT &T and Cingular are just sending out bluffs waiting to see if the landowner lays down the hand. Unfortunately, they are using a third party company to do the renegotiations and it is difficult to get anything out of the agent's for that company. The agent's are