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SR-09-10-2013-3ICity Council Report City of Santa Monica' City Council Meeting: September 10, 2013 Agenda Item:' To: Mayor and City Council From: Jory Wolf, Chief Information Officer Subject: New License Agreement for Rooftop Space at 100 Wilshire Boulevard for Public Safety Radio Communication System Infrastructure. Recommended Action Staff recommends that the City Council authorize the City Manager to negotiate and execute a new License Agreement with Douglas Emmett 1998, LLC, a Delaware company, for lease of rooftop space at 100 Wilshire Boulevard for a five year term, in an amount not to exceed $263,750. Executive Summary The City currently occupies rooftop space at 100 Wilshire Boulevard for the Police and Fire Department's radio communication system infrastructure. The rooftop space has been occupied by the City since 1987 for the purpose of operating the Police and Fire radio systems. The site is a strategic location for the communications equipment due to the building's height, central location in the downtown area, and emergency power equipment. The new License Agreement would enable the City to continue using the space through June 2018 and would not exceed $263,750 for a five-year period. Background In 1987, the City was granted permission to use rooftop space at 100 Wilshire Boulevard for operation of the Police Department's radio system. Between 1987 and 1999 the City paid an annual rental fee for the space. On March 23, 1999, Council authorized a License Agreement for the rooftop space at 100 Wilshire Boulevard to be used for continued operation of the Police and Fire Department's radio communication systems. In May 2003, the City executed a First Amendment to the License Agreement extending the term through June 2008. Since then, the City continually occupied the rooftop space and paid rental fees annually via a Purchase Order through FY 2012-13. The parties were otherwise operating under the terms and conditions of the License Agreement. On May 28 2013, Council authorized a Second Modification to the License 1 Agreement. As the parties were going through the process of executing the Second Modification, and upon further review of the License Agreement, it was determined that because the original Lease Agreement expired in June 2008, although annual rental fees were paid, there was no License Agreement in effect to modify. Staff has brought the item back to the Council to make this clarification and recommends that the City enter into a new License Agreement. The original License Agreement was with Douglas Emmett Realty Fund 1998, a California Limited Partnership. That entity is no longer the owner of the property. The successor in interest is Douglas Emmett 1998, LLC. The proposed new License Agreement is with Douglas Emmett 1998, LLC. Discussion The rooftop space located at 100 Wilshire Boulevard is critical to the continued operation of the Police Department and Fire Department radio systems. The building is the ideal height for proper operation of the infrastructure equipment, is centrally located in the downtown area and has the appropriate emergency power equipment for operation during an electrical outage. The Police Department and Fire Department have installed equipment at 100 Wilshire Boulevard as part of their respective radio system infrastructures that is critical to proper operation of their systems. There are no practical alternatives for relocating the equipment presently installed at 100 Wilshire Boulevard. Relocating the equipment to a different building that does not have the same profile and geographic location as 100 Wilshire Boulevard would degrade communications for Police and Fire. In the event a suitable location existed, the process to relocate the equipment to a new location would require a complete system design, potentially costing several million dollars. The annual license fee established in 1999 was $27,300. Since then, annual increases have ranged between 3% and 4%, as set forth in prior license agreements by the property owner. In fiscal year 2012-13, the annual license fee was $46,822. The proposed license fee for fiscal year 2013-14 would be $48,695. The new proposed license agreement establishes an annual 4% increase through June 2018. 2 At this time, staff recommends entering into a License Agreement in order to secure the space through June 2018. Financial Impacts & Budget Actions The License Agreement to be awarded to Douglas Emmett 1998, LLC is for an amount not to exceed $263,750. Funds are available in the FY 2013-15 budget in division 01304. The contract will be charged to account 01304.522620. Budget authority for subsequent budget years will be requested in each budget for Council approval. Future funding is contingent upon Council approval and budget adoption. Prepared by: Eric Uller, Lead Public Safety Systems Analyst Approved: on f C of Information Officer 4 Forwarded to Council: ----` � Rod Gould City Manager Reference: Contract No. 9798 (CCS)