11-23-2020-SWS - Laserfiche WebLink

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ARDEN HILLS SPECIAL CITY COUNCIL WORK SESSION—NOVEMBER 23, 2020 3 Councilmember Holmes agreed with Councilmember McClung. She did not understand why the City was considering a renegotiation of the lease before the end of the five year term. She recommended the City renegotiate the lease at the end of the term. Councilmember Holden reported she would rather renegotiate versus losing the lease altogether. Mayor Grant asked if the Council could support $40,000 with the 2.5% increase annually. Councilmember.Holden stated she could support this option. Mayor Grant commented he could support the $38,400. Councilmember McClung indicated if this lease was left alone, the North Water Tower may be open up to another vendor. Councilmember Holden asked if there was room on this water tower for another vendor. Public Works Director/City Engineer Blomstrom stated there was additional room on this tower for another tenant. Further discussion ensued regarding the AT&T lease agreement. Councilmember McClung reiterated the fact that he did not like the fact that the Council was proposing to renegotiate a lease in the middle of the term and feared this could set a precedent. He believed it was not the City's responsibility to get them out of their current situation. Rather, this could be addressed at the end of the term of the current lease. Councilmember Holmes asked when the current lease would expire. Public Works Director/City Engineer Blomstrom reported the current lease term would expire on December 31, 2024. He noted AT&T was 11 months into the current lease. Councilmember McClung questioned why AT&T had not brought their concerns to the City when the current lease was renegotiated. Public Works Director/City Engineer Blomstrom stated he was uncertain. He reported the existing lease automatically renews if neither party requests a termination of the lease. Councilmember Scott reviewed the staff memo stating the rental terms being offered by AT&T were well above market rate. Councilmember Holden spoke to the cost of moving the cell tower equipment. Public Works Director/City Engineer Blomstrom commented on how the escalators may be more important to AT&T than the actual yearly rental amount.