| ITEM #: 16. DATE: 04/18/2022 AI #:864 |
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CITY COUNCIL ACTION REPORT
| SUBJECT: | WYYERD CONNECT, LLC – FIBER OPTICS TELECOMMUNICATIONS RIGHT-OF-WAY LICENSE AGREEMENT |
| STAFF PRESENTER(S): | Linda Beals |
SUMMARY
Council to consider approval of a five-year license agreement between the City and Wyyerd Connect, LLC (“Wyyerd”) to install, operate and maintain a fiber optic communication system within the City.
Recommendation
ADOPT RESOLUTION NO. 2022-2232 AUTHORIZING THE CITY MANAGER OR HER DESIGNEE TO EXECUTE THE LICENSE AGREEMENT BETWEEN THE CITY OF GOODYEAR AND WYYERD CONNECT, LLC, A DELAWARE LIMITED LIABILITY COMPANY, PROVIDING FOR THE CITY MANAGER OR HER DESIGNEE TO EXECUTE AMENDMENTS TO THE LICENSE AGREEMENT ASSOCIATED WITH MINOR SCRIVENER ERRORS AND TO ENTER INTO SEPARATE AGREEMENTS FOR IN-KIND EXCHANGES OF FIBER, CONDUIT. (Linda Beals, Real Estate Coordinator)
FISCAL IMPACT
Wyyerd will provide the following to the City as in-kind compensation in lieu of the annual linear foot fee:
1. Two (2) pair of fiber strands within Licensee’s backbone network within the City as depicted on the Backbone Network Map;
2. One (1) pair of fiber strands from Licensee’s backbone into the arterial of each neighborhood on Licensee’s network as depicted on Preliminary Neighborhood Network Map (there will be additional areas and minor deviations as design is completed);
3. One (1) empty “18/14mm future path micro duct” conduit within four (4) segments totaling approximately 31,000 linear feet within Licensee’s network as depicted on the Micro Duct Location Maps;
4. Licensee’s construction costs associated with this in-kind exchange shall be assumed by Licensee throughout the term of this Agreement and shall not be passed along to City of Goodyear residents.
The in-kind fiber and conduit will be provided by Wyyerd to the city at no cost and the estimated value of the in-kind exchange is derived from the cost of the installation and maintenance of the fiber/conduit.
The city will receive the benefit of Wyyerd’s design and installation of a system which is being designed to encompass most of the city. The estimated cost of the city building a similar standalone system is $6,000,000. The overall benefit to the city of having access to this system without having to spend the capital funds and the staff requirements to manage this significant undertaking is considered to more than offset the $0.89 a linear foot rate which equals approximately $1,875,000 over the five-year lease period.
No city expenditure is required to issue the license agreement.
1. Two (2) pair of fiber strands within Licensee’s backbone network within the City as depicted on the Backbone Network Map;
2. One (1) pair of fiber strands from Licensee’s backbone into the arterial of each neighborhood on Licensee’s network as depicted on Preliminary Neighborhood Network Map (there will be additional areas and minor deviations as design is completed);
3. One (1) empty “18/14mm future path micro duct” conduit within four (4) segments totaling approximately 31,000 linear feet within Licensee’s network as depicted on the Micro Duct Location Maps;
4. Licensee’s construction costs associated with this in-kind exchange shall be assumed by Licensee throughout the term of this Agreement and shall not be passed along to City of Goodyear residents.
The in-kind fiber and conduit will be provided by Wyyerd to the city at no cost and the estimated value of the in-kind exchange is derived from the cost of the installation and maintenance of the fiber/conduit.
The city will receive the benefit of Wyyerd’s design and installation of a system which is being designed to encompass most of the city. The estimated cost of the city building a similar standalone system is $6,000,000. The overall benefit to the city of having access to this system without having to spend the capital funds and the staff requirements to manage this significant undertaking is considered to more than offset the $0.89 a linear foot rate which equals approximately $1,875,000 over the five-year lease period.
No city expenditure is required to issue the license agreement.
BACKGROUND AND PREVIOUS ACTIONS
Wyyerd is requesting a fiber license agreement from the City to install, operate and maintain a fiber optic network within city rights-of-way. The locations planned for connections are throughout a signification portion of the City. The unique opportunity being presented by Wyyerd is the placement of fiber throughout a large portion of the City’s developing areas, including residential neighborhoods.
As part of the City’s in-kind compensation, the City will receive one pair of fibers reaching into neighborhoods serviced by Wyyerd. This portion of the Wyyerd network will provide city fibers in areas that are not, as of yet, serviced by any of our existing fiber providers.
The City will also receive two pairs of fiber across Wyyerd’s entire backbone system within the City and conduit within four segments of the Wyyerd backbone system. City staff has identified a need for conduit within certain areas.
The license agreement includes the following:
1. The initial term of the license is for five years.
a. Renewal fee is $2,500 every five years
2. This is a non-exclusive license that allows the City to issue multiple licenses to vendors.
3. Wyyerd is required to obtain permits from the City through our standard process.
4. Wyyerd is liable for damages to rights-of-way and other utilities.
5. If Wyyerd expands its fiber network within city right-of-way, then Wyyerd and the City can negotiate additional in-kind compensation in lieu of the annual fee for any future Wyyerd network expansions.
As part of the City’s in-kind compensation, the City will receive one pair of fibers reaching into neighborhoods serviced by Wyyerd. This portion of the Wyyerd network will provide city fibers in areas that are not, as of yet, serviced by any of our existing fiber providers.
The City will also receive two pairs of fiber across Wyyerd’s entire backbone system within the City and conduit within four segments of the Wyyerd backbone system. City staff has identified a need for conduit within certain areas.
The license agreement includes the following:
1. The initial term of the license is for five years.
a. Renewal fee is $2,500 every five years
2. This is a non-exclusive license that allows the City to issue multiple licenses to vendors.
3. Wyyerd is required to obtain permits from the City through our standard process.
4. Wyyerd is liable for damages to rights-of-way and other utilities.
5. If Wyyerd expands its fiber network within city right-of-way, then Wyyerd and the City can negotiate additional in-kind compensation in lieu of the annual fee for any future Wyyerd network expansions.
STAFF ANALYSIS
The license agreement will allow Wyyerd to operate a fiber network within the City. The license will grant the necessary rights-of-way access to enable the required permitting and inspections for installation, operation and maintenance of the network. Wyyerd’s fiber optic network services will provide high bandwidth infrastructure to residential, enterprise, and small/medium business within the City.
In lieu of the annual fee, the City will receive in-kind fiber and conduit as previously described. The in-kind exchange will allow the city to have access to fiber optic cable and conduit that can be utilized for city facilities and departments within a short-time frame without any expenditure of funds from the City. Both the fiber and conduit will improve the City's overall network connectivity.
In lieu of the annual fee, the City will receive in-kind fiber and conduit as previously described. The in-kind exchange will allow the city to have access to fiber optic cable and conduit that can be utilized for city facilities and departments within a short-time frame without any expenditure of funds from the City. Both the fiber and conduit will improve the City's overall network connectivity.