Set to expire in 2022, Councilors are considering a request by a company to extend a lease for 20 years for a cell tower on Kendall Pond Road.
At press time, council members were scheduled to discuss the proposal at their May 16 meeting.
Crown Castle is currently leasing the site on Kendall Pond Road from the town and recently approached the town requesting a lease extension, Town Administrator David Caron wrote in a recent staff report.
The lease is set to expire and Crown Castle is requesting a 20-year extension, Caron wrote.
“The town leased the site to Ominpoint Communications: as is commonplace in that industry, ownership has changed several times, with all subsequent owners required to fulfill the terms of the original site lease,” Caron wrote.
Crown Castle has approached the town to extend the lease terms. It is not unusual for cellular providers to seek stability in their coverage areas and seek long-term leases, according to officials. Crown Castle currently owns two towers on Kendall Pond Road immediately adjacent to one another.
The tower is currently occupied by one major carrier. A second carrier is scheduled to vacate the site in October 2019, following the purchase of site by the major carrier, Caron wrote.
“We have reviewed the economics of the site and recommend extending the lease until 2042, Caron wrote.
Staff and counsel reviewed the current lease, in context of both market rates and characteristics unique to the site, Caron wrote. They also particularly considered that a second tower is immediately adjacent to the tower, he said.
“Due to the site’s characteristics, the economics are relatively modest, but appropriate given the circumstances,” Caron said.
The town currently receives $1,332.82 per month from the site owner. In addition, it also receives $334.46 per month from one co-locator until October 2019. And the rent is also increased by changes in the Consumer Price Index, and the town receives 25 percent of rent from sub-tenants, Caron wrote.
Staff is recommending that the lease on the site be extended until 2042. And in exchange, the base rent on the site will increase by 3 percent per year; Derry will receive 40 percent of the rent received from future subtenants, and the Town will receive 40 percent of the rent received from sub-tenants. In addition, the town will receive a one time payment of $17,000, payable within 60 days after execution of the lease agreement, Caron wrote.
In other agenda items, councilors will hold a public hearing on a proposal to increase the veteran’s tax credit by $500. In addition, public hearings are scheduled for: establishing a police detail revolving fund and amending the fund balance policy.