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Impromptu Council actions up rent for Island cell tower

An agenda bill that originally appeared on the Mercer Island City Council consent calendar in early September drew an unusual amount of attention at last week’s meeting.

The bill, a lease contract for T-Mobile, reappeared on the Sept. 20 agenda after Councilmember Dan Grausz notified city staff that only half the lease appeared in the Councilmembers’ Sept. 7 informational packet. Only the odd pages were copied, he said. The Council unanimously agreed to defer the bill until the next meeting. The Reporter also received a copy that contained only the odd pages of the agreement.

At the Sept. 20 Council meeting, Grausz again moved the bill off the consent calendar, a grouping of “routine, non-controversial” items, which are passed in one motion at the beginning of each Council meeting. The calendar is meant to streamline the meeting process.

“I have a basic concern of if the city should be involved in such a contract,” Grausz said. He’s also concerned over the amount of rent charged for the space, located within the right of way adjacent to the west of 4646 Island Crest Way.

“I’d like to see a higher rent set to market rent,” he said.

City Attorney Katie Knight said the city did a market survey in 2005 to establish the “going rate” and create consistency in cell tower lease agreements.

But Grausz is still concerned about the city’s current financial shortfall.

“We’re starting the budget process. We need to be mindful,” he said of city revenue sources. “It’s our duty as the City Council to scrutinize outside leases.”

Councilmember Bruce Bassett weighed in on the rent issue.

“I don’t know what the right rent is, but I do feel like we have a responsibility to treat T-Mobile consistently with other cellular services,” he said, suggesting that the city develop a policy to address cell tower lease consistency.

Councilmember El Jahncke couldn’t comment on the starting lease of $1,140, but said the contract’s 20 percent increase at each five-year term renewal is high.

“As someone who looks at real estate leases ... this is way above average. I’d say it’s at the top of the market,” he said.

Grausz is also concerned that the Council may still be held liable Despite the indemnification in the lease for the T-Mobile vault on city property, "I would like T-Mobile to indemnify the city of Mercer Island," he said in reference to the antenna on the pole.

His comment sparked concern among the Deputy Mayor and City Attorney.

"You're asking T-Mobile to do something we haven't asked of other carriers," Knight said of Grausz' request for T-Mobile to indemnify the city for the antenna, which is outside the lease.

Jahncke added, “If we treat T-Mobile differently, we very well may be buying ourselves some litigation.”

Irked by the sudden turn of discussion, City Manager Rich Conrad cautioned the Council.

“I’m getting very uncomfortable with the amount of discussion and debate about litigation,” he warned.

Conrad’s comment drew a snicker from a T-Mobile representative who attended the meeting with an attorney.

Grausz also took issue with the variance granted in the lease, which allows for a maximum wireless facility height of 90 feet.

“I’ll take that up with the city attorney,” he said.

The Council unanimously approved a final motion with amendments to authorize Rich Conrad to enter into a Telecommunications Site Lease with T-Mobile for a wireless communication facility, amend the lease to have the initial rent set at $2,000 per month with each subsequent renewal term set so that the rent increases to the market rate, and include language regarding indemnity by T-Mobile.

The two amendments regarding the change of rent and indemnity passed with a vote of 4-3. Councilmembers Grausz, Mike Grady, Mike Cero and Steve Litzow voted in favor of the amendments. Councilmember Bassett, Deputy Mayor Jahncke and Mayor Jim Pearman voted against the amendments

Conrad will work with T-Mobile on the new lease terms, he said. If T-Mobile agrees, the lease will be signed and not go before the Council again.

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