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1V A 1 t N C N F R I. 1 1 RII'VERSIDE PUBLIC UTILITIES PUBLIC U T I L I T I E S Board Memorandum BOARD OF PUBLIC UTILITIES DATE: July 15, 2011 ITEM NO: 3 SUBJECT: POLE ATTACHMENT AND CONDUIT LICENSE AGREEMENT BETWEEN FREEDOM TELECOMMUNICATIONS INC. AND THE CITY OF RIVERSIDE ISSUE: That the Board of Public Utilities consider approval of a Pole Attachment and Conduit License Agreement with Freedom Telecommunications, Inc. RECOMMENDATION: That the Board of Public Utilities recommend that the City Council approve the Pole Attachment and Conduit License Agreement between Freedom Telecommunications, Inc. and the City of Riverside, and authorize the City Manager, or his designee, to execute the necessary documents. BACKGROUND: The California Public Utilities Commission granted Freedom Telecommunications, Inc. a certificate of Public Convenience and Necessity to provide facilities based local exchange and interexchange telecommunications services ("data services")within the State of California. Freedom Telecommunications, Inc. has notified the City of Riverside ("City") of its intent to install a fiber optic system within the City to provide data services. To economically install their fiber optic communication system, Freedom Telecommunications, Inc. requested to lease pole and conduit space from Riverside Public Utilities ("RPU") and has made an application to enter into a Pole Attachment and Conduit License Agreement ('Agreement"). The Agreement defines the processes by which Freedom Telecommunications, Inc. can utilize RPU's poles, conduits and structures for the purpose of installing its fiber optic facilities. Charter Communications, tw telecom, Pacific Bell Mobile Services, ICG Telecom Group and Southern California Edison all have entered into similar agreements with RPU. The benefit that this Agreement provides to Freedom Telecommunications, inc. includes reduced installation costs and accelerated in-service schedules. The benefit that this Agreement provides to the City is fewer street excavations and greater control over aesthetic issues. The Agreement also provides RPU with an additional source of revenue. It incorporates a $57 per pole and structure application fee to recoup RPU's related engineering and inspection costs. The standard rental fees are$44 per pole per year, $5 per anchor per year, and $2 per foot of conduit per year. This item was presented and approved at the Electric Committee meeting on July 1, 2011. FISCAL IMPACT: The estimated annual income of $3,000 is based on the initial planned installation as projected by Freedom Telecommunications. Inc. This amount may increase as additional fiber lines are installed.