Best No Contract Wireless Cell Phone

Document Sample
Best No Contract Wireless Cell Phone Powered By Docstoc
					AFC/T-Mobile Cell phone tower proposal questions and Answers:

Thanks to our great members, the board has received quite a few emails with
questions about the proposal. Below are as many as we can answer and some
additional background on the negotiations that have been done so far:

   1. Are we getting enough for our lease? Are we getting a fair price?
   AFC was approached by T-Mobile in the spring of 2008, 1 year ago, and we
   have been back and forth with them on the financial terms for over a year.
   The initial offer from T-Mobile was $1,200 per month and 3% increase every 5
   years. Our initial counter proposal was $3,600 a month and we asked for
   $1500 for each additional carrier both of which they rejected outright and said
   T-Mobile would never agree to. The final terms we negotiated were
   $1800/month + 4% per year increase. We also talked with 2 pools that have
   Cell towers, one in Burke, VA is getting $1500/month 5 year term and 10%
   increase after 5 years. They are also getting $1500 /month for each additional
   carrier on their tower. The other pool in Fairfax county is $1,850/month + 3%
   escalation clause every year.

We also talked with someone from the Wireless Landlord’s association. The
average cell tower lease in Arlington leases for $1,938, the low was $874, the
high was $3,350, so when we initially counterproposed to T-Mobile, we tried for
the high end. T-Mobile from what I hear is tough to negotiate with and we felt like
this was the best deal we could get. If we feel like we could do better, we could
reject this deal and pro-actively go to Verizon, Sprint, Virgin Mobile, whoever, but
in the current economy I don’t know how far we will get.

2. Can we get a “Pine Tree” type tower?

We did ask about getting a tower that looks like a tree rather than the proposed
“concealment pole” (antennas on the inside). Because the pole is designed to
accommodate 3 carriers, each with a set of antennas on the pole, the lowest set
of antennas has to be above the tree line, so the board felt that aesthetically, the
pole would stand out less with the concealment version. That said, AFC does
have final approval of any designs before the pole is built, so this could be
modified. Note that Arlington County might try to dictate this as well, but AFC
has final approval. If people feel strongly about it , we can take a poll, we will
have some time during the zoning process to decide.

2. Will this income be subject to Unrelated Business Income (UBI) tax or impact
our tax exempt status?

Response from our tax accountant:
The rental of a cell phone tower by your organization to T-Mobile would be
subject to income taxes as unrelated business income . The gross rent less
direct expenses would be subject to income taxes at the regular corporate tax
rates, which are 15% on the first $50,000, 25% on the next $25,000 34% on the
next $25,000 and 39% on amounts from $100,000 to $335,000, the rates change
again for taxable income from $335,000 to $10,000,000 . I assume that the
rentals would never be anywhere close to the upper limits of the tax brackets.

In order to effect the tax exempt status, rental and other invest income generally
cannot exceed 35% of the organizations gross income. Which for 2007 was
approximately $449,000 (35% =$157,150)

3. Will we need to provide easements for electric utility supply to the site? Yes,
we do need to provide easements for T-Mobile to bring power to the site from
Carlin Springs. T-Mobile will be doing their own trenching in burying the electric
lines, and we have specifically requested details on how deep the trenches will
be dug and want to have assurances that no tree roots will be disturbed by the
trenching and no additional trees will be affected by this, except for the trees
identified to be removed by the 40 x 50’ space requested by T -Mobile.

T-Mobile will have their own electric meter (assuming this is feasible, but very
likely) – they will be responsible for paying any utilities associated with the cell
phone tower.

4. Can we cancel the lease at one of the 5 year intervals at our discretion o r do
we need to have due cause to cancel the lease?

We asked for this right during the negotiations (no contract has been signed of
course) but were rejected. T-Mobile’s argument is that they are making a major
capital investment ($100K) so this is a risk for them if we have the right to
cancel (or renegotiate financial terms) every 5 years. We can cancel for cause,
including non-payment, or any other breach of the contract terms that is not
cured within 30 days.

5. If we cancel the lease, will they be responsible for dismantling the tower?

Yes, from the contract terms: “Upon termination or expiration of this Lease, the
Premises shall be returned to Landlord in good, usable condition, normal wear
and tear and casualty excepted.” And there is another clause that says “Tenant
shall have the right and obligation to remove the Antenna Facilities at any time
during and upon the expiration or termination of this Lease, including all
concrete to one foot (1’) below grade. Tenant shall make all reasonable effort to
ensure that any installation or removal activities cause minimal disruption to
normal pool operations, and shall provide at least one week’s written notice to
Landlord before such activity occurs.”
6. Do we provide unrestricted access for service trucks to work on the facility?

We are required to provide 24 x 7 access to the site, however we also have in
our contract that any work they do on the site cannot interfere with the normal
operations of the pool. The site will be fenced off and locked, only T-Mobile will
have the keys, AFC will not have access to T-Mobile’s leased portion of the

7. Will we have any level of liability for damages or injury caused by this facility,
(blowing over, neighborhood kids climbing the fence into the facility and getting

T-Mobile is required to provide Commercial General Liability Insurance of One
$1,000,000.00 per occurrence and $2,000,000.00 aggregate. We also have a mutual
―Hold Harmless‖ clause in our contract that may be invoked in the event of 3rd
party lawsuits.

8. Value of our location:
Can we get An upfront (Lease origination?) fee, payable upon signing of the
lease—not upon completion of construction.

Yes, we are getting an annual lease option fee of $2,500 upon lease signing and
if the zoning takes more than one year (a possibility) we get another $2,500,
after that if it drags on longer, the fee is up for negotiation.

9.     Request Replanting the same number of trees that they will remove, to
other areas on our property or to a location that we determine.

This is a great idea, though we would have to determine where these trees might
go, or maybe we could have T-Mobile donate X number of trees to the
community associations, Arlington Forest Association has tree grants for
homeowners for example.

11.    Request that T-Mobile provide Free HotSpot service for members use on
our property.

   AFC can ask that T-Mobile provide this for our members.

12. Zoning: T-Mobile will be responsible for applying for, paying for and obtaining
all zoning variances, permits etc as required by County, State and Federal

13. What are the exposure risks from Cell Towers?
Information on the FCC and the American Cancer Society websites provide that
these organizations do not believe there is any evidence that Cell phone towers
cause cancer, here are some web links for more information about exposure
levels from cell towers: FCC web site, and from the American Cancer Society:
asp? sitearea=WHO.


Below is a brief recap of the questions from the informational meeting held on July 18 at
the pool.

Would T-Mobile build AFC a bath house?
No, T-Mobile will not build a bath house for AFC.

Will the County even allow the cell towe r to be built?
This question cannot be answered at this time. There is an extensive permitting/approval
process, which will involve the active participation of local civic associations,
environmental and engineering studies, etc. It is possible that the County will not permit
the construction of the cell tower.

Will be building the cell tower cause AFC to be taxed at a comme rcial rate? Would
AFC be zoned comme rcial if we leased the space to T-Mobile?
It is possible that the site itself (ie, the 40- by 50-foot parcel) might at some point in time
be zoned as commercial, but the rest of the club (eg, the pool, the deck, playground area,
tennis courts, the area by the brick wall, the parking lots, the grounds around the pool)
would not be zoned as commercial. It is important to note that T-Mobile will pay all
taxes related to the tower site itself; however, if T-Mobile ever left, and the site in fact is
zoned as commercial (not a certainty, but it could happen), then AFC would have to
request the country to return the 40- by 50- foot space to being zoned as noncommercial.

How many watts will the tower put out?
T-Mobile did not know; they will provide us with an answer shortly.

How many customers does T-Mobile serve?
T-Mobile will get back to us with a number for the Arlington area.

Why did T-Mobile pick the AFC location? Is it related to the fact that we are close
to Route 50?
The demand for this tower comes solely from customer demand. As more and more
people are abandoning land lines, working from home, etc., demand for cell service has
been increasing.
Is the tower self-supporting?
Yes, tower is self- supporting. No cables will be required to keep the tower in place.

Has T-Mobile looked at other sites? Did they approach any other sites in Arlington?
This is the primary site T-Mobile is pursuing. No other pools approached.

Would T-Mobile be willing to put money into escrow to pay for the re moval of the
tower if T-Mobile goes out of business?
 No, T-Mobile would not create an escrow account; however, they would be willing put
up some type of bond. There is also a clause in the lease agreement that says T-Mobile is
responsible for restoring the site to good and usable condition if the lease is terminated
for any reason.

What is the diameter of the tower/pole?
About 3 feet, tapers to 22 inches at the top. Because the tower is a concealment tower, all
the antennae are located inside the pole itself—there will be no antennae sticking out
from the top of the tower.

Will T-Mobile provide broadband access to the neighborhood? A free hot spot?
This is something that may be discussed during the permitting process; T-Mobile could
not provide an answer at this time.

Are radiation hazard analyses performe d?
Yes, but not until after the tower is built. T-Mobile will provide us with results

Will the cell tower interfere with any other electronic devices —home security
systems, cordless phones, TVs?
 No, each carrier operates on its own frequency.

Will T-Mobile compensate AFC for trees removed?
T-Mobile may consider this.

Is the cell tower is a lightning draw? That is, will it attract lightning?
 No, the tower is very well grounded.

Will T-Mobile sign a contract stating that no one at AFC will get soft-tissue cancer?
No, T-Mobile not sign such a contract.

Shared By:
Description: Best No Contract Wireless Cell Phone document sample