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REPORT <br />To the Honorable Mayor and City Council <br />From the City Manager <br /> <br />March 27, 2017 <br />SUBJECT <br />Agreement with Zayo Group, LLC for the Installation of Fiber Optic Facilities in <br />Redwood City <br /> <br />RECOMMENDATION <br />By motion, approve and authorize the City Manager to execute an agreement with Zayo <br />Group, LLC for the installation of fiber optic facilities in Redwood City <br /> <br />BACKGROUND <br />Zayo Group, LLC is a wholly owned subsidiary of Zayo Group Holdings, Inc., a publicly <br />held company, that provides communications infrastructure services, including fiber and <br />bandwidth connectivity. The California Public Utility Commission issued Zayo Group, <br />LLC a Certificate of Public Convenience and Necessity (CPCN) to provide <br />telecommunication services throughout the state of California. The CPCN gives Zayo <br />authority at a state level to operate in the public right-of-way in accordance with its <br />terms. <br /> <br />In 2016 Zayo approached staff to install, maintain and operate its facilities within <br />Redwood City in accordance with its CPCN. The CPCN allows Zayo facilities in the <br />Redwood City public right-of-way in a manner similar to telephone and cable <br />companies. Zayo facilities would include fiber optic communication lines that allow its <br />customers to communicate with data centers, exchange information, and access the <br />internet. <br /> <br />Staff and Zayo negotiated an agreement to provide a general framework for Zayo <br />facilities. Within this framework Zayo will apply for the necessary permits and approvals <br />to install, maintain and operate its facilities in compliance with state law and local <br />ordinances. The City has entered into at least nine similar agreements with other <br />communications companies since the year 2000, and many of those companies <br />continue to install, maintain and operate their systems in the public right-of-way. <br /> <br />ANALYSIS <br />The proposed agreement will require Zayo to comply with all local ordinances, including <br />the requirement to apply for an encroachment permit each time work is performed in the <br />right-of-way. Under the framework laid out by the agreement, Zayo will provide a <br />financial guarantee that it will perform its work in accordance with the agreement and <br />any associated permits. All other fees, deposits and securities will still be due with each <br />permit. <br />6.1.A. - Page 1