By John M. Pelkey, Garvey Schubert Barer
In “How to Turn Steel into Gold: Monetize Your Tower,” Radio and Television Business Report, June 27, 2012, Erwin Krasnow and I explained that a broadcaster’s tower can be a ready source of revenue. Expanding on that theme, “Money-Saving Tips on Leasing Your Tower,” Radio and Television Business Report, August 2, 2012, highlighted some of the pitfalls that a broadcaster might encounter when it leases space on its tower. That article explained, among other things, that establishing a prompt commencement date for the lease, limiting the tenant’s ability to install new or replacement equipment and reigning in the tenant’s subleasing rights are all important and have a place in a well-drafted lease agreement.
Often, however, the schedules to the lease are even more important than the lease itself. That is because a tower lease frequently is drafted so that the body of the lease is a “one size fits all” document that can be used in virtually any state in the country. The schedules are what make each lease unique inasmuch as they define the essence of the understanding between the landlord and the tenant. In fact, a tower company owning multiple towers typically uses a “master lease” with identical language in all of its leasing transactions. What differentiates one transaction from another is not the lease itself, but the schedules that are attached to each lease.
A broadcaster would be well advised to follow the example of these tower companies and use schedules to flesh out the nitty-gritty details of the lease arrangements.
What goes into these schedules?
Location. The schedules should provide a description of the location of the tower site. If available, a street address can be useful, particularly if the tenant must arrange for deliveries to the site. Of greater importance, however, are the coordinates for the tower on which the tenant’s antennas are to be placed. Unfortunately, there is no agreed-upon system for defining coordinates. The use of different datum systems yields different sets of coordinates. Different branches of the FCC use different datum systems. The Media Bureau issues broadcast licenses using a datum system that is referred to as NAD 27, whereas the Antenna Structure Registration (ASR) that the Commission issues in the case of towers more than 200 feet high is based on the NAD 83 datum system. As a result, a broadcast station license may show one set of coordinates, while the ASR shows a different set of coordinates even though both are referring to the exact same spot. To avoid confusion, the schedules should clearly state whether they are specifying NAD 27 or NAD 83 coordinates. Unless that is done, it is quite possible that the tenant’s relocation to the broadcaster’s tower could be delayed because it finds that its application to use the broadcaster’s tower must be amended to correct the coordinates.
Because most tenants will at some point file an application using the FCC-issued ASR for the tower and those registrations use NAD 83, it frequently is less confusing to use the NAD 83 coordinates on the lease schedules. Regardless of whether the schedules list NAD 27 or NAD 83 coordinates, those coordinates should be the same as the coordinates that are on record with the Commission. If the coordinates that are on file with the FCC are incorrect, the appropriate paperwork should be filed with the Commission to correct the mistake (which is something that should be done even if the landlord is not contemplating leasing out space on its tower).
Sketches. Trying to describe in words precisely where a transmitter is to be placed in a shed can be extremely difficult. The chances are that two people reading the same text would draw different conclusions as to the correct location of the transmitter. Consistent with the adage that “a picture is worth a thousand words,” it is far simpler to use a sketch to depict the placement of the transmitter, any associated equipment and all transmission lines. If the sketch is drawn with even a minimum amount of accuracy, it is reasonably likely that the parties to the lease will have a very good understanding as to precisely where all of the tenant’s equipment is to be placed in the shed. A sketch can be particularly helpful if gates or fencing are to be installed to provide additional security within the shed.
Similarly, a sketch of the tower that depicts the location of the tenant’s antennas, including all of the bays, can help avoid confusion and may have the added benefit of preventing a situation in which the parties inadvertently specify an antenna location that cannot be used because of the placement of the tower’s guy wires or other obstructions. The tower sketch should also depict the location of the transmission lines if that location is important to the parties.
A third sketch can be used to depict the transmitter site. It would show the tower, the location of the transmitter shed, the location of ice bridges and other approved routes for the transmission lines, generators, satellite dishes and pads on which the tenant is permitted to install equipment and any additional outbuildings or cabinets in which equipment is to be placed. Such a sketch helps to avoid the disputes that otherwise can arise when the tenant’s construction team constructs its facilities without regard to the needs of the landlord or other tenants, such as when the tenant’s contractor installs an underground transmission line by slicing through the ground system used by the landlord’s AM station.
In addition to clarifying the rights and responsibilities of the parties, such sketches can serve a second function. Depending on the jurisdiction that the tower is in, zoning and permitting may need to be taken into account. Many jurisdictions require that an architectural and engineering firm produce drawings of the transmitter site, along with any necessary proposed power installations or modifications. The sketch of the tower site, with dimensions and electric conduit routing and cabinet placement, can usually be given to the architectural and engineering as a basis for the construction documents.
Listing of Antennas to be Used. The schedules should specify the make and model of the antennas to be installed by the tenant. The dimensions of the antennas, their weight, the heights at which the antennas are to be installed (using the heights of the centers of radiation) and the dimensions of the antennas should all be set forth in the schedules.
Transmission Line and Other Tower-Installed Equipment. The schedules should provide information concerning the sizes of the transmission lines feeding the antennas. They should also provide information concerning any equipment, such as amplifiers, that the tenant will be installing directly on the tower. This information is important because the sizes and locations of the transmission lines and tower-mounted amplifiers affect the wind-loading of the tower and potentially limit the ability of the landlord to rent out space on the tower to other tenants. If the landlord has a preferred method of transmission line installation for the tenant to follow (for example, use of stacking, clamp-in cable hangers, as opposed to cable ties), it should be specified in the schedules, as should any landlord specifications for equipment grounding, use of ice bridges or similar installation or maintenance requirements.
Transmission and Other Equipment Not Located on the Tower. The schedules should specify the make and model of the tenant’s transmitters, the power at which they will transmit and the frequencies on which they will operate. The schedules, used in conjunction with the sketches described above, should also describe exactly where the tenant’s equipment is to be placed.
Specifying the exact location of tenant’s equipment not only helps to avoid a situation in which a tenant occupies so much space that other rental opportunities are foreclosed, but it also permits the landlord to assess whether the tenant equipment is likely to generate extra heat requiring more air conditioning. That assessment permits the parties to agree, in advance, on their respective responsibilities for purchasing and installing additional air conditioning equipment and paying the electrical costs of running that equipment. If some of the tenant’s equipment is to be placed in an outdoor cabinet or on a pad, the location of that outdoor cabinet or pad should be included in the schedules and on the site sketch, as should any standalone tenant equipment that is to be kept outdoors, such as satellite dishes, generators, or heat exchangers.
In addition to specifying the tenant’s transmission equipment, the schedules should also list the reception equipment that the tenant is using. In particular, the schedules should indicate the receive frequencies that the tenant will be using. That information is especially important if the tenant’s equipment includes a translator inasmuch as a translator can be rendered useless if there is interference to its receive frequency. The landlord will want to make sure that no other present or future tenant operates on a frequency that is likely to cause interference to that receive frequency.
Also included in the schedules should be a specification as to the power requirements for the tenant’s transmission equipment. For example, does the equipment operate at 110 volts or 220 volts? How much amperage will the equipment draw? By including this information in the schedules, the landlord helps avoid a situation where it discovers – after the fact – that additional power lines must be installed.
While the drafting of the body of the lease can largely be left up to counsel, the schedules require the input and review of the broadcaster’s engineer. The engineer should be able to look at the installation of the tenant’s proposed antennas and other equipment from an eminently practical point of view and be able to draw the parties’ attention to problems that must be resolved if the lease arrangement is to be a success.
During his more than 30 years as a communications attorney, John Pelkey has done nearly everything that there is to do in the communications field. He co-authored the Supreme Court brief that sanctioned competition in long-distance telephone service. He argued both before the FCC and the court the case that led to the issuance of the nation’s first cellular authorization awarded through comparative hearing. He was co-counsel in the successful federal court proceeding that struck down the Fairness Doctrine. He represents both commercial and noncommercial broadcasters and has handled numerous broadcast sales transactions. He can be contacted at [email protected].
