staff report 62

Meeting Date: 12/08/21

Lease Number: PRC 8168

Staff: K. Connor

Staff Report 62

LESSEE/ASSIGNOR:

X2 Telecom, LLC

APPLICANT/ASSIGNEE:

Zayo Group Holdings, LLC

PROPOSED ACTION:

Assignment of a General Lease – Right-of-Way Use

AREA, LAND TYPE, AND LOCATION: 135,000 linear feet, more or less, of sovereign land located in the Pacific Ocean,

from Morro Bay in San Luis Obispo County, to Santa Barbara in Santa Barbara

County.

AUTHORIZED USE: Use and maintenance of an existing fiber optic cable and four steel conduits

buried in the ocean floor.

TERM: 20 years, beginning December 18, 2015.

CONSIDERATION: Public benefit derived from Applicant’s acceptance of franchise obligations

pursuant to California Public Utilities Code section 7901.

1

Staff Report 62 (Continued)

STAFF ANALYSIS AND RECOMMENDATION:

AUTHORITY: Public Resources Code sections 6005, 6216, 6301, 6501.1, and 6503; California Code

of Regulations, title 2, sections 2000 and 2003.

PUBLIC TRUST AND STATE’S BEST INTERESTS: On December 18, 2015, the Commission authorized a General Lease – Right-of-Way

Use to X2 Telecom, LLC (Item C94, December 18, 2015). That lease will expire

December 17, 2035.

In August 2016, the Lessee’s parent company, Integra Telecom Parent, Inc. was

rebranded as Electric Lightwave. On November 30, 2016, Electric Lightwave was

purchased by the Applicant, and the ownership of the existing improvements was

transferred to Zayo Group Holdings, LLC. Commission staff was not notified of the

ownership transfer until the application was submitted, but the Applicant has

continued to meet all lease obligations. The Applicant is now applying for an

assignment of the lease for the use and maintenance of the fiber optic cable and

four steel conduits buried in the ocean floor. The effective date of the assignment

will be November 30, 2016, to coincide with the Applicant’s effective ownership of the improvements.

Approval of this lease assignment will not result in a change in the use of, or

impacts to, Public Trust resources at this location, at this time, and for the remaining

term of the lease. For these reasons, staff recommends finding that approval of this

assignment is in the best interest of the State.

CLIMATE CHANGE: Climate change impacts, including sea level rise, more frequent and intense storm

events, and increased flooding and erosion, affect both open coastal areas and

inland waterways in California. The existing fiber optic cable varies from 0.42 to 1.20

inches in diameter, and it is buried in the Pacific Ocean along with the steel

conduits. This cable is part of the larger high-capacity fiber optic transport network

that directly links major cities along the California coast. It was installed in federal

waters (between 3 to 12 miles offshore) and comes ashore in seven locations in

California. The cities of Morro Bay and Santa Barbara are two of these seven major

links of this larger telecommunications system. The armored sea cables do not

transmit any electrical power and are waterproofed to resist damage in the ocean.

The cable was buried about 3 feet deep below the Pacific Ocean seafloor to

prevent damage from fishing equipment or anchors. Since this is an existing cable,

2

https://www.slc.ca.gov/Meeting_Summaries/2015_Documents/12-18-15/Items_and_Exhibits/C94.pdf


cable burial surveys are required every 5 years to confirm that the cable remains

buried for the remaining lease term until 2035.

The California Ocean Protection Council updated the State of California Sea-Level

Rise Guidance in 2018 to provide a synthesis of the best available science on sea

level rise projections and rates. Commission staff evaluated the “high emissions,”

“low risk aversion” scenario to apply a conservative approach based on both

current emission trajectories and the lease location and structures. The Port San Luis

and the Santa Barbara tide gauges were used for the projected sea level rise

scenarios for the regions as listed in Tables 1 and 2.

Table 1. Projected Sea Level Rise for Port San Luis

Year Projection (feet)

2030 0.5

2040 0.7

2050 1.0

2100 3.1

Source: Table 19, State of California Sea-Level Rise Guidance: 2018 Update

Note: Projections are with respect to a 1991 to 2009 baseline.

Table 2. Projected Sea Level Rise for Santa Barbara

Year Projection (feet)

2030 0.4

2040 0.7

2050 1.0

2100 3.1

Source: Table 22, State of California Sea-Level Rise Guidance: 2018 Update

Note: Projections are with respect to a 1991 to 2009 baseline.

The lease is a 20-year General Lease – Right-of-Way Use that began on December

18, 2015, and may be subject to the climate change effects of the projected sea

level rise scenario provided above. Regular monitoring and maintenance, as

referenced in the lease, may reduce the likelihood of severe structural degradation

or dislodgement. Further climate change impact analyses on the leased facilities

will be assessed at the time the lease is up for renewal in 2035 and would be based

on projected sea level rise scenarios at that time.

CONCLUSION: Assignment of this lease will not result in a change in the use of or impacts to Public

Trust resources. Staff believes approval of this assignment is consistent with the

common law Public Trust Doctrine and is in the best interests of the State.

3


OTHER PERTINENT INFORMATION:

1. The Applicant is qualified to hold the lease and staff has not discovered any

information that would provide a basis for withholding the assignment. Upon

expiration or prior termination of the lease, neither the assignor nor the assignee

has any right to a new lease or to renewal of any previous lease. If no new lease

is granted the assignee may be required to remove the fiber optic cable and

four steel conduits and restore the premises to their original condition.

2. This action is consistent with the “Meeting Evolving Public Trust Needs” Strategic

Focus Area of the Commission’s 2021-2025 Strategic Plan.

3. Assignment of the lease is not a project as defined by the California

Environmental Quality Act because it is an administrative action that will not

result in direct or indirect physical changes in the environment.

Authority: Public Resources Code section 21065 and California Code of

Regulations, title 14, section 15378, subdivision (b)(5).

EXHIBIT:

A. Site and Location Maps

RECOMMENDED ACTION:

It is recommended that the Commission:

PUBLIC TRUST AND STATE’S BEST INTERESTS: Find that the proposed assignment of the lease will not substantially interfere with

Public Trust needs and values at this location, at this time, and for the remaining

term of the lease; and is in the best interests of the State.

AUTHORIZATION: Authorize the assignment of Lease Number PRC 8168, a 20-year General Lease – Right-of-Way Use, of sovereign land located in the Pacific Ocean, as shown on

Exhibit A (for reference purposes only) attached and by this reference made a part

hereof, from Lessee to Applicant, effective November 30, 2016.

4

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PACIFIC OCEAN

CENTERLINE 10' WIDE

LEASE AREA

MORRO BAY PARCELS77°37'55"E

8202.695m

NO SCALE SITE

LATITUDE: 35°23'46.835" LONGITUDE: -120°57'41.406"

not intended to be, nor shall it be construed as, a waiver or limitation of any State interest in the subject or any other property.

This Exhibit is solely for purposes of generally defining the lease premises, is based on unverified information provided by the Lessee or other parties and is

MORRO BAY TO SANTA BARBARA

PACIFIC OCEAN SITE SAN LUIS OBISPO

MORRO BAY

MAP SOURCE: USGS QUAD

STATE OF C

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NOTE: Basis of Bearings shown hereon are based on UTM North American Datum 1983, Zone 11N. All bearings and distances are grid and in meters. Geographic positions are based on North American Datum of 1983.

NO SCALE LOCATION Exhibit A-1 PRC 8168

ZAYO GROUP HOLDINGS, LLC GENERAL LEASE -

RIGHT-OF-WAY USE SAN LUIS OBISPO COUNTY

POB LATITUDE: 35°24'38.350" LONGITUDE: -120°52'22.487"

SITE

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RIGHT-OF-WAY USE SAN LUIS OBISPO COUNTY

SITE

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CENTERLINE 10' WIDELEASE AREA

MORRO BAY PARCEL



S85°40'19"E

9538.270m

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1040.538m

POB LATITUDE: 35°24'45.000"

LONGITUDE: -120°52'24.760"

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NOTE: Basis of Bearings shown hereon are based on UTM North American Datum 1983, Zone 11N. All bearings and distances are grid and in meters. Geographic positions are based on North American Datum of 1983.

LOCATION NO SCALE

MORRO BAY

PACIFIC OCEAN SITE SAN LUIS OBISPO


This Exhibit is solely for purposes of generally defining the lease premises, is based on unverified information provided by the Lessee or other parties and is not intended to be, nor shall it be construed as, a waiver or limitation of any State interest in the subject or any other property.

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Exhibit A-3PRC 8168


RIGHT-OF-WAY USE SANTA BARBARA COUNTY

SITE

SANTA BARBARA TO MANHATTAN BEACH

NO SCALE

CITY OFSANTA BARBARA

~ SUBMERGED LANDS GRANTED TO

• THE CITY OF SANTA BARBARA PERSTATUTES OF 1937, CHAPTER 13, SECTION 3.

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• '7 POBLATITUDE: 34°23'43.7764"LONGITUDE: -119°41'33.7983" I,

£ N N A l:l C R A CENTERLINE 10' WIDE

SOUTHERN PORTION LEASE AREA, LANDING #5

S17 A E

LEASE AREA LANDING #5NORTHERN PORTIONNOTE:

Basis of Bearings shown hereon are based on UTM North American Datum 1983, Zone 11N. All bearings and distances are grid and in meters. Geographic positions are based on North American Datum of 1983.

S12°53'02"E 128.210m

LATITUDE: 34°21'46.0800"LONGITUDE: -119°40'44.4000"



LOCATIONNO SCALE

SANTA BARBARA

SITEPACIFIC OCEAN


This Exhibit is solely for purposes of generally defining the lease premises, is based on unverified information provided by the Lessee or other parties and is not intended to be, nor shall it be construed as, a waiver or limitation of any State interest in the subject or any other property.

SITEMJF 11/29/2021

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LONGITUDE: -119°42'50.400"LATITUDE: 34°22'33.960"

SUBMERGED LANDS GRANTED TOTHE CITY OF SANTA BARBARA PERSTATUTES OF 1937, CHAPTER 13,SECTION 3.


POB PARCEL 1


MORRO BAY TO SANTA BARBARA (PARCEL 1)

Exhibit A-4PRC 8168

ZAYO GROUP HOLDINGS, LLCGENERAL LEASE -

RIGHT-OF-WAY USESANTA BARBARA COUNTY

SHEET 1 OF 2

SANTA BARBARA

SHEET 1 OF 2

NO SCALE

PACIFIC OCEAN

MAP SOURCE: USGS QUADThis Exhibit is solely for purposes of generally defining the lease premises, isbased on unverified information provided by the Lessee or other parties and isnot intended to be, nor shall it be construed as, a waiver or limitation of anyState interest in the subject or any other property.

SITEMJF 11/29/2021

NO SCALE

NOTE:Basis of Bearings shown hereonare based on UTM North AmericanDatum 1983, Zone 11N. All bearingsand distances are grid and in meters.Geographic positions are based onNorth American Datum of 1983.

LOCATION

SITE

SITE

CENTERLINE 10' WIDELEASE AREA, LANDING #5

NORTHERN PORTIONPARCEL 1

SANTA BARBARA CHANNELSTATE OF CALIFORNIA

OFFSHORE BOUNDARY

CITY OFSANTA BARBARA

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N40°36'34"W

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1223.50'

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Exhibit A-4PRC 8168

ZAYO GROUP HOLDINGS, LLCGENERAL LEASE -

RIGHT-OF-WAY USESANTA BARBARA COUNTY

SITE

MORRO BAY TO SANTA BARBARA (PARCEL 2)

N85°32'12"W73.091m


SANTA BARBARA CHANNEL

LONGITUDE: -119°54'02.855"

LATITUDE: 34°21'36.117"S89°53'58"W

8174.189m

LONGITUDE: -119°48'40.400"

LATITUDE: 34°21'43.927"CENTERLINE 10' WIDE

LEASE AREA, LANDING #5NORTHERN PORTION

PARCEL 2STATE OF CALIFORNIA

OFFSHORE BOUNDARY

POB PARCEL 2

NOTE:Basis of Bearings shown hereonare based on UTM North AmericanDatum 1983, Zone 11N. All bearingsand distances are grid and in meters.Geographic positions are based onNorth American Datum of 1983.

SHEET 2 OF 2

LOCATIONNO SCALE

NO SCALE

SHEET 2 OF 2

SANTA BARBARA

PACIFIC OCEAN

MAP SOURCE: USGS QUADThis Exhibit is solely for purposes of generally defining the lease premises, isbased on unverified information provided by the Lessee or other parties and isnot intended to be, nor shall it be construed as, a waiver or limitation of anyState interest in the subject or any other property.

SITEMJF 11/29/2021

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