Related Party Transactions

12 Months Ended

Dec. 31, 2019

Related Party Transactions [Abstract]

Related Party Transactions Disclosure

Related Party Transactions

As discussed in note 6, the Company and the Guarantors entered into a Management Agreement with CCUSA, which replaced a previous management agreement among the same parties. Pursuant to the Management Agreement, CCUSA has agreed to employ, supervise and pay at all times a sufficient number of capable employees as may be necessary to perform services in accordance with the operation standards defined in the Management Agreement. CCUSA currently acts as the Manager of the sites held by subsidiaries of CCIC. The management fee is equal to 7.5% of the Company's "Operating Revenues," as defined in the Management Agreement, which is based on the Company’s reported revenues adjusted to exclude certain items including revenues related to the accounting for leases with fixed escalators. The fee is compensation for those functions reasonably necessary to maintain, market, operate, manage and administer the sites, other than the operating expenses (which includes real estate and personal property taxes, ground lease and easement payments, and insurance premiums). The management fee charged by CCUSA for the years ended December 31, 2019, 2018 and 2017 totaled $49.8 million, $48.5 million and $46.9 million, respectively.

In addition, CCUSA may perform installation services and make certain modifications to the Company's towers for which the Company is not a party to any agreement and receives no cash payment. For these tower installation services and modifications, however, deferred revenue for a portion of the transaction price which represents a lease component under GAAP is included within "Deferred revenues," on the Company's consolidated balance sheet and is recognized as "Amortization of tower installations and modifications" on the Company's consolidated statement of operations over the associated estimated lease term. The portions of the transaction price which do not represent a lease component are not reflected in the Company's operating results. See note 2 for further discussion on towers service agreements.

As part of CCIC's strategy to obtain long-term control of the land under its towers, affiliates of the Company have acquired rights to land interests under the Company's towers. These affiliates then lease the land to the Company. Under such circumstances, the Company's obligation typically continues with the same or similar economic terms as the contract for the land that existed prior to the purchase of such land by the affiliate. As of December 31, 2019, approximately 30% of the Company's towers were located on land which was controlled by an affiliate. Rent expense to affiliates totaled $43.3 million, $41.0 million and $36.7 million for the years ended December 31, 2019, 2018 and 2017, respectively. Also, the Company receives site rental revenue from affiliates for land owned by the Company on which affiliates have towers and pays ground rent expense to affiliates for land owned by affiliates on which the Company has towers. Rent revenue from affiliates totaled $1.0 million for each of the years ended December 31, 2019, 2018 and 2017.

For the years ended December 31, 2019, 2018 and 2017, the Company recorded an equity distribution of $362.8 million, $368.0 million and $335.0 million, respectively, reflecting distributions to its member. Cash on-hand above the amount that is required by the Management Agreement has been, and is expected to continue to be, distributed to the Company's parent company. As of December 31, 2019 and 2018, other than the amounts of its ROU assets and operating lease liabilities related to land leased from affiliates of the Company reflected in "Operating lease right-of-use assets," "Current portion of operating lease liabilities-related parties" and "Operating lease liabilities-related parties," the Company had no material related party assets or liabilities on its consolidated balance sheet.