Cash For Cell Towers?

National telecommunications companies are active in the Traverse City area, offering municipalities and school districts substantial cash buyouts in return for long-term lease deals on their existing cellular towers.

At its Aug. 8 meeting, the Traverse City Area Public Schools Board heard the details of offers from three companies interested in acquiring leases on two of the school district’s cell towers – one at West Middle School and another on the south side of Thirlby Field on 14th Street. The towers currently generate about $40,000 a year in revenues.

The companies – Unison, Crown Castle and Tower Point – each made offers of lump sum payments of roughly $700,000 for the use of both towers, according to Christine Thomas-Hill, executive director of finance/operations. There are some differences in the offers, such as details on revenue sharing.

“We have permission from the board to move forward,” says Thomas-Hill. “It’s been reviewed by legal counsel. Once we determine which company we’ll go with, we hope to wrap it up by October or November.”

The $700,000 one-time payment would be earmarked for the school district’s general fund.

Across town in Elmwood Township, the Township Board will consider a proposal at its next regular meeting on Sept. 12. A telecommunications firm is interested in purchasing the township’s lease for a cell tower on Cherry Bend Road behind the former fire hall.

In return for a one-time lump sum payment, the township would essentially relinquish control of the tower in perpetuity, according to Supervisor Jack Kelly, who declined to share details of the offer before it was presented to the board.

Kelly has told the company that the tower represents a legal, nonconforming use that could likely never be expanded. Lawyers contacted by Kelly have advised that unless the township is in need of immediate cash, it would probably be best to decline the offer and keep control of the tower and its revenue stream.

Earlier this year Grand Traverse County’s Parks and Recreation Commission declined a lease conversion proposal from New York-based Unison for two county-owned cellular towers at the Civic Center and Twin Lakes Park.

The county currently has two leases that generated $19,320 in revenues last year. Under the Unison proposal, the county would have received a one-time payment for each of the 40-year leases, thus forfeiting any current revenue. Unison was asking the parks commission to accept a one-time payment of $232,848.

But over the length of the 40-year lease, the loss of potential revenue would total $539,952, according to a March 8 memo by Deputy Administrator Jennifer DeHaan.

The parks commission did not proceed with the offer, according to DeHaan. “Accepting that one-time offer and forgoing the annual income would have cut the legs off of the board in coming years,” she said.