TOWER — The city council, after months of indecision, gave approval to a proposal from American Tower for a 50-year lease renewal for a cell tower on the city’s north side. That agreement is contingent on the company increasing the offered signing bonus, preferably to $40,000. The company is currently offering $25,000.
The offer, which includes new language giving American Tower right of first refusal in the event the city opts to sell the tower site, was one of three alternatives offered by the company.
The other two offered more upfront payment terms, including an entirely pre-paid lease that would have provided the city with $735,000 in a single payment for the 50-year term. The other would have front loaded monthly payments over the next ten years, with monthly payments of $7,392, or $88,704 annually.
The option tentatively approved by the council will generate nearly $40,000 in the next year, with a $2,400 annual escalator.
Council members noted that the city could benefit from an upfront payment, since it would help fund city projects and reduce interest costs. Clerk-treasurer Michael Schultz noted that the city had spent about $22,000 in interest on the recently completed water treatment plant since it didn’t have sufficient cash flow to pay all the construction bills as they came due. Lakehead Constructors had agreed to carry the expenses for a time but had charged the city interest.
Councilor John VanDeVoort suggested going with the ten-year payment plan, but he later withdrew the motion. Councilor Joe Morin motioned to go with the 50-year payment plan, contingent on the company raising the signing bonus. His motion passed 4-1, with Mayor Dave Setterberg voting no.
In other business, the council opted to table bids for the planned sewer and water extension to the harbor and Marjo RE development after the bids all came in significantly over the engineer’s estimates and above the city’s currently available funding. The city will be looking for additional funds, or changes in the scope of the project, before deciding how to proceed. Council members also discussed whether two other infrastructure-related projects that the city had planned to pursue IRRR funding for this year could be postponed a year to focus the city’s request on the harbor and Marjo developments.
“I think a discussion with the IRRR is appropriate,” said Schultz.
In other infrastructure discussion, the council gave the clerk-treasurer authority to work with a handful of property owners on S. Second and Third streets, who are being required to replace their sewer laterals as part of the ongoing street repair project there. Schultz said the quotes homeowners have been receiving have run as high as $20,000, making it a real financial burden for some of the residents.
In the past, the city has paid for the work and offered payment plans for residents in similar circumstances, but some on the council were reluctant to make a similar offer in this case. “I’m concerned about setting a precedent,” said Councilor Kevin Norby. “The precedent has already been set,” responded Setterberg, who noted that the sewer lateral replacements will help the city address continuing problems with inflow and infiltration into the sanitary sewer system.
“The city is forcing it on them,” he said.
In a motion authorizing the assistance, Morin specified the unique circumstances that justify the assistance in the current case.
In other action, the council:
• Unanimously approved a motion to offer Hoodoo Point Campground managers Randy and Julie Pratt a five-year extension with a three-percent annual pay escalator. “They’re definitely worth it,” said Councilor Bob Anderson.
• Approved a motion to move forward with the purchase of a new public works dump truck, at a price not to exceed $125,000, contingent on the arrangement of a financing plan. The truck would likely not be purchased before next year.
• Approved a motion to put the city’s 2013 ambulance up for sale, with a minimum bid of $5,000.
• Approved an agreement with MnDOT for airport improvements, including a ranch hangar and an automated seaplane base access gate. The agreement includes design services from SEH, including $98,600 for the hangar design and $67,300 for the seaplane gate design.
• Appointed Setterberg and Morin to negotiate the 2026 police contract with Breitung Township.
• Voted to hire Kevin Ledman and Bryce Williamson as new city firefighters, contingent upon background checks.
• Gave the first reading of changes to the city’s blight ordinance to establish a blight committee and clarify enforcement procedures.
• Tabled action on a new franchise agreement with Minnesota Power until the city’s attorney has a chance to review it.