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Town of Appomattox approves towers contract

Town of Appomattox approves towers contract

The town of Appomattox’s cell tower rents were sold to AP Wireless for a little more than $1 million in a divided vote at Tuesday’s council meeting.

Instead of the town receiving the money from companies at the town’s four cell tower sites, the money now will go to San Diego-based AP Wireless. The town still owns the land and the lease for the towers but AP Wireless now gets the rent payments in exchange for $1,001,000 to help fund the town’s capital improvement and economic development plans. The towers still are owned by the cell companies.

After the meeting, Appomattox Town Manager Bill Gillespie compared the agreement to a mortgage payment someone makes where the bank passes the mortgage payments off to an outside company but still holds the lease on the deal.

The sale passed in a 4-2 vote with councilmen Steven Connor and Timothy Garrett opposing.

After the meeting, Connor said he voted against the sale because he didn’t want to tie future decision makers into a bad contract for 50 years, much like the town has now.

“I think it’s shortsighted to obligate people for 50 years,” he said.

The current leases the town has with the tower companies span several decades. Three towers have more than 10 years left on the leases. The nTelos lease expires in six years.

“All of these leases have been extremely long leases in my mind,” Councilwoman Claudia Puckette said.

Mayor Paul Harvey said the current leases prohibit adjusting the rates.

After the meeting, Garrett said he opposed the sale because he felt the rents were worth more than the town sold them for. He said the town may be “shorted in the end.”

During the meeting, some council members expressed the need for the money.

“If we don’t get this money, it’s going to put a stop to the plans we’re making, the things we came here to do,” Puckette said.

“While it’s not the best proposal I’ve seen in my real estate time, it’s a means to an end.”

Under the agreement, AP Wireless receives a combined monthly payment of about $4,885 in rents from the four cell tower companies. This is more than $58,600 annually.

In addition to the rents, AP Wireless can expand its portfolio and coverage area.

“They want their portfolios to be this big,” Gillespie said. “That alone is a marketing tool.”

After the vote, Garrett said he wanted the town’s lawyer to ensure the public safety and schools equipment remains and operates on its tower as it is now.

Gillespie said that antenna would not be affected by the agreement.

The sale was bid out a few months ago. The town received interest from five companies. Of those interested, only AP Wireless and New York-based Unison submitted proposals.

Unison was turned down because it wanted to buy the land the towers are on as part of the agreement. It also did not offer the town as much money for rate increases and new tower tenants, Gillespie said.

Through AP Wireless, the town receives 100 percent of the difference if there is a rate increase. If a new tenant locates on the tower, the town will receive 100 percent of that rent if they found and signed the company and 70 percent if AP Wireless brought the new tenant in.

Through Unison, the town would only have received 80 percent of the rate increase, Gillespie said.

One of the big questions was whether the town should stay with the towers throughout the long leases and risk losing money if cell towers close or to take the money upfront.

Gillespie expressed concern the nTelos Wireless tower might not be in operation in a few years because they are a relatively small company. The Nextel tower closed in December.

Contact Katrina Koerting at (434) 385-5530 or kkoerting@newsadvance.com.

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