Akron Mayor Dan Horrigan is asking the council to approve an $11 million agreement to sell the rights to lease city property for cell towers to put money into the city’s “rainy day fund,” before the end of the year, reported the Akron Beacon Journal. The plan would give exclusive rights to lease parts of 13 city-owned properties to EIP Communications, a Pittsburgh startup that manages property for carriers like AT&T, Sprint, and Verizon.
But why the rush? It seems that the city has already spent $6 million of the plan’s proceeds before the deal was even approved, so the mayor is pushing for an agreement ASAP. Plus, the city’s “rainy day fund,” which should total $26.8 million, is nowhere near that figure.
Currently, the city holds 15 lease agreements with telecommunications companies that use space on 13 publicly owned properties which provides $480,000 in annual revenue. Under the new deal, EIP would pay $11 million upfront and immediately take over the collection. In exchange, only EIP would be allowed to strike telecommunications leases on these 13 public assets for the next 50 years, reported the Akron Beacon Journal. The city also has the ability to lease other property directly to telecoms.
Councilwoman Veronica Sims, brought up the concern that with this proposed deal, the city might be forfeiting future revenue. If the current leases the city has with carriers were all renegotiated for the next 50 years, then the city would collect $22.7 million, more than double the $11 million on the table from EIP. To refute this statement, James Hardy, Horrigan’s chief of staff said, “You can’t calculate what you don’t know to be true. So, we can’t see beyond 2028.”
“Now is the time to make responsible decisions that will enable us to invest in that savings account once again,” Horrigan said Monday, in a statement about privatizing the lease of city-owned cell tower properties and building up the rainy day fund.
December 6, 2017