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City engineer presents $230,000 buyout offer for 10th Street cell tower lease; council hears risks
Summary
The city engineer told the council of a $230,000 offer to buy out the 10th Street cell tower lease, noting a right of first refusal for the original company and that projected rent increases would take until Sept. 30, 2038, to recoup the buyout at current escalation assumptions; council took no action because the item was not on the agenda.
The Marseilles city engineer presented a memo informing the council of an offer to buy out the lease on the 10th Street cell tower for $230,000. The lease, originally executed in 2007 and amended in 2016, runs in its current form into the 2060s; the engineer said the current rent is $1,288 per month (including $375 for additional antennas).
The engineer explained the buyout would be an upfront payment of roughly $230,000 and would include a provision to share half of any additional antenna rents going forward. He cautioned that the original leaseholder retains a right of first refusal, and that several companies have attempted buyouts in the past five to seven years. He also noted the practical risk that if towers become obsolete or are vacated the city could face a structure left on city property; the engineer said the company would be responsible for removal under the terms discussed and recommended attorneys review any offer.
Using projected rent escalations (a 15% increase every five years), the engineer said it would take until Sept. 30, 2038, to recoup $230,000 via rents under the illustrative scenario. Council members asked about liability language and were told the company would be responsible for the structure if it left the site. Because the buyout proposal was not on the published agenda, no formal council action was taken; the engineer encouraged members to review the proposed terms and consult city attorneys before any future decision.
The city will solicit feedback from attorneys and interested council members before placing a buyout proposal on a future agenda for formal consideration.
