Mukilteo council reviews short-term radio array lease, raises questions about price and visibility

Public Works Director Nienhaus presented a proposed lease with Tower Research Capital for a receive-only radio (antenna) array to be sited on city-owned parcels at Harbor Reach and Beverly Park.

Nienhaus said the agreement is structured as a three-year lease with one-year renewal options at $18,000 per year, with annual escalation tied to the Seattle CPI, capped at 3 percent. He described the equipment as a low-profile, line-of-sight receive-only array that would feed into the company's fiber and then into the city’s fiber network at Harbor Point and onward. “It does not make audible sounds,” Nienhaus said, and the company has proposed a residential-style 6-foot cedar fence around the equipment; the firm would install power and fiber and maintain the interior of the fenced area. The lease includes a provision for the tenant to reimburse the city’s attorney and administrative fees incurred negotiating the contract, Nienhaus said.

Council members questioned whether the rent reflected market value and whether staff should push for higher compensation. One council member noted comparable cellular ground-lease pricing can range much higher and asked whether the city had sought a market analysis; Nienhaus said the city attorney and staff negotiated the terms and considered the short-term nature of the arrangement. Councilors also pressed about a standard subleasing clause in the contract; Nienhaus explained such clauses are common for telecom leases and said any sublease would be subject to the city’s consent provisions in the lease package.

Members raised visual-impact concerns because the parcel abuts residential property on one side and industrial land on the other; Nienhaus said the proposed cedar fence and the parcels’ raised topography mean the array should be largely out of public view from the street. Council members also asked how long the array would likely remain; Nienhaus described the deployment as experimental and relatively easy to remove, not a permanent tower structure.

No vote was taken. Staff said the lease would return to the council after further review; council discussion centered on whether to seek higher rent or accept the short-term revenue stream rather than risk losing the agreement.