A recent change in state restrictions on lease terms for county-owned land has caused New Hanover County commissioners to consider a proposal that would allow a private company to build cell phone towers on county property.
The contract would allow Milestone Communications, a Virginia-based company that was selected by a committee of county staff employees following a request for proposal that was put out in April, to construct towers on county property and lease the use of those facilities to other cell phone and information technology companies. The county would receive 40 percent of gross revenue from each tower constructed as well as 20 percent of tower capacity use for public service communications such as emergency alerts.
According to New Hanover County Chief Information Officer Leslie Chaney, who presented the proposal to commissioners Monday afternoon, the deal would present “an opportunity to increase the communication capacity in New Hanover County and also to hopefully generate some revenue for our county.”
“We all know that the need for cell towers is growing,” Chaney said, citing a statistic from the Pew Research Center that says nearly 70 percent of Americans own smart phones. “The need for internet access is increasing, and increasingly folks are wanting that to be mobile and ubiquitous.”
Chaney said that this idea was being brought forward now after New Hanover County staff learned that other local governments in neighboring South Carolina, Virginia and Maryland were collecting revenue from similar contracts. Several county departments collaborated into looking at replicating it locally but found that state laws prohibited the kind of long-term leases that were required.
“We were ready to proceed and found that there was a limitation in the state’s laws that would not allow us to use our property in a long-enough term lease to make this viable in North Carolina,” Chaney said. “The legislature removed that restriction, changed the law, clearing the way for us to investigate this again recently.”
The benefits of such a contract would include enabling the county to make revenue on property in areas ideal for tower locations as well as allow them to retain control over the style and exact placement of the structures. Though the county would make money, they would not spend money on the construction, management or marketing (getting wireless companies to become tenants) of the towers, which would be up to Milestone.
How it works, according to Chaney, is the county would put together a list of properties that are available to build on. That list would then go into a database used by carriers, where they can choose sites in areas they feel they need more coverage. They would then have to approach the county and state their desire.
“Even at that point, we can say, ‘No, we’re not interested in developing that piece of property,’ or ‘ Something’s changed, we’re not interested in that anymore,’ and that goes away,” Chaney said of the county’s control. “We also work with them to say where on that property a tower would be located and what it would look like.”
“If you all don’t approve what we plan to build, we just don’t move forward,” said Jennifer Bond, a representative of Milestone Communications.
Commissioner Woody White said that while he understood the financial benefit to the county of such a deal, he did not think it was something government should get involved with, particularly because he saw an unfair advantage for the county.
“To me it seems the same as buying a building and leasing it out, and we compete with private owners of buildings in the same area, only we don’t have the overhead associated with private folks,” White said of using untaxed public land to make money off other businesses. “So it puts us at a competitive edge over the private sector, and I’m not comfortable with that.”
White said it might make more sense to him if there was a public policy justification for the move, but could not support it otherwise.
“There’s a very robust private sector enterprise that goes on every day and works fine,” White said. “Notwithstanding the money that we might make, it just doesn’t fit within our core mission, in my view.”
Commissioner Skip Watkins agreed, and asked for more time and information to look into the issue.
“I have always found use of public property against private competition distasteful … right now for me, there’s just way too many questions, so I could not vote for this,” Watkins said, suggesting they table the issue. “In light of what I hear today, maybe we can have some research done … so maybe put it off, bring it back or burn it down.”
Vice Chair Jonathan Barfield Jr. said he wasn’t opposed to putting towers on public property.
“I just think we can do it ourselves,” Barfield said, citing existing relationships with representatives from major carriers such as AT&T and Verizon. “We’ve just got to let them know that we have sites available. They’ll figure the rest of it out.”
In the end, Commissioner Rob Zapple motioned to table the issue until the board’s first meeting in September in order to gather more input on all aspects of the proposal.
“I don’t feel like I have the entire picture,” Zapple said. “Certainly it is an intriguing thought.”
The motion to table passed unanimously by all five board members. It will be on the commissioners’ Sept. 6 agenda.