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Erik Burgess and Charly Haley, Published April 01 2013

Moorhead's public utility wants to Oakport to pull back on cell-tower deal

OAKPORT TOWNSHIP, Minn. – Oakport Authority Board members decided Monday night to delay a decision on entering a lease agreement for the Oakport water tower after the legality of the lease was questioned.

The board is considering a 35-year lease with AT&T for a telecommunications antenna attached to the tower, which becomes the property of Moorhead Public Service when Oakport Township is annexed into Moorhead on Jan. 1, 2015.

AT&T currently pays Oakport $1,000 a month for the antenna, but the new deal would end monthly payments in exchange for a one-time $122,300 payment to the township, leaving MPS out of the deal. AT&T also offered $131,400 for a perpetual lease on the antenna, but the Oakport board isn’t really considering that option, said Jeff Schaumann, chairman of the board.

AT&T’s deadline for Oakport to sign a letter of intent on the new lease is April 19, Schaumann said. The final decision would be made by November, he said.

John Boulger, an attorney for MPS, said a joint powers agreement from 1990 between the township, the utility, Moorhead and Clay County prevents Oakport from entering into contracts that will “encumber” the water tower once the township is annexed.

In a letter written to Schaumann, Boulger said MPS will not honor any long-term contract that it has not agreed to.

“To have them dictate terms that will be governed for 35 years, or 33½ years after we take over, doesn’t seem to be acceptable either legally or as a policy,” Boulger told MPS commissioners in a special meeting Monday.

While Boulger said there is no threat of litigation, Commissioner Dave Anderson said it could come to that if the township accepts the lump-sum payment.

“In a year and a half, somebody’s going to be in court,” he said, referring to the annexation date.

The joint powers agreement also requires the entities to “fully cooperate” if any pre-annexation issues arise, said Bill Schwandt, the utility’s general manager.

The utility board was not made aware of the contract renegotiations until late last week, after the Oakport board had already approved the re-negotiation price. An Oakport resident, not the township’s board, informed MPS of the deal, which has been under consideration since January.

“It was by accident that we found out that the situation existed,” said Ken Norman, board president. “This is an issue that we should be discussing in good faith like the joint resolution says we should.”

In a March meeting, Oakport’s board unanimously gave Schaumann the authority to sign a new deal with AT&T. That authority was withdrawn Monday when the board unanimously decided to table the issue for discussion with its attorney and Moorhead Public Service. Oakport’s next board meeting is April 15.

During Monday night’s meeting, Schumann presented Boulger’s letter to the other members of the board, about 15 Oakport residents in attendance and Schwandt and one other MPS representative.

Oakport board members said they want to make sure money from an agreement with AT&T would benefit Oakport taxpayers who paid fully for the tower, which was constructed in 2002. The lump-sum from the AT&T deal would go back to Oakport residents in the form of projects such as flood protection.

In Monday morning’s MPS meeting, commissioners said they hoped to get some payback from that lease deal to help pay for maintenance to the tower.

Readers can reach Forum reporters

Erik Burgess at (701) 241-5518 and Charly Haley at (701) 235-7311