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McHenry County water towers offer more than water

Area municipalities lease space as a revenue source

Published: Monday, June 2, 2014 10:59 p.m. CDT • Updated: Monday, June 2, 2014 11:34 p.m. CDT
Caption
(Sarah Nader - snader@shawmedia.com)
A water tower on Sioux Lane in McHenry has multiple cellphone antennas attached on top. Many area municipalities are using water towers as locations for cellphone antennas and leasing the space to cellphone companies. The revenue source can mean hundreds of thousands of dollars to municipalities.

High above Sioux Lane in McHenry, sitting on top of the water tower that has the town’s name, are several antennas broadcasting signals for a handful of cellphone companies. 

Companies such as AT&T, T-Mobile and U.S. Cellular are leasing space on top of the tower and providing the city with a source of revenue to help pay for the ongoing maintenance of the water tower.

Long-term leases of space by cellphone companies on municipal properties, especially on water towers, has become a common source of revenue for towns as a way to help their bottom lines, while helping towns minimize the amount of towers from being built in an area.

McHenry has been leasing space on municipal property to cellphone companies for several years, said Deputy City Administrator Doug Martin.

“These companies require tall structures to provide their services in order to overcome physical obstructions, trees, tall buildings, as well as topographical changes, which inhibit providing clear signals,” Martin wrote in an email.

Antennas need to be close to high-traffic areas and high population centers where there is high demand.

“Water towers are a natural match because they are located at high points throughout the city plus it’s much less intrusive and more aesthetically desirable to locate antennas on an existing water tower than constructing a monopole tower,” Martin said.

In McHenry, money from antennas located on water towers goes toward maintenance for water towers and the city’s water system. There is a monopole at the city’s public works building that generates rental revenue that goes toward both the city’s general fund and water utility operations.

McHenry’s City Council recently approved a lease with New Cingular to locate on a water tower in Tonyan Industrial Park. The company has an option to pay $300,000 up front to place antennas for 10 years. 

Dave Nelson, the city administrator for Harvard, said money the town receives from Sprint for leasing space on its water tower goes toward costs related to the city’s water utility.

“We’re not using [the top] of it,” Nelson said. “There’s space available for these companies. ... When it is there, it’s like an asset you have. It’s an opportunity to get revenue out of the asset.”

Individual cellphone towers are not pleasant to look at, Nelson said.

The last tower the city approved included provisions that required co-location and subleasing to other companies, Nelson said.

“It’s a sight that sometimes you don’t notice them, but when they’re looked at, they’re ugly,” Nelson said.

When cellphone companies determine they need to have an antenna location in a particular area, they prefer to put that antenna on an existing structure, said Mark Wilson, the National External Affairs manager for T-Mobile.

Wilson said those structures include rooftops, water towers and light standards, among others. Cellphone antennas are at the Norge Ski Club, which recently agreed to lease land to AT&T because it no longer has space on the jump. Antennas can even be placed in church steeples.

“It’s less obtrusive,” Wilson said. “Sometimes people have problems with new towers. This eliminates the necessity of building a new tower. It can be cost-effective to locate on an existing structure.”

Wilson said most municipal zoning codes call for antennas to be placed on existing structures and call for co-location.

Cellphone companies use propagation studies that take into account call volume and data usage, as well as customer feedback about signal strength to determine where an antenna site might be needed, Wilson said.

He added that access to the internet is done on a cellphone more than 50 percent of the time.

“Cellphone usage has increased dramatically in the last five years,” Wilson said.

With demand on cellphones going up, once an antenna is in place, it’s usually a permanent placement, Wilson said.

“They become integrated into a broader part of the network,” Wilson said.

When an antenna is on a water tower, companies seek a long-term lease.

“We really rely on that for coverage,” Wilson said. “We want to have long-term leases to have that coverage.”

Cary has antennas in four locations.

A water tower’s primary purpose is to provide reserves for different demand spikes and storage in the event there is an emergency, such as a water main break, said Village Administrator Chris Clark.

“In most communities, water towers are not built to provide space for cellular equipment,” Clark said. “Municipalities have become aware of the revenue potential of co-location of these sites on existing elevated structures.”

Money from cellphone antennas in Cary goes toward the village’s general fund.

“We’re always concerned about how dependent we become on that revenue source,” Clark said. “We may look through our budget process, may look at that being capital improvement investment, as opposed to money we count on to balance the budget.”

Current year cellphone antenna revenue:

McHenry - $105,459.45

Wonder Lake - $1,464

Harvard - $27,149

Crystal Lake - $303,906.30

Algonquin - $193,939.88

Lake in the Hills - $201,494.40

Cary - $270,000

Fox River Grove - $185,804

Lakewood - $3,600

*Revenue is generated from companies that provide high-speed internet

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