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City Council denies small business request for a lower lease amount

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Bemidji, 56619
Bemidji Minnesota P.O. Box 455 56619

A new Bemidji-based company is trying to improve wireless service throughout the city.

Enterpoint L.L.C. has asked the city of Bemidji for permission to lease space atop the 15th Street water tower for an antenna that would allow the company to offer "Wi-Fi" to areas in and around Bemidji.

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The city already leases space on the water tower to three cell phone providers at a cost between $9,700 and $11,500 a year.

Each cell phone company started at a base price of $9,700 a year and the lease amount increases based on cost-of-living increases.

Enterpoint and the city of Bemidji began dealing with one another this fall, when Enterpoint initially asked to lease space on the 15th Street water tower to install a wireless antenna.

But, rather than paying the $9,700 rate, Enterpoint asked that the amount be reduced.

The Bemidji City Council on Nov. 19 gave authorization to allow Enterpoint to install the antenna. However, the city gave authorization on the condition that city staff would investigate other cities' policies on leases with companies other than cell phone providers regarding water tower leases.

On Monday, the result of that investigation was revealed: Cities do not generally differentiate between types of companies, according to Bemidji Finance Director Ron Eischens, who contacted other Minnesota cities.

This news eventually resulted in a unanimous vote by the council to offer Enterpoint a lease on the water tower at an annual rate of $9,700, which would be raised based on inflation in the future.

Fred Stinar, who owns Enterpoint along with a son, questioned the council's decision to not differentiate between a small, local business and national companies.

"A smaller business doesn't even have a chance," he said.

Stinar argued that the space required from Enterpoint doesn't compare to the space taken up on the water tower by cell phone companies.

Cell phone providers have to offer service to a larger territory than Enterpoint. Also, cell phone companies set up electrical boxes at the base of the water tower, which he does not need to do, Stinar explained.

City Attorney Al Felix said cell phone companies probably do have a "bigger presence physically" on the water tower versus what Enterpoint has set up.

Felix explained that the issue was coming before the City Council, because staff needs elected officially to set a policy on the matter.

The terms of the lease would be identical to those offered to cell phone providers and would require the incoming company, in this case Enterpoint, to make sure no interference was created, Felix explained.

"I cannot support anything less than $9,700," said Councilor Nancy Erickson, who advocated for the same base fee to make sure all companies were being treated the same.

Erickson said the issue was not the amount of space being rented - but that space was being rented from public property.

"Historically, ($9,700) has been the base amount," she said. "Really, we have already set the policy."

The council voted unanimously, 6-0, to offer a lease in the amount of $9,700. Councilor Ron Johnson was absent from the meeting.

Stinar told councilors that he did understand their desire to have a uniform policy for all companies, but urged them to consider that the cell phone providers have a very large customer base spread out throughout the country.

Enterpoint is just trying to reach a smaller, targeted group of customers in the Bemidji area, he explained.

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