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Sara Petrosyan

Cell Tower Revenues Going to Mayors, Not the Community Coffers

Communities in Armenia allowing cell towers to be built on their land are paid, on a yearly average, US$1,000, and in certain cases, as much as $3,000.

However, in over fifty of the communities Hetq researched for the article, these rents paid by telephone operators don’t wind up in the community coffers but in the pockets of local mayors and those with “connections”.

In the Tavoush community of Noyemberyan (incorporating nine settlements), eight of the cellphone towers are installed on land belonging to legal entities, and seven on community lands.

In the town of Noyemberyan there are two cell towers. One was built on land belonging to the daughter of former town mayor Vanoush Amiraghyan.

Mayor Amiraghyan declared his daughter the winner of a 2014 auction, and sold her the 200-square meter parcel for 45,760 AMD. Soon after, Kharabakh Telecom built a tower there.

There are four cell towers in the Syunik community of Lernadzor (incorporating five villages). While longtime Mayor Stepan Petrosyan told Hetq that the phone operators signed land leases with the community, in reality, the contracts were signed with other individuals who then subleased the land to the operators.

One of these individuals was Henrik Hambardzoumyan, a former head of the Syunik Province Cadastre. Another was a son of Mayor Stepan Petrosyan. A third was Aida Ghoukasyan, wife of Gagik Aghakhanyan, Syunik branch head of the State Property Cadastre Committee.

Aida Ghoukasyan won a bid to lease 225 square meters of community land in 2014 for 25 years at a yearly rent of 3,700 AMD ($7.75 at today’s exchange rate). She originally claimed the land would be used for agriculture. Soon after, she subleased the land to VivaCell-MTS.

In Garni, all three cell towers (2 belong to Viva Cell-MTS and 1 to Ucom) are on land leased to Arzoukan Stepanyan, the wife of former mayor Ashot Vardanyan. On March 31, 2006, then mayor Vardanyan handed over 1,400 square meters of community land zoned for farming to his wife in a 25-year lease deal at an annual rent of 3,000 AMD.

On April 18, 2006, Stepanyan subleased 200 square meters of the land to Karabakh Telecom for ten years at a monthly rent of 40,000.

Some four years later, on May 24, 2010, Stepanyan leased another 140 square meters to Orange Armenia (now Ucom) for ten years at 70,000 AMD per month.  

So, the former mayor is making a nifty $3,000 annual income of the land while only 3,000 AMD is going into the community budget.

The list of such “sweet deals” is long, but communities across Armenia aren’t just being finagled out of millions of AMD in land lease payments.

Cell towers are mainly erected on lands zoned for agricultural purposes. Before signing lease contracts with phone operators, communities are obligated to rezone the land for energy purposes. Sidestepping this requirement, the Cadastre registers the illegal contracts.

Rezoning doesn’t happen for two reasons. One is that the process is expensive. The second is that land zoned for energy-related purposes is taxed at a higher rate than farmland. Thus, the lessee or owner would have to pay a higher property tax later.

Last January, Minister of Territorial Administration and Development Davit Lokyan instructed communities to assist ArmenTel and VivaCell-MTS by rezoning certain lands and to sell them to the operators, who would then pay the applicable property tax rates.

Our research shows that most communities haven’t paid all that much attention to the minister’s directive.

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