The new gold, or the new oil, some might say, is mobile technology.

And when the city of Davis bought a small ranch on the northeast side of the city a decade ago, it may have purchased a piece of that action.

In 2002, the city was weighing a legal battle with the individual who owned Howat Clayton Ranch — as the land was then called — near County Road 105. The property owner claimed at the time that the city was flooding the property and the owner wanted to be compensated for the damage.

But after some consideration, the city realized it would be cheaper simply to buy the land, rather than fight with the owner year after year over flooding.

So, for about $1.77 million, the city bought 770 acres of largely vacant farm land.

Vacant, that was, except for a small cell tower.

At the time of acquisition, Verizon owned the tower and rented the land through a ground lease, paying about $1,000 a month to the property owner — which eventually became the city — to operate the tower on the site.

A few years later, Verizon hired a cell tower manager, American Tower, to look after the structure and deal with the property owner.

For about eight years, the management company paid the rent on its 20-year-deal with the city, without a hitch.

But Anne Brunette, the city’s property management coordinator, saw that the lease would expire in a few years and the two sides would have to negotiate a new deal, likely more complicated and more expensive than the outdated 20-year lease.

“The lease was so old, that the dollar amount for the rent was very low compared to what the city makes for rent on other cell towers,” Brunette said. “Everyone was well aware the agreement was going to be updated and come up to what I call ‘market rent.’ ”

So, hoping to get a head start on the deal, and to make sure the city didn’t get caught short at the end of the contract, Brunette reached out to the management company to begin those discussions. But she received little response.

“American Tower is such a large corporation that they were somewhat dysfunctional in their ability to negotiate,” Brunette explained. “They were not paying attention to it, even though they were getting letters saying that we were going to terminate (if they didn’t negotiate a new deal).”

Years eventually whittled down into months, at which point Brunette decided to take offers from other cell tower companies, as American Tower didn’t appear interested in renewing the deal.

The city received interest from ComSites West, a company similar to American Tower that already operated towers in Davis. ComSites West eventually offered about $75,000 in up-front fees and a monthly rent of $2,400 over a 25- or 30-year deal.

The contract would have more than doubled what the city was making on the old deal.

So, with a real offer in hand, Brunette brought the proposed contract to the City Council meeting in late August, prepared to terminate the city’s relationship with American Tower and go with ComSites.

But American Tower and Verizon, who had a lot to lose because it didn’t want a gap in coverage, got ahold of that staff report and sent representatives to the meeting.

“We would like a short extension at the end of the month to paper up a more lucrative deal for the city,” the American Tower representative asked of the council.

With another suitor back in play, the council decided to hold off on making any decisions and let Brunette work out the best deal for the city. And Brunette came through.

After receiving another low-ball offer from American Tower, Brunette rolled the dice and gave her final offer, thinking American Tower wouldn’t go for it.

“If you really want this cell tower,” she said, almost on a whim, “you will show up Friday at 3 o’clock with a check for $220,000 (in up-front fees) and a signed agreement. Or just assume the lease is terminated.”

American Tower showed up and, agreeing to the up-front fee and $2,500 monthly rent, essentially guaranteed the city a lease worth more than $2 million.

The 30-year deal also earns 4 percent interest and the city receives 15 percent of the rent that the third carrier on the tower pays. If an additional carrier is added, the city drops the interest rate to 3 percent but earns 25 percent of the fourth carrier.

The deal translates into about $63,000 a year in revenue. Brunette said that since the property originally was bought with water and storm drain funds, the revenue goes to support those accounts for the city.

“We were not only able to save the taxpayers money from litigation, but we were able to turn the cell tower into a revenue stream for the city,” she said.

The city of Davis has 11 cell towers within its borders, though none of the other contracts are set to expire soon.

— Reach Tom Sakash at [email protected] or (530) 747-8057. Follow him on Twitter @TomSakash

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