SALINEVILLE - For the first time, village council publicly announced the details of a lease agreement between the village and Chesapeake Exploration LLC Monday night.
The property being leased is the 17 acre Woodland Cemetery along State Route 644 on the northeastern edge of the village.
In late August, village council passed an emergency ordinance to accept Chesapeake's lease offer. Under the terms of the agreement, the village would receive $44,145 annually and 15 percent royalties from any drilling which might take place there. The lease will last for five years with the option for the village to renew for another five years.
At the time council passed the ordinance to accept the lease, there was brief mention of the fact that the lease money would have to be split with Buckeye Water District (BWD) because of a settlement from a 2012 lawsuit between the village Board of Public Affairs and Buckeye.
As part of the settlement, the BPA agreed to pay $150 a month toward paying off a $96,212. 69 debt incurred largely through water usage at the village sewage treatment plant.
The settlement also stipulated that the village must split half of any gas and oil lease with BWD to pay off the debt.
There was some debate among council members as to whether the lease money, which technically belongs to the village because the village holds the deed to the cemetery, should be used to pay off the BPA's debt to BWD.
"I don't think we can use cemetery money to pay off Buckeye Water," said councilman Tom Hays
At this time, councilman Wayne Lieshman pointed out that the village owns the cemetery and therefore must give BWD half of the lease money.
Hays then counter-argued that the Board of Public affairs is a separate entity from the village and therefore paying off their debt should not fall to the village.
"It's (the BPA) still the village of Salineville," responded councilman Rick Beadle.
"Board of public affairs is a different account from our general fund," responded Hays, insisting the two were separate entities
"But it's Salineville land," said Lieshman adding, "Actually council could probably take it all if we wanted to be really terrible to the cemetery, but we want them to have all they can have and we do owe half to Buckeye."
Village Solicitor Andy Beech was then asked by council to clarify the situation.
"The village is entering into the lease so it's going to be village monies when that check comes and you're obligated by that contract to pay half of that to Buckeye," said Beech. "What you do with that other half is up to this council."
After some discussion, council voted unanimously to give all of the money left after splitting the lease with Buckeye to the cemetery, plus all royalties. Half of the lease will amount to about $22,072 for the cemetery annually.