HomeMy WebLinkAboutRESOLUTION 1990-42Suggested by: Administration
City of Kenai
ItI~OLU'~ON NO. 90-42
A RESOLUTION OF THE COUNCIL OF THE CITY OF KENAI,.ALASKA T~J~NSFERRING
$10,000 IN TRE GENERAL FUND FOR ATTOItNEY FEES IN T~ MSM PARTNERSHIP
LITIGATION.
WHEREAS, the City of Kenai has appealed the Trial Court's decision to
the Alaska Supreme Court in the MSM Partnership (Inlet Woods)
litigation; and
WHEREAS, it is est~ted that an additional $10,000 is needed to
provide legal fees through the Supreme Court appeal.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF T~E CITY OF KENAI,
ALASKA, that the following budget transfers be made: i
~en~ral Fund
From: Other - Contingency $10,000
TO: Legal - Professional Services $10,000
PASSED BY THE COUNCIL OF TH~ CITY OF KENAI, ALASKa, this 15th day of
August, 1990.
ATTEST:
Carol L. Freas, City Clerk
Approved by. Finance:
(S/~/90)
kl
~10 FIDAI.eO KENAI,'ALASKA
TELEPHONE
FA)(O07-288-~014
TO:
Kenai' City Council
FROH: Charles A. Brown, Finance Director
DATE: August 9, 1990
SUBJECT:
HS~ Litigation/Inlet Woods
On July 16, 1990, the City through its attorney, Richard Haggart,
filed its appeal in this case with the Alaska Supreme Court. A copy
of the brief has been placed in each Councllmemberts packet for the
August 15, 1990 council meeting. The City Clerk also has a copy,
which is available for public inspection (the brief, has been filed and
is a public record).
I believe that Counc£1's last discussion of this matter was in
executive session on October 4, 1989. I was not in attendance at that
meeting. However, my correspondence with Council on September 19,
1989 explained that the City's case was dismissed in the trial court
in August, 1989. This, and subsequent court action, is more fully
explained on pages'four`' and f~ve of 'the brieff ......
The opposition has thirty day8 to file a response to our brief. We
then have an opportunity to make a last response.
The arguments in the brief speak for themselves. Roughly, we' have
sued for the first year's (first of twenty) assessments, about
$250,000. Since that time, two more annual installments have become
delinquent. If we are successful in this suit, I assume that we would
proceed with further action for those other delinquencies.
Simultaneous with our actions, the Kenai Peninsula Borough has
foreclosed on these properties for 1988 taxes. The one-year
redemption period expired May 19, 1990. The Borough has indicated to
me that.the City shoul~obtain title, as a result of Borough
foreclosure, in late spring. It is possible that we could attempt to
sell some or all of those lots (in addition to other foreclosed lands
the City owns) next summer.
Kenai City Council
August 9, 1990
Page Two
The City administration has discussed a pending sale in general terms.
We have not .decided on particulars, but it is fairly .certain that we.
will have problems similar to those that MSM' Partnership had= the'
assessments exceed market value. As of today, assessments (including
interest and'penalty)-on each lot total $16,.652. Taxes and costs ..
related to the BOrough forecloSure will Probably be in excess'of $500..
Therefore,. tax and assessment liens will exceed $17,000 per lot.. The
City will have to decide how to handle this in order to effectively
market the land.
The City has approved legal expenses for our attorney totalling
$23,000. At the time of our last purchase order in August of 1989, we
did not anticipate the Supreme Court appeal. Including charges for
July, the attorney anticipates that an additional $10,000 will be
needed to carry this issue through the appeal. A $10,000 resolution
and purchase order appear in this Packet for your approval.