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HomeMy WebLinkAbout1993-06-16 Council Minutes4 • KENAI CITY KENAI A. CALL TO ORDER AGENDA COUNCIL - REGULAR MEETING JUNE 16, 1993 7:00 P.M. CITY COUNCIL CEMERS 1. Pledge of Allegiance 2. Roll Call 3. Agenda Approval 4. Consent Agenda *All items listed with an asterisk (*) are considered to be routine and non -controversial by the Council and will be approved by one motion. There will be no separate discussion of these items unless a Council Member so requests, in which case the item will be removed from the Consent Agenda and considered in its normal sequence on the agenda as part of the General Orders. H. SCHEDULED PUBLIC CONNED' (10 Minutes) 1. Kent Swisher/Chryetal Smith - Alaska Municipal League Update Presentation 2. Lucille Haddon - Director of Visitor Services/Kenai Visitors & Convention Bureau, Inc. co PUBLIC $EARL GS 1. Approval - Settlement Agreement Between the City of Kenai and MSM Partnership (Inlet Woods). 2. Ordinance No. 1546-93 - Amending Kenai Municipal Code, Chapter 20.05 Entitled, "Vehicles-For-Hire.11 3. Ordinance No. 2547-93 - Amending KMC 7.12 to Provide for Monthly Filings of Hotel/Motel Room Tax Returns for Certain Delinquent Accounts. 4. Ordinance No. 1540-93 - Finding That a Portion of the Southeast h, Section 36, T6N, R12W, S.M. (A 200' Strip Along Evergreen Street), City -Owned Lands, is not Required for Public Use and May Be Sold. 5. Ordinance No. 1549-93 - Amending the Kenai Municipal Code 14.20.150 to Include Revocation of Conditional Use Permits. -1- r� L D. so • 6. Ordinance No. 1550--93 - Amending the Official City of Kenai Zoning Map for a Portion of the SEk, Section 36, T6N, R11W, S.M. (a 200 Foot Strip Along Evergreen Street), 7. Resolution No. 93-46 - Transferring $1,450 in the Public Works Department for the Purchase of a Computer Upgrade. 8. Resolution No. 93-47 - Transferring $2,776 in the General Fund for Replacement of the Ice Machine at the Recreation Center. a 9. Resolution No. 93-48 - Transferring $4,000 in the General Fund for Additional Repair and Maintenance Supplies in the City Shop, 10. Resolution No. 93-49 - Transferring $4,147.55 in the Congregate Housing Capital Project Fund for Reinspection Costs, 11. Resolution No. 93-50 - Awarding the Security Services Contract for the Airport Terminal Building, for the Period July 1, 1993 Through June 30, 1996, to Guardian Security Systems, Inc., for $1,274.00 Per Month. 12. Resolution No. 93-51 - Authorizing the Execution of Cooperative Participation Agreements Among Alaska Municipalities and School Districts Creating the Alaska Municipal League Joint Insurance Arrangement. 13. Resolution No. 93-52 - Transferring $5,000 in the General Fund for Additional Attorney Fees in the Inlet Woods Litigation. 14. Resolution No. 93-53 - Awarding a Radio Maintenance Contract to Southcentral Communications for a Three - Year Period. 00MRI88I091IGOMMITTBS REPORTS 1. 2. 3. 4. 5. 6. 7. 1. Council on Aging Airport Commission Harbor Commission Library Commission Parks & Recreation Commission Planning & Zoning Commission Miscellaneous Commissions and Committees *Regular Meeting of June 2, 1993. -2- 4) • 1. *6/3/93 Senator Murkowski Letter - Regarding Overland Avenue Easement. 2. 6/8/93 APRN/voices of Alaska - Request for Contribution/"The Wisdom and Words of Peter Kalifornsky." O. OLD RUSINE88 I. Approval - Lease of Airport Terminal Spaces 28, 29, 30 and 31 - MarkAir. 2. Discussion - Elementary School Renovation/Construction. no Nei BUBIN88B 1. Bills to be Paid, Bills to be Ratified 2. Purchase Orders Exceeding $1,000 3. *Ordinance No. 1551-93 - Establishing Section 13.10.060 of the Kenai Municipal Code, Entitled Sanitary Facilities for Camping on Private Property. 4. Discussion - Settlement/Change Orders - Kenai Courthouse Project, 5. Discussion - Airport Commission Recommendations. I. ADMINISTRATION RESORTS 1. Mayor 2. City Manager 3. Attorney 4. City Clerk 5. Finance Director 6. Public Works Director 7. Airport Manager �?. DIBCU$BION 1. Citizens (five minutes) 2. Council R. SXECUTIyIeSBSX - City Clerk and City Attorney Evaluations. -3- 1 0 0 • :6 XHNAI CITY COUNCIL REGULAR MEETING JUNE 16, 1993 7100 B.M. I CITY COUNCIL CRAMSERS .TORN J. WILLIAMS, RESIDING Mayor Williams called the meeting to order at approximately 7:02 p.m. in the Council Chambers in the Kenai City Hall Building. Mayor Williams introduced Tom Manninen, Kant Swisher, and Chrystal Smith to the Council and audience. Mayor Williams led those assembled in the Pledge of Allegiance. A-2. Roll was taken by the City Clerk. Present were: Williams, Bookey, Swarner, Monfor, Measles and McComsey. Absent was Smalley. A-5. Mayor Williams requested the following changes to the agenda: ADD: C-1, Additional Information - Raw Lands Sales Report, produced by Ron Johnson, ERA -Real Estate Specialists, C-2, Additional Information - Financial Analysis Letter from Mike McLane. C-2, SUBSTITUTE ORDINANCE NO. 1546-93 - Additional amendments defined on the memorandum attached to the substitute ordinance. Councilman Measles requested Item K be removed from this agenda and requested it be forwarded to the July 70 1993 council meeting agenda. MOTION: Councilman Measles MOVED for approval of the amended agenda. There were no objections. SO ORDERED, A-6. There were no changes to the consent agenda. • KENAI CITY COUNCIL JUNE 16, 1993 PAGE 2 MOTtONs MEETING MINUTES Councilman McComsey MOVED to approve the Consent Agenda as presented. There were no objections. 00 ORDERED. M.A. =1DRULED PDHL=e RMENT (10 Minutes) Rent Swisher/Chrystal Smith - Alaska Municipal League Update Presentation Swisher stated he and Chrystal Smith were in Kenai to make a site visit of the Kenai/Soldotna area in preparation for the 43rd AML Annual Conference in November. Swisher added they are breaking new ground with holding the conference in Kenai/Soldotna, as it is normally held in the Anchorage/Fairbanks/Juneau areas. Swisher added he has been very impressed with the good attitude in regard to holding the conference in this area. Swisher stated they expect approximately 500 persons to attend the conference. Swisher added the conference in this area will be very good for the economy. Williams stated approximately $300,000-$400,000 will be brought into the community because of the conference. Williams added 400 hotel rooms will be needed (including bed & breakfast accommodations). 13-2. Lucille Hadden - Director of Visitor Services/Kenai Visitors & Convention Bureau, Inc. Hadden requested Council to reconsider their action in closing the Forest Drive Municipal Park to tent camping. Hadden stated not only cannery workers want to tent camp. Hadden stated they receive requests for information from people coming into the area from out of state and out of the country. Advertisements published state there is tent camping available in Kenai. Hadden added these travelers are coming to our area because we have invited them. Hadden requested Council to come to some short-term solution. Hadden stated she is not suggesting the reopening of the Municipal Park. However, a safe, clean, quiet area is needed. Williams stated an ordinance has been requiring private property owners who provide tent camping areas to also provide sanitary facilities. • KENAI CITY COUNCIL MEETING MINUTES JUNE 16, 1993 PAGE 3 v Councilwoman Monfor referred to the Parks & Recreation Commission minutes wherein they will be discussing a tent camping area at their next meeting. Monfor stated she has driven through the Municipal Park and would be embarrassed for anybody to camp there. Monfor added most of the tables are gone, the outhouses are very bad, etc. Monfor added Soldotna has better facilities. Councilman Bookey stated he sympathizes with Councilwoman Monfor, however he has sent 27 people who were looking for tent camping facilities to other places (out of Kenai). Bookey stated advertisements were placed offering tent camping areas in Kenai. Bookey added they are promoting on one hand and not on the other. Bookey added the topic needed to be addressed now. Monfor stated it is the Council's fault for not addressing the problem earlier. Monfor stated a tent camping area should have been their first priority. Monfor stated she believed it will take two weeks of work to clean up the Municipal Park. Williams stated he has had some discussions with private property owners in the city to help take care of the problem. Williams added they will have to struggle by this year. ITEM Ct PUBLIC REARING8 Approval - Settlement Agreement Between the City of Kenai and MSM Partnership (Inlet Woods). VERBATIM: WILLIAMS: We'll move to our regular scheduled agenda of ordinances and public hearings. The first public hearing we have this evening deals with the settlement agreement that's been drafted between the City of Kenai and the MSM Partnership, ah, Inlet Woods and I would like to take just a moment, we'll go off the record for a moment so the Council has an opportunity to review the latest information that's been handed to us. So, we'll stand at ease for just a moment. OFF RECORD: BACK ON RECORD: WILLIAMS: All right. We're ready to come back to order. Call the meeting back to order. The issue before us is the settlement agreement that's been prepared regarding the a, the a settlement between the City of Kenai and the MSM Partnership. Ah, I suppose 13 KENAI CITY COUNCIL MEETING MINUTES JUNE 16, 1993 PAGE 4 the first thing that we should probably do is have the principals from MSM address the Council one more time to see if there are some things that we haven't covered or should hear or should be notified of. MONFOR: Mr, Mayor. WILLIAMS: Yes. MONFOR: Do you want a motion first? WILLIAMS: All right. We can do that. The Chair will entertain a motion with regard to the settlement agreement. Councilwoman Monfor. MONFOR: I move for approval of the settlement agreement between the City of Kenai and MSF...MSM Partnership. This is in regards to Inlet Woods. WILLIAMS: All right. There is a motion on the floor, is there a second. MEASLES: Second. WILLIAMS: It's been moved and seconded. We'll now continue with some discussion. Principals please state your name for the record. MC LANE: My name is Mike McLane, Box 769, Kasilof, and I'm a partner in the MSM Partnership. In the hand out that I've - prepared today for you folks, I've done a financial analysis of. the settlement offer. The main thing that I wanted you to keep in mind in going through these numbers, it doesn't take into account any acquisition costs, cost of the lawsuit or anything we've incurred up to this date. And that amounted to about eight -hundred -and -fifty -thousand in cash that we didn't have in the project and have actually written off as losses against the project. The numbers that you have for the following market scenario don't take into account any of that. It's just from this day forward what we would have to market the lots.to break even. The ah, one of the main reasons for me speaking tonight is to 40 dispel any thoughts of our settlement offer was brought about by the idea of profiting from this whole offer. This lawsuit has E KENAI CITY COUNCIL MEETING MINUTES JUNE 16, 1993 PAGE 5 been about money and hurt feelings and this offer here is the best efforts of my family to make financial amends to the City and I just want to be straight up about that and just go through each one of these deals to answer questions where I came up with these numbers. Over the course of the winter, ah, I worked with the utility companies and various developers that have come into town looking at Inlet Woods and so I was able to have hard -dollar numbers for extending utilities back into Phase II. Um, dealing with the first ah, page of this information is the, the actual loan amount that we'd have to put together to ah, fund this thing. The first item is the $12,500 net to the city. The second is hard numbers from the electric company and gas company to put those utilities to the back half of the subdivision which we had been unable to do. If you flip back to the, my map, Phase II is the area that isn't certified electric and plumbing. We did put gas throughout the entire subdivision from the start. Then ah, the next number is back taxes to the Borough. That's $183,290. Bank appraisal fees, this was the appraisals done on Inlet Woods, Mooring Estates, and our little ah, Mother Natures building out there in Soldotna. That's that number. We had to buy out, pay off, our former partner's attorney before he would sign the settlement agreement. That was his attorney, the seventy -four -hundred number. The other attorneys fees were just for view from our attorney's dealing with your folks! attorneys. The title insurance, that was a hard quote from Southcentral for the bank. The loan origination fees and bank fees are estimates based on 1 point for the origination fee and 2 points on the about. That brings to the, for a grand total of two-m ll-ion-two-hundred and twenty-seven thousand two hundred dollars ($2,227,200) that we'll have to get from the bank to fund this settlement. In the next sheet I go to show where our break even point is .with that. You go through and ah, we have a year's worth of interest. We pay the utility companies. We've got to pay the bank fees out of pocket. The appraisal fees, the attorney fees, the cost out of pocket in addition to everything is the four -hundred -ninety- eight thousand. The break-even sales price at $15,658 per loft, that came from a settlement sheet done by Southcentral Title. Now that was done on a lot in Phase I where the utilities were already in so we could actually sell that lot today and go with • KBNAI CITY COUNCIL JUKE 16, 1993 PAGE 6 MEETING MINUTES $12,000 to the city and $12,500 plug cost of sales and all that. So, if you go to the settlement sheet that's in the back of the packet that'll show what a net...we give you folks $12,500, pay the real estate commissions, appraisals and everything and the back taxes, that's where the fifteen-thousand-six-thirty- eight...six-fifty-eight figure comes from. But I wanted to see what a break-even point would be in the back because we don't, we have to figure we're going to be putting the utilities in for the whole thing, so I figured we'd analyze the 141 lots total in this one. So, the additional marketing cost to do that is that four -hundred -ninety -eight -thousand. So it's a grand total today of $19,197 per lot if we bring everything that .we own in Inlet Woods up to market conditions with the utilities, pay the back taxes and everything. So that's our sort of base deal. The next sheet is, since we've qVm, been, we've got a, we've got a real offer of 600,000 on the table for fifty of these lots. If we go ahead with this sale on our own after the bank has funded the project, we would incur another cost to my family of $182,900. That would have to be added to the 91 lots that we still own after we've sold the fifty at 12,000 a piece. So, the end run, if we were to complete the fifty -lot bulk sale right now, we would have to market the other lots for 21,207 bucks. And, these numbers are substantially higher than market conditions today. And so, that's where I wanted to come and run out these so, if you have any questions we can go through that. I really think that Inlet Woods can be an asset to the town because it's a well -designed, well-built subdivision. The only thing it was built ten years too soon. I just want to, it was never our intention to bilk the City and it's not our intention to do that with this settlement offer and that's what I'm here and ah, if I can answer any questions, I'd sure be glad to. WILLIAMS: Questions from council? All right, seeing none. Thank you very such Mr. McLane for taking the time to do the lengthy preparation to bring this material to us this evening. At this time I would ask if there was...Yes, all right. At this time I would ask if there's anyone else that would like to address the Council on the matter. Mr. Johnson, please state your name for the record and sign in 0 there on the sheet. • KENAI CITY COUNCIL JUNE 16, 1993 PAGE 7 MEETING MINUTES JOHNSON: My name is Ron Johnson. I'm a real estate broker with Real Estate Specialists of Kenai. I put this ah, package together for you for several reasons not the least of which is to show you that the, the ah, the offer that I am the agent for doesn't represent current market conditions. It makes a little bit of an effort towards speculative investment. A gamble, I think, is what it comes out more to be. I'll share some of the statistics with the audience that you have in front of you. This, we talked with a couple of the title companies to determine what was the percentage of the raw land sales within the city of Kenai that were traditionally handled by realtor organizational members. A shotgun figure, but the two major title companies come up with a neighborhood of 40%. So, using that number, we advanced some projected sales and some projected figures and I tried to justify those and make them pretty simple to understand. The current market available of the existing listings that are very similar to the properties that we're dealing with right now on the second page, they're itemized to give you an idea of the cross-section. There's 43 active in the current multiple listing service today. This was taken just a few minutes ago. If we use that 43 as 40%, that puts about 110 lots currently available on the open market in Kenai today. This is only within the city limits of Kenai, I might add. These properties run from 1,000 to 25,000 a piece, giving us an average market price of 11,200. Ah, I just penciled in a number for my own use. Comparable properties in the North Kenai area that are minimum probably in the area of one acre lots sizes, will average out about seventy-two hundred or $7,500 per lot. And there's a lot of them available. Ah, you see, January 1 through May 31, the actual sales in the Kenai city, there were two of them through the Board of Realtors. Ah, one was a river front lot at 26,000. You can't, you can't buy river front lot today for 26,000, but there are a lot of them available. They're hoping for a higher price. I would say the other lot that sold for $5,000 was probably closer to what the average should be. If we extrapolate that with the 40% then in that period of the first six months of 1992, there were probably five or six lots sold. . KENAI CITY COUNCIL JUNE 16, 1993 PAGE 8 MEETING MINUTES January one, or June one of 1992 to December 31, 1992, picked up a few more sales in that five parcels were sold through the Board of Realtors. If in fact, five parcels represents 40%, then 12 parcels were actually sold. I have no way of tracking the actual numbers. I'm just going by some guesstimate estimate. This year we're seeing some increases in sales and I suppose, or I presume that most of the increase in sales is the result of speculation and as well as the prices of some of the properties is very, very low. There's some properties that have been dumped on the market by the banks and lending institutions, auctions, FDIC, and that sort of thing. In the City of Kenai, to this point this year, there have been eight parcels sold through the Board of Realtors. That's tracked sales. If that be the case, then we've got 20 lots sold so far this year in the City of Kenai. I'm inclined to think that number is a little low, but that's all I can track right now. You notice that the average price came up to $10,715. Not a great, great leap I might add. On the second page you have some prices of some lots that run anywhere from $1,000 up. The last page, I think, is, is probably the most important part of this little effort. Ah, if we take the existing lot sales and factor in an absolute best -case increase of 110%. In other words, we sell 10% more lots every six months than we sold the previous six months. At the end of that period and December 31, 1999, we will have sold 496 lots. That based on the realtor organizations selling 198, which is 40% of those. That's absolute best case. Now, if, if this particular subdivision managed to be 25% of those sales, in 1991 that subdivision was very close to sold out. Considering that across the spectrum of the various lots and the variety of lots that are available, that's not going to happen because it's a high, it's a high lot subdivision in terms of it's going to be a better -than -average subdivision. Therefore, itts going to take a little bit longer to sell. The current days -on market indicate that while the days are coming down, ah, it went from 620 to 300 and we're sitting now at 250 days on the market, so it's going to take just a little longer than just a couple of months to get these things to happen. . Ah, yesterday, I had the opportunity to visit with and show some people ah, who hope to have their name withheld, ah, residential lots, ah residential properties available, as well as they had a 0 • KENAI CITY COUNCIL JUNE 161 1993 PAGE 9 MEETING MINUTES request for 40,000 square feet of offices. If you put those numbers into a calculator, it comes up to roughly 400 families. If that be the case, that we could get something like that to relocate to this area, one of the major concerns is that we have no place for them to live. There aren't, there aren't enough developable, developed good - quality lots available on the market today. There are not enough good -quality residential properties on the market today. e According to the building permits, the City of Kenai, Kenai provided to me, at this point in time, at this point in the year, we're the just one number, one permit behind what we were last year. From June 1 to December 31 last year, there were 30 additional permits built ah issued and I would say that probably if that be the case for this year, increase it by 50%. Ah, that's not going to house 400 people, 400 families. So, I think it's in the best interest of the community to get some building started in that subdivision to get the tax base in there to keep the people from moving out of town. There's an awful lot of property out of town that's available for sale. It's available for sale cheap and it's cheap enough that it's going to cause some of the people to move out of town rather than to come in to town even though they prefer to be in town and have the benefits of the city waters and sewer and that kind of thing and a new home. So, I would encourage you to look at it from the perspective of trying to keep the people who are looking for housing now, in town. WILLIAMS: Thank you very much Mr. Johnson. Are there questions of Mr. Johnson? Thank you very much for preparing the material for us. At this time I would ask if there's anyone further that would care to address us, please come forward, state your name for the record and sign the sheet. PEDERSEN: My name is Larry Pedersen. . - Distinguished members of the council, I believe this Is —the third occasion I've had to come before you on this matter. Ah, I wanted to give you somewhat of an update ah, taking the lead that was granted us from ah your body last week. I have managed to place a preliminary package on this project before four lenders by next weekend, probably almost eight that this package will be presented in front of. • KENAI CITY COUNCIL JUNE 16, 1993 PAGE 10 MEETING MINUTES I. Ah, at the current time out of the existing four, we have two of them that have somewhat of a lukewarm reception regarding this package and I'll get into why in a minute, and we have two that a significant interest and one that's trying very hard to work with us to come forth with a successful conclusion. Um, one of the reasons that this package is extremely difficult has just been presented in front of you this evening and that is ah, you normally don't go in front of a lender, any kind of a lender, and say, "I want to finance a project and the money I want to borrow is for the, is far more than what the project is worth." Especially when the project itself is the primary source of repayment for that loan. When you're trying to obtain a loan from a lender, one of the first things he does consider is what is the source of repayment of the loan. With respect to flat loans, land loans, development loans, the land itself is the primary source of repayment. The secondary source that you look at is the financial strength of the borrower and then you may have alternative sources after that should you be fortunate enough to have those in your loan equation. Ah, banks get criticized for making these kinds of loans, yet we have a significant interest here from two banks right now that want very much for this thing to happen and for it to come together successfully. I think it's extremely important that ah, we understand that ah, that ah, this is not about profit and loss. This is not a situation where the City of Kenai is going to profit, nor is it a situation where the McLane family is going to profit. This is a situation of resolution. Bringing to a conclusion a battle that no one wins. Ah, this is not about getting even. It's about resolution. This is not about feeling good about the conclusion because no one can feel good when no one wins. It's about resolution. This is not about coming to grips with reality because, ah, this is about ah, coming to grips with making the best of a decision we made years ago that probably wasn't as good as it could have been. This thing is about resolution. IS I feel ah, I feel very good about the interest from the lenders that we have that are working with us. Especially to have, ah I think they have enough interest to try to make this thing work for all of us. If it comes together, the McLanes are making a KENAI CITY COUNCIL JUNE 16, 1993 PAGE 11 MEETING MINUTES sacrifice. The city is making a sacrifice. I think the best thing to say about it is that we've come to a resolution so we can make it work. Ah, I would urge all of you to think about resolution. Thank you for allowing me to speak. If you have any questions about lending or where we, anything you want to know about it, I would be more than happy to answer any questions. WILLIAMS: Thank you. Are there questions of Mr. Pedersen? Thank you very much Mr. Pedersen. Is there anyone else that wishes to address us on this matter? Name of the record and please sign the sheet. MOORE: My name's Joe Moore. I live in Inlet Woods subdivision and my comments are concerning that. Ah, I've had an opportunity to review the unapproved minutes of the City Council Meeting of June 2, 1993. I've also talked with the mayor and Councilwoman Monfor regarding the City's attempt to settle with McLanes. I know that it is the Council's responsibility to look out for the best interests of the taxpayers. I also know that when something looks too good to be true, it usually is. As I see it, the only party that is losing anything in this deal is the taxpayers of the City of Kenai. The McLanes appear to be getting a $1.9 million break at the expense of the taxpayers. I find the timing of this attempted settlement ironic. 'With the apparent economic upswing and property values beginning to rise, I see the potential for the McLanes to benefit financially from this. Again at the expense of the taxpayers of the City of Kenai. There are and were other property owners, owners in this subdivision who also held lots when the real estate market crashed. We were not offered a deal. We either stuck it out financially or the lots were taken back and sold at auction. I also don't fully understand why the Council is hesitant to pursue this matter further when we, the taxpayers, have already won in court. There doesn't appear to be any convincing evidence that the McLanes will even have the ability to appeal. So why consider it as a bargaining chip? If additional legal fees are incurred, aren't those fees awarded to the winner of the court cade? U . . KENAI CITY COUNCIL JUNE 16, 1993 PAGE 12 MEETING MINUTES I would suggest to the Council that seriously reconsider this offer as the impact of the citizens of Kenai and the residents of Inlet Woods is going to be felt for years to come. I would also request a full council vote on the issue. As a resident of Inlet Woods, I feel compelled to ask your help, for your help with this whole mess. Some of the lots that were sold by City, sold by the City at auction, have been built on with what I would call, reckless irresponsibility. The buyers of those lots claim that they had no idea that there were any covenants attached to the subdivision. In one particular case, an approximately fifteen -year old house was dragged in on a trailer.and jacked up on a foundation. A foundation that was set so low that sump pumps were used to drain the lower level during break-up. My point is this. In the last minutes, there was a reference to element of 51 lots floating around at 600,000. I assume Mr. McLane, I assume this to mean that the McLanes have lined up a buyer for a chunk of lots which would ease their finance requirements. If this is the case, I plead to the Council to attach to any agreement that the city makes, a clause that clearly states that there are enforceable covenants in the subdivision and these covenants will remain in tact and cannot be changed by a party that comes into the picture by purchasing a large chunk of lots. I ask that as you decide the future of Inlet Woods, you assist us residents in making sure that it is developed responsibly as it was intended to be done in the beginning. Thanks. WILLIAMS: Thank you very much. Are there questions from this Council? Seeing none, thank you very much. Is there anyone else from the general public that would like to address the Council? SILVERMAN: Can I sign at the end? Is that okay? My name is Nancy Silverman. I'm a ten-year resident of the City of Kenai and property owner and a taxpayer. And, I really don't like getting up here and talking in front of you guys, but I really have to. I'm really against this settlement with the McLanes. Um, Mr. Pedersen, Ism glad you're so humble tonight. The, reading the minutes of the last meeting, I thought it was a pretty arrogant thing to say that the taxpayers of the city of Kenai incurring the debt of 1.9 million wasn't too bad of a deal. KENAI CITY COUNCIL MEETING MINUTES JUNE 16, 1993 PAGE 13 As a taxpayer, I think it's a real bad deal. I could go over the things that Joe said in the beginning of his statement, Joe Moore. I am in agreement with most of the beginning section as to why I'm against this proposed settlement. It is really not right. It's not our debt. It's not the taxpayers' debt and we should not be paying it. Ah, the McLanes, in the beginning of this, were the only ones who stood to make a profit on this when the City bonded the subdivision. I don't understand why theyohad no risk of losing on this. What should have happened, the City should have ceased the property and any other assets of the McLanes long ago to cover this when they were ah, failing to pay the assessments on it, but I won't even go into that. The main points I need to bring out that ah, I feel weren't brought out is, if you want to get this resolved, it should be resolved the right way. It shouldn't be resolved just to get it, you know, out of the way or sweep it under the carpet. By doing so, ah, the City may be opening itself up to a class action or some other kind of law suit by a disgruntled taxpayer. Just possibly myself. We do not owe this 1.9 million. Ah, for the last three or five years, one mill rate out of our property taxes, and I do have several properties and my husband owns several properties in Kenai, all in Kenai. One mill of our property tax has been going to pay off this debt. It's not our debt. It's not mine. I don't owe it. I don't want to pay it. Ah, okay. The other thing, so I wanted to point out there could be a lawsuit against the city. Then there's going to be more legal fees and you're going to pay these legal fees you've already incurred now no matter what you decide. Ah, the other aspect...one of the worst aspects of the proposal, and I don't know if this has changed or not. I'm just going by the minutes of the last, the unapproved minutes of the last council meeting, is that the McLanes were, according to Mr. Pedersen, were unwilling to quit claim deed over their interest to the City, any interest they had to the City on any of the remaining lots should they fail in their attempt to either sell the lots or obtain financing in the 120 days. That is a real lousy deal. I don't know why you would accept such a deal. It puts you in the position, it puts us in the position back to this square one in 120 days if they fall through. If they fail, unless the um, although you would be less the choice lots of the subdivision, so, I don't know. There's, there's better ways to resolve this. M �J • KENAI CITY COUNCIL JUNE 16, 1993 PAGE 14 MEETING MINUTES I don't have the answers for everything and I may not have my information, you know. I don't have all the figures and everything. Ah, I'm also going to request that we have a vote of the full council because this is a real important issue and I'd like to see how all councilmembers vote on it. I do vote so. Thank you for your time. WILLIAMS: Thank you very much Mrs. Silverman is it? SILVERMAN: Yeah. It's Ms. WILLIAMS: Ms. Silverman? For coming before us this evening. Is there anyone else who wishes to address the council this evening with regard to this matter? Please state your name for the record. WILLIAMSON: My name's Jim Williamson. I've been a taxpayer in Kenai for about ten, eleven years. And, that's my wife. I'm like her. I'm nervous up here in front of you guys. If we were talking somewhere else, it'd be a little bit different. Anyway, about the only thing I have to say is, I agree with my wife and Joe. It's a lousy deal for the taxpayers. It's a real lousy deal. I was a builder and developer in Juneau for about 25 years. I developed three different subdivisions there. And anyone of those subdivisions, if I had done the same things McLane did, I would have been broke. The bank would have came in and taken everything that I own. And that would have been it. TAPE CHANGE. ...and they come and they take everything away from you. So, that's about all I wanted to say was just to...I don't agree with this and I do think there should be a full council hearing so that the taxpayers could see how every councilmember votes on this issue. Cause it is a very big issue. WILLIAMS: Thank you Mr. Williamson. There seems to be some concern about the voting of the council. I'll assure you that the Council will vote in public, in the open, on this issue this evening. We have elected to elevate this entire discussion to the level to an open meeting rather than holding it in a closed meeting. There has been more issues surrounding this particular a . • KENAI CITY COUNCIL JUNE 161 1993 PAGE 15 MEETING MINUTES matter discussed in executive sessions that any other matter that has ever come before this council and I assure you that the council has since made up its mind that the final elements of this agreement, this settlement issue, and all of the matters pertaining to it, ah were to be done in, in open meeting as we're doing this evening. So, I do thank all of you for coming before us this evening ah, to voice your concerns and if there are no more concerns to be voiced from the public, then I'll bring it back to council. If there is someone else that still has something to say, please step forward, seeing none, then I will bring it back to council. Council, for discussion? There are some things I would like to clear up before we move along towards the vote, This issue has been before the Council for nearly six years, or about six years in litigation. During six years of litigation, it's been one of the most agonizing things that has ever faced this council and previous councilmembers who have set on this council over the last six years. We have looked at every possible solution to the program. Ah, and as, as been indicated, the courts have ruled in favor of the city. McLanes have waived their capability of, of appealing the judgment. We could, in fact, probably go out and bankrupt several families, destroy quite a bit of work that's been done in the community, and we could probably get all of the properties back to us. We would face much more litigation in trying to clear the title and get these properties ready for marketing and in some circles it's thought that this property could take as long as ten year to put back on the market if we go through the legal process. Also, if we go through the legal process, if it takes that long, we're going to wind up having to service the debt for that length of time. There is about eleven years left on the bonds. We've managed to renegotiate on behalf of the taxpayers of the City of Kenai, the interest rate on these bonds and we've brought it down considerably so that it would be much easier to handle. If we are forced into servicing this debt for the next eleven years, the remaining debt will be serviced by property taxes at the rate of about one mill of our entire .property tax. Which is only 3h mills now. That means that we will continue to service the debt with property tax and we will continue to lose, and . C� w KENAI CITY COUNCIL DUNE 16, 1993 PAGE 16 MEETING MINUTES lose, and lose, and the property may never go on the market, thus denying the City of Kenai a very lucrative tax base for itself in its future growth. With regard with some of the numbers that have been discussed. The McLanes have indicated that at the present time, they are out $850,000 out of pocket. That $8500000 may every be seen again regardless of the numbers that ah, can be put together. We have evidence before us in the form of ah figures for cost development that indicate that the price of future lots will be $19,000 just to get at a break-even point using today's figures. With regard to the amount of money that the City is out, there has been bantered around the numbers up as high as a million nine. The City, at present, will write off $1,179,658. That's a lot of money to write off. It represents one mill of property tax for the last nine years. However, we cannot continue to write that money off. With the settlement money as it's proposed, and we have every reason to believe that it's being proposed in good faith and that it will•be forthcoming, we will be able to pool the money, the $1,700,000, thus releasing the liability of debt service from the taxpayers and will no longer will be carrying this debt on their shoulder. We will be able to service the debt from the pool, we will be able to take care of the bond issue, we will be able to move on with our lives. There are a lot of exciting things that are going to happen in the City of Kenai over the next three to five years. One of them, I hope, is the development of that subdivision and the other, I hope, will be a new school that goes with it. I personally am going to vote in favor of this settlement. I've studied and I've looked at it. I've put a tremendous amount of time and effort into it. I've been at every meeting that this has been discussed at for the last six, seven years and beyond. I believe it's in the best interest of the city of Kenai for all Of us to get away from this and try to see it resolved and try to make it work. This is the tail end of an economic crisis that hit the State of Alaska in 1987 and eight the likes of which I personally hope that I never have to live through again. A lot of people suffered during that crisis. Everyone here probably lost something ah and this is the tail end of that . crisis as far as the real estate market within the city of Kenai. I think it behooves us to try to settle. I do not expect or do I believe or do I see any way possible that the McLanes are going • • 0 KENAI CITY COUNCIL JUNE 16, 1993 PAGE 17 MEETING MINUTES to benefit financially from this settlement. I compliment them on their efforts to try to bring this thing to a conclusion rather than walking from it, filing bankruptcy, and leaving town. I compliment them on the fortitude that they've taken and then work they've put themselves to. With that, is there further discussion from the council? Councilwoman Swarner? SWARNER: Well, I guess I just have a comment about Joe Moore's comment about the covenants. The City doesn't enforce the covenants. MOORE (from audience): Oh, I understand that. Yeah, it's up to the subdivision to enforce them. My concern was that the majority owner of the subdivision can change the covenants. SWARNER: That's right. MOORE: I see that as being a possibility to the large chunk of lots sold to one individual. SWARNER: I just wanted to make sure that you knew... MOORE: I understand that. WILLIAMS: Mr. McLane. MC LANE: Ah, when we put that subdivision covenant package together, we addressed that. It's usually you have to have a majority. In this one you have to have 90%. There's absolutely no way that we, owning 141 lots, can change those covenants. You have to have, it's like, 30 more lots, over, with those, to change the covenants. WILLIAMS: I would like to address a question to either Mr. Moore, Silverman or Williamson with regards to the community ah, enforcement group. Do you have a subdivision committee in place now? WILLIAMSON: No, there isn't. WILLIAMS: Does your covenant agreement call for a committee, subdivision committee to be in place. . C7 KENAI CITY COUNCIL MEETING MINUTES JUNE 161 1993 PAGE 18 VOICE FROM AUDIENCE, WILLIAMSON?: I don't believe it does. There's not an architectural committee or anything... MOORE (from audience): We're in the process of forming a homeowners' association. WILLIAMS: All right. I would suggest that that homeowners' association be formed immediately. That the bylaws include the elements of the covenants and that you begin immediately to seek enforcement through your own resources of those covenants. VOICE FROM AUDIENCE, WILLIAMSON?: Yeah, but that ah, on these covenants, that has nothing to do with my objection to this, to the ah deal that the council was trying to do. You're kind of sweeping the trouble under the table and ah want to get out from under it. WILLIAMS: Well, I would say the banks, the FDIC, the FSLIC, the to seven failed banks of Alaska and the rest of them has swept $2% billion of bad paper.... VOICE FROM AUDIENCE, WILLIAMSON?: I think they foreclosed on every one of those, didn't they? WILLIAMS: No, they did not. VOICE FROM AUDIENCE, WILLIAMSON?: No? Okay, well maybe not. WILLIAMS: There has been so many deals have gone down that included everything but foreclosures. VOICE FROM AUDIENCE, WILLIAMSON?: I believe they did foreclose on an awful lot of them that worked that way... WILLIAMS: Well, all right. Thank you very much for your comments. Ah, further comments from Council? Seeing none, it appears that we're ready for the vote. The motion is to approve the agreement. The Clerk will call the roll. FREAS: Williams? WILLIAMS: Yes. • FREAS: Bookey? BOOKEY: No. l • 0 KENAI CITY COUNCIL MEETING MINUTES JUNE 161 1993 PAGE 19 FREAS: Swarner? SWARNER: No. FREAS: Monf or? MONFOR: (Long pause) Yes. FREAS: Measles? MEASLES: Yes. FREAS: McComsey? MC COMSEY: Yes. WILLIAMS: All right. The vote is four yes, two no. The motion passes. It's hopeful that ah, we can move on from here and see the resolution of this matter in its entirety. I will make one further comment. With the release of this debt, ah, from the taxpayers as it now appears, ah, this year we're faced with a $587,000 fiscal gap in our budget. By removing this debt from our books, we will be able to cover almost half of that fiscal gap on behalf of the taxpayers of the city of Kenai in the next budget. And we're confident that we can lay that to rest as well. I for one am pleased to see it through. Thank you very much. END OF ITEM. C-2. Ordinance No. 1546-93 - Amending Kenai Municipal Code, Chapter 20.05 Entitled, "Vehicles -For -Hire." MOTIONS Councilwoman Swarner MOVED for adoption of Ordinance No. 1546-93 and Councilman McComsey BECONDED the motion. There was no public comment. 3 17� • KENAI CITY COUNCIL MEETING MINUTES DUNE 161 1993 PAGE 20 MOTION TO AKEND: Councilwoman Swarner MOVED to amend with Substitute Ordinance No. 1546-93 and Councilwoman McComsey SECONDED the motion. Councilman Measles requested ONANIMOUS CONSENT. There were no objections. 80 ORDERED. VOTE ON MAIN AMENDED MOTION: Smalley: Absent Williams: Yes Bookey: Yes Swarner: Yes Monfor: Yes Measles: Yes McComsey: Yes MOTION TABBED UNANIMOUSLY. C-3. Ordinance No. 1547-93 - Amending KMC 7.12 to Provide for Monthly Filings of Hotel/Motel Room Tax Returns for Certain Delinquent Accounts. MOTION: Councilman Bookey MOVED for adoption of Ordinance No. 1547-93 and Councilwoman Monfor BECONDED the motion. There were no public or council comments. VOTE: Smalley: Absent Williams: Yes Bookey: Yes Swarner: Yes Monfor: Yes Measles: Yes McComsey: Yes NOTION PASSED UNANIMOUSLY. C-4. Ordinance No. 1548-93 - Finding That a Portion of the Southeast h, Section 36, T6N, R12W, S.M. (A 200' Strip Along Evergreen Street), City -Owned Lands, is not Required for Public Use and May Be Sold, MOTION: Councilman McComsey MOVED for adoption of Ordinance No. 1548-93 and Councilwoman Swarner SECONDED the motion. • KENAI CITY COUNCIL MBETING MINUTBS DONE 161 1993 PAGE 21 There were no public comments. Swarner asked if there has been some interest in purchase of this property. Brown stated no. Brown added subdivision preparations, etc., will be done and they it will be decided whether to sell the property in blocks. Brown added he has not received any specific interest. These are General Fund lands. VOTE: Smalley: Absent Williams: Yes *Bookey: Yes Swarner: Yes Monfor: Yes Measles: Yes McComsey: Yes MOTION PASSED UNANIMOUSLY. C-5, OVdinaAOa No. 1549-93 - Amending the Kenai Municipal Code 14.20.150 to Include Revocation of Conditional Use Permits. MOTION: Councilman Measles MOVED for adoption of Ordinance No. 1549-93 and Councilwoman Swarner SECONDED the motion. There were no public or Council comments. VOTE: Smalley: Absent Williams: Yes Bookey: Yes Swarner: Yes Monfor: Yes Measles: Yes McComsey: Yes MOTION PASSED UNANIMOUSLY. C-6. Ordinance No. 1550-93 - Amending the Official City of Kenai Zoning Map for a Portion of the SEk, Section 36, T6N, R11W, S.M. (a 200 Foot Strip Along Evergreen Street, MOTION: Councilman Measles MOVED to adopt Ordinance No. 1550-93 and Councilman Bookey SECONDED the motion. • There were no public or Council comments. C. • 0 KENAI CITY COUNCIL MEETING MINUTES JUNE 161 1993 PAGE 22 MOTION TO AMEND: Councilman Measles MOVED to amend Ordinance No. 1550--93 by amending all references to R11W in the ordinance by changing them to R12W. Councilman Bookey SECONDED the motion. There were no objections. 80 ORDERED. VOTE ON AMENDED MOTION= Smalley: Absent Williams: Yes Bookey: Yes Swarner: Yes Monfor: Yes Measles: Yes Mccomsey: Yes MOTION PASSED 9MAN IMOUSLY. C-7, Resolution No. 93-46 - Transferring $1,450 in the Public Works Department for the Purchase of a Computer Upgrade. MOTION: Councilwoman Swarner MOVED for adoption of Resolution No. 93-46 and requested UNANIMOUS CONSENT. Councilman McComsey SECONDED the motion. There were no public or Council comments. VOTE: There were no objections. 80 ORDERED. C-8. Resolution No. 93-47 - Transferring $2,776 in the General Fund for Replacement of the Ice Machine at the Recreation Center, MOTION: Councilman Measles MOVED for adoption of Resolution No. 93-47 and Councilman McComsey SECONDED the motion. There were no public comments. McComsey asked how old the machine is that is being replaced. McGillivray stated this one was used when it was purchased and they had it for about five years. The previous ice machine was also used when it was purchased. r• s • • KENAI CITY COUNCIL MEETING MINUTES JUNE 161 1993 PAGE 23 VOTE: Councilman Measles requested 9NANIKOUS CONSENT. There were no objections. 80 ORDERED. C-9. Resolution No. 93-4• - Transferring $4,000 in the General Fund for Additional Repair and Maintenance Supplies in the City Shop, MOTION: Councilwoman Swarner MOVED for adoption of Resolution No. 93-48 and requested UMINOUS CONSENT. Councilman Measles SECONDED the motion. There were no public or Council comments. VOTE: There were no objections. 80 ORDERED, C-10. Resolution No. 93-49 - Transferring $4,147.55 in the Congregate Housing Capital Project Fund for Reinspection Costs. MOTION: Councilman McComsey MOVED for approval of Resolution No. 93-49 and Councilman Measles SECONDED the motion. There were no public or Council comments. VOTE: Councilman McComsey requested UNANZKOUS CONSENT. There were no objections. SO ORDERED. Resolution No. 93-50 - Awarding the Security Services Contract for the Airport Terminal Building, for the Period July 1, 2993 Through June 30, 1996, to Guardian Security Systems, Inc., for $1,274.00 Per Month. MOTION: Councilman Measles MOVED for adoption of Resolution No. 93-53 and Councilwoman Swarner SECONDED the motion. • • KENAI CITY COUNCIL JUNE 16, 1993 PAGE 24 MEETING MINUTES There were no public comments. Brown was asked why the contract is for three years. Brown stated the contract is for a full year for three years. Brown stated it is not uncommon to bid contracts for three-year periods, i.e. radio maintenance, janitorial, etc. Williams stated they started the service due to vandalism and car thefts. Williams asked if the service has been going on for twelve months. Ernst stated it has been used since Council's request approximately five months ago. Ernst stated the agreement allows for termination by either party with a thirty - day notice. Measles asked if the service is needed more in the winter than the summer. Ernst stated there is more traffic in the summer months. Ernst added car thefts happen more in the winter around Christmas and vandalism is more prevalent in the summer. Ernst added the reason for using the service is to protect the terminal during the time of the night when no one is using the terminal. Williams stated he will vote in favor of the resolution, but would like the need for the service reviewed in six months. McComsey asked if the terminal can be locked. Ernst stated it could, however, changes to the doors would need to be made in order that they do lock. Also, someone would have to go to the terminal each night to lock and to unlock the doors. Ernst stated the terminal is patrolled from 1:30 a.m. to 4:30 a.m., seven days a week, for $7.00 an hour. Measles stated he believes checking on the terminal a has been vandalism or not. well as vehicles parked in attempt to protect it. VOTE: it is necessary to have someone t that time of the night whether there Because it is a public building, as the paid parking lot, the City should There were no objections to the motion. 80 ORDERED, C-12. Resolution No. 93-SI - Authorizing the Execution of Cooperative Participation Agreements Among Alaska Municipalities and School Districts Creating the Alaska Municipal League Joint Insurance Arrangement. a LJ 0 • KENAI CITY COUNCIL JUNE 16, 1993 PAGE 25 MOTION: MEETING MINUTES Councilwoman Swarner MOVLD for adoption of Resolution No. 93-51 and Councilman Bookey BECONDED the motion. Public comments: steve Gregor: Last Frontier Insurance in Kenai. Gregor made three points: (1) Their last year's quote for coverage was $9,000 less than the JIA quote. Gregor added they were told last* year that the City was not planning to bid insurance for another three years. (2) The local brokers were not allowed to bid the whole account. The local brokers give combined coverage. JIA has bid the whole contract. (3) Last Frontier has 15 employees who are local taxpayers. The money his agency makes on the City's accounts pays for one employee. Gregor requested Council to keep their insurance brokers local. Steve ilelle - JIA Insurance - Wells gave reasons why the City should join the program. (1) It is an Alaska Municipal League program developed six years ago to provide constant, stable insurance coverage. (2) The company is owned by the participating communities in Alaska. JIA is not a broker, it is the company. They do not receive a commission when communities join. (3) They provide competitive rates and provide a lot of services that insurance companies do not. Wells stated the cities of Kodiak and Bethel hired an outside consultant to review insurance costs, etc. The consultant stated the JIA program had the best insurance coverage in the state. Wells added the deductibles are lower and do a fine job to reduce the cities' losses and will reduce the cities' insurance costs. McComsey stated he understood the JIA program only insures the first $250,000 of each city and then another company goes from there and that company is out of San Francisco. Wells stated JIA takes the first $250,000. Then they have a re -insurance company from London for liability and comprehensive. Property coverage is from one company and Workers' Comprehensive from another. Their actual broker is based out of San Francisco and have a lot of pooling experience. KENAI CITY COUNCIL MEETING MINUTES JUNE 16, 1993 PAGE 26 McComsey asked if they have losses or claims more than $1.2 million, will all cities involved have to pay more. Wells stated the $1.2 millionis surplus. JIA would have to have 16 $1 million losses in one year to break even. Wells stated Kenai will make up about 9% of the program. Swarner asked Brown if they pass the resolution and later decide this is not the best way to go for insurance coverage, can the city decide to purchase insurance elsewhere. Brown stated if the resolution passes, the city will join the pool. Bookey asked Brown if he was that comfortable. Brown stated he was first apprehensive because of stories he had heard from other people. It took months for his confidence level to raise and he now feels very comfortable with the program. Measles asked how long they would be committed to the program. Brown stated for two years, with a six-month notice. If they opt out, but still have claims incurred, they would have to stay in the pool until those claims are settled. Brown added they can get out of the program quickly if they decide they do not like its Williams stated he would vote against the resolution. Williams added his decision is not because the program is not a good one and that it does not provide good coverage. Williams stated he would vote against it because there are good brokers in the area. Williams stated the issue was local versus outside brokers. Williams stated the City committed itself on a quasi -basis for three years. The bid quotes by the local brokers may have been determined differently according to the term length. Williams added he is more comfortable with working with the local brokers. Williams complimented Brown for the work he put into the review of the programs. McComsey stated he feels the same way. McComsey added the insurance coverage should be kept local. McComsey stated there will be two people out of work in the community if they join the pool. Measles asked if they stay with the insurance program the city is in now, can some of the deductibles be changed to lower the IS premiums. Brown stated yes. Brown added there will not be much of a savings other than in automobile, i.e. $8,000. But that is 4 • 171 KENAI CITY COUNCIL MEETING MINUTES MME 16, 1993 ' PAGE 27 not a lot of money. Brown stated he will be speaking with Attorney Graves in regard to uninsured.motorists. There will be a small savings if it is deleted. VOTE: Smalley: Absent Williams: No Bookey: Yes Swarner: Yes Monfor: No Measles: No McComsey: No MOTION FAILED. C-13. Resolution No. 93-32 - Transferring $5,000 in the General Fund for Additional Attorney Fees in the Inlet Woods Litigation. MOTIONS Councilman McComsey MOVED for approval of Resolution No. 93-52 and Councilwoman Monfor SECONDED the motion. There were no public comments. Brown stated the money is needed due to attorney fee escalation during the settlement work. VOTHI Councilman McComsey requested UHANIMOUS CONSENT. There were no objections. SO ORDERED. C-14. Resolution No. 93-53 - Awarding a Radio Maintenance Contract to Southcentral Communications for a Three - Year Period. MOTION: Councilman Measles MOVED for adoption of Resolution No. 93-53 and requested UNANIMOUS CONSENT, Councilwoman Monfor SECONDED the motion. There were no public or council comments. • KENAI CITY COUNCIL MEETING MINUTES JUNE 16, 1993 PAGE 28 STM _Ds CO I8ST0„ f COMMIT'_ 8PORTB" D-1. Counoil on Aging Swarner reported the Senior Center and Director have been evaluated by the Older Alaskans Commission and received 100%. The Center's grants from the OAC and United Way will be decreased. Congregate Housing continues to be full. D-$. Airport Commission Councilman Measles stated he missed the last meeting. Airport Manager Ernst stated the minutes from the last meeting were included in the packet. McComsey stated he had been to the airport a few days ago and could not park in the employees parking area due to other vehicles, which did not apear to be employee vehicles, using the spaces. Ernst stated the vehicles parked there could have been those of contractors he took out onto the airport in regard to grading work. Ernst added if he finds other vehicles parked in those areas (except when they are contractors, etc. and he is working with them), he asks them to move or has them moved. D-3. Harbor Commission Bookey stated the last meeting was on Monday and the minutes were included in the packet. The Commission would like to place a sign at the boardwalk with information about the mountains, river, etc. Bookey stated he believed this type of request should go to Parks & Recreation for their review and action. D-4. Library Commission Monfor reported the Friends of the Library book sale earned $2,300. The minutes of the last Commission meeting were included in the packet. D-5. Parks & Recreation Commission McComsey reported he did not attend the last meeting. McGillivray stated the minutes of the last meeting were included in the packet. 1 9 a KENAI CITY COUNCIL MEETING MINUTES JUNE 16, 1993 PAGE 29 D-6e planning i Boning commission A memorandum in the packet stated there was no meeting due to lack of business. Williams reported he received a Commission/Committee application before the meeting from Charlie Pierce. Williams requested that all applications on file be placed in the next packet for possible action at the next meeting. D-7. Miscellaneous Commissions and Committees Beautification - Swarner reported the minutes of the June 8, 1993 meeting were included in the packet. Swarner reported the City of Delta, Colorado would like to place a blue spruce in the All - America City garden. All -America City -- Williams requested Council to allow the All - America City Task Force (Councilwoman Monfor) to put together a booth display regarding the All -America City presentation, etc. for the AML Conference in November. There were no objections from Council. Regular Meeting of June 2, 1993. Approved by consent agenda. F-1. 6/3/93 Senator Murkovski Letter - Regarding overland Avenue Easement. Approved by consent agenda. F-2. 6/8/93 APIW/Voices of Alaska - Request for Contribution/"The Wisdom and Words of Peter Kalifornsky. " No action taken. • KENAI CITY COUNCIL MEETING MINUTES JUNE 16, 1993 PAGE 30 T92 at OLD 81J8IME88 6-10 Approval - Lease of Airport Terminal Spaces 28, 291 30 and 31 - MarkAir. A memorandum was included in the packet from Administration which recommended the lease be awarded to MarkAir. Brown stated MarkAir gave some checks to him this evening, however he does not know if the amounts are correct. Brown added he will be able to determine that tomorrow. Brown stated there are some landing fees needing to be paid as well. Brown requested Council add "and landing fees" to their motion. MOTIOXt Councilwoman Swarner MOVED that the lease be awarded to MarkAir, provided they become current in delinquent taxes owed to the Kenai Peninsula Borough and lease amounts and landing fees due to the City and any other things and the check is good, for spaces 280, 290, 30, and 31. Councilman Bookey SECONDED the motion. There were no objections. SO ORDERED. a -a. Discussion - Elementary School Renovation/Construction. Williams referred to his memorandum included in the packet. Williams reported he appeared before the School Board at their meeting on Monday night and talked about new construction or renovation. Williams reported the Board voted 5-2 to build a new school. Williams requested a directive from Council as to their true feelings in order that a letter be forwarded to the School Board. Discussion followed regarding cost and student capacity. Williams stated in his view, the area is entering into a major long-term growth. Two major firms may be coming in to Kenai, which will offer a broader tax base to service the debt. Williams added there will be 3,000 more students in the next decade. Williams asked if a letter in support of the School Board's decision to build a new elementary school be sent. There were no objections. BREAK TAKEN t 9120 P.M. BACK TO ORDERS 9140 P.M. a 0 KENAI CITY COUNCIL MEETING MINUTES JUNE 161 1993 PAGE 31 ,STEM R a NEW BV8I 88 B-1. Bills to be Paid, Bills to be Ratified MOTION: Councilwoman Monfor MOVED to pay the bills and Councilwoman Swarner SECONDED the motion. There were no objections. SO ORDERED. R-Z. Purchase Orders Euoeeding $1,000 MOTION: . Councilwoman Swarner MOVED to pay the purchase orders over $1,000 and assumes Brown is checking that they are current in their sales tax. Councilwoman McComsey SECONDED the motion. Brown stated Tri-City are in the process of registering and they will hold the purchase order until they are registered. Measles asked why the purchase order for the computer upgrade was more than the transfer approved earlier. Brown stated there was some money in that budget before the transfer. Monfor requested discussion regarding sales tax policy be placed on the August agenda, i.e. current versus delinquent. Monfor stated a policy needs to be determined in order that all are treated equally. Brown stated at this time they have no policy. Williams suggested a work session arena would be better. Monfor requested a work session be set for September. There were no objections. E-3. Ordinance No. 1531-93 - Establishing Section 13.10.060 of the Kenai Municipal Code, Entitled Sanitary Facilities for Camping on Private Property. Approved by consent agenda. VERBATIM: Discussion - Settlement/Change Orders - Kenai Courthouse Project. i • • KENAI CITY COUNCIL MEETING MINUTES JUNE 16, 1993 PAGE 32 WILLIAMS: Moving on to Item H-4. This is the discussion of the settlement charges and orders with regard to the Kenai Courthouse Project. Ah, and I didn't bring my copy of that. MONFOR: I did. WILLIAMS: There we are, here we are. I've got one. SWARNER: I did. WILLIAMS: All right. Before us, who wants to lead the discussion? I think it boils down to the bottom line ... The summary on page 6. The offer from the contractor is $544,810. Last and final offer of the city's second offer to the contractor is $475,000. And there begins the discussion. MONFOR: I suppose to open it up or to shut it down or whatever, I would move that the City would pay the $475,000. WILLIAMS: All right. It's been moved. MC COMSEY: Second. WILLIAMS: And seconded, that the City pay the contractor on the courthouse, $475,000. Further discussion? Councilwoman Swarner. SWARNER: Well, I guess, there are a few things that I have problems with and one of them is the potting of the plant materials when they knew, I mean it was obvious that we're late and things were ordered. After that there was, after the delay was known. And, to excavation work that was done, stand-by time. And maybe Keith, maybe I missed here by not, there is stand-by time, included in the City's second offer, is that correct? or has that been taken out? KORNELIS: No, the stand-by time was in the claim, which was Item 12. SWARNER: Okay. So, in the second offer, it's zero. KORNELIS: That's correct. SWARNER: Okay. KORNELIS: As you can see in this chart, Item ah, Column A is the contractor's first offer ah, which was the initial thing that was • KENAI CITY COUNCIL MEETIAIG MINUTE8 JUNB 16, 1993 PAGE 33 • given to us which is Exhibit A. I believe. Attachment A. And Column B and C was in my proposal, which is ah, Attachment B. And then ah, the contractor came back with this last letter dated June 8, which is Attachment C at the $544,810. It's, it's listed as a lump sum amount. It's not broke down at all and ah... SWARNER: Okay, and I think you were overly generous too, but ... And then I have another question, I guess, where would the extra money come from. BROWN: Ah, we have, we have money in the budget and I want to turn to pages, cause Keith and I got together on some notes on that... KORNELIS: Page 5. BROWN: Page 5. There's enough money with the $400,000 state grant which I assume has been signed. I, I haven't received official word on it yet. Do you know if it's signed yet? I really don't know. WILLIAMS: There's a stack of them laying on his desk now. BROWN: Ah, we would have to come back to the City Council because we made a commitment going into this for some other items, basically for the courthouse, furniture, electronic card key system ... It's my guess that, that if you went with the full $544,000 that G&S wants, the City would then have to come up with at least another $250,000. Of course, it would be.something less than that if you settle an amount smaller. But, page 5 pretty well lays that out. SWARNER: So, if we Went with the 475... BROWN: Well, then you could subtract ah, ah, what's the difference... KORNELIS: About sixteen... BROWN: About $70,000. You'd still have to come up with about 80,000 of city money. SWARNER: And would that come out of the General Fund or... BROWN: I would anticipate taking it out of the Airport Fund. KENAI CITY COUNCIL MEETING MINUTES JUNE 16, 1993 PAGE 34 WILLIAMS: Further questions? One of the things...Yes, Councilwoman Swarner, SWARNER: Well, I guess then I would amend the motion to um...Can I amend it to make it 400? WILLIAMS: 400? Before any amendments are made here there's a couple of questions I'd like to ask of Keith. Ah, get down in there into the other unknown or known pending items, this design increase we request McCool, Carlson Green for 68,000 and of course the associated inspection request ah, the $74,000...$74,900 total. Would it be reasonable to assume that these design increase requests and the associated inspection request might not be the responsibility of the court system rather than the City of Kenai? KORNELIS: Absolutely. I think so. I think that, basically what the design increase is, is because of items that were different than the Palmer Courthouse that the Court System, the ah, would like to proceed on. But, you have to remember this is their full request. I don't agree with that full amount of 68,000. We had a contract with them and they went over that amount without getting any written approval, without checking with us, and I think they just went over budget. As you recall, we, we negotiated their contract with them and dropped it down from something like five or ten percent and they mention that in their letter that they were under budget to start with. Well, they agreed to it and I think there's a certain, a certain portion of that, that request that's probably legitimate, but there's a good portion of it that is not. A very large portion of it is not. That's, they just over, went over on their budget. WILLIAMS: All right. Another question.. Did we agreement with regard to the electronic card key whether they were going to leave it out or not? come to an system as to KORNELIS: No. No, there was no agreement. That was something the Court System has had on there own. They plan on contracting that out on themselves. Um, the individual who has been working with us on the Court System, Chris Benedicktson has left and there's a new gentleman. I don't really think he's really up to speed on it. I, I don't know...He has never mentioned that.the ah, card key system. But, the previous gentleman, Mr. Benedicktson, thought he could do it for like 35,000, something like that. Even though there was 50 that was in there that they have set aside for their, for this. I don't know if they would • KENAI CITY COUNCIL JUNB 16, 1993 PAGE 38 MEETING MINUTES drop it or not. Ah, as Charlie has mentioned. it was mentioned, it was mentioned in the agreement. I don't think there was a dollar amount in the agreement though for it, was there? BROWN: Yeah. They have these dollar amounts. It was in a, it was in a document that sized the loan that these monies were set aside. There, it's not in the specifications. Ah, we could get into a real argument with the courthouse. That we agreed to build it according to the specs and furniture and card key system wasn't in the specs. But, on their side, they'd argue that they had included it in the amount of money they borrowed and we burned up the contingency out of what was borrowed for soils contamination. So, they have an argument that the money should have been there for these items. They'd have a good case, I think. WILLIAMS: I hope this one doesn't take as long to settle as the Inlet Woods one did. Ah, it's going to be rather interesting. WE're going to perhaps fight this case in the new courthouse? KORNELIS: Ah, another thing that should be brought up ah, that is not included in other unknown pending items. As I mentioned in here, there are some construction change directives that at the time I wrote this were pending and there may be some other ones, but there is one, this DCR107, a hundred and seven, concerns relocating some duct work and it's something that needs to be done. Immediately. In fact, I think they may have even started on it. Ah, but it's less than $1,000. The cost is not to exceed a thousand, so. WILLIAMS: All right. Further discussion from Council? The motion on the floor is to pay $475,000. Further discussion? Yes, Mr. Green. GREEN: Would it be appropriate for me to comment at all at this point or? WILLIAMS: Well, sure, I think ah, since you're the one we're going to pay the 475,000 to, come one, come discuss it with us here. GREEN: I don't, I don't really know where to start here folks, but...I stood right here before this Council and went just like this. "What do you want me to do? Do you want me to stop or do you want me to keep going?" Nobody told me to stop. Proceed on good faith. I proceed on good faith. I turn in a legitimate iKENAI CITY COUNCIL JUNE lfi, 1993 PAGE 35 MEETING MINUTES drop it or not. Ah, as Charlie has mentioned. it was mentioned, it was mentioned in the agreement. I don't think there was a dollar amount in the agreement though for it, was there? BROWN: Yeah. They have these dollar amounts. It was in a, it was in a document that sized the loan that these monies were set aside. There, it's not in the specifications. Ah, we could get into a real argument with the courthouse. That we agreed to build it according to the specs and furniture and card key system wasn't in the specs. But, on their side, they'd argue that they had included it in the amount of money they borrowed and we burned up the contingency out of what was borrowed for soils contamination. So, they have an argument that the money should have been there for these items. They'd have a good case, I think. WILLIAMS: I hope this one doesn't take as long to settle as the Inlet Woods one did. Ah, it's going to be rather interesting. WE're going to perhaps fight this case in the new courthouse? KORNELIS: Ah, another thing that should be brought up ah, that is not included in other unknown pending items. As I mentioned in here, there are some construction change directives that at the time I wrote this were pending and there may be some other ones, but there is one, this DCR107, a hundred and seven, concerns relocating some duct work and it's something that needs to be done. Immediately. In fact, I think they may have even started on it. Ah, but it's less than $1,000. The cost is not to exceed a thousand, so. WILLIAMS: All right. Further discussion from Council? The motion on the floor is to pay $475,000. Further discussion? Yes, Mr. Green. GREEN: Would it be appropriate for me to comment at all at this point or? WILLIAMS: Well, sure, I think ah, since you're the one we're going to pay the 475,000 to, come one, come discuss it with us here. GREEN: I don't, I don't really know where to start here folks, but...I stood right here before this Council and went just like • this. "What do you want me to do? Do you want me to stop or do you want me to keep going?" Nobody told me to stop. Proceed on good faith. I proceed on good faith. I turn in a legitimate • KENAI CITY COUNCIL MEETING MINUTES JUNE 16, 1993 PAGE 36 amount of money to do the work, after the fact, unauthorized, cause nobody would give me authorization to do so. And somehow, we've gotten to the point where you're going to take $75,000 right out of my pocket. And I don't understand this, at, at all. You've been fed misinformation about certain things like potting material. I've never had the opportunity to rebut whatever information you've received on that. But, Councilman Swarner, you're, you're mistaken in saying that we miss -ordered this material and, and didn't do the proper thing. We do the proper thing. Because bare root material, bare root plants are simply that. You're not shipping dirt. You're shipping bare root materials that have to ship in the spring. If they don't ship in the spring, they must be potted. Whether we pot them here or they pot them down there. WILLIAMS: Mr. Green. I think, the problem we face, of course, is that we don't know... TAPE CHANGE. ...we don't know all of the facts, both sides of the issue pertaining to the whole issue of the total amount, the 544,000 and I think that what we're trying to do here is put the $475,000 on the table now. And at some point in time, I think you'll agree with me, we don't know what the final cost of this whole thing is going to be based on this paper and tonight's meeting. Ah, for example, we have no idea what the soils thing is going to be. Not that that's related to your direct billing, but it's a part of the overall cost. At some point in time, it's been our experience in the past, we wind up setting down with some fine pencil and we start going through item by item to determine just exactly where the true costs lie. For example, in the one paragraph that we have before us that says, "the contractor kept track of the work as if it were T&M." Time and material. Keith indicates to us that he didn't make it, he did make it clear however, that we were not going to go to T&M for framing. So, what we have here is a discrepancy in, in thought. You're going to operate on a time and material basis. Keith indicates that he said, no, you're not going to operate on a time and material basis. so, therein lies the difference. That difference of opinion has to be worked out at some point, but we don't want to work it out tonight, or are we going, and all the other items that go along with that. Dozens of them. a KENAI CITY COUNCIL MEETING MINUTES JUNE 161 1993 PAGE 37 So, what we're trying to do is advance the $475,000 now and as we have done with virtually every other project the city ever gets into at some point down the road, the rest of it's going to be cleared up as to who owes who what. GREEN: I think the unfortunate part with that is, that Keith will now generate a change order that will come to my office for signature and I can't sign it. WILLIAMS: Change order for what? GREEN: For outstanding excavation that hasn't been paid for six months to the tune of $207,000. Extending excavation another $85,000 to, to finish the excavation. WILLIAMS: Well, see, therein lies another problem that we, it's hard for us to try to get to the, when you talk, the excavation. The same thing sets there. Whether or not the excavation done was really authorized or should have been done, is a, is a big question, see. GREEN: Well, I suppose that's where obviously... WILLIAMS: I suppose the Council doesn't have... GREEN: ...from your Public Works Director standpoint, at, at now, that we all stand back and it's seventy degrees and the sun is shining outside, it's real obvious to everybody, oh, geez, we shouldn't have went ahead. But unfortunately, at that particular point, there was no other alternative but to go ahead. Everybody said, well why didn't you stop work? I asked this Council to stop me. I wrote letters that, that asked, that said I was going to stop. The next thing I would get is directive to keep going. This is a "catch-22." I got trapped in a situation that was totally out of my control. We did the best job this company could do for the least amount of money we could do it for. And now the City Council is telling me that I'm not entitled to that money. That I should pay for some of the cost to build this silly courthouse over here and that's simply not fair. WILLIAMS: Yeah. No, and, you know, dealing again with the 16 excavation work. Here we have, and I'm only pointing these out, out as examples of the whole issue. Excavation, excavation work done by G&S. G&S requests 207,889. Now, you know, according to the information we're presented, ah, our first offer back was . KENAI CITY COUNCIL MEETING MINUTES JUKE 16, 1993 PAGE 38 167,343. It only included actual costs. The second offer of 186,588 included actual cost plus 7h% and 4% for the subcontractor and the general. Half of the normal amount allowed. All right. Even if the full amount were allowed, it wouldn't come up to the full 207. So I guess what we're caught with is the figure of 207 that you want and an apparent 167 that was the actual cost. So... GREEN: The actual cost plus the subcontractor's overhead which is all within the contract. WILLIAMS: Yeah. GREEN: There's nothing that was ever added to changes or any of these numbers that isn't totally within the contract. toWILLIAMS: But see there are discrepancies in the two numbers. That's where the difference of.the 75,000 comes to. You see, the figures that the City's keeping ah, with regard to what our actual costs and overhead are different than what your billing is with regard to what the actual costs are... GREEN: Well, and I realize that and that's, Keith and I have sat down and had some conversation about this and there's been a lot of thought put into it. There's lots of other outstanding issues that have never been itemized specifically. Okay? What we tried to do was to make, to bring all these numbers into the cost numbers, true costs, I mean, I can bring the payrolls out and show you folks what it cost to do these, these particular items. I only added what is allowed by the contract. And I paid for the bond and that's the $544,000. That's the bottom line. Now, that's going to clean it up as far as the Council's concerned. That's the end of it for you. There will be no more related to contaminated soils. I'm telling you. If you guys go 475 and, and drag this thing out further, you're going to leave me no alternative. That's too much money for this company to walk away from. I simply can't do that. Four hundred and, or $544,000 wipes the slate clean. It's a done deal. There'll be no other unknowns related to that contaminated soil. To me, that's what you would want is to finish this think. r E KENAI CITY COUNCIL JUNE 16, 1993 PAGE 39 MEETING MINUTES To be done with it. To get it behind us. I'd, I'd love to get it behind me. I've been wishing this for seven months and that's... WILLIAMS: What other unknowns are there though between the 544,000 and the final element? GREEN: What other unknowns? There's a $67,000 delay claim by the, by the excavation contractor which, legitimate or not, have to be discussed that's not in the $544,000. If this project runs on and on and on, there will be additional supervision costs. There will be extra overhead costs. Utility costs to run this project. Unfortunately, I didn't bring my, I didn't bring backup to list every item. There's additional home office expense. I'm tied up on a project where I should be out bidding other work. Instead, I'm racing around producing reams of paperwork on this project. WILLIAMS: Ah, somewhere in the paperwork we're looking at an. extension of the deadline on the contract. So what we're saying is that there are costs associated with the operation of the, operational costs of the project from the time it should have ended until the new proposed ending date... GREEN: Absolutely, WILLIAMS: And those are still things that are out there in front of us beyond the 544, 000. GREEN: No. Those, there, there's those costs, those are real costs. Those are costs that this company will bear. They are not in the 444,000 and you will never hear from me again. I'm not going to come back to this Council and say, "Well this project ran another three months. I need additional supervision money. I need additional home -office expense. We're going to have to fight about this delay claim from the excavator." All those issues in the $544,000 are settled. It's overl They'll be no more fun and games. There's not going to be any going to court to decide who's right and who's wrong and wasting more of taxpayers money and my money. It's, it's done! It's over. I, I don't know. I just... WILLIAMS: All right. In your Paragraph No. 4 of your letter dated ah, June 8, you said an extension of the contract time will be needed to be, will be, will need to be negotiated. Have you got a final date? 41 0 KENAI CITY COUNCIL MEETING MINUTES JUNE 161 1993 PAGE 40 GREEN: That's since been addressed. KORNELIS: Item b, ah, Attachment D of September third... SWARNER: Mr. Mayor, when was the first date, the original date? KORNELIS: August... GREEN: our original schedule showed it in June. SWARNER: June. KORNELIS: Yeah. But then we, 37 days beyond that cause we, that period of time that we... WILLIAMS: Right. September thirtieth... KORNELIS: ...stopped the work, was 37 days, so... WILLIAMS: So September 30 is the final date, All right. GREEN: I just think that it would be ... we're not going to have to go, me sit before you folks and Keith sit over there and we go through every item, item by item, and address the merits of each one individually at this point would take days to accomplish. I, I don't know. Ah, I feel, I feel like the offer of $544,000 was some, some real sincere giving on our part to settle it. To get it over with. I want it, I want it over with. Because of.that, I'm willing to give up thousands of dollars frankly. But, I can't give up $75,000. Can't do it. I've already given up a lot to get to the 544. WILLIAMS: All right. Council understands, of course, that all of this money that we're spending from the Airport Fund is going. to go into litigation. As, as I understand it, this is the part of the, of the program that we turned over to the Attorney General's office for litigation of these funds from whoever may be responsible? GRAVES: No. That's... WILLIAMS: This is not part of that litigation? GRAVES: The litigation regarding collecting damages from, from former lessees and other PRP's is our responsibility to pursue our claim. i KENAI CITY COUNCIL MEETING MINUTES JUNE 16, 1993 PAGE 41 WILLIAMS: My understanding the Attorney General was going to... BROWN: We're going to work together. GRAVES: We're going to cooperate with the Attorney General's office, but we do not turn over the responsibility to pursue those claims to the Attorney General and my office is continuing to move along those lines without getting into details. WILLIAMS: Right. Pursue that...right. The act, the numbers that we're dealing with here, the 544,000 or 475,0001 will become a part of whatever we seek, along with everything else probably... GRAVES: That money the Airport Fund pays to remedy to the contaminated soils will be damages that will be pursued from the former lessees and PRP's... WILLIAMS: Whatever they might be. GRAVES: ...whatever they might be. Right. WILLIAMS: Well, I think that's the point I'm, I'm trying to bring to Council's attention. Whatever monies paid on behalf of this project from the Airport Fund, will in all probability be a part of future litigation. GRAVES: Right. We're going to pursue former lessees or PRP's who we think are responsible and try to collect monies paid to the contractor. WILLIAMS: Councilwoman Swarner. SWARNER: Well, Mr. Mayor, I just, in regards to the contractor's comments about the plant materials, I'm looking at Page 3 of Keith's letter and where he talks about further discussions on leaves and plants (inaudible)_. That's my... GREEN: That's, that's correct, Mrs. Swarner... SWARNER: I mean, that's why I thought that you did have ample time. • GREEN: Yes ma -am. We did, we knew a change was coming. We, we assumed there was one coming. But, we cannot operate on assumption. We can't do that. We have to operate on our • KEPJAI CITY COUNCIL JUKE 16, 1993 PAGE 42 MEETING MINUTES contract. I can't not order something. Six months later we get a change order to not do that. We just can't operate like that because it'd be like, well, we might take the furniture out, so I don't order the furniture. But then the change never happens and now I can't finish the project. Do you understand what I'm saying? SWARNER: Yes, you're saying that we didn't give you a change order. GREEN: I had, I had no written direction not to order this plant material. To this day, I have no written direction not to order the plant material. It was never given to me. We talked about it. There was lots of things talked about. But never anything in writing. Keith, am I correct in saying that or am I off base? KORNELIS: Yeah. Basically ... If you read on through here it says there was verbal ah discussions about it. But, the Alaska Court, or the, yeah, the Court System took some time to consider about deleting it. But the formal, I think the thing that kind of bothered me, there was a formal proposal, everybody knew we were going to deduct some, some, some of the landscaping and there was a formal proposal for deducting the landscaping given to G&S on April, April second and it just happened that in our weekly meeting on April 22nd, they said they could give us a credit but the credit was only for the labor because they, the day before it shipped all the plants. Ah, it's, it's no real big, big item of this thing because we're only a thousand dollars apart, I mean between the two of us. There's only a thousand dollars and I think the 4500 was an estimate anyway. GREEN: Right. KORNELIS: So, there's no huge difference there. It was more of the idea that we did not coordinate and ah, the Court System is part to blame and I suppose I am too and the subcontractor and contractor. But, if we could have stopped it back at the vendor, we could have done something such as deleting a portion of that to take care of the potting itself and there would never, therefore there wouldn't be any expense. But, we do have the plants here. They are potted. So ... there's another alternative too which I've been thinking about. We could take this credit of, of ah $7,800 which would give us a credit on the project and take the plants and Parks & Rec could use them for something. That's another alternative. • 6 • 11 KENAI CITY COUNCIL MEETING MINUTES JUNE 161' 1993 PAGE 43 SWARNER: That doesn't still help use retrieve the difference of his offer and our offer. KORNELIS: Yeah. It's so close. It's just a thousand dollars difference. WILLIAMS: All right. Mr. Green, there's one other matter. A minute ago you said that ah, the excavator's claim of $67,205 would be "dealt with at a later date." GREEN: What, what I'm saying is, is the $67,500 is in this claim of 544. Now, whether I pay that excavator anything for that, that's going to be my worry. WILLIAMS: All right. GREEN: I'm not going to later come back to you and say "I need another $67,000 to satisfy the excavator's claim." WILLIAMS: All right, then, to make it perfectly clear, the $67,205 will not come back as a charge to the City... GREEN: No... WILLIAMS: ...at some point in time. GREEN: ...it will not. It's, that's going to be as part of the $544,000. Whatever I negotiated with my subcontractor. WILLIAMS: Okay. GREEN: Are you people confused on that, do they understand about the $67,000? The delay claim? His, his claim, whether it's legitimate or whether it's not, isn't the issue. I'm going to deal with that. That's my responsibility to deal with him and his delay claim. That's part of, part of this thing is for me to do that with him. KORNELIS: What we're looking for is one number that takes.care of everything. If it's ever brought up again that, that the contractor says, "we need more money because there was a delay, because of soils," no, there's no money. He's agreed that there will never be any more costs because of that. Soils doesn't have anything to do with it anymore. GREEN: It's done. KENAI CITY COUNCIL MEETING MINUTES JUNE 161 1993 PAGE 44 KORNELIS: The only thing that would be in addition to the project would be a something that's not known at this time, would be a structural problem or something that doesn't have anything to do with delay claims or soils contamination or any of that business. It's all over. It'd be all over with. WILLIAMS: All right. There are two other areas that I want to discuss briefly and I, I beg the Council's indulgence. We might be able to come to an agreement here if we push this a little bit. Items 3 and 4 amounted to the additional framing and labor, ah, in which your request for one was $89,337 and the additional steel framing labor was $18,667. Those, those are two of the items, Items 3 and 4. According to Keith's notes, you kept track of the work again on a time and material basis. Keith indicated that we were not going to go time and material for framing. GREEN: Okay. Are you, well finish... WILLIAMS: Yeah. All right. Therein the lies the difference of $27,000 on Item 3 and $13,000 on Item, no, $8,000 on Item 4, roughly. Is there anyway that we can work out a, an agreement on that number? GREEN: Can I, can I explain something on the framing labor. I, I realize that it was, it's not time and material. There was no material. Material is a different issue. We're talking labor only. WILLIAMS: All right. GREEN: Labor is something that, that I can go back to my certified payrolls and show you every penny of labor that was paid towards framing. Okay. And the same goes for the, the steel fab labor. Okay? Now, I've been in the construction business for 20 years bidding framing labor. I have missed one job in that length of time on framing labor. One time have I missed. My bid was too low. Okay? One time in 20 years that I've done this and I can back that up. Okay? So, for Keith to say that my framing labor is only over a certain percentage, when I can say this is my framing labor. This is what it costs. This is exactly what it cost. We're not, there's nothing ambiguous here about how much the framing labor cost. This is it. I can 41 • • KENAI CITY COUNCIL JUNE 16, 1993 PAGE 45 MEETING MINUTES show you where, where it is by certified payrolls. So, that's my cost to do that particular part of that project. And I might add too that in that eight, how much was that John? WILLIAMS: 89,337 for the framing and we're, we're offering 62,729, roughly 27,000... GREEN: Okay. The 89 thousand had a $16,000, look -into -the - future -to -finish -the -framing, okay? I can tell you now that I'm going to run over that somewhat because when I put that number together, I forgot about all my fancy metal soffits that cost me $7,500. I'm going to eat that. That's not that. WILLIAMS: For the courtroom themselves? GREEN: That's right. WILLIAMS: All right. GREEN: So... KORNELIS: Do you understand what, what I did. He's correct. He's taken, basically what happened, and by the way Dan, your letter concerning the extra, on April 14th, your letter concerning why those extra costs is part of their packet, why the framing cost you extra, the letter you wrote me... GREEN: Oh, okay. Yeah, I haven't seen this information I don't... KORNELIS: Yeah. It was all put together and sent to them. But, basically, what happened was when we started, when he started the framing, he thought he could do it for the bid price that he had in the bid. Of course that was being optimistic in the very beginning. Ah, we got toward the end and he, he had kept track through his certified payroll . In the whole main time, I was saying that I didn't th nk, �ecsause of the experience we've had with time and material and the excavation which is now three times what it was, I wanted to try to keep it on, on the deal that it was what he actually bid in his bid proposal. The only way that I could do that and, and try to be fair was to try to get some expert advice, which I did. I called Clark Graves, who are Alaska's experts on estimating and according to their people that, and I explained the whole situation, winter work and, and the whole deal. In fact, he did do the estimate on this project for McCool Carlson. So he's very familiar with our �J • KENAI CITY COUNCIL JUNE 16, 1993 PAGE 46 MEETING MINUTES project. He said that in these situations and when it went to court or arbitration or whatever, usually the contractor was . given twenty to thirty percent more for the framing for working under those conditions. So the first offer.I used was the twenty percent. The second offer I added twenty-five percent. So, it's a little bit different way of figuring this.. Dan threw out what he bid, what he had in his estimate, just threw it out completely and started with time and materials and saying I'm going to pay my men. The City's going to pay me for what I pay. I said no, we're going to hold your bid which you told us you were going to do it for, but yes there was some additional costs because of the conditions, we'll add 25%, was the second offer. Ah, so that's the difference between... WILLIAMS: All right. Now, in, in your final figure there, you have cut back your percentages of payroll cost, your overhead and profit and your two percent bonding. Have you made some adjustments in those figures in your final offer? GREEN: I can't say as I, that's not how I went at it. How I went at it was, do I have to have this? Is this particular item something that I can live without? That's how I went at it. Not, well, I'll cut my overhead and profit down on these figures. I went at it from, I'll just give up that issue, period. I'll just give up this issue, overhead and profit and cost for it. I'll just absorb those costs to settle this thing. That's how I went at that offer of $544,000. And I didn't think that under the circumstances it was appropriate for me to come in here and, and try to itemize and somehow discuss and give reasoning for every item that, that I came up, that, that made it possible for. me to come up with that number. WILLIAMS: All right. I'm going to make a recommendation to Council after and I want the Administration to ah offer some comments with regards to my recommendation either negative or positive, I don't care which. if my recommendation is off, I want you to just come right out and say so. First of all, I want to thank Keith for the tremendous amount of time and labor he put into this and the overall project. This is the one that's drove him completely up the wall too. Secondly, I want to say that there's been a lot of give and take on both sides and Mr. Green has come down from originally, what was it, 601,000 or ... . KENAI CITY COUNCIL JUNE 16, 1993 PAGE 48 MEETING MINUTES 544,000. Ah, personally, I think, the 475 was fair, but the Council has all the information and it's not going to hurt my feelings to go with what the Mayor's saying. WILLIAMS: And I want it understood by Keith that we're not circumventing what you've done here. I think you've done an excellent job at it. You've looked after the City's interests well. Councilman Measles. MEASLES: I agree with what you're saying now, I just one to get one thing clear in my mind and be sure that I heard what I heard earlier. If we do this, and we grant the contract the extension, barring any unforeseen additional change orders or additional problems, the contract, the extension will not cost the city any more money? GREEN: The contract, if you pay me the $544,000, the contract extension will not cost you any more money. This will be the end of the, of any claim that has anything to do with the contaminated soils. We obviously, like Keith stated, we can't guarantee that the roof trusses weren't designed right or that the floor covering is wrong, but anything that has anything to do with this delay is over. It's a done deal. WILLIAMS: Any future change orders that we might see or unforeseen items such as the sheet metal duct work and things that ah, we haven't yet come upon. GREEN: Just normal construction activity. WILLIAMS: Do you see that as possible? KORNELIS: Yeah, I, 1 don't have a problem with it. Um, there are a couple things I'm still a little bit concerned about, but, for instance in Attachment C of Dan's letter, he talks about Nelson's estimate and I want to make Council aware of that. It says quantities of fill will be paid for unit price on actual quantities hauled and I don't know if Dan or his subcontractor has had a chance to completely go through Nelson's figures, but, that could be something that would come back unless that was settled too with this thing. 16 GREEN: Well, that's, that's the one issue from Rozak that,we, Rozak used your engineer's information to determine the quantities of soils that yet need to be removed and the quantity of soils that need to be in place. If those quantities are . • KENAI CITY COUNCIL MEETING MINUTES JUNE 16, 1993 PAGE 47 BROWN: 655... WILLIAMS: 655,000 to 544,000. That must have sucked up a lot of overhead and profit and ah, thirdly, we've come up from our original 400,000 or what was our original? KORNELIS: 372... WILLIAMS: 372 to 475. So we've all moved. And the last point I want to make is that the difference, what we're talking about between ours and theirs, after we've both suffered, amounts to about 70 grand which is probably going to wind up in the neighborhood of 5% of the total amount of the overall cost overruns that we're eventually going to wind up looking at in the overall litigation. We're going to sue for $10 million, right? So, we're talking about 5% of the, of the damages or somewhere in that neighborhood and my numbers probably aren't right and I'm going to go on record right now and say that I'll disclaim them if they're used in court. How's that? BROWN: Sounds good. WILLIAMS: So, I'm going to recommend to the Council, and with Administration's discussions that we pay Dan the $544,810. That we don't look at his ugly face back in here again... GREEN: It wouldn't hurt my feelings... WILLIAMS: ...although he's a lot better looking than I am after all his health problems, ah, that we move on with this project and that ah, we hope that it comes out. Five percent is not going to make or break this project, but I think we've both come a long way in moving back and forth and that's my recommendation. Let's pay him the $544,810 and move on. MONFOR: Okay, we have a motion on the floor, so we need to... WILLIAMS: I know that. I know that. That's not an official vote yet. It's up to the Council. Ah, some comments from the Administration with regard to those... BROWN: I won't object to it. I think, I think that Keith's offer was fair. Um, I think it's been turned over to the Council now and I, I'm not going to voice an objection to going with the a KENAI CITY COUNCIL DUNE 16, 1993 PAGE 49 MEETING MINUTES incorrect, whether they're too much or too less, that's going to be the Council's responsibility. That's, your engineer made that estimate. Is that they way you see that Keith? KORNELIS: Yeah, ah, it's a little bit, it's pretty complicated because we're talking a lot more than just fill material. We're also talking storm drains and um, some of the other items... GREEN: Keith, he's agreed to do everything remaining to be done except for quantities of fill. WILLIAMS: be clear in that. Everything remaining to be done will be do except the specific quantities of fill that may be required. GREEN: The fill that's in that estimate is an assump..., the engineer has made an estimate of how many yards of material have yet to be moved. Correct? KORNELIS: That's correct... GREEN: We have included that in our price. If you're engineer's right, you won't see my face again. WILLIAMS: If our engineer is wrong, that's not your responsibility. GREEN: If he's wrong and it's 51000 yards in your favor, you'd want see my face again. If it's the other way, you probably won't. VOICE: But we will see you if it's the other way. GREEN: I don't see how we can do it any other way than that. That's quantities and material that your, your people have estimated. That's a very complex issue and you can verify that with your Public Works Director that that estimate was not an easy thing to come up with. KORNELIS: Well, we paid $2,500 for something cause we had to do a lot of surveying in there. I was very concerned because, as you can see, from the, from the contractor's first proposal, there was a $140,000 in there and I, I didn't think there was that much work remaining. So, and that was, by the way, originally the subcontractors amounts. The general contractor's proposal would have normally been, would have been 151*000. But, 0 C7 • KENAI CITY COUNCIL MEETING MINUTES JUNE 161 1993 PAGE 50 it was my position that yes, there under cold weather conditions and w because of the water table, because everything else, so we have a lot o justified, that we went to time and beginning when the project started. the best weather we've ever had so and material would not be the best was a lot of excavation done e had to accelerate that of the basement and f overtime. We went, very materials back in the This particular time w I, I felt to continue on way to go. I think mayb was, I don't know how this number came out, the 140, but at point, I felt we should get a exact quantity out there. Go and survey it and make sure we knew exactly what was there, work had to be done and pay the contractor based on his bid e e have time that that out what amount times the percent remaining. And that's where we came up with the 85,000 is that we went out and actually did a real, Nelson & Associates, did a, took a survey crew out and we figured out that if we took what he bid, which was 300,000 and some thousand, multiplied that by times the percent remaining, that was what the actual figure. It got quite a bit complicated, more complicated, because there's about 25 items, including water, sewer, storm drains and all that. So we had to take the percent remaining on each one of those items and um, what Dan is saying is that if the engineer made a mistake on the quantities, then we may have adjust a little bit. GREEN: Either way. KORNELIS: And it gets more complicated because down to a certain elevation, it's part of the building bid, and roll that amount, there was a unit price, but all that can be worked out with the engineers. WILLIAMS: Okay. At least we have that understanding. Everyone understands that. Councilman Measles. MEASLES: Could I ask the Clerk to read the motion back. FREAS: I'll have to find it first. Um, Councilwoman Monfor moved to pay the $475,000 and Councilman McComsey seconded it. MEASLES: Okay. WILLIAMS: Councilman Measles. 0 0 KENAI CITY COUNCIL DUNE 16, 1993 PAGE 51 MEETING MINUTES • would like to amend the motion so that it reads MEASLES• I $544,810 as per contractor's last offer. 's been moved and seconded to raise the figure to WILLIAMS• . It amend the motion to $544,8109 MEASLES: Tha tthat all the statements that have gone on the , record tonight be remembered. WILLIAMS: Yes. • harlie, help me out on this a little bit, buistwe KORr1ELI S . C roved here method that would be done then, I would you have would do a change order based on forthepart of the work that wh ah, and incorporate actual paymenta estimate that you are, is done at this point as part of the p Y Ire approving tonight also. you've already, well, Youut future Hquantities- would w ork be based on the quantities, htahe85Xa 000this week, ors That 85,000 amount. We wot would paYuld be done after, after the work s far as the pay estimate, it wo 's done. Is that correct? Is that the done. Not before the work way to go? BROWN: Yeah. GRAVES: We would want with the change order to do a settlement agreement to go along outlining the details of the settlement. you're GREEN: Did I understand, going to pay me then you're going to agree to pay me and authorize payment this moneyexcept for the excavation that's remaining. what I heard? th ayment of MEASLES: No, no, no. we're $544,810 that you asked for authorized e p to settle everything. GREEN: Okay, but, but there's that there's work of eight -some done. tonight, f or all of is that the work, Keith is correct in We haven't thousand dollars FABLES: Right and you would not actually get, get M it tonight, but you would that. we're authorizing for that work until it was done* paid for not get paid k C KENAI CITY COU NCIL MEETING MINUTES JUNE 161 1993 PAGE 52 GREEN: Okay. What about the difference between the 544 and the 87, will that be authorized to be paid so that, I do I'm making myself clear. Therels... n t know if MEASLES: Anything that has been done and is com let time will be paid with this authorization. p e up to this GREEN: Will that be part of that pay estimate that's tonight? before you BROWN: Well, that pay estimatels already been a rov pp ed GREEN: So what that means is that I have to wait unt council meeting which I believe is three weeks before your next paid for any of that $544,000. i can be WILLIAMS: No. MONFOR: No. MEASLES: No. KORNELis: I think that they could approve, I mean back and add that in at any time I would think. ' they can go BROWN: If, if Council wanted, assuming this passes could make another motion to authorize the City to wor°uncil approve a pay estimate, and it could include $544#810 minith you, agreed upon amount that is not yet been completed. We d us an presumably we would subtract 85,000 from that. on t, GREEN: Thates what it would be. BROWN: And then we could work through the retains es that. Council knows the routine. If that's the inand all could make a separate motion. tent, they MEASLES: Yeah. A separate motion that would also Cary said about a settlement agreement that spells o what ut... BROWN: Okay. WILLIANS: In actual dollars, ites somewhere around actual cash. 450,000 i n GREEN: That I can contain...that'd be great. s F 0 • • KENAI CITY COUNCIL MEETING MINUTES JUNE 161 1993 PAGE 53 MONFOR: Mr. Mayor, I'd like to call for the question on the amendment before this gets anymore cloudy. WILLIAMS: Yes, please do. MONFOR: I call for the question on.the amendment. WILLIAMS: Oh, call for the question on the amendment. All right the question's been called for. Clerk will call the roll. FREAS: Williams? WILLIAMS: Yes. FREAS: Bookey? BOOKEY: Yes. FREAS: Swarner? SWARNER: No. FREAS: Monf or? MONFOR: Yes. FREAS: Measles? MEASLES: Yes. FREAS: McComsey? MC COMSEY: Yes. WILLIAMS: All right. The amendment passes ah $544,810, ah, shall we call the main motion now. MONFOR: Call the main motion. WILLIAMS: Call the main motion. Clerk will call the roll. FREAS: Williams? WILLIAMS: Yes. FREAS: Bookey? • 0 KENAI CITY COUNCIL MEETING MINUTES JUNE if , 1993 PAGE 54 HOOKEY: Yes. FREAS: Swarner? SWARNER: No. FREAS: Monfor? MONFOR: Yes, FREAS: Measles? MEASLES: Yes. FREAS: McComsey? MC COMSEY: Yes. WILLIAMS: Okay, now we can look at the clouds again. MEASLES: Now, see if we can clear up the facts. I would move that the Administration be authorized to meet with Mr. Green, Administration to include the City Attorney, and the payment for completed work to this point be authorized upon the satisfactory completion of a settle agreement, settlement agreement as per the discussions here tonight. MONFOR: Second. MEASLES: Future... MONFOR: Sorry... MEASLES: ...work that has not been completed at this time would be approved for payment upon completion within this total amount. Now you can say it. MONFOR: Second. WILLIAMS: All right. We have a motion and a second to the motion stated the C1erk...Councilwoman Swarner. SWARNER: I have a question. Which funded, funds would these monies come from since we don't know if we have the state grant yet, right? . • KENAI CITY COUNCIL MEETING MINUTES JUNE 16, 1993 PAGE 55 MEASLES: Beautification, SWARNER: No, there's no money in there to buy the trees (laughter), WILLIAMS: I believe they're coming from the Airport, is that correct, the Airport Lands Fund? BROWN: Yeah. Whatever we, if we don't get the state grant, it's going to come from the Airport Fund. Ah, I've been assured that the Governor's going to sign that. Now... SWARNER: Wait till the check comes... BROWN: As, as of Friday, Mike Navarre was saying it will be signed. I hope he's right. But regardless, regardless of whether we get the grant, we entered into a contract with the Attorney General's office that we will finish this job. So, we have to honor that agreement. WILLIAMS: The only way we're going to survive is with another... All right. Ah, the motion then is moved and seconded. Further discussion on the motion? Seeing none, the Clerk will call the roll. FREAS: Williams? WILLIAMS: Yes. FREAS: Bookey? BOOKEY: Yes. FREAS: Swarner? SWARNER: No. FREAS: Monf or? MONFOR: Yes. FREAS: Measles? • MEASLES: Yes. FREAS: McComsey? e • KENAI CITY COUNCIL MEETING MINUTES JUNE 161 1993 PAGE 56 MC COMSEY: Yes. WILLIAMS: All right. Now, with any luck at all, that should put the majority of all the problems regarding the courthouse behind use END OF ITEM. BREAK TAKEN: 10:43 P.M. BACK TO ORDER: 10:50 P.M. H-5. Discussion - Airport Commission Recommendations. Williams referred to a memorandum included in the packet. McComsey asked if the City paid for the car rental stalls to be built at the terminal. Ernst stated yes, they were part of the terminal package. Ernst added the car rental agencies feel the glass partitions extending the wall to the ceiling will allow them more privacy between businesses. Ernst added the agencies feel that too much can be heard from one space to another and it is hurting their business. Ernst stated the agencies estimated a total cost of $500 to add the glass. Dan VanZee, Herts Car Rental - VanZee stated he received an estimate from Doors & Windows approximately five months ago. It is for h" safety glass to be placed from the top of the partition to the ceiling, for $90 for each partition. McComsey stated the car rental agencies at the Anchorage airport did not have partitions at all between businesses. VanZee stated their counters are approximately 20 feet long and allows more space for privacy. VanZee added they have no way to talk to a customer or employee without the conversation being heard by other adjoining businesses. Swarner stated the Anchorage counters are close together and do not provide privacy either. VanZee stated their counters are 20 to 30' long and allows 151 or more between competitors. Swarner asked VanZee if they were willing to pay for the placement of the glass. VanZee stated no, he did not think so. VanZee added he feels that his lease allows him the right to enjoy the peace and quiet of the lease. VanZee added he thinks it is a design flaw. VanZee stated the booths are too small, too close together, and • there are too many of them. VanZee stated there have been other KENAI CITY COUNCIL JUNE 16, 1993 PAGE 57 MEETING MINUTES improvements made at the airport and the city has paid for them. VanZee stated he did not think this cost was too large for the city to pay. Williams stated last year the car rental agencies paid the City $110,000. Williams suggested the $500 cost would be okay for the city to pay. MOTION: Councilwoman Monfor MOVED that the car rental booths have glass partitions installed between each rental booth and the city will pay for the cost. Councilman Bookey SECONDED the motion. VOT21 Smalley: Absent Williams: Yes Bookey: Yes Swarner: No Nonfor: Yes Measles: Yes McComsesy: Yes MOTION PASSED. Discussion continued regarding the recommendation of the Airport Commission to eliminate the vehicular service road from the east side of the airport apron. MOTION1 Councilman McComsey MOVED to eliminate the vehicular service road from the east side of the airport apron and Councilman Measles SECONDED the motion. Brown stated this issue has come up a number of times and has been discussed with Ernst and himself. Brown stated he is adamantly opposed to the elimination of the road. Brown added it is needed for safety reasons. Brown requested., at the minimum, Council delays their action on this vote until the new city manager comes on board for several months for a fresh look at the issue. • 6 • KENAI CITY COUNCIL MEETING MINUTES JUNE 16, 1993 PAGE 58 VOTBI Measles called for the question. Smalley: Absent Williams: No Bookey: No Swarner: No Monfor: No Measles: No McComsey: No MOTION FAILED VMAN IMOUBLY. iTBX8 A MINI9'1'RATION_REP_ORTS a. Work Bession - Williams requested a work session be scheduled with the Council, Planning & Zoning Commission and Townsite Historic Task Force. A work session was set for June 230 1993 at 7:00 p.m. in Council Chambers. b. Evaluations - Williams requested evaluations of the City Clerk and City Attorney be set for July 7, 1993 in an executive session. c. AML Conference - Williams requested payment of $4,000 to AML for travel costs as discussed during budget work sessions, etc. be readied for the next council meeting. Williams added the EDD has agreed to act as the broker of the AML Committee. Williams requested Administration to transfer the $4,000 from the City to EDD as the City's share of the conference costs at the next meeting. d. Thompson Park - Williams asked Kornelis what the progress is on the bidding of the Thompson Park trunk line. Kornelis stated he will speak with Wince-Corthell-Bryson. However, it should be getting close. e. Animal. Control shelter - Williams requested Administration to generate a request for proposal for a new animal control shelter design and construction in order to include this information in backup materials for the City's request for CIP funds from the legislature. Williams requested the proposal stipulate bid -ready plans before the end of December. s . • • KENAI CITY COUNCIL MEETING MINUTES JUNE 16, 1993 PAGE 59 Kornelis stated he has several designs from the National Animal Control on file. Kornelis stated an architect will still be required to adapt the building to our site. Kornelis was asked if staff could do this adaptation work. Kornelis stated a licensed architect is required to be awarded grant funds. f. Test Well - Kornelis stated he will go to either one vendor or bids. I -a. City Manager No report. I-3. Attorney Graves reported he will file a complaint on Coyle's Landing for not paying bed tax unless Council objects. There were no objections. 1-4 . City clerk No report. I-S. Finance Director No report. 1-6. Public Works Director No report. 1-7. Airport Manager No report. . a T.W)TTI1• J-1. citizens TermeAa Verner -Quads - Quade stated she is a member of the Airport Commission. At their last meeting the Commission voted to eliminate the vehicular service roadway at the east side of the main apron. Werner-Quade stated she abstained from voting because she believed the Airport Manager Ernst is best qualified to make that type of safety and liability decision. Werner-Quade KENAI CITY CO UNCIL MEETING MINUTEg JUNE 16, 1993 PAGE 60 added she did not believe the commissioners should b vote on a matter of such high safety liabilitywithout made to having extensive study and input from professinals ut first business. in the Werner-Quade stated such voting results in undermining Position as airport manager, a job for which he havErnst s and for which the city has placed confidence in him been hired Werner-Quade added as a member of a volunteergroup, to e feel that she was in a position to decide trafic lshe did not issues between land vehicles and airplanes at the liability Airport. Werner-Quade distributed a co Kenai Municipal Council and Administration. py of her comments to Williams thanked Werner-Quade for staying throughout meeting to state her comments. t out the lengthy I :T through their action, cleared up theldiscussiostatentan Council, Ernst not to eliminate the road. and have directed Dean Lichholz - Alaska Flying Network. Eichholz brought up the road issue to the Commission last p stated he issue was tabled because of a October. The Those problems have been resolerdobl He was diraai Fuel service. discussion back to the He as that was directed to bring the command. chain of Eichholz stated he brought the issue forward in pc he is a pilot at the airport and spends a lot of time because and is also on the Board of Examiners. iat on the ramp made animosity between the users and the Administration road has Eichholz stated his objective was to remove some ion. Eichholz stated the problem was brought to his ate the conflict. helicopters, airplanes and attention from believed it was a valid fssuefaraidethou hte� Eichholz stated he Commissions attention properly. g it was brought to the the council did not discuss it furtherhbeforeataking he was sorry Eichholz stated he understood that items for discs action. brought to the Commission and they recommend action to should be Council. n to the Dan Pitts - President, Kenai Airport Fuel Service. he supports the movement to abolish the road. pit Pitts stated believes it a safety issue as the road runs across stated he . service area. the Passenger p 0 0 KEN AI CITY COUNCIL MEETING MIN PAGE 6 6' 19 9 3 V'1'ES UN Pitts stated record as President of the record eas saying this Fuel Service Presentation Coan unsafe situation.• he wanted to. has discussed it a ouncil has Pittec added go on removal of the lot. Pitts heard, the Ai stated road twice Stated the Com�atirpor mmission he could not understand we it is d for fueling area, by a service issue. road Pitts Pitts goes through a Pitts added they are back in Pitts Administded ration have bee business and the from the be on unfriendly terms appreciate that. to relieve the conflict, ginning. Pitts st with the ated they are trying Williams asked Ernst Update. Ernst statedhow long it will be Speak only to how the the draft update isbefOre there is an F . the speCific airports. is lined already out. i engineers Williams but the location is They the issuet° review this i asked if Fp�j up to with Patty Issue. Ernst stated would allow traffic requires they maintainua Sullivan,iniAlp C kept h has discussed believe the Service E and her .info airport. road is mum operating standard formed. FAA part of the safety and they Y standard for the Ernst stated t E is used to he roadway is in It I are get baggage from front °f the terminal building. Users are ware the Passen ers planes to the ding. and that would be to ha - that the the right baggage claim. would be worse. planes right The Ron Deacke - building with the 1078 Juniper Court stated c°uncil's decision • Kenai. Stated comity he felt the who thin in regard to Inlet Wood did not agre® g before the g was put together Woods. Geocke added someone will tonight and the prior feel o have to Y had it all tO McLanes Otherwise. do some hard convincingbagged Geocke Geocke for him to elementalso discussed the decision el felt y school or renovating in regard to there a new school g Kenai Elementarybui1d3ng a new Is anything will be more• Geocke stated understood t g wrong with the old�sosive and he does Playground is the real thin with Geocke added think mall, g wrong' ith Kenai Elementary he M statedY is the WilliamsWil in the problem statedg wrong with it that with the old school his concerns that t $4 million could is there is he school will soonot fix. Williams n be filled and there • 0 • LJ KENAI CITY COUNCIL JUNE 16, 1993 PAGE 62 MEETING MINUTES will be no way to build another new school. Williams added there is a good possibility the construction will not be funded. Geocke again stated Kenai Elementary should be renovated instead of building a new school. Monfor stated it would be foolish to not support something that the School District wants to do. The School Board decides what is best for the schools. Monfor added she does not disagree with the renovation of Kenai Elementary, but the discussion is now out of their hands, so the city should support the decision made by the School District. J-2. Council Bookey - Asked Kornelis when Main Street would be reopened. Kornelis stated the traffic lights were placed and the State had monies left with which they could repair the streets, taking out bad material, etc. Kornelis believed the road should be open tomorrow. The City will only have to replace the sidewalk. Ovarner - a. Reported she would not be at the next meeting as she will be in Cordova to attend a Legislative Affairs Committee meeting, July 7 to 9, 1993. b. Reported there are junk cars at the Spur Motel and in the shop area. Kornelis stated the junk cars in the shop area could be hauled away. Monfor - The Chief Executive Officer of the Boys' & Girls' Club will be in Kenai on Saturday. If anyone would like to meet with him, please inform Monfor or Greg Williams at the Boys' & Girls' Club. Measles - Asked if there was a reason why no bids were received for the radio maintenance contract. Chief Morris stated Southcentral was contacted after there were no bids to open. They had forgotten about the bid opening, but had a bid ready. Borealis received the bid specifications, but did not bid. MoComsey - Asked how many people are paying bed tax now. Brown stated everybody except for King's Inn and Sue Wright has not filed. Wright told Brown on the phone that she did not collect any bed tax and did not file. Brown stated he told Wright she still had to file. Brown stated Merit Inn paid and a claim has been filed with the Bankruptcy Court for King's Inn. N R. KBNAI CITY COUNCIL MEETING MINtlT&S JUKE 16, 1993 PAGE 63 Graves reported he has asked the Bankruptcy Court to order King's Inn to pay bed tax owing subsequent to the bankruptcy filing. Williams - Reminded Council to attend barbecue at Torgerson's in regard to the A14L Conference. ITEM Rs ExLC,�JT,�,�(� BE89.19H - City Clerk and City Attorney Evaluations. Postponed until July 7, 1993 meeting. -:K ; M . ! A-157. _ _4 The meeting adjourned at 11:44 p.m. 4' submitted by: VQ'1, BY CouWA C7�� 7y W►TI q G�IK 0