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HomeMy WebLinkAbout1989-04-05 Council Minutes. AGENDA KENAI CITY COUNCIL - REGULAR. MEETING APRIL 5, 1989 - 7:00 PM A. CALL TO ORDER 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 sn 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. B. SCHEDULED PUBLIC COMMENT (10 Minutes) 1. Sherry Innes - Concession in Airport Before Remodeling is Complete C. PUBLIC HEARINGS 1. Ordinance 1308-89 - Increasing Rev/Appns - Airport Drainage Study/Safety Capital Project Fund - $56,792 a. Resolution 89-24 - Award Contract - Comprehensive Drainage Plan, Airport - Wince, Corthell, Bryson - $56,792 2. Ordinance 1311-89 - Increasing Rev/Appns - Sr. Citizens Mini -Van - $16,896.17 3. Resolution 89-20 - Award Bid - Sr. Citizens Mini -Van - Craycroft Crysler-Plymouth-Dodge - $16,896.17 4. Resolution 89-21 - Transfer of Funds - Communications, Dispatch - $2,500 5. Resolution 89-22 - Authorizing City Manager to Enter into Grant Agreement with State - Airport Runway Paving and Installation of Lighting - $52,077 6. Resolution 89-23 - Authorizing City Manager to Enter into Grant Agreement with State - Airport Drainage Plan and Design Expanded Safety Zones - $1,775 7. Resolution 89-25 - Transfer of Funds - Purchase Boom Tractor, Price Increase - $724 8. Resolution 89-26 - Transfer of Funds - Library - Newsbank Electronic Index CD-ROM Reader - $20600 0 9. Resolution 89-27 - Transfer of Funds - Change Orders #3 & #4 - Airport Terminal Renovation $4,495 10. Resolution 89--28 - Transfer of Funds - Recreation, Snack Bar Operating Supplies - $30000 D. COMMISSION/COMMITTEE REPORTS 1. Council on Aging. 2. Airport Commission 3. Economic Development Commission 4. Harbor Commission 5. Library Commission 6. Recreation Commission 7. Planning & Zoning Commission 8. Misc. Commissions/Committees a. March 18, 1989 Meeting Regarding Seafood Industrial Park E. MINUTES 1. *Regular Meeting, March 15, 1989 2. *Teleconference, March 15, 1989 F. CORRESPONDENCE 1. *Alyeska Pipeline - Valdez Terminal 2. Alaska Senate - Select Advisory Committee on Municipal Taxation 3. *Sen. Fischer - March 18, 1989 Meeting 4. *Seafoods from Alaska - Thanks to Mayor 5. *Atty. Tony Smith - Thanks to Mayor G. OLD BUSINESS 1. Jesse Wade, Dena'Ina Pt. Estates - Rescission and Release H. NEW BUSINESS 1. Bills to be Paid, Bills to be Ratified 2. Requisitions Exceeding $1,000 3. *Ordinance 1312-89 - Increasing Rev/Appns - Airport Runway & Taxiway C Overlay and Related Lighting Improvements - $1,6661452 4. *Ordinance 1313-89 - Increasing Rev/Appns - Dock Facility, Expansion of Parking & Staging Area - $135,000 5. *Ordinance 1314-89 - Increasing Rev/Appns - Library - Cancellation of Copier Maintenance Agreement - $10500 6. Discussion - Lease of Dairy -Queen Facility 7. Discussion - Kenai River Special Management Area Advisory Bd. Meeting - March 23, 1989 i ' r 0 I. J. K. 8. Consent to Assignment - Gusty S/D - Wagoner to J. Doyle 9. Discussion - Salamatof Native Assoc. - Cultural/Recreational Project Near Elephant Lake 10. Approval - RFP - Insurance Services for Next 3 Years 11. Approval - Change Order #3 - Airport Terminal Renovation - G&S Construction - $1,543 12. Approval - Change Order #4 - Airport Terminal Renovation - G&S Construction - $2,952 13. Discussion - Inlet View S/D 14. Discussion - Kenai Peninsula Caucus Meeting - March 17, 1989 15. Games of Chance & Skill - Peninsula Extension Homemakers Council ADMINISTRATION REPORTS 1. Mayor 2. City Manager 3. Attorney 4. City Clerk 5. Finance Director 6. Public Works Director 7. Airport Manager DISCUSSION 1. Citizens 2. Council ADJOURNMENT KENAI CITY COUNCIL - MINUTES - REGULAR MEETING APRIL 5, 1989 - 7:00 PM KENAI CITY HALL PRESIDENT PRO-TEMPORE CHRIS MONFOR PRESIDING A. CALL TO ORDER Councilwoman Monfor called the meeting to order, and stated the Mayor and Vice Mayor were absent. ELECTION OF PRESIDENT PRO-TEMPORE MOTION: Councilwoman Swarner moved, seconded by Councilman McComsey, to nominate Councilwoman Monfor as President Pro-Tempore. Motion passed by unanimous consent. A-1 Pledge of Allegiance A-2 Roll Call Present: Linda Swarner, Art McComsey, Chris Monfor Marj O'Reilly, Hal Smalley ' Absent: John Williams, Ray Measles (both excused) A-3 Agenda Approval President Pro-Tempore Monfor requested item H-13 (Inlet View S/D) be moved to B-2. Council approved the agenda as amended by unanimous consent. A-4 Consent Agenda MOTION: Councilwoman Swarner moved, seconded by Councilman Smalley, to approve the Consent Agenda as submitted. Motion passed by unanimous consent. B. SCHEDULED PUBLIC COMMENT B-1 Sherry Ines - Concession in Airport Before Remodeling is Complete Sherry Innes. I am representing myself and Sandra Emch. I have been in Alaska for 25 years, 22 in the Kenai Borough. My first impression of Kenai in 1964 was it was an interesting fishing village but not much more. It is different now, especially when fishing starts. The airport is a beehive of activity in the summer. The majority are visitors from the States. They will do some shopping, but want to fish. The majority are seasoned travelers who check in early and have time to kill at the airport. Many plan to have a small snack at the airport. Many have people with them to say good-bye and many of them have children. We at the airport have to explain many times that due to remodeling, the restaurant is closed. Mrs. Emch and I are proposing a snack shop to be open June 1 to Aug. 31. We have talked to DEC and have been assured.we will not need plumbing or drains. It is portable, so all can be removed. We will not duplicate t 1 c KENAI.CITY COUNCIL APRIL 5,_ 1989 PAGE 2 what is in the vending machines. We will not be competing with any existing business but are fillinga void. DEC calls this food processor, not food servic. We will be selling beverages, a line not in the airport now. � Councilwoman O'Reilly. The food done at another location? preparation will be this time, but it is a Inns. I cannot say at approved ed by DEC. individuals that would like to bid. i have 2 I O'Reilly. Where would the people be consuming the food? Ms. Inns. It would be at the air the counter. We would provide some seatiingrtitris nnea otr sufficient for booths. It would be the responsibility Of the hired person to police the area. O'Reilly. No running water, would cleaning be awoman Problem? Ms. Inns. DEC says it would be like concession in a mall. We could use the bathroom facilities. It would not be a problem. Councilman McComsey suggested stating they cannot eat except in the immediate area and have stand-up areas like the Anchorage airport. Ms. that, we could Inns• We could do We container right pthern.S1W�swi11 have could have a garbage and have that built at the same time.a counter built The things we are providing will not be that messy. Councilwoman Swarner. What are the hours? Ms. Innes. We will have to be flexible. We may have to adjust through the season. But for now it is 10:00 AM to 7:00 PM. This is totally separate from our businesses at the airport. But we have a heavy traffic. We have spoken°tolour eMPloyer of the times of is agreed we can supervise this when off -duty. and it Councilman MCComsey. When is the construction over? Public Works Director Kornelis. They have till Sept. but hope to complete sooner. p Airport Manager Ernst. I told Ms. Inns that Council has said they were not interested. in this, but as the situation is now and we see what it is like without these facilities, I have no problem with talked with Atty. Rogers. this. I have Atty. Rogers. In order that they can bid procedures of an RFP get going without as short term Permitted • I would suggest we entertain the hurt t use with a permit because of cY of would like the need and benefits deri•red. We it so it could be extended or shortened. It would be about a week to p1epar.e. Councilman 110Comsey: Any money involved.? Atty. Rogers. I have no idea- We could set according to the Previous floor plan. Airport Manager Ernst. It is $1.65 per sq. ft., that is 150 sq. ft. Ms. Inns. W are comfortable with that. e Atty. Rogers. Have you investigated insurance? Answer - no. Atty. Rogers. I will check with our insurance agent. If I find out before the next meeting, I will contact Council by phone? Council a. MOTION: Councilman MCComsey moved, seconded by Councilwoman Swarner, to arrange this with the price per sq. ft. as R KENAI CITY COUNCIL APRIL 5, 1989 PAGE 3 If stated by Airport Manager Ernst, contingent on what Atty. Rogers finds out regarding insurance. Motion passed by unanimous consent. B-2 Discussion - Inlet view S/D PUBLIC COMMENT: a. Doug Yates, Susieana Lane, Kenai. We are one of many residents on Susieana Lane, we are concerned with road conditions in general. We have much water in the roads because they are not paved. When I bought my property and built my house, Halls said the street would be paved. If it was not paved, they said the City would take over a lot to make sure it was paved. Jan. 1, 1989 the City had the right to move into the property and implement paving. We went to Halls and are now coming to the City. I have talked to Atty. Rogers and Engineer LaShot. We are asking Council to initiate action to get this paved. There are no street signs, some missing street signs, no street lights. The subdivision next to us has many street lights. b. Janet 202 Norman St., Kenai. •We are the first house�o€f pavement. We would like streets paved and curb repaired. The curb on the outside is higher than the one across the street. Engineer LaShot came out and said it was not right. President Pro-Tempore Monfor. I thought we would pave this summer and that Halls would be paying for paving. Atty. Rogers. As an accommodation to Halls and the people who bought, the City signed off on the preliminary plat so paving could be done. Halls proceeded, with assurances and collateral of $42,000, installation agreement, note and deed of trust on the lot. We do not want more land. We have a valid note and installation agreement. They had till Jan. 1, 1989 to do this. At this juncture, the City has a number of options. Halls have asked for an extension of time, but have not offered anything else. They want to do it in early summer. I have talked to a number of residents involved. (Atty. Rogers asked if a representative from Halls was present. There was no answer). Atty. Rogers. I have written Halls, they have not responded. Mr. Hall has ;.ndicated verbally that he would do it. if it is council's desire to have Halls pave, I would urge Council to only allow after Halls sign confession of judgement that would alleviate us having to sue if they do not. Then put in a specific date. If it is not done by then, we can collect by collection of assets. If the City does the paving, it would be more expensive because of Davis -Bacon Act and seeking recompense from Halls. if we can seek more than $42,000 we will seek those as well. Probably having the City pave, while assuring paving, would be more expensive and would result in a deficit. The original document was signed, in 1986. I have urged the residents to be here this date. Councilman Smalley. Is it a moot point regarding curbing being incorrect and the lighting? Atty. RENAI CITY COUNCIL APRIL S. 1989 PAGE 4 Rogers. I have not heard about the curbing. they pave now, should the City go in and re -engineer? if Councilwoman O'Reilly. Is $42,000 the estimated cost of paving if Halls do it? Atty. Rogers. No, that is the appraised value of a lot at that time. It is probably more than estimated cost. The cost of paving does not relate to this. Public Works Director Kornelis. We have no recent estimate, but no lights were to be installed in the plans. Regarding curbs and gutters, we would not accept if it was not correct so we would make them do it again. C. Janice Magee, Susieana Lane, Kenai. I have a document dated Aug. 15, 1986 regarding paving at $.90 sq. ft., estimated cost - $26,820, by Hayes Construction. (Public Works Director Kornelis noted, this is Quality Asphalt). Also, who is ultimately responsible for improvements in that subdivision? Halls have said they are supposed to do this. Isn't that usually done before a subdivision is put in? Public works Director Kornelis. Our ordinance requires the developer go in and improvements have to be done. After they are completed, the developer can subdivide and sell. There is an exception in the Code that if a developer gives the City some type of guarantee that improvements will be put in, he can file the final plat. That is what Halls did. Ms. Magee. We paid to have this paved. We are being taxed for a paved street. Public Works Director Kornelis. The Borough should not bill till it is paved. Atty. Rogers. This is not unusual. It is a means to keep costs down. The contractor does not have to carry as much borrowed funds. Ms. Magee. I speak for all, our ultimate goal is, we want to have it paved. Atty. Rogers. We have tried to be as open as we can. Councilwoman Swarner. I was under the impression those streets would be paved this year. I own a lot there. Councilwoman O'Reilly. This is not only instrumental where the builder puts in houses and does not pave. What is there on the books to prevent this? City Manager Brighton. They cannot sell a lot till improvements are in. The one exception is if they put up collateral to cover. We may have to sue Halls to get money. Wherever the money comes from, the City will see that streets are paved. Councilman Smalley. It was my understanding that it would be done this year. Regarding curbs. If we have an agreement with Halls regarding paving, if we mess with curbing, can we accept the money? Public Works Director Kornelis. We will -go to Halls and tell them they have to repair before we will accept. Atty. Rogers. If the $42,000 we will go for the City will go ahead give me a free hand to cost of the City exceeds that. I need to know if and pave. If they are, get recompense from Halls. j 1 KENAI CITY COUNCIL APRIL 5, 1989 PAGE 5 ADDED ITEM: Councilwoman Swarner. Is O'Brien Ct. the same situation? Public Works Director Rornelis. That was never slated for paving. There is a drainage Problem there. The City accepted this street but should uld not have. Item B-2 (contd): Public Works Director Rornelis. There are lot of subdivisions in the area that have been subdivided. We do not have the clout to not allow them to do final plat. It has been finalized. our mechanism is to go to the developers and tell them they are responsible till we accept. Sometimes they just leave. In years ordinance was not enforced. Past the d. Lady. I brought up the curb issue, we live on th corner of Norman and susieana. originally Norrmane was to connect to Lawton. If You do not connect, we will not be paved, there is a pipe sticking up in the road. If you only pave Susieana, we will be left with 1/2 of our lot undone. When we bought our lot Halls said it would connect to Lawton, but it was not done. President Pro-Tempore Monfor. Did we have plans to do Norman? Public Works Director Rornelis. They were not part of the agreement with Hails. I thought the final outcome was not to do that. Lady. They cannot plow past our driveway. City Manager Brighton. You Will not definite answer this date. Let us have public Works look at this, make a recommendation to Council on how to resolve the problem. many contractors in this town have come to this otown, told people anything they want to sell lots, that roads were under the care of the City and they are not. This is what we are looking at in this situation. We are left with using taxpayers money to correct and that is not fair. They probably will not asphalt till August. Councilwoman Swarner suggested, have Public Works include street lights also. Public Works Director Rornelis. It will cost more than $42,000. Councilwoman O'Reilly. Other people have been waiting longer for street lights. President Pro-Tempore Monfor. The Hammond (?) request has been addressed and will be reviewed With next budget. Councilman MCComsey. was Mr. Hall agreeable with confession of judgement? Atty. Rogers. I told him this was an adversarial judgement at our last meeting. Councilman McComsey' should We along those lines. Proceed Atty. Rogers. Are you going to allow him to do paving? Councilman McComsey. Yes, straighten up the street and give 1-2 week deadline. President Pro-Tempore Monfor. if he does not do it, we should have time to do the work. MOTION: • s KENAI CITY COUNCIL APRIL 51 1989 PAGE 6 Councilman McComsey moved, Swarner, to contact Halls, with paving as long as th . e Councilman Smalley. It is more expenditure of money. By extending, we may not do till next summer. Is it more expedient to have the City do the paving and go to Halls? Atty. Rogers. More expedient but more expensive. Public Works Director Kornelis. It would be better to have Halls do it, we would have to go out to bid, they would not need Davis -Bacon wages. President Pro-Tempore Monfor. If Halls do not do, we could add to another project as an added alternate. It would still be done this year, but would not have to go out to bid. One way or another, it will be paved. e. Man. Both have made promises but have not done anything. Is the City ready to jump in if he does not? President Pro-Tempore Monfor. That is why we are doing this. If he does not do by the deadline, the City can bid with an added alternate and can pave. It is covered now. Councilwoman O'Reilly. I would speak against. Halls have had ample opportunity to pave. We are just delaying. Councilman McComsey. We cannot get done any faster either way. I do not want to get into the lot business. Why don't we try to get money from him. We cannot pave till July 1 anyway. Councilman Smalley. Are we going to get special date prior to paving date on confession of judgement? Atty. Rogers. A confession of judgement is effective immediately. I will give him 10 days to reply. President Pro-Tempore Monfor._ The motion says Atty. Rogers can go to Halls and say we will give him a number of days to get it paved and sign a confession of judgement. If he does not pave by July 1, the City will proceed. The road will be done in July. If he does not sign, Atty. Rogers will file suit. Councilwoman O'Reilly. If he signs it and says it will be paved by June 30, does the City have enough time to pave in August? Public Works Director Kornelis. yes, we will know by June 30 and will do drawings. It will be bid in late July. I would rather not attach to another project. Councilwoman Swarner. How long does it take to engineer? Public Works Director Kornelis. This is done. Councilwoman Swarner. Is it a good job? Public Works Director Kornelis. It will have to be reviewed and there may have to be some changes. f. Ron Hansen, Susieana, Kenai. By July 1, any bad curbing and surface will be repaired and paving will be done? City Manager Brighton. That is incorrect - not by July 1. Mr. Hansen. In the a KENAI.CITY COUNCIL APRIL 5, 1989 PAGE 7 I[] VOTE: summer? President Pro-Tempore Monfor. That is better - Summer of 1989. Mr. Hansen. Even if Halls back out, every bad.curb will be corrected? Public Works Director Kornelis. We will be maintaining, so it will have to be right. Notion passed unanimously by roll call vote. C. PUBLIC HEARINGS C-1 Ord. 1308-89 - Increas Rev./Appns - Airport Drainage Study/Safety Capital Project Fund - $560,792 NOTION: Councilman McComsey moved, seconded by Councilwoman O'Reilly, to adopt the ordinance. There was no public comment. Notion passed unanimously by roll call vote. C-1a Res. 89-24 - Award Contact - Comprehensive Drainage Plan, Airport - Wince, Corthell, Bryson - $56,792 NOTION: Councilwoman O'Reilly moved, seconded by Councie lwoman Swarner, to adopt the resolution. There was no public comment. Motion passed by unanimous consent. C-2 Ord. 1311-89 - Increas Rev/Appns - sr. Citizens Mini -Van - $16,896.17 NOTION: Councilwoman Swarner moved, seconded by Councilman Smalley, to adopt the ordinance. There was no public comment. Councilman Smalley. The resolution (89-20) was delayed from the last meeting? Answer - yes. Councilman Smalley. Why was it postponed? President Pro-Tempore Monfor. It was put on the agenda in error. Notion passed unanimously by roll call vote. C-3 Res. 89-20 —Award Bid - Sr. Citizens Mini -van - Craycroft Chrysler -Plymouth -Dodge - $16,896.17 MOTION: Councilman Smalley moved, seconded by Councilwoman Swarner,.to adopt.the resolution. There was no public comment. Motion passed by unanimous consent. C-4 Res. 89-21 - Transfer of Funds - Communications, Dispatch - $2,500 NOTION: • RENAL CITY COUNCIL APRIL -5, 1989 PAGE 8 Councilwoman O'Reilly maved Swarner, to adopt the resolution�nded by Councilwoman There was no public comment. Councilwoman O'Reilly- Is this because of a vacancy? City Manager Brighton. A re the vacancy h overtime. Someone had qu had to cover Quit. Notion passed by unanimous consent. C-5 Res, 89_22 - Authorizing City Manager to Enter into Installation of Lighting _ $52 O�rt Runway Paving and MOTION: COunciiman MCComsey moved, seconded by Councilwoman O'Reilly, to adopt the resolution°man . There was no public COmMent. Motion passed by unanimous consent. C-6 Res. 89-23 - AuthorizingCity Grant Agreement with State _ Manager toEnter into Design Expanded Safety zones--$�775Drainage Plan and MOTION: Councilwoman O'Reilly moved, seconded by ,Councilwoman to adopt the resolution. Councilman There was no public comment. Motion passed by unanimous consent. C-7 Res. 89-25 - Transf of Funds .Price Increase - $?24 - Purchase Boom Tractor, MOTION: C-8 Councilwoman Swarner moved, seconded Smalley, to adopt the resolution. by Councilman There was no public comment. Recreation Director McGillivray noted this is a mower, not a boom tractor. boom Motion passed by unanimous consent. Res. 89-26 - Transf of Funds - Electronic Index CD- Library - News ROM Reader - $2,600 MOTION: Councilwoman Swarner moved, seconded by Councilor Smalley, to adopt the resolution. an There was no public comment. Motion passed by unanimous consent. C-9 Res. 89-27 - Transf of Funds - change Orders #3 & #4 - rminal Airport Te Renovation - $4,495 MOTION: . KENAI CITY COUNCIL APRIL 5, 1989 PAGE 9 i Councilman McComsey moved, seconded by Councilwoman. o Reilly, to adopt the resolution. There was no public comment. VOTE (Passed): Yes: McComsey, Monfor, O'Reilly, Smalley No: Swarner C-10 Res. 89-28 - Transf of Funds - Recreation, Snack Bar operating Supplies - $3,000 MOTION: Councilwoman Swarner moved, seconded by Councilman Mccomsey, to adopt the resolution. There was no public comment. Councilman McComsey. We ran out of money? City Manager Brighton. Yes, revenues from snack bar sales go back to General Fund. Notion passed by unanimous consent. D . COI+ M ssI ON/ COM MITTEL REPORTS D-1 Council on Aging Councilwoman Swarner. several senior citizens are meeting with legislators regarding Congregate Housing but there is nothing in the legislature. D-2 Airport Commission Councilwoman O'Reilly. The Commission met 3-30-89 and reviewed airport terminal leases. There were no bidders. They reviewed the gift shop first. They will review one 4-6-89 and one next week. They will have their recommendations by the April 19 meeting. D-3 Economic Development Commission None D-4 Harbor Commission None D-5 Library Commission President Pro-Tempore Monfor. The officers were elected for the 89-90 year. Kathy Heus - chairman Doug Emery - vice chairman. They will be having a�book sale April 21 & 22. D-6 Recreation Commission Recreation Director McGillivray. At the 3-28-89 meeting, they discussed a camper park lease. No action was taken, they need more information. The NRPA meeting is in Anchorage in May. Some of the commissioners want to go. It will be 4 days. All the Northwest region, Korea, Japan, New Zealand, Australia, China. I will monitor 2 sessions. The Parks Dept. would be interested in the old van from the senior citizens. City Manager Brighton. We will handle that KENAI CITY COUNCIL APRIL 5, 1989 PAGE 10 in-house. There are restrictions as to what can be done with items that are bought with Federal moneys. D-7 Planning & Zoning Commission Councilman Smalley. At the 3-22-89 meeting, the Jesse Wade agreement (Dena'Ina Pt. S/D) was discussed. They will have a work session for the Comprehensive Plan after the.4-12-89 meeting. The letter from Andy Sarisky regarding the crematorium and the guiding business at Anglers Acres were discussed. D-8 Misc. Comm/Comm a. Beautification Comm. Councilwoman Swarner. The Lawton Strip was discussed at the 3-21-89 meeting. She asked Council for approval of the plan. MOTION: Councilwoman O'Reilly moved, seconded by Councilwoman Swarner, to approve the Commission recommendation for clean up the Lawton Strip area. Motion passed by unanimous consent. b. Beautification Comm. Councilwoman Swarner. Regarding the sign letters, Gus Sherman (Sherman Signs) will come to the next meeting. c. Visitors & Convention Bd. President Pro-Tempore Monfor. There was a meeting 4-4-89. The Visitors & Convention Bd. and Council will meet 4-12-89 at 6:30 PM. They want to discuss the land trade with Jim Bookey and the Bicentennial building. D-5 (contd) Library Commission. Councilwoman Swarner. Are the volunteers being handled? (A proclamation) Answer - yes. D-8 (contd) d. The 3-18-89 meeting regarding the Seafood Industrial Park. President Pro-Tempore Monfor. It would not hurt to call our representatives in Juneau. City Manager Brighton. I have been assured by all 3 that they would not ask -to have this taken out of the Governor's budget. But someone else may. ADDED ITEM: Councilwoman O'Reilly. When is the work session and where? Council agreed to discuss this item under the Clerk's report. D-8 (contd) d. (contd) Councilman McComsey. Since there is a disparity on the $1 Million for the Seafood Industrial Park, would Council agree to put the $1 Million on the fire training ground? President Pro-Tempore Monfor. We should try to stay with the Seafood Industrial Park. E. MINUTES E-1 Regular Meeting, March 15, 1989 E-2 Teleconference, March 15, 1989 Approved by Consent Agenda. F-1 Alyeska Pipeline - Valdez Terminal Approved by Consent Agenda. F-2 AK Senate - Select Advisory Comm- on Municipal Taxation No action.taken by Council. F-3 Sen. Fischer - March 18, 1989 Meeting F-4 Seafoods front. Alaska - Thanks to Mayor F-5 Atty: Tony Smith - to Mayor Approved by Consent Agenda. G. OLD BUSINESS G-1 Jesse Wade, Dena'Ina Pt. Estates - Rescission and Release President Pro-Tempore Monfor. Did the Wades accept the offer? Finance Director Brown. I talked with Wades this date. I understood this was what he wanted and. what Council wanted. Council agreed. H. NEW BUSINESS H-1 Bills to be Paid, Bills to be Ratified MOTION: Councilwoman O'Reilly moved, seconded by Councilman Mccomsey, to approve the bills as submitted. Councilma McComsey. What are the State garnishments? City Manager Brighton. They are employee's salaries. Motion passed by unanimous consent. H-2 Requisitions Exceeding $1,000 MOTION: Councilman Smalley moved, seconded by Councilwoman Swarner, to approve the requisitions as submitted. Councilman Smalley. The boons mower is $7,675, Res. 89-25E.says $724. City Manager Brighton. Council approved Federal Revenue Sharing moneysfor Cheer. When purchased, we needed $724 because price increase. Motion passed by unanimous consent. H-3 Ord. 1312-89 - Increas Rev/Appns - Airport Runway & Taxiway C Overlay and Related Lighting Improvements - $1,666,452 H-4 Ord. 1313-89 - Increas Rev/Appns - Dock Faci01ity, anion of Parking & Staging Area - $135,0 H-5 Ord. 1314-89 - Increas Rev/Appns - Library - cancellation of Copier. Maintenance Agreement - $10,500 Approved by Consent Agenda. H-6 Disc - Lease of Dairy -Queen Facility CAI CITY COUNCIL. APRIL 5, 1989 PAGE 12 MOTION: Councilman McComsey moved, seconded by Councilwoman Swarner, to approve the lease to Pete and Valerie Ischi at the rate they have here. I Councilman Smalley. I talked to the City earlier regarding phone calls I received. I was concerned regarding equipment costs. The equipment is 10 years old, the City would like to have income on this property, I would support that. PUBLIC COMMENT: a. Mary Navarre, 600 Maple, Kenai. The cost per month on the building is $1,700. For land owners around the area, it lowers property value. We are renters, if we can get into something cheaper, and Dairy -Queen is $1,700 per month, they will move out. Our overhead at Arby's is fairly high, in order for us to survive, we have to have higher costs for food. If they move in and have only $1,700 and ours is 3 times that, they will be able to lower their food costs. Arby's, McDonald's and Little Ski No will not be competitive with them. We are a different kind of food but still are fast food. Admin. Asst. Howard. The Code provides leased property should be 6% of fair market value appraisal of real estate, building, equipment and furniture. 6% of that divided by 12 months is $1,700. They did not get equipment with $100, that was for the bid. City Manager Brighton. The City followed the Code in advertising. The property was available for anybody to bid, for any purpose. We only had one bid. Last year the Borough reduced real property values by about 22% and have reduced this year by about 10%. Arby's is stuck with a lease at the old level, but we do not have control over this. Our property value has been reduced, we followed the Code, it is fair. It was available to anybody. Councilwoman Swarner. was the building compared with any other buildings in the area? Admin. Asst. Howard. The appraiser uses comparables. City Manager Brighton. On values, not rents. Councilman Smalley. Was the 6% appraisal rate fixed years ago? Finance Director Brown. It is voted every year. Councilman Smalley. Is it possible this is too low? There have been businesses that have gone under with this. Atty. Rogers. We have been told it was too high also. Councilwoman O'Reilly. We should look at the 6%. This is not raw land, it has a building. It does not seem this is competitive. But it was done correctly. It is a bad situation but Council has no way to change. Councilwoman Swarner. It would be for 10 year lease with 5 year reappraisal? Atty. Rogers. .Yes, with option to purchase for the 1st 9 years. KENAI CITY COUNCIL APRIL 5, 1989 PAGE 13 Councilwoman Swarner. Is the Ischi lease for 10 years? Answer - yes. Councilwoman O'Reilly. (To Ishci's) Is it your intention to operate 12 months per year? Mr. Ischi. Yes, Soldotna will be also. Councilwoman Monfor. I support this. Ischi's were the only,ones to bid.. We have had this over one year under controversy. The City welcomes the sales tax. PRESIDENT PRO-TEMPORE MONFOR RESUMED THE CHAIR. VOTE: Motion passed unanimously by roll call vote. H-7 Disc - Kenai River Special Management Area Advisory Bd. Meeting - 3-23-89 City Manager Brighton. The lower 5 miles of the river was discussed. The next meeting will be Monday, 4-17-89 at 1:30 PM at the Borough building, Assembly room or Clerk's conference room. It is imperative for Council to attend. These folks are adamant about getting it under their control. Council was opposed to this lower 5 miles. We were promised at the time if the 5 miles stayed in, it would not pass. Council was afraid because of another umbrella of permitting in conunercial fishing of Kenai River. It could be impossible for them to work on the river. They are putting on pressure to get in. The Legislature has to I amend to put in the lower 5 miles of the river. President Pro-Tempore Monfor. When I was on this, they wanted it at that time and Council objected. Council should be very strong in sending opposition to the Legislature and sending letters to the current Board by City Manager Brighton that we still object. We will see that we stay in control of the river. City Manager Brighton. They have gone so far to pass an amendment regarding regulations governing the wetlands and pass an ordinance governing disposal of toxic waste. There are 14 other agencies to handle this, we do not have money, expertise or manpower for this. Barry Eldridge, Harbor Commission Chairman. The Harbor Comm, and City considers the entire river within the City as part of the Kenai harbor. We may want to go to mile 12.6. That may get their attention. It is above tide land. City Manager Brighton. We could have a letter at the work session. Council agreed to the suggestion. H-8 Consent to Assignment - Gusty S/D - Wagoner to J. Doyle Councilman McComsey. If this assignment is given, will the building stay? Jim Doyle. It will stay there. Councilman McComsey. Are the lease and taxes current? Finance Director Brown. The lease is current. MOTION: .: KENAI CITY COUNCIL APRIL 5, 1989 PAGE 14 Councilman McComsey moved, seconded by Councilwoman Swarner, to approve the transfer. Motion passed by unanimous consent. H-9 Disc - Salamatof Native Assoc. - Cultural/Recreational Project Near Elephant Lake President Pro -Tempore Monfor. They are not asking for any money. Councilman McComsey requested a resolution be prepared for the 4-19-89 meeting. Council agreed. H-10 Approval - RFP - Insurance Services for Next 3 Years MOTION: Councilwoman Swarner moved, seconded by Councilwoman O'Reilly, to continue with Walters & Olson as our insurance agents. Councilman Smalley. It was brought to my attention that evaluation was made of insurance companies by the Borough. Walters & Olson was done. Is it a public document? Finance Director Brown. I am not familiar with that. The Borough has done the same process and narrowed it to these 2. Atty. Rogers. They have had the advantage of using our work. They have not taken action. Councilman McComsey. I have been over both proposals. I cannot see where the City evaluation means much. I cannot understand the high price and clarity. Finance Director Brown. The price is the same factor as others. Clarity was the significant factor. we could not determine the fee, and other categories. Atty. Rogers.If Council wants to review, okay. If they do, we will have to bring other things forward. It will not change our recommendation. Councilman McComsey. Can we hear from the 2 representatives? Have you talked to both sides? Atty. Rogers. It would not change the opinion. Councilman Smalley. It would be nice to hear from them. It is significant that it is in excess of $40,000 difference. Finance Director Brown. $24,000 over 3 years. President Pro-Tempore Monfor. My problem was "cost plus," there was nothing in black & white. a. Kurt Olson, Walters & Olson Ins. Our fee was inclusion of all sums, not add-ons. The risk management portion has been a significant amount of time we have spent with the City. You paid $.50 on the dollar in the last 7 years. b. Steve Gregor, Last Frontier Ins. On the evaluation sheet it said we would have a problem with CIGNA. We would not have a problem with writing with them. There are quite a few companies with Walters & Olson also. Regarding the fee of Last Frontier. Approved was overlooked. The City said they can cancel in 90 days. If you don't approve it, you are protected and can cancel. A big deal has been put on nothing. An example of expense is the rash of claims in workmen's compensation, costs will go up. If the City approves, they can have seminars to cut costs. You will deal directly with Last Frontier. Our quality was listed as not as high. We could put A+ companies in. We were trying to be realistic and get the best for the job. We do not have lower quality companies than Walters & Olson. We have 13 employees locally, a lower fee. I don't know what else we can offer. Councilman McComsey. I.will abstain. Steve is a very good friend of mine. I don't feel I should be voting on this. I believe $8,000 per year is worth mentioning. Atty. Rogers. If you abstain, YOU should not address the issue. VOTE: Motion passed by roll call vote, with Councilman McComsey abstaining. H-11 Approval - Change Order #3 - Airport Terminal Renovation - G&S Cons. - $1,543 Public Works Director Rornelis reviewed the change order. a) Elevator. Arch. Gintoli designed it. The company said one thing, he designed and bid. The contractor says we need another 14 in. b) The wall•in the gift shop. It was originally designed for 2 shops. Airport Manager Ernst recommended we remove the wall and have one shop. c) The wall is covered with sheet rock, we will have to add a shear wall. d) We do not need emergency lights. We have emergency generator. f) The panels, wires, etc. We will have a credit to offset these items. Councilman Smalley. What is a shear wall? Arch. Kluge. it is to transfer loads to footings, in case of earthquake or snow load. Councilwoman Swarner. How many change orders are we going to have? Arch. Kluge. Any time you are dealing with remodeling, especially without as-builts on the original building, you will have this. Councilwoman Swarner. Will there be any more asbestos? Arch. Kluge. I will not answer. But other than asbestos problems, we are $1,500 in change orders. Councilman McComsey. Is there bond cost on all change orders? Arch. Kluge. It is in his contract we allow a profit. The bond.is to set the amount. Public Works Director Rornelis. At the end of the project it will be adjusted. MOTION: Councilman Smalley moved, seconded by Councilwoman O'Reilly, to approve the change order in the amount of $1,543. VOTE (Passed): Yes: McComsey, Measles, Monfor, O'Reilly, Smalley No: Swarner 8-12 Approval - Change Order #4 - Airport Terminal Renovation - G&S Construction - $2,952 MOTION:. Z KENAI CITY COUNCIL APRIL 5, 1989 PAGE 16 f` a Councilman Smalley moved, seconded by Councilwoman Swarner, to approve the change order in the amount of $2,952. President Pro-Tempore Monfor. I hope we are going to get this back from the asbestos people. Public Works Director Kornelis. The asbestos people were only required to remove asbestos off the joints. Now there is no insulation on the joints. Councilwoman O'Reilly. This is not an error? Answer - right. Councilwoman Swarner. Regarding the Redoubt Plumbing bill. Is #4 covered in the estimate? When will this end? Public Works Director Kornelis. That is not part of the change order. We are replacing the boiler. He is saying he is willing to do other work. Councilman McComsey. $2,680 is the actual cost of what he will do and overhead of $300+? Public Works Director Kornelis. G&S is handling the paperwork, they will get 8%. It is part of the contract. Councilman McComsey. How do we come to $2,680? It seems to be a lot of money. Arch. Kluge. It is $348. For pipe fittings the are using fiberglass. We felt this was a fair amount. Councilman McComsey. The overhead and profit - it should say it is for G&S. Arch. Kluge. The bill is made out by G&S. Councilman Smalley. Of the $53,000 in change orders, $48,000+ was abatement. A project of that magnitude, and the age of the building, obviously it will be more. I would encourage you to support it. VOTE (Passed):. Yes: McComsey, Monfor, O'Reilly, Smalley No: Swarner President.Pro-Tempore Monfor. KCHS had a flood and pulled up tile, it was only $15,000. Public Works Director Kornelis. The work was done by them. Councilman Smalley. The airport abatement vs the Borough - you would not want to be in the airport when the work was done. H-14 Disc. - Kenai Peninsula Caucus Meeting - 3-17-89 Councilman McComsey explained he was not able to go to the meeting and thought it should be in the packet for information. H-15 Games of Chance & Skill - Peninsula Extension Homemakers Council Council had no objection to the application. I. ADMINISTRATION REPORTS I-1 Mayor C1erk.Ruotsala noted the letter to Valdez Mayor Devens (regarding the oil spill) was distributed this date. I-2 City Manager City Manager Brighton spoke. a. He distributed the Governor's budget as of April 4, and the Legislative budget. It is about the same. The Legislature wants to cut Municipal e KENAI CITY COUNCIL APRIL 5, 1989 PAGE 17 • 0 Assistance & Revenue Sharing 200, the Governor wants to cut about 10%. This is the first challenge from one branch of government to another. There will be a capital budget of about $100 Million, but over $60 Million will be dedicated to matching of Federal moneys. There will be $40 Million left for the entire State. I am concerned both sides will cut to spite each other. We happen to be in the middle. I would say Municipal Assistance & Revenue Sharing will be cut 10 a . b. At the City Manager's meeting, it was discussed there are cities in terrible shape. Fairbanks is in bad shape, they are borrowing at 9%. In 1986 they had 400 employees, now they have 190. No 24 hour ambulance service, no ladder truck for large buildings. They had $20 Million in General Fund surplus 5 years ago. They said the City should not be in the business of banking and holding tax payers' money. They reduced the tax rate to the point where $4 Million had to be used to fund the operating budget. Now the fund is gone. They have turned down sales tax on 3-4 votes. Anchorage is approaching the same situation. If they cut 10%-20% Municipal Assistance & Revenue Sharing there will be cuts. The Federal Govt. is cutting mass transit, that is how Anchorage is paying for them. High government is cutting and forcing lower governments to'pay and raise taxes. Anchorage and Fairbanks are contemplating shutting off every otter street light because they cannot afford them. Councilwoman Swarner. They are city owned utilities. I-3. Attorney Atty. Rogers spoke. a. Item F-5 (Atty. Tony Smith Letter). There will be more letters such as this. b. Item I-3 (Patel vs City of Kenai). The Patel case has gone away. C. Item Info 15. We will have more fund transfers for legal advertisements. We are getting more than expected. d. I was contacted, we have litigation with Ken Cole. He has proposed a settlement. I said we do not accept settlements, with Council agreement. e. I attended AML Legislative Committee meeting. The next meeting is 4-16-89. I disagree on the 10% cut (Municipal Assistance & Revenue Sharing). f. Item F-1 (Alyeska Pipeline - Valdez Terminal) is worth reading. g. Councilman McComsey. How are we on the airport lands condemnation? Atty. Rogers. Nothing, it is in the hearing state. Councilman McComsey. How long does it usually take? Atty. Rogers replied 2-5 years. h. Councilman McComsey. Do we have any other cases? Atty. Rogers replied yes. Councilman McComsey. Any movement? Atty. Rogers reviewed the cases. i KENAI CITY COUNCIL APRIL S. 1989 PAGE 18 • i. Councilwoman Swarner. Is the Kenai Korners bldg. being condemned? Atty. Rogers. It will be destroyed. We have sent out notes. We will have to spend money an it. Councilman McComsey. is the City going to be in the same process with the Harborview? Answer - yes. I-4 City Clerk Clerk Ruotsala spoke. a. She noted the House Bill on combining election dates for municipalities and State elections. b. There is information on liquor licenses in the Iac et (I-4, Rainbow; I-4, The Rig; Info-13, Merit C. There are reports on the Clerks Seminar in the Packet (I-4) from Planning Secy Loper and Clerk Ruotsala. It was a very successful seminar. d. The Community Development Forum (Info-8) sent booklets regarding their programs. The booklets are in the Clerk's office for those interested. e. Conflict of Interest forms are due in the Clerk's office by April 14. f. The mayor has asked to change the work session and Council meeting dates per memo distributed this date. MOTION: Councilwoman Swarner moved, seconded by councilman McComsey, to meet for the 4-12-89 work session at 6:30 PM in the Library, no food, and end at 10:00 PM. Motion passed by unanimous consent. MOTION: Councilwoman Swarner moved, seconded by Councilman Smalley, to meet for the 4-19-89 teleconference at 6:30 PM and have no food. council agreed to have the pull tabs and airport discussions at the 4-19-89 meeting. Presideleases Pro-Tempore Monfor requested the teleconference be completed by 7:00 PM, so the public does not have to wait. = Motion.Passed by unanimous consent. _- I-5 E`inance Director None - I-6 Public Works Director Public Works Director Kornelis spoke. a. Regarding Liability Ins. of Wm. Nelson, Engr. (Info-20) He has requested his liability insurance be lowered. Councilman McComsey. If we drop the liability and he does not have the float Plane 0basin finished, will that put us in the 00 limit. Answer - yes. Councilman KENAI CITY COUNCIL APRIL 5, 1989 PAGE 19 F� • i MOTION: VOTE: McComsey. How much more is there to do? Public Works Director Kornelis. About $87,000 of construction. We are designing 15 more slips. Councilman McComsey. Maybe he should keep it till May. Public Works Director Kornelis. The premiums are coming due. He will not need next year. He is trying to reduce to a minimum amount. Councilman Smalley. "The risk to the City is minimal." That scares me. Atty. Rogers. Arch. Gintoli wanted to drop his insurance, Council said okay. Design liability is included in there. That is not just during construction. When projects are done, usually insurance lapses. We could go back personally to design professional ins. but it would be hard to get. Councilman Smalley. If there is a problem, how expensive could it be? Atty. Rogers. It would be design liability, it will be big problem and be down the road after it is complete. Public Works Director Rornelis. The boating facility is done. The float plane basin has no building. E&O is more important on structures than float plane basin strips. I would say risk is minimal. Airport Manager Ernst. I agree. There is not that much left in the project. Councilman McComsey. In my job, if we don't have insurance, we don't work. I hate to see him without insurance. President Pro-Tempore Monfor. This is compatible with what we have done in the past. Councilwoman O'Reilly. I don't have a problem with this because of the facility. But I have a problem with setting a precedent. Councilwoman Swarner. I would like to delay till 4-19-89 meeting. Public Works Director Rornelis. I don't know when the premium is due. He will not have work in the area next year, he does not want to carry insurance. The 2 items he is doing are extensions that are not part of his original proposal. Councilwoman Swarner moved, seconded by Councilman Smalley, to put this item on the agenda for the 4-19-89 meeting. Councilman Smalley. This may not be a problem, but if someone goes into business with the City, they should not come back towards the end of the project and ask for this. Public Works Director Rornelis. Arch. Gintoli did this. City Manager Brighton. He dropped from $1 Million to $500,000, then to nothing. Councilman Smalley. Since the City asked for an extension, could the City put it on theirs? Atty. Rogers. Arch. Gintoli's request came from himself. Public Works Director is speaking for Mr. Nelson. Motion passed by unanimous consent. Councilman Smalley suggested Mr. Nelson come to the 4-19-89 meeting. RENAI CITY COUNCIL APRIL 5, 1989 PAGE 20 b. Item Info-11 per request I-7 Airport Manager None (Street Sweeping by State) was sent of Council. I-6 (contd) Councilman McComsey. Did the City pay for the extension (float plane basin slips)? Public Works Director Kornelis - yes. ADDED ITEM: Councilwoman Swarner. Did the City accept O'Brien Ct. even though it was not up to standard? Public Works Director Kornelis. I believe so. There are drainage problems there. I will check into it. Councilwoman Swarner. If it is accepted, why are Halls doing things with it? Public Works Director Kornelis. I do not know. Councilwoman Swarner. It was by the parking lot. J.. DISCUSSION J-1 Citizens None J-2 Council a. Councilman McComsey. Who is the Alaska Coalition to Prevent Shoplifting? (Item Info-18) We have no ordinance regarding this. This is just a gesture. City Manager Brighton. I think Council will have to address this. We have a direct interest in one pull tab operation with the Senior Center. If you have 5-6 in the City, it will delete that. Council may want to adopt an ordinance. b. Councilwoman Swarner. There was a meeting regarding the Extension Service plant test site by the airport. Are there any questions regarding this? No action by Council. C. Councilwoman O'Reilly. I agree with Atty. Rogers on the comments on the Valdez terminal. (Item F-1) d. Councilman Smalley. The 2 mooring buoys at the Salamatof cannery were discussed at the Borough meeting. There have been as many boats as 7,%it is leased for 3. The City should take a look at this. The Kasilof River study was done for free by the Borough, the Kenai River should be done. e. Councilman Smalley. There should be applause for the City Clerk for the technical class she helped teach. f. President Pro-Tempore Monfor. I have received 3 phone calls regarding Spur Rd. across from the mortuary, the trailer and school bus. Could Building Inspector Hackney check into this? g. President Pro-Tempore Monfor. I ask for Council support regarding the KCHS athletic stadium, they need new bleachers, they are 20+ years old. It is 1 8 s KENAI CITY COUNCIL APRIL 5, 1989 PAGE 21 a safety hazard. The Borough has funds from the old KCHS stage. They have been bottlenecked at the Assembly, it is a political thing. They cannot be used for administration. We could have a resolution for the Assembly. The bleachers concession stand, toilet facilities need work. Councilman Smalley. We are not talking dollars from the School District, but Borough dollars. The public has not been informed correctly. Councilwoman O'Reilly. It should be- an educational process, it was describid as a "clubhouse." MOTION: Councilwoman Swarner moved, seconded by Councilman MCComsey, that a resolution be prepared by Administration in support of the stadium. Motion passed by unanimous consent. Councilman Smalley. I have seen 3 people go through this. h. President Pro-Tempore Monfor. I have had requests from people on Camai Circle (Lantern Way),off Candlelight. They would like to have it paved. I would like the cost. There are about 7 houses. It would be for the 100% assessment rate, they know they are to pay 100%. Also, who changed the name? They are angry about this. Public Works Director Kornelis. I will check on this. President Pro-Tempore Monfor. They thought it was not being paved because it was not up to standard. Public Works Director Kornelis. They should come into Public Works and talk with us. City Manager Brighton. We will get an estimate. i. City Manager Brighton. Will the Harbor Comm. members come to the Kenai River meeting?. Harbor Comm. Chairman Eldridge. I will check. Ron Rainey will come, there may be others. K. ADJOURNMENT Meeting adjourned at 10:30 PM. a, City Clerk Janet Ruotsala KENAI CITY COUNCIL PARTIAL VERBATIM FOR ITEM H-10 APRIL 5, 1989 PRESIDENT PROTEMPORE CHRIS MONFOR PRESIDING H-10 APPROVAL - RFP - Insurance Services for Next 3 years. President Protempore Monfor: We have the approval of the RFP for insurance services for the next three years, and earlier in the evening I thought perhaps we would be discussing this tonight because there was nobody here but now both sides are here. So what's the pleasure of the Council. Would you like to discuss this tonight or would you like to wait until it's a full Council .... whatever. Councilwoman O'Reilly: We should discuss it tonight. President Protempore Monfor: Okay. I think we should .... Councilwoman Swarner: let Charlie talk to this. Do you want to talk to this? City Manager Brighton: No, I don't want to talk at all. You've got administration's recommendation unless you have some questions from us, there isn't any reason for us to say any more. If there are things in here that the Council needs to ask the two potential providers, then that's what probably would be appropriate. President Protempore Monfor: What's the pleasure of the Council? City Manager Brighton: (inaudible) Councilman Smalley: We never have before. City Manager Brighton: I know. Well, you've never had this item. (inaudible) Councilwoman Swarner: Well, I would move to continue with Walters and Olson as our insurance agent. Councilwoman O'Reilly: Second. President Protempore Monfor: Is there any comment from Council? Councilman Smalley. Councilman Smalley: I have a question. Ah, it's been brought to my attention that there's been an evaluation done of insurance companies and that there was .. an evaluation and summary of Walters and Olson. Is this a public document at this point in time or is it still ... City Attorney Rogers: Deferred material. Finance Director Brown: What evaluation are you referring to. C� it KENAI CITY COUNCIL PARTIAL VERBATIM OF ITEM H-10 PAGE 2 What, that administration ....? Councilman Smalley: I think it was one that was done by Peral (inaudible - phonics translation). Finance Director Brown: I'm not familiar with that evaluation. The Borough has formed the same process, send out RFP's. I think they've pretty much narrowed their field to the same two firms. But I've not seen those proposals, not seen their evaluations, that's their business. City Attorney Rogers: They're going through the same process that we're going through. They've had the advantage of some of our work. We haven't had the advantage of some of their work. And they've not taken action. President Protempore Monfor: Councilman McComsey. Councilman McComsey: I'd like to ah, I've been over both proposals and I really can't see where this ah, City Administration's evaluation is, to be honest, means very much. I can't understand why price is only 12% of this item. And clarity is 10% or 12% also. I don't that hardly has anything to do with ah, making up an insurance proposal. And overall rating, what's overall rating mean? That gets 12% and that's, I don't even know what its about. President Protempore Monfor: Charlie, I guess you'd better answer those. Councilman McComsey: Price doesn't seem to be entering into it is what I'm saying. (Loud coughing is obscuring much of the verbiage) Finance Director Brown: Price is a factor given the same weight as other consideration. Ah, ... Councilman McComsey: Clarity means .... Finance Director Brown: Clarity turned out to be a significant factor to all of us. What the fee was, (several voices overlapping, much of verbiage inaudible). .... said the fee, called it a flat fee and that included an amount plus some other expense and wasn't identified (inaudible) ... clarity of it did make a difference. City Attorney Rogers: Not, not just in that category as well. Finance Director Brown: That's right. City Attorney Rogers: There were some other ah, other, aspects of the proposals that clarity entered into. (Loud coughing) Especially trying to decipher as to one of the proposals which of . 0 ♦ Y KENAI CITY COUNCIL • PARTIAL VERBATIM OF ITEM H-10 PAGE 2 the two firms within that one proposal would be doing what. In this instance we were left with a number of questions. We had, Council wants to review those proposals, that's certainly their prerogative, drew up what we considered to be an appropriate criteria, appropriate waiting, but that's just the way we did it. Council may decide to do it some other way, and that's certainly their prerogative, if they get into that, we would probably presenting Council .... some other things, perhaps (inaudible) brought to bear since then that doesn't really change our recommendation. It may have a bearing. Councilman McComsey: Maybe we ought to look at all of it then. Do you have .... City Attorney Rogers: That's up to you. Now, not that it would change our recommendation. Councilman McComsey: If we change ours could we hear from that, from the two .... City Attorney Rogers: I really don't think ... Councilman McComsey: ....questions that you guys asked. You have talked to both sides or are you just .... City Attorney Rogers: I don't think it would change, I'm convinced it wouldn't change the Council's opinion but the weight, I think that the weight ... if anything would be stronger .. ah ... then it presently is. President Protempore Monfor.: What would the Council like to do. Are are you ready tonight to make a determination one way or the other, do you want to hear from the two representatives, one from each agency ....? Councilman Smalley. Councilman Smalley: Yea, I think it might be nice to hear from them since they are here. One thing that I see that is significant is that the $40,000 in access of $40,000 difference. Now that's, am I reading it wrong? Finance Director Brown: I think so. Councilman McComsey: $44,000. Finance Director Brown: $24,000 over three years. Councilman Smalley: Okay, I have, it's still significant though. I mean... President Protempore Monfor: I think that my biggest problem that I had with Last Frontier was cost plus with nothing saying what the plus was. Makes you real nervous when there's nothing down in black and white because, plus can be just about anything. KENAI CITY. COUNCIL • PARTIAL VERBATIM OF ITEM H,-10 PAGE 4 Kurt Olson: I can address the difference between Walters and Olson .. (partially inaudible) President Protempore Monfor: Why don't, why don't you each take at least three minutes, up to five. Kurt Olson: My name is Kurt Olson from Walters and Olson. Ah, our fee was inclusive of first management services and all expenses, it was one lump sum, we were, our fee requested that we address it in that manner. Ah, there were no add-ons, ah, there won't be anything presented at a later date. Ah, the risk management portion has, ah, been a significant, ah, amount of time that we've spent on the City of Kenai for the last seven years. And I think the low frequency of claims, low sparity (sic - phonic spelling of inaudible word) of claims, the ah, $250,000 you got back on your Workers Compensation policy alone during the last seven years speaks for that ah, speaks for that ability. You paid about $.50 on the dollar across the last seven years for your Workers Comp. President Protempore Monfor: Are there any questions from Mr. Olson? Thank you. Steve Gregor: I'd like to address a couple of points, or ... President Protempore Monfor: Sure, it's your turn. Steve Gregor: Thank you. I'd like to hand out a letter .... President Protempore Monfor: Would you state your name for the record and then ... Steve Gregor: Yea, I'm Steve Gregor I'm a broker with Last Frontier Insurance, 10453 Spur Highway in Kenai. Ah, on the evaluation sheet it was noted that we would have a problem running with CIGNA who is the current major company writing the City's insurance right now. I've given you a copy of two letters I received regarding our relationship with CIGNA and as you can see I don't think we'd have a problem writing the City's insurance with them. Brokerage agreements are common, and if you look at Walters and Olson'.s proposal there's quite a few companies that they have to use to access other companies. So brokerage agreements you know, they're not a big deal,. I think that point is, is accelerated a little more than it should be. Secondly the fee that Last Frontier quoted, I think, the one thing that's overlooked is approved is underlined and capitalized and there's been a lot of questions as exactly what this means. I think the emphasis has to be put on approved. The City itself said that they can cancel our agreement within 90 days if they do so, if they wish. If you don't think that one of our requests for approved expense, or you don't approve it, and we say we'd like to have it, then you protect yourself. Cancel us. I mean, I just think a big deal has been put on nothing. ` 1 KENAI CITY COUNCIL - PARTIAL VERBATIM OF ITEM H-10 PAGE 5 An example of an expense that might occur, and I'm not saying it would but, let's assume.that there was a rash of claims on the Workers Compensation policy. ON your current retro plait your. premium might go from $70,000 to $140,O00. Now what are you going to do to correct that. It's possible that if the City approves it you'd want to hire professional loss control people to come in and get seminars. To cut down claims. I have to stress ithas to be approved by the City. We only included those prices to get the City an idea of what it might cost to use additional professionals. We're not trying to hide unknown costs. Third point, I'd like to guarantee that whatever company the City is placed with, they would deal directly with Last Frontier. There seems to be a notion in the evaluation that, you'd have to call Anchorage for something which is totally false. And, another point made was that our company's qualities were not as high. Well, we could have put all A plus twelve companies in all those spots. With no problem. We're just trying to be realistic in our companies and trying to put the best ones.for the job. And I don't think it's realistic to say that Last Frontier and Bally, Martin and Fay in a joint venture have.lower quality companies than Walters and Olson. And finally I guess, we offer local representation 13 employees. :.r We are the power of a national brokerage firm for leverage, and we have a lower fee. I don't know what else we can offer. President Protempore Monfor: Thank you. Does anybody have any questions? (inaudible) We'll bring it back to Council for discussion. We have a motion before us to accept the RFP from Walters and Olson. Councilman McComsey. Councilman McComsey: I'm going to ah, abstain from voting for the simple reason that Steve is a very good friend of mine and as (inaudible) would depend upon my softball team and I don't feel that I should be voting on this for his firm. I do believe that $8,000 a year is worth mentioning and .... President Protempore Monfor: Thank you. City Attorney Rogers: If you, if you abstain Councilman you shouldn't addre3s the issue either. Councilman McComsey: Okay. President Protempore Monfor: Is Council ready to take the vote? Councilwoman Swarner: Ask for unanimous consent. Councilman Smalley: Can't with one abstaining. Councilwoman Swarner: Oh. KENAI CITY COUNCIL PARTIAL VERBATIM OF ITEM H-10 PAGE 6 President Protempore Monfor: Ask Clerk to call the roll. City Clerk Ruotsala called the roll. All Council members voted yes with Councilman McComsey abstaining. President Protempore Monfor: I thank both of you gentlemen for coming and staying. Time for the change orders. Janet A. Loper Transcribing Secretary 0