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Home My WebLink About1979-06-26 Harbor Commission Summary~Q,~ ..J ~' ~ ~~' R MEETING KENAI ~ARBQR COMMTSSION 7:04 PM KFNAI PU6LIC SAFETY 6UILDING TUESDAY, JUNE 26, 1919 CHAIRMAN PR4 TEMPORE 60B PETERKIN PRESIDING AGENDA Oath of Off i ce A ROLL CAIi. 1 Agenda approval 6 MINUTES ~ 1 Mi nutes of regul ar meeti ng June 12, 1979 C OLO BUSINESS 1 Option to lease for Kenai Harbor Deve~opment D NEti' 6US I NESS ~ E1 ect i on o~ cha ~ rman-~ 2 Presentation of Tideiands ~rdinance , , .. r" i .. ~~ ~ t~ ~ . ~ :..: ', ~,,' ;~~; . :~ ~ ~7 , h .1 t SPECIAL MEETIN~ KENAI HARBOR C~MM ~~SS I~QN 7:00 PM KENAI PUBLIC SAFETY BUILDTNG TUESDAY, JUNE 26, 1979 CHAIRMAN PRO TEMPORE BOB ~ETERKIN ~'RESIDING ~ATH OF Q~FICE A ROLL CA~LL Present Chester Cone~ ~ohn W~illiams, Robe~rt Pete~~~in, Bo~ Tepp, Tom Wagoner and Ex Off~cio N1em6er, Co~anc~lr~or~an Betty ~1 ick Absent Tvm Ackerly ~nd Ex O~Ff i~i. ~ Mem~er, N~~~or UTnce 0' Rei l ly 1 A~enda Appr~yal The Agenda was app~ro~ed as w~^i tten. 6 N~ I NUTES 1 Commi ss i~ner Chester C~ne as ked the f~11 o~ri ng co~r~^ecti Qns be made t~ the mi nutes of the June 12, 197~ meeti~ng : T~e spel 1 i ng o$ ~Mr ~-reck's name on page 8; the co~^~recti on of Joe ~reebroc~C "~ s name ~-r~m J Tm ~reebrock , on. .~~~~ f our ~ the notati~on tlhat the City Mana~er, when ~sked ~y Co~mTSSioner Williams had not wri tten the 1 ette~^ to the ~LM/Secreta~ry~ of the Interi or reQa~rdi ng remo~al of ~estri cti ons from T~ract A. C OLD BUS~NESS 1 The Ci~ty Atto~^ney~, Ernest Schl e~eth, c~mmented on the T~^act D~pti on for KHD anc~ handed out c~pies o~ it, w~~~c~ is~ attached to the minutes as Exhibit A. City Attorney Sc~lereth st~tea.th~t the option ~ras di~ficult to write in such a way as to p~^otect the C~ ty~ an~ Kenai~ k~ar~or pevel opr~ent. The Ci ty Attorne~~ a~ded that he had made tr~o tri~ps to Anchorage to confer avith Mr ~reck and had revised the opti~n accordingly Yn the Ynte~rest of both parties after each meeti ng. ~ne pr~~l em wi~th the ~pti~~an ~ s the val ue of these more than 60 acres o~` ~ ana w~~~ch i s the ~ ast eas ~~~~-~aev~1 oped , i f not the ~~~~t of the develQpable, t~de~~~n~s~ t~e ~pt~~on must emp~as~ze that KND must ~e consi stently wor~ci~ng Qn the de~~el opment of the 1 ands. The Ci~ty must b.e abl e to pu11 out o~ the ag~ree~ent at the end o~ Ane year ~~~ t~e condi ti ons ~-~ the opt~ on a~^e n~t ~et a KHD w~~shes to ha~re an oati on ~~~nd~~ng en~ugh to ~ enab1 e them t~o Q~tai~n ~~nanci ng pn the 1 and, The ~pti on i s~uery conse~rvati vely w~ri tten, t~a ki ng i nt~ cons i de~~ati~on ~s many~ o~F t~e conti ngenci es ~s ~oss i~ bl e ~ and hel p i ng K~D . ~~ Commi ssi ~ner W~~11 i ams asked th~~^ee ~Uesti~c~ns a~~ut the cont~ract t A~. pa~ragraph f our ~n p~ae s i x dea1 s wi th ri ghts o~ p~re~e~~^ence ana Cor~mi ss i one~ Wi 11 ~ ams asked the City ~ttorney to please exp1ai~~n t~ese ri~~hts. Ci ty Atto~^ney~ Schl ereth ~rep1 i~ed that t~e p~^e~e~re~nce ri g~ts co~rer cl ~~r~s that might ha~~re o~i~g~nated gene~^ally~ ~rom 1~57 to 196Q; there ~s a two year expiration date for the~e cla~r~s that w~11 end tw~ yea~^s afte~^ the adoption of the Tidelan~s Ordi nance t~~t wi 11 be cons ~ dered 1 ate~^ by~ the Ha~bo~^ Comr~~ ss~ ~n ~ The Ci ty Attorney ~dded that he ~e1t this was mo~re of a p~^ec~utiona~ry note s~nce the City daes not h~ve a T~de~ a~nds 0~^di nance ~ n e~~ect n~owt ~.. KENA I HARBOR COP~1M I SS I ON SPECIAL MEETING JUNE 26, 1979 Page 2 B} Page seven states that the opt~on~will nvt be recorded. Commiss~~oner Williams asked if this were a standard procedure. The City Attorney replied that r~ost land cont~racts are ~ecorded, but he does not want anything to ~e~^haps cloud the tit1e of the land shou1d the opt~on to le~se not be exercised, C) Fina1ly, Commissic~ner Williams noted that the signature on the contract was that of R L Roper a1one, not the Kenai Harbor De~vel~pment Corporation~ The exact legal relationship of Kenai Harbor Development and R L Roper is unknown to the City or the City Attorney at this point since ~he City has receiued no assignment of lease or lease ap~plication interest from Mr Roper to Kenai Harbor Development; therefore, the application is written in this r~anner. T~e City Council must an~r~ue.a11 ~ssignments except those for co1later~l, ~pproval power ~f which was gi ven to the Ci ty Manager by the Counci ~~ r~oreo~~r' C~~~!~o~f i_~~s have not recei ~ed the assignment~f4~^m fr~Q~m KHD far submission to City Council, the City Attorney responded. Commissioner Tepp called attention ta the fact that Mr Roper wou1d agree t~ give up Tracts B and C if the option is not r~et on Tract D and questioned when this would be done. The City Attorney answered that this wou1d be at the end of the 12 month period. Chairman Pro Tempore Peterkin noted that R1r Roper would be giving up all of his rights to these lands to Kenai Harbor Development and Mr Roper stated that he already had sic~ned over his rights to the land to the Corporation to begin with~the assignment of interest will be submitted to the City Offices/and Council. Commissioner Cone questioned var~ous parts of the lease option also such as the inability of the Kenai Harbor Development to assign the option to another, but most specifically the Preference Rights Clauses.and legal problems that might result. From the ensuing discussion, City Attorney Schlereth stated that another class of Preference Rights did exist, Preference Rights I which gives the rights to the ground to anyone who deve]oped the tide or submerged lands prior to Statehood, September 7, 1957. This a1so grants the persons or their successors the interest. Again, there is a two-year period for filing, after which the cl~imants cannot press their c]aims, but the two-year period for filing would not beg~n until the enactment of the Tidelands Ordinance. Although City Attorney Schlereth did not feel that any claims would be likely to be forthcoming, exceptin~ perhaps that of Ruby and Waldo Coyle.~ Commissioner Cone, however, upon inquiry by the Commission members, stated that he had heard of developments an this land prior to statehood such as a saltry. The ramifications of these PreferenCe Riqhts~were discussed at length. Mr Breck noted that no lender would look at loaning money on land wherein someone could watch the development of the land for two ,years and then pass~bly file for Preference Rights near the end of the two year time period. Chairman Pro Tempore Peterkin wondered if the City would not be vulnerable to a lawsuit if the land were leased and then at some later point in time the Preference Rights were filed on by someone else. City Attorney Schlereth stated that ~+as the contingency that he was trying to avoid. w ~ ` KENAI HARBOR COMMISSI~N SPECIAL MEETING~ JUN~ 26~ 1~79 Page 3 The City Attorney did a]sa amplify ~he classes of ~~~~e~ence Ri~l~ts; the~^e is a third sort o~'~^ight, but this in~olues establis~ment ~~ w~at t~e St~te ca1led ~ a Di rector's Li ne. ~, As we did not haue t~ h~ue vne est~bl ~ shed ~e~^e, tMi s'- was ommitted from our Tide1~nds Ordinance dr~ft. ~ ~1r Breck, s~eaki ng as the ~i nanc~ al Ad~ri~s~pr to the K~#D ~~utl i ned h~ s~uesti on~ and objections conce~rning the lease option; One ob j ect i on w~s t~ speci f i ca 11 y menti on i n~ ~11 ~f the bu i 1 d i n~s that appea~^ on the prel imi na~ry d~~wi n~~ for t~~ devel opment of ti~e are~. These drawi ngs ar~e preliminarya Mr Breck st~ted, ~nd the lease opt~on sho~ald not ~e tied intp them. N~r Breck wou 1 d 1 i ke to h~ue t~he 1 ease opt~ ~n cpnta ~ n the poss ~ bi l i ty o~ a~s i gnment to another. If the Preference Rights cl~uses c~nnot be deleted tpta1ly, M~^ B~^eck would 1ike t~em to be kept ~s ~ague as~ p~s~i~1e, Furthe~^~ the review of the ~use charges b~ th_e Ci ty~ are not i r~ the ~est i nterests of obtai ning a 1 oan or r~nni na ~ priyate corppr~tion. M~ Breck wou1d prefe~^ that th~s clau~e would be kept tc~ s~meth~ ~g 1 i ke t~e ~CHD" s noti ~i cati on of the us~ ch~~~ges to the Ci t~r. ~Ir Breck al s~ objects to the 1 angua~e of tl~e 1 ease fAr ~ract C whi cl~ s~ys that KHD, o~^ i~r Roper, wi 11 p~y ~~~ the deve1 pp~ent af the tr~act of 1 and a the Ci ty h~s i t~11 appr~ i sed, and then KHD ~~ 1~ pa~y a 1 ease ~ate ti~at i nc1 udes these improvements~. This does not seem fair to Mr Breck. Mr Breck ~ls~ objects to not reco~rdin~ the 1e~se d~cument and he would a1s~ prefe~^ the opti.on to st~te th~t it wi~ll run out in ~2 mont~s unless the Harbor Commision/Counci ~ takes f u~^the~ action. Fin~11y, Mr Breck o~jects to having to pay ~or the surveyi ng costs fo~^ the Tract D 1 ands whi ch ~ui 11 run around $2,O~JO to $2,500. Althou~.h he wi~l1 not pursue this ~bjection, Mr B~^eck feels the City h~s so much tt~ gain fr~m the increased tax base that the de~elop~ent wi 11 offer, t~~it the sur~ve,y sh~ul d be born by #~he~;~~i ~~ ~~~~ ~~~s ~ dor~~; ~~:n~ at~er , cases . Chairman Pro Tempore Peterkin ~sked that the City Att~rney and rY1r Breck confe~^. puer the next cou le ~f weeks ~n~ t~ry to iron out these last problems to the option. ~ Commissioner Williams ~sked if M~^ Breck wou1d share with the Commission h~s stu~~r of the Prefe~^ence R~ght~ prpbl em ~~ ~ f an,~ h~ve ~een f i 1 ed and what was the resul t of that f iling~ Mr Br~eck st~ted t~iat he ~wou1d be happ~ to share this information w~ th the Commi~ i,~m as he ~t~~rd~i ~d ;~he ~~ef erence ~i ghts ,-~i 1~,ng~ ~~y~ the~ ~nd sQ ~n. 9 NE~I BUSINESS , 1 Election o~ a permanent CommissiQn Chairman ~OTION Commi ss ~ oner W~ l l i ams r~Qved, seconded ~,y CQmmi ss ~~ner::: Cone to tabl e the e1 ecti on of a pe~^manent C~ai ~^m~n u~nt~ 1 the July 1O.th meet~ ng ~ Tl~e mot~ on was unanimous1y approved by a r~ll ca11 ~ote. 2 The City Att~rney presented the Tide1ands Qrdinance to the Ha~rbor Cor~~mission by the City Council and ~ave some back~~^ound o~ that ordinanceR KENAI HARB~R C4MMISSION SPECIAL MEETING JUNE 26, 1~79 Pa~e 4 In 1976 the State of A1ask~ deeded the Tidelands tv the City of Kenai and, according to Title 38,the City is required to honor Preference Right holders that would make certain claims on the lands. Tit1e 38 is very speci~ic ~nd the definiti~n of occupan~ron or before ~anu~ry 3, 1~59. The St~te 1aw require~ ordinances setting up procedures to honor~ these claims; furt~er, these rights expire two years after the passage o~ public notice that the Pre~erence Rights wou1d ~~r~i n~~e~~dn ~th~ ~~~~a~~::~:.~ Thi s structure woul d prevent us from the remote possibility of the c1aimants coming in at a 1ater date, wou1d give ample and strictly-defined public notice and wou1d c~ear any possible cloud to the tit1e of the Ti de1 ands . The Tidel~nds Ordinance was held up so long because of an attempt to include the set-net fisheries as part o~F the Tidelands, but this is a controversial subject and ~~.e.~i ~~~t~yh~a:s f i nal ly c~pted to i ncl ude the set~net fi sheri es separately i n order to enact the Tidela~nds Ordinance as quickly as possible. The set-net fisheries regu1ations wi11 be put before the Harbor Commis~ion, but it will be done separately. The State origin~lly put out t~e set-net lease~ and the City agreed to hon~r them when we accepte~ the Tidelands from the State; the leases have exp~red and we need new ones which must be considered soon, Chairman Pro Tempore Peterkin asked if the lease for the Harbor lands shou1d be included under Section 3-~ ~nd City Attorney Sch]ereth agreed that this would be a good idea. ~ MOT~QN Commissioner Williams moued, seconded by Commissioner Cane that the Kenai Harbor Commisison accept no furthe~r business unti1 such time as Ordinance 455^l8, the- Tide1ands Ordinance, has been sent to th~ Co~ncil o~ the City and approued by the Council of the City ~f KenaiR Di scuss i on fo11 owed such that Cc~mmi ss i oner~ W~ 11 i ams fe1 t that the I~arbor Commi ss i on could deal with nothing adeguately unti1 it had settled the Tlde1and~ ~rdinance and put the time 1 imi t~c~r the Preference Ri ghts i n effect. T1~~ s acti on should clear the table and enable the Commission ta fin~sh the Tidel~nds Qrdinance rapidly. The Attorney for Kena~ H~rbor Development and the C~ty Attorney can also be working on the option ~or the Tract D lands at the same t~~me so th~t it can be rapidly dealt with and more pr~operly dea1t with vnce the Tidelands Ordinance ~s effecti~e. Passed unanim~usly by ~^0l1 ca11 vote. Counc~l~Qman Glick ~sked if per~~ps~ the Co~nmissiQn shou1d dea1 with the set netters background by obtaining the b~l~nce o~ the Tidelands ~rd~nance at f~ar s~~.d~v~. ~~:~~~~~ ~~ The secretary agreed to send this in~orm~tion vut with the m~nutes. Commissioner Wi1liams ~ls~ asked that the copies of the 1etters to the BL~1 and the Con~~^essional DelegatiQn c~ncerning releasing the City from the restrictions for the lands obtained ~rom them be ~tt~ched to the minutes along with copies of the letters to (~r Ne1son and the Roya1 Pacific Development Corporation, Commissioner Williams ~ls~ asked ~f a State Departmen~t of Lands man cou1d come to talk t~ the Cor~mission about t~e procedure~s fo~^ the Tidelands as we11 as Attorney Garnett. Councilwoman Glick stated that the dates listed ~t the bottom of the current Tidelands Ordinance would be altered to reflect the actual tir~e the Ordinance was sent back to Council and set for public hearings. KENAI HARBOR COMMISSI4N SPECIAL MEETING JUNE 26, 1979 Page 5 Chairman Pro Tempore Peterkin asked that the Administrative Assista~nt send a full copy of the Airport leases to the Harbor Commission and the City Attorney obtain a copy of the State of Alaska lease on the set net fishing plus any other appropriate leases and get it to the commissioners as soon as possible. Further, the Commissioner asked that the City Attorney start on the revised version of the Airport lease that the Harbor Commission will be considering for their information. The next meetings were set as follows: a regular meeting of the Kenai Harbor Commission wi]1 be set on July 10, 1979, Tuesday, at 7:00 PM at the Kenai Public Safety Building. A special meeting of the Kenai Harbor Commission on Ju~ly 24, 1979 Tuesday, at the Kenai Publ ic Safet~r Bui lding at 7:00 PM. Chairman Pro Tempore Peterkin also asked the Administrative Assistant to see that a letter is written to the Ken~i Harbor Development Commission to explain why they wi11 be struck from the ac~enda until the Tidelands Ordinance is passed by the Ci ty Counci 1. The Chairman Pro Tempore stated that he felt the Commission could deal adequately with the Tidelands Ordinance in three meetings and another special one woul~d be ~alled if necessary to clear the Tidelands. The meetinq was adjourned at 10:00 PM. Respectfully submitted ~ _ ~ Pink Wtipi 1 Administrative Assistant