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HomeMy WebLinkAbout2003-05-12 Harbor Commission SummaryKENAI HARBOR COMMISSION MEETING MAY 12, 2003 KENAI COUNCIL CHAMBERS 7:00 P.M. AGENDA ITEM 1: CALL TO ORDER/k ROLL CALL ITEM 2: AGENDA APPROVAL ITEM 3: APPROVAL OF MINUTES -- April 7, 2003 ITEM 4: PERSONS SCHEDULED TO BE HEARD ITEM 5: OLD BUSINESS ao Discussion -- Kenai Coastal Trail/Erosion Protection Project 1. Draft Bird and Marine Mammal Surveys 2. 4 / 14 / 03 Corps of Engineers Project Update ITEM 6' NEW BUSINESS ao b, Discussion -- Proposed Meeting Schedules for City Commissions, Committees, Boards and Council on Aging. Discussion -- City Dock Leases/R&J Seafoods Discussion-- 5/2003 Kenai Harbor Rate Schedule ITEM 7: REPORTS ao Director Dock Foreman City Council Liaison ITEM 8' COMMISSIONER COMMENTS / QUESTIONS ITEM 9' INFORMATION ao Kenai City Council Action Agendas of April 2 and 16, 2003. ITEM 10: ADJOURNMENT KENAI HARBOR COMMISSION MEETING MAY 12~ 2003 KENAI COUNCIL CHAMBERS 7:00 P.M. CHAIRMAN TOM THOMPSON~ PRESIDING MINUTES ITEM 1' CALL TO ORDER/l~ ROLL CALL Chairman Thompson called the meeting to order at 7'03 p.m. Members Present: Higley, Foster, Barrett, Spracher, Thompson, Simon (arrived at 7:06) Members Absent: Eldridge Others Present: Councilman Bookey, Director I(ornelis, Dock Foreman Freden, Contract Secretary Roper (two students from the KCHS Government Class) ITEM 2: AGENDA APPROVAL MOTION: Commissioner Spracher MOVED to approve the agenda and Commissioner Foster SECONDED the motion. There were no objections. SO ORDERED. ITEM 3' APPROVAL OF MINUTES -- April 7, 2003 MOTION: Commissioner Barrett MOVED to approve the minutes of April 7, 2003 and Commissioner Spracher SECONDED the motion. There were no objections. SO ORDERED. ITEM 4: PERSONS SCHEDULED TO BE HEARD- None ITEM 5: OLD BUSINESS 5-a-1. 5-a-2. Discussion-- Kenai Coastal Trail/Erosion Protection Project Draft Bird and Marine Mammal Surveys 4/14/03 Corps of Engineers Project Update Kornelis indicated he had no current status reports on the above items. Discussion took place on the budget and Kornelis noted the Corps pays close attention and have done a good job. Councilman Bookey noted the Benthic Study was being performed by the University of Alaska Fairbanks and he hoped they could be biased in their opinion. Bookey added, the State came down hard on the City of Kenai when they contracted with the University for a previous study and it would be interesting to see how this study would be accepted. Kornelis reported Glenda Landua is no longer with Fish and Game. Simon asked if the history of activity on the coastal trail project could be made available to the Commission. Kornelis will provide a summary of activity at the next meeting. Simon stated she thought the document might be a good thing to take to Commissioner Erwin with the Department of Natural Resources. ITEM 6' NEW BUSINESS Discussion -- Proposed Meeting Schedules for City Commissions, Committees, Boards and Council on Aging. Councilman Bookey explained the reason for the proposed meeting change and advised the Commission special meetings could be scheduled as necessary. Simon asked if the Commission, with less than a quorum, could meet on some issues without public notice. Bookey noted no formal action could be taken and explained the Open Meetings Act. Bookey added, he'd be hesitant if that happened too much and noted the protocol should be that it remained an advertised meeting. Bookey continued, it could become a situation where things are taking place without the involvement of Administration or Council and if it was misconstrued in the public, it could put the City in a legal situation. Bookey recommended meetings take place on an open public forum and if a work session is needed, the City Clerk is to be contacted. Discussion -- City Dock Leases/R&J Seafood Kornelis provided an updated version of the proposal letter from R&J Seafood and noted there were few changes from the letter included in the packet. Kornelis explained the original bid for the dock lease went out with an error; it showed the minimum bid at $12,500 and it should have been $23,500, which was the same figure as previous years. There was only one bidder, R&J Seafood, for the first bid. Because of the error the City rejected the bid and went out with a re-bid. Kornelis reported there were no bidders on the re-bid. Kornelis reported R&J Seafood contacted him and asked if they could submit a proposal for privatization of the dock, boat launch and parking for the Commission's consideration. Kornelis added, it's a working document and while reviewing the R&J Seafood's proposal, he and the Dock Foreman took notice of several concerns that were not considered in the proposal. Kornelis listed the many items including the port-a- HARBOR COMMISSION MEETING MAY 12, 2003 PAGE 2 potties; buoys in the river; fuel spills and equipment; damage to the facility; crane certification; weights and measures; water testing; mud removal and maintenance; water softeners; yard work; trash; oil on docks; pilings, etc. Kornelis explained the R&J Seafood proposal and noted they suggested splitting the revenue with the City and provided an overview of what the revenue might include. Barrett asked Randy Meier with R&J Seafood if he was aware of the concerns Kornelis listed and if it would still be a viable option for him. Randy Meier, R&J Seafood~ Kenai~ Alaska -- Meier handed out two additional proposals for consideration which included some of the concerns listed by Kornelis and noted these two proposals would take the place of the two submitted previously. Meier stated the' minimum bid four years ago was $8,000 per crane and R&J overbid that on Crane 2 and 3 in order to get the lease. Meier continued, the minimum bid was not $23,000, it would have been only $16,000 and added, the reason he was at the meeting was because of the new bid and referred to the April 7th minutes where it is noted the minimum bid was stated as being $12,500. Meier added, Kornelis informed him on the phone the minimum bid was $12,000 and then was notified the day after he was the only bidder and it wasn't in the best interest of the City. Meier continued, he was told the City now wanted to charge $23,000 and he didn't feel that was right and he wouldn't run a business that way and he felt he was treated unfairly, but still wants to work with the City on the dock. Meier added, he was given one week to send in a new bid, which he didn't do because he could not afford it and there isn't a provision for him to submit a rebuttal or to even make an offer. Meier reiterated his desire to continue working with the City on the dock and he feels a different process is needed. Barrett asked if it was a miscommunication between the City and R&J Seafoods and Kornelis replied, there was a mistake with the first bid and he wasn't sure how the $12,500 figure got into the bid specifications, however, prior to bidding he spoke with Meier and informed him the minimum bid would be the same thing he paid last year which was $23,500. Kornelis stated the City has the option to reject any and all bids for any reason and because of the admitted mistake, the bid was rejected. Kornelis continued, the re-bid went out with the same price the City got the past few years and the $23,500 price is as low as the City can go and with that rate, the City still loses money. Discussion took place on what the minimum bid was four years ago and Meier stated R&J Seafood bid on the crane Snug Harbor had after Kornelis called them to see if they would be interested. Meier added, at that time both cranes were $8,000. Meier noted, he's paying $8,000 more from four years ago yet the City has dropped their price 25% in the handling of the dock. When he was told the bid was $12,500, he thought it HARBOR COMMISSION MEETING MAY 12, 2003 PAGE 3 included a 25% reduction. Meier added, as a businessman he can't and won't pay $100,000 so he wanted to offer suggestions to try to work something out if the City was willing and wanted to work with him. Barrett asked the difference between the two proposals submitted and Meier replied, the basic difference is Option 1 takes over the whole facility and Option 2 basically takes over just the dock portion. Barrett asked, after hearing the concerns listed by Kornelis, if it would be a feasible operation for R&J Seafood. Meier stated he still had not received any numbers from Kornelis on some of the items and he didn't know if the costs are inflated or actual so he couldn't say for sure if it would feasible. Meier added, the numbers he put down are arbitrary numbers since he doesn't have any actual costs. Bookey reported Council has reviewed the dock situation and voted to close the dock a month on each side to reduce the cost of operation. He added, with the work sessions and discussions Council had regarding the dock, it was agreed the City would not lose any more money. 13ookey continued, after reviewing both proposals, he's convinced neither would be a lucrative deal for the City as there is no lease amounts included. Meier confirmed there were not. Bookey stated, he would carry any recommendation to Council but asked the Commission to carefully review the proposals and projects to make sure they are understood completely before making any recommendations. Meier asked if the City would be interested in entertaining an offer in just plain money; to go back the same way where Rar~J Seafood would have no responsibility except to offload his boats and pay the City a certain amount of money. Meier added, this woUld now give the City three options to consider. Simon gave an overview of discussion for clarification purposes and stated she is not in favor of either proposal. Simon stated, if R&J Seafood wasn't willing to come up with $23,500 as a minimum bid and the City isn't willing to negotiate, then it appeared the only option Meier would have is a counteroffer. Simon continued, the Commission had recommended to the Council operation on the dock would continue status quo with certain reductions so this has already been whittled down to a certain extent. Bookey asked if the City Attorney had reviewed either 'document and Kornelis replied, he had reviewed the one included in the packet and not the other three. Bookey stated he would be reluctant to even discuss a proposal until a legal opinion was provided. Meier asked if the City would be willing to take anything less than $23,500 as he is going to be left high and dry with less than a month to go. Meier said this should have been started in January and February and Bookey responded, Administration didn't do anything with this in January or February as the Council was reviewing the dock status and was considering closing it. HARBOR COMMISSION MEETING MAY 12, 2003 PAGE 4 Barrett asked why this was such a bad idea, adding he works for a facility run by another company who doesn't pay the City to be in the building. Bookey responded, the organization Barrett works for doesn't have the liability the dock has and he was looking at this through the Council's eyes and he wasn't comfortable in giving away the facility without any type of lease. Bookey continued, it comes to a point when one has to consider whether it's more beneficial to keep the doors open or close them; sometimes the hard decision to close the doors has to be made. Bookey also stated the City would not relinquish the dip net fishery or the boat launch. Meier again asked if the City would entertain a bid for just the straight cash amount with no responsibility to take the dock, which would be under the $23,000. Bookey replied, he couldn't speak for the rest of the Council but he wouldn't Support anything less than $23,500. Bookey added, the City can lose more than $16,000 due to some accident and the City wouldn't want to take the risk. Barrett asked what would happen if the proposals didn't go through and there are no bids to operate the dock. Kornelis replied, the dock would close, the City wouldn't sell fuel, and the Dock Foreman would go to work for the Street Department. Bookey added, even if there were no bids, anyone could submit a proposal to the City Manager who could take it to Council for approval; so other options are available. Meier stated he had another option he hadn't submitted but no one has told him they were willing to entertain it. Bookey said it didn't matter if he entertained it or not and pointed out Meier had the right to submit it to the City Manager. Meier stated he thought if he had a recommendation from the Commission before it went to Council, his chances would be better. Kornelis added, he was glad the Meier was in attendance as most often Council would ask if the Commission had seen the proposals. If they had not, the issue would have been sent back and more time would have been spent. Simon stated she thought things could be broken down at the dock between the City and R&~J Seafoods and noted, she heard there might be some redundancy with insurance on the dock with the City's policy and R&,J Seafoods. Simon asked if R&~J Seafoods made a proposal, could he be relieved of his dock insurance costs to eliminate the duplication of insurance. She suggested R&d Seafood's labor force could handle the fee collection of the boat launch and dip net fishery rather than the City hiring additional help. Simon continued, sharing the work down there could improve Seafoods' proposal and the City would still be able to maintain management of the dock. Meier stated he is willing do to that as the $23,000 he paid to the City is not even close to his total cost for the dock, which is $31,000. Meier added, if the insurance could be cut or other things can be cut, he would be interested. Thompson stated he wasn't comfortable with making decision due to lack of information. HARBOR COMMISSION MEETING MAY 12, 2003 PAGE 5 Foster asked if Meier would be interested in paying $16,000 and then supplying labor for the City in some areas to make up the difference. Meier stated he would if they had someone like the Dock Foreman to tell them what to do. Thompson asked if the City would be willing to turn over the fee collection to an outside party and Kornelis answered, probably not and explained the checks and balances the City goes through for their own staff. Kornelis added, there is too much chance for more problems. After additional discussion on various options for R&J Seafoods, it was decided the Commission would not vote on a particular proposal but suggested Meier submit a proposal to the City Manager with a request that she take it to City Council for approval. MOTION: Commissioner Barrett MOVED to encourage R&J Seafood to meet with the City Manager and work with Administration and the City Council on an agreement to continue working at the dock in a manner that is agreeable to both parties. Commissioner Higley SECONDED the motion. Kornelis clarified the minimum bid as $23,500 and R&J Seafood is willing to pay $16,000. R&J Seafood would explore different options to offset the $7,500 difference to bring it closer to the minimum bid price. Bookey added, this needs to be acted upon quickly and encouraged Meier to meet with the City Manager on May 13, 2003. VOTE: Eldrid§e Barrett Thompson Absent Yes Yes Hi§ley Simon Yes Yes Foster Spracher Yes Yes MOTION PASSED UNANIMOUSLY. Discussion-- 5/2003 Kenai Harbor Rate Schedule Kornelis provided an overview of the 2003 Harbor rates. ITEM 7: REPORTS 7-a. Director-- No report. 7-b. Dock Foreman -- Freden provided a report on dock activities. 7-c. City Council Liaison - Councilman Bookey provided a report on recent Council activities. ITEM 8: COMMISSIONER COMMENTS/i~UESTIONS HARBOR COMMISSION MEETING MAY 12, 2003 PAGE 6 Commissioner Barrett thanked Meier for coming in and encouraged him to continue his work on the proposals. Commissioner Foster asked who controls the duck fiats during hunting season. It was noted it is the State's responsibility but the City owns the land. Foster expressed concern with the new bike path and possibly the Coastal Trail and would like to see more control in the area. Kornelis stated only shotguns are allowed and after a brief discussion it was decided the item would be placed on the next meeting agenda. Commissioner Simon stated she sits on the Fish and Game Advisory Commission and asked if anyone sees any illegal activity during the dip net season to let her know. She would like to stay in the loop on those activities. Kornelis suggested she contact the police department as they have summer hires in the area. ITEM 9: INFORMATION Kenai City Council Action Agendas of April 2 and 16, 2003. ITEM 10' ADJOURNMENT Chairman Thompson stated the next meeting is scheduled for June 9, 2004. The meeting adjourned at 9'05 p.m. Minutes recorded and transcribed by: Bal:ba~a ~op~r, ~on{ract4'Secretary HARBOR COMMISSION MEETING MAY 12, 2003 PAGE 7