HomeMy WebLinkAboutOrdinance No. 3436-2024-z
KENAI
CITY OF KENAI
ORDINANCE NO. 3436-2024
Sponsored by: Administration
AN ORDINANCE INCREASING ESTIMATED REVENUES AND APPROPRIATIONS IN THE GENERAL
FUND LANDS ADMINISTRATION DEPARTMENT FOR PROFESSIONAL SERVICES ASSOCIATED
WITH THE SALE OF CITY -OWNED LAND, DETERMINING ELEVEN CITY -OWNED PROPERTIES
ARE NOT NEEDED FOR A PUBLIC PURPOSE, AUTHORIZING THE CITY MANAGER TO DISPOSE
OF PROPERTIES BY PUBLIC OUTCRY AUCTION, APPROVING THE TERMS OF FINANCING TO BE
OFFERED ON THE SALE, AND DESIGNATING THOSE PARCELS AS ELIGIBLE FOR A 25%
VETERANS DISCOUNT.
WHEREAS, the Administration has identified eleven City -owned properties intended for residential use
for public sale having access to improved streets, water and sewer utility access or of adequate size for
onsite water and wastewater systems, a residential zoning designation, and a recommendation for
disposal in the City's Land Management Plan; and,
WHEREAS, the identified properties are:
1. KPB Parcel 06361018, Lot 3, Block 2, Salty Dog Heights Subdivision Part 1
2. KPB Parcel 04521047, Lot 6, Doyle Subdivision
3. KPB Parcel 04513025, Lot 2, Bloc 1, Kaknu Korners Subdivision
4. KPB Parcel 04317003, Government Lot 128 T6N R11W Sec 31
5. KPB Parcel 04310039, Lot 1, Block 3, Evergreen Subdivision Kim Addition
6. KPB Parcel 03910109, Lot 2, Block 7, Mommsen's Subdivision Replat Addition No. 1 & 2
7. KPB Parcel 03910111, Lot 4, Block 7, Mommsen's Subdivision Replat Addition No. 1 & 2
8. KPB Parcel 03910112, Lot 5, Block 7, Mommsen's Subdivision Replat Addition No. 1 & 2
9. KPB Parcel 03906309, Lot 9, Block 11, Carl F. Ahlstrom Subdivision
10. KPB Parcel 03906310, Lot 10, Block 11, Carl F. Ahlstrom Subdivision
11. KPB Parcel 03906311, Lot 11, Block 11, Carl F. Ahlstrom Subdivision; and,
WHEREAS, these properties are not needed for a public purpose; and,
WHEREAS, sale by public outcry auction is an authorized method of sale pursuant to KMC 22.05.095
(b) (2) (i) and has proven to be a successful method by other local governments; and,
WHEREAS, establishing the minimum bid for parcels at the current Kenai Peninsula Borough tax
assessment is reasonable and appropriate for a public outcry auction; and,
WHEREAS, the Lands Administration Department's FY2025 Budget did not include funds for professional
services related to the sale of City owned land that are estimated at $27,250; and,
WHEREAS, to expedite and facilitate the sale, the City Manager is authorized to accept terms for sales
and may accept a note secured by a deed of trust for a portion of the purchase price; and,
WHEREAS, accepting a note secured by a deed of trust for a portion of the purchase price with
reasonable terms requiring a 15% down payment, a fixed interest rate of prime plus 2%, and a maximum
term of 10 years are reasonable terms in order to expedite and facilitate the sale of City lands; and,
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Ordinance No. 3436-2024
Page 2 of 3
WHEREAS, KMC 22.05.095 (d) allows an eligible veteran to a discount of 25% off the purchase price of
certain City -owned land intended for the principal use as a single-family dwelling when the land is
designated as eligible for the City's veterans discount prior to sale; and,
WHEREAS, as all parcels are zoned with a residential designation, designating as eligible for the City's
veterans discount is appropriate; and,
WHEREAS, the sale of these properties by public outcry auction, with financing terms to expedite and
facilitate the sale of City lands and designating the parcels as eligible for the City's veteran's discount will
encourage residential development and is in the best interest of the City.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, AS
FOLLOWS:
Section 1. Form: This is a non -code ordinance.
Section 2. That the Council determines that the following properties are no longer needed for a public
purpose and are available for sale:
1. KPB Parcel 06361018, Lot 3, Block 2, Salty Dog Heights Subdivision Part 1
2. KPB Parcel 04521047, Lot 6, Doyle Subdivision
3. KPB Parcel 04513025, Lot 2, Bloc 1, Kaknu Korners Subdivision
4. KPB Parcel 04317003, Government Lot 128 T6N R11 W Sec 31
5. KPB Parcel 04310039, Lot 1, Block 3, Evergreen Subdivision Kim Addition
6. KPB Parcel 03910109, Lot 2, Block 7, Mommsen's Subdivision Replat Addition No. 1 & 2
7. KPB Parcel 03910111, Lot 4, Block 7, Mommsen's Subdivision Replat Addition No. 1 & 2
8. KPB Parcel 03910112, Lot 5, Block 7, Mommsen's Subdivision Replat Addition No. 1 & 2
9. KPB Parcel 03906309, Lot 9, Block 11, Carl F. Ahlstrom Subdivision
10. KPB Parcel 03906310, Lot 10, Block 11, Carl F. Ahlstrom Subdivision
11. KPB Parcel 03906311, Lot 11, Block 11, Carl F. Ahlstrom Subdivision; and,
Section 3. Council authorizes these properties to be sold by public outcry auction to the highest
bidder and that the established minimum bid for the parcels will be the current Kenai Peninsula Borough
assessed value.
Section 4. In order to expedite and facilitate the sale of City -owned lands, the Council authorizes the
acceptance of a note secured by a deed of trust for a portion of the purchase price requiring a minimum
down payment of 15% of the purchase price, at a fixed interest rate of prime plus 2%, for a maximum
term of 10 years, and requiring the buyer to pay all closing costs.
Section 5. In recognition of their service to the country, the Council designates these parcels as
eligible for the City's veteran's discount which provides a 25% discount off the purchase price.
Section 6. That estimated revenues and appropriations be increased as follows:
General Fund:
Increase estimated revenues —
Appropriation of Fund Balance $271250
Increase expenditures —
Land Administration — Professional Services $2
Section 7. Severability: That if any part or provision of this ordinance or application thereof to any
person or circumstances is adjudged invalid by any court of competent jurisdiction, such judgment shall
be confined in its operation to the part, provision, or application directly involved in all controversy in
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Ordinance No. 3436-2024
Page 3 of 3
which this judgment shall have been rendered, and shall not affect or impair the validity of the remainder
of this title or application thereof to other persons or circumstances. The City Council hereby declares
that it would have enacted the remainder of this ordinance even without such part, provision, or
application.
Section S. Effective Date: That pursuant to KMC 1.15.070(f), section 6 of this ordinance shall take
effect immediately upon enactment and the remaining sections shall take effect 30 days after enactment.
ENACTED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, THIS 18T" DAY OF SEPTEMBER,
2024.
A TEST:
Michel M. S r, MC, City Clerk
Approved by Finance:
Brian Gabriel Sr., Mayor
Introduced: September 4, 2024
Enacted: September 18, 2024
Effective: September 18 & October 18, 2024
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City of Kenai 1 210 Fidalgo Ave, Kenai, AK 99611-7794 1907.283.7535 1 www.kenai.city
ill 14 11j,l�
TO: Mayor Gabriel and Council Members
FROM: Terry Eubank, City Manager
DATE: August 26, 2024
SUBJECT: Ordinance No. 3436-2024 - An Ordinance Increasing Estimated Revenues
And Appropriations In The General Fund Lands Administration Department
For Professional Services Associated With The Sale Of City -Owned Land,
Determining Eleven City -Owned Properties Are Not Needed For A Public
Purpose, Authorizing The City Manager To Dispose Of Properties By Public
Outcry Auction, Approving The Terms Of Financing To Be Offered On The
Sale, And Designating Those Parcels As Eligible For A 25% Veterans
Discount
This memorandum supports the proposed Ordinance for the sale of eleven City -owned properties,
the establishment of the sale method and terms, and the designation of these properties as
eligible for a veteran's discount. The goal is to effectively manage City land resources and
encourage residential development.
The Administration has identified eleven City -owned parcels suitable for sale for residential
development based on their location, utility access, and residential zoning. These parcels, listed
below and on the attached map, are intended for the principal use as a single-family dwelling, not
restricted in use or sale, have road access, have been identified as not needed for a public
purpose, and are recommended for disposal in the City's Land Management Plan:
1. KPB Parcel 06361018, Lot 3, Block 2, Salty Dog Heights Subdivision Part 1
2. KPB Parcel 04521047, Lot 6, Doyle Subdivision
3. KPB Parcel 04513025, Lot 2, Block 1, Kaknu Korners Subdivision
4. KPB Parcel 04317003, Government Lot 128 T6N R11W Sec 31
5. KPB Parcel 04310039, Lot 1, Block 3, Evergreen Subdivision Kim Addition
6. KPB Parcel 03910109, Lot 2, Block 7, Mommsen's Subdivision Replat Addition No. 1 & 2
7. KPB Parcel 03910111, Lot 4, Block 7, Mommsen's Subdivision Replat Addition No. 1 & 2
8. KPB Parcel 03910112, Lot 5, Block 7, Mommsen's Subdivision Replat Addition No. 1 & 2
9. KPB Parcel 03906309, Lot 9, Block 11, Carl F. Ahlstrom Subdivision
10. KPB Parcel 03906310, Lot 10, Block 11, Carl F. Ahlstrom Subdivision
11. KPB Parcel 03906311, Lot 11, Block 11, Carl F. Ahlstrom Subdivision
The Ordinance outlines the following framework for the sale process, financing terms, and
eligibility for a veteran's discount:
1. Sale Method and Terms: The ordinance authorizes the sale of these parcels through a
public outcry auction, which is a proven method for ensuring competitive pricing and
transparency. The minimum bid for each parcel will be set at the current Kenai Peninsula
Borough tax assessment value, ensuring a reasonable minimum bid and maximum
potential for higher bidding at a public outcry auction.
2. Financing Terms: To facilitate the sale and broaden buyer interest, the ordinance allows
the City Manager to accept terms for sales, including notes secured by deeds of trust.
Proposed terms include a 15% down payment, a fixed interest rate of prime plus 2%, and
a maximum term of 10 years. These terms are designed to balance buyer accessibility
with financial prudence.
3. Professional Services Funding: The ordinance provides for professional auction
services estimated at $27,250 required for the sale process. Since these funds were not
included in the FY2025 Budget, the ordinance increases the General Fund to cover costs.
The scope of services would include conducting a live -online simulcast auction, online and
print advertising, property postings, marketing, MLS listings, and documentation.
4. Veterans Discount: The ordinance designates these parcels as eligible for the City's
veterans discount pursuant to KMC 22.05.095 (d). This policy supports veterans and
encourages residential development on these parcels.
The City's last General Fund land sale, conducted as a sealed bid auction in 2007, included
several of the above -listed properties, none of which received bids. The proposed ordinance
outlines a more effective and efficient approach that adheres to the sale methods outlined in the
City Lands Code. By authorizing the sale of these parcels, setting clear sale terms, and providing
necessary professional services, the City will promote residential development, facilitate the
successful disposal of surplus land, support community development, and uphold its commitment
to supporting veterans.
Your consideration is appreciated.
Page 2 of 2
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