HomeMy WebLinkAboutOrdinance No. 3460-2025KiNAI
CITY OF KENAI
ORDINANCE NO. 3460-2025
Sponsored by: Administration
AN ORDINANCE DETERMINING THAT REAL PROPERTY DESCRIBED AS LOT 11, BLOCK 1,
ETOLIN SUBDIVISION NUMBER 3, ACCORDING TO PLAT 82-103, CITY -OWNED AIRPORT LAND
LOCATED OUTSIDE THE AIRPORT RESERVE, IS NOT NEEDED FOR A PUBLIC PURPOSE AND
AUTHORIZING THE SALE OF THE PROPERTY TO LOROC, LLC.
WHEREAS, the City of Kenai received a Quitclaim Deed from the Federal Aviation Administration (FAA)
on December 1, 1963, to nearly 2,000 acres of land subject to certain restrictions, including that no
property shall be used, leased, sold, salvaged, or disposed of for reasons other than for airport purposes;
and,
WHEREAS, on September 1, 1967, the FAA executed a Deed of Release, for an area of land subject to
the Quitclaim Deed allowing for the lease, sale, or disposal of certain airport lands by the City, for other
than airport purposes; and,
WHEREAS, Lot 11 Block 1, Etolin Subdivision No. 3 was subject to that Deed of Release; and,
WHEREAS, on May 1, 2004, the City entered into a Lease with Rockwell G. Smith d/b/a/ Preferred
Plumbing and Heating for City -owned land identified as Lot 11, Block 1, Etolin Subdivision No. 3; and,
WHEREAS, on June 30, 2015, the rights under the Lease for City -owned land identified as Lot 11, Block
1, Etolin Subdivision No. 3 were assigned to LOROC, LLC; and,
WHEREAS, KMC 22.05.100 - Sale Procedure, Subsection (h) provides that leased land in which the
lease contains an option to purchase once the minimum development requirements have been met, the
lessee may request the sale of the land at not less than the fair market value; and,
WHEREAS, the Lease of LOROC, LLC includes a purchase right of the Lessee, and the minimum
development requirements have been met; and,
WHEREAS, KMC 22.05.010 - Authority and Intent, Subsection (b) provides that disposal or sale of City
lands shall be made only when, in the judgement of the City Council, such lands are not or are no longer
required for a public purpose; and,
WHEREAS, the City has received a request to purchase Lot 11, Block 1, Etolin Subdivision No. 3,
according to plat 82-103 (the Property) from the current Lessee; and,
WHEREAS, the fair market value of the Property was determined by a qualified independent appraiser
on September 3, 2024 to be $187,000.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, AS
FOLLOWS:
Section 1. Statement of Ownership: That the City of Kenai is the owner of Lot 11, Block 1, Etolin
Subdivision No.3, according to Plat 82-103 (the Property).
Section 2. Public Purpose and Best Interest Findings: That the Property is not needed for future
public municipal or airport purposes. Under the Airport Layout Plan, the Property is designated for non -
New Text Underlined; [DELETED TEXT BRACKETED]
Ordinance No. 3460-2025
Page 2 of 3
aviation commercial or light industrial uses. The sale of the Property is in the best interest of the City and
Airport, as it serves a purpose of continuing commercial growth and investment in the City.
Section 3. Authorization of Sale: That the Kenai City Council hereby authorizes the City Manager to
sell the City -owned lands described as Lot 11, Block 1, Etolin Subdivision No. 3, according to Plat 82-
103, under the procedures and terms established for the sale of City -owned lands outside of the Airport
Reserve, as set forth in KMC 22.05.100 et seq. at not less than $187,000; the fair market value of the
land, excluding lessee -constructed improvements, as determined by an appraisal.
Section 4. Title: That title shall be conveyed by quitclaim deed. Any instrument conveying title to the
Property shall include the following restrictions, promises, and/or covenants:
a) That the City of Kenai reserves unto that the grantee expressly agree for itself and its heirs,
executors, administrators, successors, transferees, and assigns, for the use and benefit of the
public right of flight for the passage of aircraft in the airspace above the surface of the Property,
together with the right to cause in said airspace such noise as may be inherent in the operation
of aircraft, now known or hereafter used, for navigation of or flight in the said airspace, and
for use of said airspace for landing on or at and for taking off from or operating on Kenai
Municipal Airport; and,
b) that the grantee expressly agree for itself and its heirs, executors, administrators, successors,
transferees, and assigns to restrict the height of structures, objects of natural growth, and
other obstructions on the Property to a height of not more than 242 feet above mean sea level;
and,
c) that the grantee expressly agree for itself and its heirs, executors, administrators, successors,
transferees, and assigns to prevent any use of the Property which would interfere with landing
or taking off of aircraft at the Kenai Municipal Airport, or otherwise constitute an airport hazard;
and,
d) that all covenants heretofore stated shall run with the land and shall inure to the benefit of,
and be binding upon the heirs, executors, administrators, successors, transferees, and
assigns of the parties to the contract for sale and conveyance.
Section 5. Proceeds of Sale: That should a sale of the Property be finalized, all revenues from the
sale shall be deposited in the Airport Land Sale Permanent Fund for use in the development,
improvement, and operation of the Kenai Municipal Airport and as otherwise required in the Deed of
Release dated September 1, 1967.
Section 6. 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 judgement shall
be confined in its operation to the part, provision, or application directly involved in all controversy in
which this judgement 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 7. Effective Date: That pursuant to KMC 1.15.070(f), this ordinance shall take effect 30 days
after enactment.
ENACTED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, THIS 19T" DAY OF MARCH, 2025.
Brian Gabriel Sr., Mayor
New Text Underlined; [DELETED TEXT BRACKETED]
Ordinance No. 3460-2025
Page 3 of 3
ATTEST:
MichelleV. San(l\ MM, City Clerk
Introduced: March 5, 2025
Enacted: March 19, 2025
Effective: April 18, 2025
New Text Underlined; [DELETED TEXT BRACKETED]
City of Kenai 1 210 Fidalgo Ave, Kenai, AK 99611-77941907.283.7535 1 wwwlcenaixity
TO: Mayor Gabriel and Council Members
THROUGH: Terry Eubank, City Manager
THROUGH: Kevin Buettner, Planning Director
FROM: Brandon McElrea, Planning Technician
DATE: February 26, 2025
SUBJECT- Ordinance No. 3460-2025 - Determining that Real Property Described as
Lot 11, Block 1, Etolin Subdivision Number 3, According to Plat 82-103,
City -Owned Airport Land Located Outside the Airport Reserve, is Not
Needed for a Public Purpose and Authorizing the Sale of the Property
to LOROC, LLC.
LOROC, LLC submitted a request to purchase the above City -owned leased land outside the
Airport Reserve with substantial constructed leasehold improvements pursuant to Section D. 52
Right to Purchase, of the Lease Agreement.
LOROC, LLC is the current lessee of Lot 11, Etolin Subdivision No. 3, which was entered into on
May 1, 2004 for the purpose of a storage building to support Preferred Plumbing and Heating,
which operates on the adjacent leased lot. The 25-year lease term expires on June 30, 2029 and
is in good standing.
On May 11, 2018, the Federal Aviation Administration (FAA) released the property for sale for
other than airport purposes, allowing the property to be sold at fair market value. All revenues
from the sale would be deposited in the Airport Land Sale Permanent Fund for use in the
development, improvement, maintenance and operation of the Kenai Municipal Airport as
required by the Deed of Release.
While City Policy does not provide for the sale of any specific property, Section d. 52. of the Lease
Agreement provides for the purchase of the property by the lessee at not less than market value
after leasing the property for the preceding two years or completion of the agreed to improvements
to the satisfaction of the City Manager, both of which have occurred.
The lessee submitted a good -faith deposit and the City ordered an appraisal to be performed on
the property as though vacant. The fair market value of the property was determined to be
$187,000 by an appraisal performed by MacSwain Associates on September 3, 2024.
If the City Council approves the sale, City Administration may proceed with the sale.
Thank you for your consideration.
Attachment —Aerial Map