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2006-05-10 Council Packet
AGENDA KENAI CITY COUNCIL -REGULAR MEETING MAY 1T, 2006 7:00 P.M. KENAI SENIOR CENTER htto: / /www.ci kenai ak us ITEM 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 so 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. ITEM B: SCHEDULED PUBLIC COMMENTS (10 minutes) 1. Presentation/V.F.W. Poppy Week Proclamation 2. Tom Adams, Lounsbury 8s Assoeiates -- Wal-Mazt Project Update. 3. Phil Bryson/Casey Madden, Wince-Corthell-Bryson -- Airport Runway Project Update. 4. Ricky Gease, Kenai River Sportfishing Association, Inc. -- Management Oversight Reports and Economic Information of Upper Cook Inlet Salmon Fisheries. YTEM C: UNSCHEDULED PUBLIC COMMENTS (3 minutes) ITEM D: REPORTS OF KPB ASSEMBLY LEGISLATORS AND COUNCILS ITEM E: PUBLIC HEARINGS 1. Ordinance No. 2160-2006 -- Increasing Estimated Revenues and Appropriations by $28,000 in the Airport Land System Special Revenue Fund for Utilities. Ordinance No. 2161-2006 -- Increasing Estimated Revenues and Appropriations by $21,000 in the Terminal Enterprise Fund for Utilities. Ordinance No. 2163-2006 -- Enacting KMC 7.05.035, Adopting a Community Purposes Property Tax Exemption as Authorized by AS 29.45.050, 4. Ordinance No. 2164-2006 -- Increasing Estimated Revenues and Appropriations by $60,000 in the Airport Land System Special Revenue Fund and the Runway Safety Area Improvement Capital Project Fund for Engineering Services. 5. Resolution No. 2006-20 -- Authorizing the Amendment of the city of Kenai, Alaska and Public Employees' Retirement System (PERS) Participation Agreement to Exclude All Elected Officials, Effective May 3, 2006. (Clerk's Note: Consideration of Resolution No. 2006-20 was postponed from the May 3, 2006 meeting. An active motion to approve Resolution No. 2006-20 is on the floor.] 6. Resolution No. 2006-26 -- Supporting a Gulf of Alaska Groundfish Rationalization Pian thief Maintains Open Markets, Free Trade, and the Movement of Commerce for Fisheries Resources Within the State of Alaska. Resolution No. 2006-27 -- Awarding the Bid to Emulsion Products Company for 2006 Dust Control, Rental of Asphalt Distribufion Truck and Furnishing CSS-1 Emulsified Asphalt for the Total Amount of $46,800. 8. Resolution No. 2006-28 -- Transferring $12,000 in the Water and Sewer Fund for Supplies. YTEM F: MINUTES 1. *Regular Meeting of May 3, 2006. 2. *Notes of Budget Work Session of May 2, 2006 ITEM G: UNFINISHED BUSINESS ITEM FI: NEW BUS%NESS Bills to be Ratified 2. Approval of Purchase Orders Exceeding $15,000 3. *Ordinance No. 2165-2006 -- Adopting the Annual Budget for the Fiscal Year Commencing July 1, 2006 and Ending June 30, 2007. 4. *Ordinance No. 2166-2006 -- Increasing Estimated Revenues and Appropriations by $3,800 in tlxe Senior Citizen Title III Grant Fund for Senior and Disabilities Training. 5. *Ordiaaace No. 2167-2006 -- Increasing Estimated Revenues and Appropriations by $4,210.00 in the General Fund to Pay for Improvements to Police Department Report Writing Stations and a Computer Projector. *Orclinaace No. 2168-2006 -- Amending KMC 1.15.130 to Allow Council Members to Telephonically Attend Up to Six (6) Additional Council Meetings During a Twelve (12) Month Period if the Member is Physically Unable to Attend Due to the Need for Extended Medical Caze and Treatment of the Member or the Member's Immediate Family. *Ordiaance No. 2169--2006 -- Transferring $125,000 From the FY2006 Public Improvements Capital Project Fund to the Boat Launch Capital Project Fund and Transferring $100,000 From the Boat Launch Capital Project Fund to the General Fund. 8. Approval -- Consent to Assignment of Lease f Lots 2 8v 3, Block 5, General Aviation Apron/Geneva Stanek to Wendy McGahan, Lynn Dydema and Gwen Woodazd d/b/a Kenai Fabric Center, Inc. 9. Approval -- Terminafion of Lease -- 20/20 International, Inc. and John C. & Marie L. Pazker/Lot 11, Block 1, F.B.O. Subdivision. 10. Approval -- Assignment of Lease for Security Purposes, Lots 10 & 11, Block 1, Etolin Subdivision No. 3 -- Rockwell G. Smith., d/b/a Preferred Plumbing & Heating. 11. Approval -- Renewal of Six Shore Fishery Leases. 12. Discussion -- Proposed Shamrock Circle L.I.D. -- Report of City Manager to Council. 13. Approval -- Cost of Living Salary Increase/City Clerk and City Attorney ITEM Y: COMMYSSYON/COMMYTTEE REPORTS 1. Council on Aging 2. Airport Commission 3. Hazbor Commission 4. Library Commission 5. Parks & Recreation Commission 6. Planning & Zoning Commission 7. Miscellaneous Commissions and Committees a. Beautification Committee b. Alaska Municipal League Report ITEM J: REPORT OF TYiE MAYOR ITEM K: ADMINISTRATION REPORTS City Manager Attorney City Clerk %TEM L: 1. Citizens (five minutes) 2. Council EXECUTI~7E SESSION -- Evaluations of City Attorney, City Clerk and City Manager. ITEM M• 0 m R -S ~, N '\ ry W W W W ~ Z ~ W - }O ~^ `Ll ~ Y } m ~ d O Q ~ cn v~ ~ -~ ~ ~ ~ > ~, .. .s ~. N ~ ~ ~ W Z W ~ N O ~ } ~ O Q c i~ vi t LL I®^ v Z W V Z O V ,^ VI G L.6 Q\ `J /Z~ ~/ 1Y ~ W //~ O '/~ <> ~ VJ ~~ W J ~ O ~ ~ ~ ~ O O O ~ 'S /V/' ~ V' Q `V/,~ V, O O ~ \ ~ ~ h /w VO C ~~ ~~ {(\ N \ ~ Z ~ W 1.LZ W } O t ~ ~ N LL O ~ ' ^ v' /^ V, m a ~ ~ ~ ~ ~ u i ~~v > ~ ~ ~. ~ ~ ~ W W W O ~ ~ u J W ~ ~ ` `yI ~ Y 0 CD 0 O. 0 ~ 'S tA a ~ 0 ~' 0 ~ d ` ~ ~ ~ ~. V! t ~ . N LL ~. Z ~ W Z W 7- ~ W W W N l l N . ~ I.L ,~ Q' 0 0 0 ~ Q O O Y f~ ~. ~ tn ~ 2 ~ S `'v ~5 ~~~ ~~ w O ~( N R 0. ti: O Z F= W LL! J V Z O U Z ~ ~ ~}COQ ~OOO~ YaOa~tn ` ~ ti ~ i ~ ~ Z Z ~ !- W ~ Z ~ W V7 fA } ~ ~ fn ~ J ~- ~ o Q (n (n -! N 0 ~IWIW W ~~00 BYO] ~ J v ~ ~1 n ~ \, S Z ~ W W Z W } W ~ W W ' ~ o ~. Q - ~ n o ~ ~ 1 ~ } m ~ a ~ ~ v j ~ c ~ ~ ,; c n `~. °~~ Z W yi ~ W W ~ W Z ~ W - ~ ,, Y m a ~ ~' ~ ~ ~ c n 9 N `~ ~ ~ ~ ~ W ~ ~ W Z ~ W - '" o ~ ~ > ~ >" 0 ~ 0 o 0 Q 3 fn ¢ fn 0 0 s-i WHEREAS, the annual sale of Buddy Poppies by the Veterans of Foreign Wars of the United States has been officially recognized and endorsed by governmental leaders since 1922; and, WHEREAS, V.F.W, Buddy Poppies are assembled by disabled veterans, and the proceeds of this worthy fund-raising campaign are used exclusively for the benefit of disabled and needy veterans, and the widows and orphans of deceased veterans; and, WHEREAS, the basic purpose of the annual sale of Buddy Poppies by the Veterans of Foreign Wars is eloquently reflected in the desire to "honor the Bead by Helping the Living." NOW THEREFORE, I, PAT PORTER, MAYOR OF THE CITY OF IfENAl, do hereby proclaim May 22-26, 2006 as V.F. W. BUDDY POPPY WEEK in the City of Kenai and urge the citizens of this community to join with the Jerry V. Horn, V.F.W. Memorial Post 10046 in recognizing the merits of this cause by contributing generously to its support through the purchase of Buddy Poppies; and; FURTHER, I urge all patriotic citizens to wear a Buddy Poppy as a symbol of appreciation for the sacrifices of our honored dead and mute evidence of our gratitude to the men and women of this country who have risked their lives in defense of the freedoms which we continue to enjoy as American citizens. DATED: This 17th day of PAT PORTER, MAYOR ATTEST: ~~~ ~~~~ Carol L. Freas, City Cle I, ~ ~i, '~ I NVId A13dtlS e ~ ~ NOIlOf1i11SN000NV ~ ~ 1f10AH1103f021d \ b ~ s I J } / / ~1 t \ /~ b ~~ ~ ~ / /[ ~~ ~ ~ ~ ~ ~~ (^` ~ t ~ ~ ?@ ~ t \ ? / ~ e ` ~ \ ~ r ~ I sa _ - a \ ~ a 2 \ Se I f L6 ~~E 66"4 ~4 `~ u ~' ' N ~~ '~~ ~~ e ~ ~ e ~ ~ r 5 5~ I a 6b I . I S { j n ~ I i ' Ij ~ d ~ ~J ~?f + 1 „~~ I ~ ~ it 5 ~ V` £ ~ ~ ~~~ `~~ ~3 ~ ~I y a )r~ I {{ V a ~~~ ~ ~ I j II~qpg@gy $@ ~' r r ~ { ~1! ']Ibb k,,, ~i ~ ~ ~~ ~ ~ ~ fir, ,, i~ i ~~~ ~ ~ ~~ ~ ~- a~ ,__ ~ ~ - I~ l~ ~, f I~ ~`x~ ,f~ ~ ~$ ~ I ' I i~ ~~~~I 4. ~ r ~ €a ~ ~ I °3 ~ ~ ~y _ ' ~ i © ~, r ~ I~, ~~-- `JNI1H~Il ONV 1N3W3AVd 'SV311V A13iVS ~S1N3W3~OadWl AVMNfItl . eoxu~ \ k F~ t ~ K L b ~ ~~ F `g 4 ~\ P- 5 I `_. { ~ ` ~ n ~ ~ ' (\\ ~ S t 5 ~R p 2 F £F ~ k~ ~ ~. s e 6~ O° ~A s y^ r y t ~ S ; l0 z _ E i a1~14 c ll S d ~ € s C'. 1 ~~ ~ ~ ~f ~i ~ £z~ :~ ~ ~~ 'py~ ~~ J ~, i ~~\ f ~~ x t 4 ® ~ ~ ~y C ~ ~ E ~~~?~~//`~O ~r £2 &e 1 / J ~ _ ~ ~~ Y 9 B ~ ~ ~i Id ~.' V ~~~,m ;a'~O~x ~~p~ '~ q/% ~ ti ~~~ ~~ ~j i r r-1 ~ ~ . ` fit` , ~ ~ i,~ `~ ,~ ~ e 3 ~ ~ ~' ~ ~ a € ~ r,~~ £ ~ ~ 16? ~~ A( /A ~C1A ~.r' ,I r ~ ~ ~~ ~~ ~ , ~ ~f ~ ~ ~~ ~ ~ d o. ~ ~ ~ ~~ I ^i e~W ~o. ~ ~~ ~~ ~ ,~o I i f h~i ~ ~~I ~ ~ ~ ~ ~"~ Qa ~~ i - ~t ~ „~ ~~ `~ ~~ ~; -' ~o ~ S I EC ~~d ~ O Q ~ ~ I I ~- ,i"Y~ Ha gr: ~~ a° ~ O ~ A i ~~ LLr ~ , ~ I _ ~n P _ r- ~ a/ ~ ~ ~ . O pt '~."' ~ ~ ,L ~i4 C!~~. QNw ~® . " o ~~ ~ ~U R ~ /,p, ice' /0 ~:° ~.~~ , B-'~ Carol L. Freas, City Clerk 210 Fidalgo Avenue Kenai, Alaska 99611 Dear Carol: KENAI RIVER SPORTFISHING ASSOCIATION i P~C~r- '.--ice:-A I APR 2 6 206 I K'' ~'~~`E~:C April 26, 2006 At the Kenai City Council meeting on Wednesday, May 3, I would like to update the council members on four reports released this spring by the Kenai River Sportfishing Association: 1. KRSA 2005 Annual Report of Progress -Pacific Coastal Salmon Recovery Fund 2. KRSA 2006 Strategic Plan for Focusing Pacific Coastal Salmon Recovery Funds on Priority Habitat and Fisheries Concerns in the Kenai River Watershed 3. KRSA 2006 Call for Proposals -Pacific Coastal Salmon Recovery Fund -Kenai River Watershed 4. Economic Values of Sport, Personal Use, and Commercial Salmon Fishing in Upper Cook Inlet The first three reports relate to KRSA management oversight of Pacific Coastal Salmon Recovery Funds ;for the Kenai River Watershed, while the last focuses on economic information of Upper Cook Inlet salmon fisheries. All four reports are available in electronic format, which I can provide at your convenience. The handouts I will have at the meeting are: the strategic plan (2), the economic values report (4), KRSA's annual newsletter and a KRSA DVD for the Kenai River. Please let me know how many copies of handouts aze necessary for the meeting. The update will be verbal, with a brief overview of each report, and a short comment on future trends for participation (growth) in the recreational sportfishery, with consequences and needs for infrastructure and public access. For background, I have attached the executive summary of each report. Thank you for your time and attention in this matter. I look forward to the council meeting next week. Respectfully, 1~1.~'t'~ ~ Y-- Ricky Gease, Executive Director Kenai River Sportfishing Association :Attachment: Executive Summary of KRSA reports released in spring 2006 Dedicated to preserving the greatest sport/fishing river in the world, the Kenai. PO Box 7228 • 224 Kenai Ave., Suite 702 • Soldotna, Alaska 94669 Phone: (907) 26Z-8588 • Fax: (907) 262-8582 • www.kenairiversportfishing.com • E-mail: info@kenairiversportfishin~.com KENAI RIVER SPORTFISHING ASSOCIATION Executive Summary of KRSA Reports released in spring 2006 KRSA 2005 Annual Report of Progress -Pacific Coastal Salmon Recovery Frrnd This is the 2005 Annual Report of Progress for Kenai River Sportfishing Association (KRSA) management of Kenai RiveriRussian River appropriations under the Pacific Coastal Salmon Recovery Fund/Southeast Sustainable Salmon Fund (PCSRF/SSSF). In FFY 2004 $1,910,000 was appropriated to the Kenai River watershed. and $955,000 was appropriated to the Russian River watershed (a tributary river to the Kenai.) [n FFY 2005 $956,000 and in FFY 2006 $750,000 were appropriated to the Kenai River watershed, with z cumulative fora! of $4,571,000 to date under the management direction of KRSA. 2005 was the first year in which KRSA actively managed and recommended approval of projects through the PCSRF/SSSF appropriations. In 2005 KRSA established a framework for strategic planning (planning approach, priorities, and project evaluation criteria,) fast track and standard track project approval, call and review of pre-proposals, call and review of proposals, statemen[s of work, awarding of funds, and monitoring and evaluation of projects. KRSA worked in conjunction and close cooperation with the Alaska Department of Fish and Game (ADFG) throughout this process. The ADFG Commissioner provides final review and signature of all projects recommended for approval by KRSA. Fisheries projects totaled $831,447(33%), habitat projects totaled $1,747,941(67%). Within habitat projects, l2°% of funds have gone to habitat research projects and 88% of funds have gone to restoration /access projects. „~;. ,,.~ in 2v"06, KRSA will update t he strategic plan created it 2005, r, '•h °°source managers and put fer:.". a cal: ~r proposals in order to use the remaining balance of PCSRF/SSSF For the Kenai River. KRSA will continue to monitor fast track projects approved and implemented in 2005 and monitor the standard track projects approved in 2005 that will be implemented in 2006. Once projects are completed, KRSA, in conjunction with ADFG and other resource managers, will evaluate project results, and update the strategic planning document for the Kenai River watershed. KRSA 2006 Strategic Plnn for Focusing Pacific Coastal Salmon Recovery Fut:ds on Priority Habitat and Fisheries Concerns in tke Kenai River Watershed The Kenai River Sporttishing Association (KRSA) initiated a strategic planning process in February 2005 to ensure that monies received tk~rough the Pacific Coastal Salmon Recovery Fund (PCSRF) are focused on priority information/aetion needs (hereafter referred to as "needs") for the conservation and restoration of habitat, and salmon research in the Kenai River watershed. To update the plan, KR5A convened a half day informational meeting on March 30, 2006 and a one day planning workshop on March 3l, 2006 in Soldoma. At the informational meeting, 33 attendees registered, and about a dozen members of the public viewed the meeting. At the planning workshop, a total of 25 representatives from Local, state and federal government agencies and non-governmental organizations with Land and fishery management responsibility participated in discussions to identify and prioritize needs. Results from the planning process form the basis of KRSA's 2006 call for proposals. This report details the results from the informational meeting and planning workshop held in 2006. Dedicated to preserving the greatest sportfishing aver in the world, the Kenai. PO Box 1228 • 224 Kenai Ave., Suite 102 • Soldotna, Alaska 99669 nw.....,. InM1 7G 9_4044 . Cav len'71 71:7-R°::"/ . un~nu 4anoiri,mrcnnrVF'mhinn rnm . G-mvl. infnn Lonoiri,mrcnnhfichina rnm YRSA 2006 Call for Proposals - Pacifrc Coastal Salmon Recovery Fnnd -Kenai River Watershed Kenai River Sporttishing Association (KRSA) is seeking habitat restoration, and salmon and habitat research project proposals suitable for funding by the Pacific Coast Salmon Recovery Fund (PCSRF), managed in Alaska through Alaska Department of Fish and Game (ADFG) as the Southeast Sustainable Salmon Fund (SSSF). A portion of that fund has been dedicated for work on the Kenai and Russian rivers. KRSA, in collaboration with representative land and fishery managers, has identified action and information needs for protecting salmon sustainability. You are invited to identify your interest and to submit pre-proposals for use in the development of a list of potential projects to address the specifec objectives, action and information needs for the Kenai watershed. Economic Vahtes of Sport, Personal Use, and Commercial Salmon Fislting in Upper Cook Inlet Upper Cook !Hier is unique among all of Alaska's maritime regions in its relative proportions of recreational and commercial tishing. Sport and personal use fishing is heavily concentrated in the region, and the economic values associated with these activities are very substantial. Commercial fisheries in Upper Cook Inlet yield a minor fraction of the state's commercial harvest values. Economic values of sport and personal use salmon fisheries in Upper Cook Inlet now significantly surpass those of the Upper Cook Inlet commercial salmon fisheries by every available measure. Economic factors are among the considerations taken into account by the Alaska Board of Fisheries when making allocations and other regulatory decisions. This report reviews published seudies and agency data on participation, economic significance, net economic value, and potential economic impacts in Upper Cook Inlet's sport, persona( use, and commercial salmon fisheries. Participation: Cook Inlet supports Alaska's largest and most economically valuable recreational fisheries. Neazly two- 'hirds of the state's residents (61%) live in the three Cook Inlet boroughs (Anchorage, Mat-Sq and Kenai), and almost 60% bf Alaska's sport fishing occurs in these boroughs. More than 250,000 anglers-Alaskans and visitors-fish each yeaz in the Cook Inlet boroughs. [n good fishing years, recreational anglers collectively approach one million days per yeaz fishing on the Kenai Peninsula. More than half (~l%) of all summer fishing trips in the state are in Upper Cook Inlet. And almost three-quarters of all summer fishing trips in Alaska are for salmon. Salmon fishing in Upper Cook Inlet accounts for well over one-third (37%) of a[i recreational t""fishing in the state. Economic SigniScance: Sport and personal use fishing in Southcentral Alaska generate direct spending of $4[5 million (2003 dollars) and total sales of $532 million that support some 6, I00 "full time equivalent" or "average annual" jobs that produce $171 million in income. Recreational salmon fishing in Upper Cook Inlet generates direct spending of $246 million (2003 dollars) and $290 million in total sates that support 3,400 average annual jobs producing $95 million in income. Net economic value: The average value (over and above expenses) that individual Alaskans place on their annual recreational fishing is $714 (2003 dollars). Sport and personal use fishing in Southcentral Alaska accounts for four fifths (80%) of the statewide recreational fishing net economic value or NEV total. The net economic value of recreational salmon fishing in Upper Cook Inlet is estimated at $104 million (in 2003 dollars}-almost half (47%) of the statewide recreational fishing NEV total-with $56 million of that amount going to Alaskans. Future Trends: Demand for recreational fishing opportunities in the Cook Inlet boroughs is expected to grow by 2.3% per yeaz through 2010-a net increase of almost 60,000 anglers over 2001 levels. A record l9, 110 personal use permits were issued in Upper Cook Pnlet in 2003. Allocation and Management: Commercial fisheries are currently allocated 80% of the Upper Cook Inlet salmon harvest, while sport and personal use fisheries are allocated 20% of the harvest. The success of recreational fisheries relies not only on receiving an appropriate share of the salmon harvest but also on receiving those fish in a way that is meaningful to recreational users. 4/21/06 ..w The Rest of the Fish Story Economic Analysis by KRSA Has Fatal Flaws Several economic facts were selectively picked, altered, or omitted concerning the commercial fishing industry as reported by Kenai River Sportfishing Association (KRSA). Following are the 2005 commercial landings and ex-vessel payments in the Kenai Peninsula Borough: salmon - 34,615,000 pounds generated over $33 million; halibut -16,439,721 pounds generated over $49 million; black cod - 8,459,797 pounds generated over $34 million; and gray cod - 2,560,000 pounds generated over $1.5 million. These four fisheries collectively landed 62,074,518 pounds of fish generating ex- vessel payments in excess of $113 million in 2005. These $113 million are spent directly into the Kenai/Alaskan economic community for crew wages, fish taxes, vessel purchases, vessel repairs, gasoline, diesel, auto and truck fuels, homes, property taxes, repairs, supplies, clothing, food, and transportation services. As we spend our fishing incomes these dollars circulate in and through our economic community about five times, growing to over $500 million of economic activity. However, when KRSA made its economic analysis the comparison was between all forms of sport fishing to just the ex- vessel payments of salmon (they conveniently chose to omit these other species and commercial economic activity as these ex-vessel payments circulate in an economy). Additionally, KRSA conveniently omitted the economic activity due to over one hundred vessel owners and crews that make the peninsula home, but commercially fish in Prince William Sound, Kodiak, Bristol Bay, and the Aleutian Chain. These fishermen bring their cash back home to spend on the Kenai Peninsula, which brings additional tens of millions of dollars into our economic community. The four fisheries mentioned above do not include additional fisheries such as herring, Pollock, bottom fish, scallops, or octopus commercial landing, which add millions to the ex-vessel payments. Most commercial fishermen are multi-species, multi-area fishermen. The KRSA's so called "economic report" does not cover the entire scope or breadth of commercial fishing. Rather, they selected one fishery, salmon, to compare against the entire economic scope and breadth of sport fishing. Each year it takes over 1,200 semi trucks to carry the millions of pounds of seafood produced on the Kenai to markets. It costs about $12,000 for a semi truck to leave the lower 48 to come to the Kenai and return south. If the freight being hauled north (such as bananas, lettuce, carrots, or fruits) has to pay the entire $12,000 trucking costs, the freight cost per pound is 33 - 34¢. However, if the same semi can pick up a load offish destined for the lower 48, the freight is cut by about half to 16 - 17¢ per pound. The lower 48 destined fish will cover half the $12,000 round trip costs, or about $6,000. Everybody wins with semis loaded both ways. These 1,200 semis each provide a $6,000 freight subsidy (totals to over a $7,200,000 annually) on the goods we all consume. The KRSA study conveniently omitted this and similar commercial fishing economic benefits. The commercial gillnet fishing industry consume over 100,000 gallons of gas/diesel fuels during every opening. At $2.50 per gallon, that equates to $250,000 for fuels for each opening. The commercial gillnet fishermen utilize far in excess of one million gallons of - fuels per year, and that's just on salmon. Additionally, many of these commercial 4/21/06 fisheries provide fish eggs and egg products that are worth millions of dollars per year. The KRSA economic analysis also conveniently omitted to consider these products. By now the rest of the fish story starts to come into focus. Over the years KRSA has demanded the commercial fishing industry disappear in order fcr them to achieve their self interests. It should be readily apparent that KRSA doesn't want to shaze any fish with anyone and wants to steal the fishery resources "fish by fish". No compensation to the commercial fishing industry; just take the fishery "fish by fish". What kind of community neighbor is KRSA anyway? The only justification KRSA has ever offered for the "fish by fish policy" is that these fish are valuable to KRSA. What an economic policy for our neighborhood, "If something is more important to me than you - I'm going to go ahead and take it ! ". With xhis take " fish by fish" practice, KRSA has created a culture of conflict supported by conveniently misleading economic analysis and intentionally distorting the facts. The so called economic analysis has no author identified; this leaves the public to assume that Ron Rainey and/or Ricky Gease are the authors. KRSA, would you please identify the author of your recent economic analysis report so that we can publicly debate this unnamed individual? In building a strong and diversified economic community we need an economy that includes the medical, oil & gas, professional services, transportation, commercial fishing, education, governmental, retail, and tourism sectors. KRSA is the only ~~;ctor that actively promotes the demise of an economic neighbor. The commercial fishing industry and a great number of your economic neighbors want, deserve, and expect better treatment. KRSA, you have sorely tempted the commercial fishing industry, but we resisted the urge to go after you because of your poor neighbor skills. KRSA, if you want to become a full economic neighbor, then you must tell the truth, show respect, and be a supporter of all the community economic sectors. 4/20/2006 Dr. Roland R. Maw, PhD, Executive Director United Cook Inlet Drift Association (UCIDA) 260-9436 4 ~'"''` February 2006 Volume 26 Number 2 ISSN 0960.3345 Address Change Our mailing address has changed to the Alaska Department of Labor & Workforce Development, P.O. Box 111149, Juneau, AK 99811-1149. To contact us for more information, a free subscription, mailing list changes. or back copies, email us at trends@la bor.state. a k. u s or call (907)465-4500. Alaska Economic Trends is a monthly publication dealing with a wide variety of economic-related issues in the state. Its purpose is '.. to inform the public about those issues. Web site: almis.labor.state.ak.us Frank H. Murkowski, Governor of Alaska (sreg 0°Claray, Commissioner Susan Erben, Editor Layout and cover design by Sam Dapcevich Email Trends authors at: trends@laborstate.ak.us February Trends authors are staff with the Research and Analysis Section, Administrative Services Division, Alaska Department of Labor & Workforce Development Free Subscriptions: trends@labor.state.a k.us (907) 465-4500 Aiaska Economic ', Trends is funded by the Employment Security Governor's Letter 3 Division and published by the Alaska Department of Labor&workforce Employment in the Alaska Fisheries 4 Development. Positive signs in 2003 and 2004 Printed and distributed by ', Assets, Inc., a vocational training and employment The American Community Survey 14 program, at a cost of $1.27 per copy. Anew approach to Census data '. Material in this publication is public Profile 20 information and, with appropriate credit, may Alaska's Traveling Seafood Workforce '.. be reproduced without permission. Employment Scene 24 Cover photo courtesy of Alaska seafood Marketing Employment up 1.8 percent over the year -- Institute Alaska Economic '. Trends is available -- on the Internet. See URL above. Alaska's Fisheries - A Suecess Story of Recvery by Governor Frank H. Murkowski Alaska is a state rich in natural resources and one of the most important is fish. Our wealth includes 50 percent of the nation's commercial harvest from the sea. I°m encouraged by recent figures showing improvements in Alaska's seafood industry. Total earnings, employment and exports have all increased over the past two years. Almost 4 billion pounds were harvested in 2004, generating close to $1 billion in gross earnings, more than 6,700 direct jobs and the core economy for much of coastal Alaska. This month's Trends discusses this rebound, which comes after an eight-year steady decline. Early in my administration, we began taking steps to invigorate an industry wounded by a boom in farmed fish production. Through our Alaska's Fisheries Revitalization Strategy, we're pumping $50 million over several years into the state's seafood industry with economic grants, a worldwide marketing campaign and disaster relief funds. - Key to the success of our efforts has been the partnership between government and the seafood industry. The collaboration of the departments of Labor & Workforce Development, Fish and Game, and Commerce, Community and Economic Development, along with those in the industry, has resulted in an additional $40 million in matching contributions from the seafood industry. Across the state, we've invested resources to improve productivity and innovation. We've provided disaster relief assistance to individual fishermen and communities most impacted by the farmed fish industry. We've worked to improve transportation activities within the industry to help move products more efficiently. And to ', help us keep pace with an ever-expanding industry worldwide, we've funded product quality improvements, -- technology assistance, as well as research and development projects. ', We've recently developed the Targeted Fisheries Assistance Program to provide boat-improvement grants to - salmon fishermen so they have the equipment and systems to provide the highest quality product possible. The surge in popularity of farmed salmon was due largely to its consistent quality, which made it more appealing than Alaska wild salmon. Improving harvesting and the abilities of tender vessels to maintain product quality -- will help us earn higher prices and increase our profitability and success. Alaska's seafood industry is changing for the better. Employment and earnings were up in 2004. Markets are -- beginning to demand our wild Alaska salmon over farmed salmon. The Alaska Fisheries Revitalization Strategy is part of this positive change. I'm pleased with the efforts of all involved to help protect and stimulate one of our most precious resources, and I look fonnrard to ongoing successes in our seafood industry. Continued -- collective efforts between my administration and the seafood industry are delivering positive results. P®sitive signs in X003 and 2004 ince the late 1980s, much of the news about Alaska's fisheries has been negative. Gross earnings fell 63 percent from 1988 to 2002' and the number of active permit holders fell 35 percent over the same period. The good news is that fisheries data from 2003 and 2004 -including the employment estimates that are the subject of this article -suggest that the tide may have changed. Among the reasons for cautious optimism are a 19 percent increase in gross earnings from 2002 to 20042 and a 3 percent increase in Fish Harvesting Employment Alas(ca, 2000-2004 Employment 8,500 a,ooo 7,500 7,000 s,sao s,ooo 00 O~ Off' 00 A ri0 ry0 r~0 rt0 ry0o Source: Alaska Department ofLabor 8 WorMorce Development, Research andAnatysis Sech'on active permit holders. Employment in the fisheries also recovered some of the lost ground, adding 265 jobs after losing nearly 1,500 over the previous two years. (See Exhibit 1.) Employment data - the new kid on the block Most of what we know about the state's fisheries comes from the Alaska Commercial Fisheries Entry Commission, which provides detailed fisheries data on, among other things, gross estimated earnings, pounds caught, permit holders and permit holders who fished. CFEC's data isgenerally available back to at least 1980. The employment estimates discussed in this article are produced by the Alaska Department of Labor & Workforce Development and are a relatively recent addition to the library of fisheries-related informatiun. The Series Giiiy goes back to 2000 and this is just the second time it has been published in Alaska Economic Trends. Before looking further at the numbers themselves, though, it will be useful to clarify a few key terms and concepts and to specify what information the employment data provide that is not already available from other sources. Comparisons with permit and crew license data As noted above, CFEC provides statistic on the number of commercial fishing permits issued. These are comparable to statistics on the number of business licenses issued, in that both give their owners a right to participate in a certain regulated activity. Earnings are adjusted to constant 2004 tlollars using the Anchorage Consumer Price Index. ' The year 2004 is the most recent year for which data are currently available. ,.~;~ ~ ,.~ 4~..- ' =AL-~SKA-ECQNOMICTREND~~ `~ FEBRUARY 2006° ; Halibut Miscellaneou Shellfish 2.1% 2®®® Salmon 52.4% Harvesting Employment by Species Source: Alaska Department o/Labor & Workforce Development, Research andMatysis Section As a subset of the total number of permit holders, CFEC also collects data on the number of permit holders who actually catch and sell fish with their permits. These are the statistics referred to in the first paragraph as "active permit holders" or in some CFEC publications as "fishermen who fished." :".that ~neithcr the iiumibcr of poi mit holderc nor the number of active permit holders can tell us, however, is the number of jobs generated by the permits.' Some permit holders may fish during only one month a year, while others may fish during 10. Both will show up in CFEC data as one active permit holder during that year despite the obvious difference in the amount of employment generated by the two permits. What's more, a count of permit holders leaves out another important piece of information: how many jobs, if any, are created for crew members hired to help with the harvest. In most cases, the permit holder doesn't work alone. In this sense, the permit holder is akin to the business owner whose license to operate creates a certain number of jobs for others. dust as an active business license for afull- service restaurant that operates year-round generates more jobs than a business license for a seasonal hot dog stand, active permit holders also generate different numbers of jobs depending on how labor-intensive it is to participate in the given fishery and also on how many months of the year the permit holders are aCively fishing their permi*s. On the low end of the spectrum, a permit to harvest clams with a shovel doesn't generate a lot of jobs because the harvest can be done by just one person and it's only done for a few months of the year. By contrast, a permit to harvest king crab on a vessel over 60 feet long generates substantially more jobs because it takes an average of six people to operate the boat and gear. Permits for Alaska's less seasonal fisheries - groundfish and halibut, for example -also generate more jobs per permit than do permits in fisheries that only last for a few months each year. The number of crew licenses issued each year is collected and published by the Alaska ' Employment data published in this article and elsewhere in Trends and U.S. Bureau of Labor Statistics' publications are annualized so that a job that lasts all 12 months of the year is counted as one job, a job that lasts six months is counted as 0.5, and so forth. Statevlride Salmon Prices In nominal dollars, 2001-2004 King Sockeye Coho Pink Chum 2000 $1.95 $0.79 $0.56 $0.15 $0.27 2001 $1.68 $0.57 $0.49 $0.13 $0.34 2002 $1.30 $0.60 $0.36 $0.10 $0.18 2003 $1:43 $0.63 $0.48 $0.09 $0.18 2004 $1.85 $0.60 $0.68. $0.10 $0.21 1980s. Salmon fishermen in particular have faced lower prices as a result of competition from farmed salmon and the consequent increase in world supply. In 1980 the world salmon supply was around 550,000 tons, 98 percent of which was wild salmon; by 2001 the world supply had grown four-fold to roughly 2.2 million tons and 62 percent of that amount came from fish farms." Higher prices. raise employment Source: Alaska Department ofLaborBWorkfome Devebpment, Research and Analysis Section levels In the$almOn fishery - Department of Fish and Game. This too is different from a count of jobs in that the crew license data simply quantifies the number of people who are eligible to work in the fisheries as crew members in a given year. To illustrate the difference, if 12 different crew members work for a month each in a year, the crew member count would be 12 but the annualized job count would be one. On the other hand, if one crew member works for all 12 months, both the crew member count and the annualized job count would be one. Under most circumstances, increases in crew licenses will correlate with increases in the total number of jobs, but it's possible for the two to diverge since they count different thines. Familiar turbulence for the fishing industry As is often the case with resource-based industries, employment levels in Alaska's fish harvesting industry have seen significant variation over the years, and the 2000 to 2004 period discussed in this article is no exception. Changes to both supply and demand are common, and regulatory changes; such as the introduction of the limited entry permit system and individual fishing quotas, can also have a dramatic effect on employment levels. Biologically, Alaska's fisheries are healthy; economically, they have struggled since the late In terms of employment, the salmon fishery is the state's dominant contributor. (See Exhibit 2.) In 2004, 49 percent of all fish harvesting jobs came from salmon, down slightly from 52.4 percent in 2000. The 3,305 jobs generated by salmon fishing in 2004 were still more than double the amount from groundfish, the next largest category. Statewide per-pound prices for king and Coho salmon showed definite improvement in 2003 and 2004. King salmon prices rose from $1.30 a pound in 2002 to $1.85 in 2004 and Coho prices increased from $.36 a pound to $.68 over the same period. (See Exhibit 3.) Sockeye and pink prices were essentially flat, however, and chum prices moved only slightly from $.18 a pound to $.21. In fact, prices for sockeye, pink and chum -the three species that account for over 93 percent of all salmon harvested, by volume -are still at or near historical lows. The impact of rising prices for king and coho was nevertheless sufficient to have a noticeable effect on total earnings. After falling from $412 million in 2000 to $144 million in 2002, a decline of 65 percent, earnings partially recovered over the next two years, rising to $254 million by 2004. As one would expect, higher overall prices also increased employment in the salmon fisheries in 2003 and 2004. (See Exhibits 4 and 5.) Specifically, the strong increase in 2004 king salmon prices raised employment for February and March, the months when most winter kings are caught in Southeast Alaska. Employment ° Knapp, Gunnar. Projections o(Future Bristol Bay Salmon Prices. University of Alaska: Institute of Social and Economic Research, 2004. 6= A[ASK~ECSINQMIG'`TRENC2S~- FEBRUARI'~ Z00&= in February climbed from 134 in 2002 to 258 in 2004, and March employment rose from 204 to 327 over the two-year period. Groundfish employment follows the same pattern as salmon Salmon generates more jobs than any. other fishery, but in terms of volume and value of the catch, the state's largest fishery is groundfish, where a fairly small number of large boats catch an enormous amount of fish, predominantly pollock, without requiring a lot of manpower. Groundfish harvesting employment declined almost 20 percent from 2000 to 2002 before reversing course and adding about 8 percent from 2002 to 2004. (See Exhibits 4 and 5.) The reasons for the decline and partial recovery are not as clear-cut as they were with salmon where price changes had such an obvious effect. Pollock prices from 2000 to 2004 were low by historical standards and relatively static. Earnings in the sablefish fishery fell noticeably in 2001 before recovering strongly in 2003, which may account for part of the employment growth. Harvesters caught a significantly higher volume of sablefish in 2003 as well, indicating healthy stocks and an increased quota. Halibut is down slightly, crab rose then fell Alaska's halibut fishery is managed by the International Pacific Halibut Commission using individual fishing quotas, or IFQs, which grant a certain percentage of a regional fishery's total allowable catch each year to individual permit holders. Because of this system, and because halibut stocks have been relatively constant in recent years, the number of jobs has also been relatively constant. (See Exhibit 5.) Small declines in 2003 and 2004 may have been caused by a consolidation of quota shares. Individuals are allowed to own multiple IFQs as long as their total share doesn't exceed a specified percentage of the total halibut quota for the region. Salmon and Gr®undfish Empl®yment Percent Change, 2001-2004 Percent Change 15% 1o°r° 5% o°i° -5% -1o°i° -15% -2o°i° ® Salmon °" Groundfish 2001 2002 2003 2004 Source: Alaska Department of labor 6 Workforce Development, Research andAnatysis Section Employment in the crab fishery moved in opposite directions from salmon and groundfish, growing from 2000 to 2002 before dropping off in the next two years. (See Exhibit SJ Responsible for about 7 percent of all harvesting jobs in 2004, the crab fishery's peak employment months are roughly the opposite of salmon. The Bering Sea opilio crab fishery reaches full strength in January and February, and the Bristol Bay red king crab fishery pushes employment way up in October. Most of the inhc in tha in_hatwePn months are ~OI?CentratP.d in Southeast's dungeness crab fishery. Harvesting employment by region Nearly all of Alaska's fish harvesting employment is accounted for by three broad regions: Southwest, Southeast and the Gulf Coast. In the Northern region, less than 100 jobs come from the salmon, crab and herring fisheries. In recent years, the Southwest region has had the largest share offish harvesting employment, nearly 44 percent in 2004. (See Exhibit 6.) It's also the region that suffered the steepest loss from 2000 to 2002, a 25 percent decline in employment. (See Exhibit 7.) Of the more than 900 jobs lost over those two years, 83 percent were in the salmon fishery: A moderately Fish Harvesting Empl®yment Estimates 2ooo-Zoos Atl Regions and Species '. Year Jan. Feb. March April May June July Auq. Sepi. Oct. Nov. Dec. Mo. Avq '. 2000 3,154 4,180 4,759 5,715 6,957 19,698 22,099 13,670 7,198 5,077 2,106 856 7,956 2001 2,639 4,172 4,160 4,025 5,849 17,132 20,350 12,760 7,068 5,256 2,229 712 7,192 2002 3,321 3,847 4,000 4,191 5,626 14,867 17,056 10,980 6,101 4,906 2.343 520 6,477 '. 2003 ' ' ~ ' ' 6,657 2004 « « « « « « « « 6,742 Total Crab Fishery i. Year Jan. Feb. March April May June JuIY Auq. Sept. Oct. Nov. Dec. Mo Avq j 2000 70 510 183 1,434 129 439 368 337 170 1,660 285 69 471 2001 593 1,626 237 141 117 462 505 490 156 1,591 454 126 541 2002 1,360 1,499 255 162 66 527 529 573 185 1,772 514 77 626 ', 2003 1,230 924 205 78 27 451 468 435 168 1,734 497 91 526 2004 1,314 707 228 36 18 466 451 460 103 1,716 275 76 487 Total Groundfish Fishery Year Jan. Feb. March April May June July Auq. Sept. Oct. Nov. Dec. Mo. Avq 2000 2,915 3,447 3,097 2,470 1,495 1,063 1,088 1,511 1,774 1,289 601 459 1,767 2001 1,907 2,354 2,394 1,966 1,345 1,159 1,378 1,544 2,232 1,393 598 387 1,555 2002 1,735 2,113 2,491 1,591 1,105 958 1,357 1.556 2,006 1,120 733 224 1,416 2003 1,889 2,258 2,226 1,835 1,379 1,053 1,410 1,710 1,909 1,01A 569 55 1,442 2004 1,939 2,350 2,186 1,950 1,472 ,1,229 1,443 1,753 1,959 1,435 652 52 ~ 1,535 Total Halib ut Fishery Year Jan. Feb. March April May June July Aug. Sept. Oct. Nov. Dec. Mo. Avq. 2000 0 0 1,017 1,393 2,189 1,939 1,563 1,930 1,793 1,122 661 0 1,134 2001 0 0 1,074 1,322 1,956 2,121 1,616 2,022 1,717 1,172 671 0 1,135 2002 0 3 744 1,488 2,039 2,367 1,833 2,030 1,574 970 572 0 1,132 2003 0 0 1,010 1,483 1,697 2,160 1,604 1,969 1,488 1,110 609 0 1,092 2004 ' ' - ' ' 1,081 Total Herring Fishery Year Jan. Feb. March April May June July Aug. Sept. Oct. Nov. Dec. Mo. Avg. 2nnn 0 0 238 92 2,016 513 88 0 0 33 248 2001 17 0 245 288 1,269 425 67 0 0 0 5 11 194 2002 6 6 270 681 1,210 65 97 0 0 8 0 17 196 2003 6 5 264 1,087 962 0 64 0 5 0 5 11 201 2004 0 0 248 797 1,028 0 46 0 5 5 0 6 178 Total Miscellaneous Shellfish Fishery Year Jan. Feb. March April May June July Aug. Sept. Oct. Nov. Dec. Mo. Avg. 2000 106 103 35 43 129 96 98 92 48 700 388 171 167 2001 53 73 31 44 129 101 66 - 69 33 738 346 112 150 2002 125 93 36 32 122 91 95 77 45 655 443 140 163 2003 ' 160 2004 « « « « 156 Total Salmon Fishery Year Jan. Feb. March April- May June July Au Sept. Oct. Nov. Dec. Mo. Avq. 2000 64 121 189 283 999 15,649 18,894 9,801 3,413 307 171 125 4,168 2001 70 119 180 265 1,034 12,865 16,717 8,635 2,931 362 155 76 3,617 2002 95 134 204 238 1,085 10,860 13,145 6,744 2,291 383 82 62 2,943 2003 121 247 251 270 1,179 12,361 14,568 6,369 2,685 469 172 159 3,237 2004 118 258 327 384 1,132 11,962 14,515 6,959 3,277 391 171 173 3,305 'There were insufficient data to make reliable monthly estimates for the halibut fishery in 2004 and for the miscellaneous shellnsh fishery in 2003 and 2004. Monthly averages for those fisheries and years represent estimates based on annual data available from other sources. ', Source: Alaska Departrnent oftabor6Woddorce Development, Research and Analysis Secflon ' $:; " ~ AL+~SKA;E~~JQMI~TRENRS'- ~ . : FEBRUARYS .2006: ,w. r ,. strong recovery in salmon jobs in 2003 pushed Southwest employment 8 percent higher. Employment in 2004 then fell off slightly due to small declines in several fisheries. The employment picture in Southeast was significantly more stable over that same period. The total job count fell by about 9 percent from 2000 to 2003 before recovering by 2.4 percent in 2004. As with the Southwest region, most of the changes were the result of a decline and partial recovery in the salmon fishery, which was responsible for more than 44 percent of ail Southeast harvesting employment in 2004. Employment in the Gulf Coast region followed the same basic pattern as the Southwest region - a steep decline from 2000 to 2002, followed by a moderate recovery from 2002 to 2004. Again, the principal cause of the movement was ', the salmon fishery, which provided just aver 50 percent of all Gulf Coast harvesting jobs in 2004. As noted, salmon jobs dominate in all three regions, accounting for about 50 percent of the employment. (See Exhibit 8.) In the Southwest and Gulf Coast regions, groundfish was the next most important category in terms of jobs provided, while in Southeast, halibut had the second-highest job count in 2004 {o(!awed by groundfish The crap ,. fishery also provided a significant number of jobs in 2004 in the Southwest and Southeast regions - 264 and 161, respectively In the Gulf Coast region, crab harvesting employment hovered around 50 from 2001 to 2004. Herring and shellfish provided a smattering of employment across the Southwest and Gulf Coast regions, while they combined to a more significant sum in Southeast (239 in 2004). Fishing's role in the state arld IOCaI eCOnOrn12$ Percent of Employment by Region Alaska fisheries, 2004 Southwest 43.7% Southeas 29.4% 26.3% Northern 0.6% Source: Alaska Depar4nent of Labor & Woddorce DevelopmenP, Reseamfi andMalysis Seco'on Harvesting Employment by Region Alaska fisheries, 2000-2004 Employment anon 3,500 3,000 2,500 z,ooo 1,500 `ti~~o `ti~~^ ti~~~ `ti~~~ - ti~o~ After fdlhngd pfeClpIY0U51$.6 percent from Source: Alaska Department ofLabor&Workforce Development, Research and Analysis Section 2000 to 2002, total fisheries employment bounced back to grow 4.1 percent from 2002 to 2004. Over the latter period, fishing jobs grew at a faster rate than some ®GulfCoast ®Southeast ®Southwest of the state's major industries and outpaced total employment growth. (See Exhibit 9.) In 2004, the state's 6;742 fish harvesting Jobs made up 2.9 percent of all private-sector jobs.s (See Exhibit 10.) When the fishing Harvesting Employment by Species Alaska fisheries, 2004 Employment 3,000 2,500 2,000 tsoo t,ooo 500 ~ Salmon ®Groundfish 'Halibut ®Crab Southwest Southeast Gulf Coast Source: Alaska Department ofLabor & Woddorce Development, Research andMalysis Section Employment Growth Statewide Selected industries, 2®02-2®04 Total Wage and Salary Financial Activities Construction Retail Trade Health Care Leisure and Hospitality Fish Harvesting industry is defined to include both harvesting and seafood processing, it accounts for 6.6 percent. That number is up slightly from 2002 when the fishing industry represented about 6.3 percent of the private sector. for comparison, the oil and gas industry in 2004 provided 3.6 percent of private-sector jobs and the construction industry 7.7 percent Jn the Southeast, Gulf Coast and Southwest regions of the state -the three regions with nearly all of the state's fish harvesting employment -the fishing industry's contributions are significantly greater. (See Exhibit 11.) Fish harvesting and processing combine to make up 14 percent of Southeast Alaska's private-sector economy. In the Gulf Coast region, about 18 percent of private- sectorjobs are either in fish harvesting or processing. In Southwest Alaska, the fishing industry accounts for just over half of all private-sector employment. These numbers, as high as they are, understate the importance of fishing to the three regions. The millionsof dollars in harvest value paid to commercial fishermen support a substantial portion of the remaining private sector in these regions, especially in Southwest Alaska. Other than a small amount of mining employment, fishing is the Southwest region's nn.ly hasir_ sector employer. The remaining private employment consists of industries such as retail trade, construction and health care that provide goods and services to the local population. It's no exaggeration to say that many Southwest Alaska communities -and others scattered throughout Southeast Alaska and the Gulf Coast region -would virtually disappear without fishing. Salmon runs create most of the seasonality Commercial fishing, like many industries in Alaska, is highly seasonal when the total job count is considered. (See Exhibit 12.) A closer look, however, reveals that most of the seasonality comes from the salmon Source: Alaska Department of Labor E Workforce Developmen; Research andMa/ysis Section ' "Pdvate-sector jobs" is defined here to mean all private wage and salary jobs combined with the fish harvesting employment discussed here. Seif- employment, employment in industries not wvered by state unemployment insurance laws and ail other agricultural empbyment is excluded. fishery, and that both the groundfish and halibut fisheries provide a relatively constant stream of jobs over much of the year. What's more, high January and February employment in the crab fishery fills in during two of the three months when there is very little halibut fishing activity. Overall, Alaska's fisheries provide a considerable number of jobs in every month but December. The Southwest region's massive summer salmon runs amplify its seasonal pattern of employment, while in the Southeast and Gulf Coast regions, the distribution is a little more even. (See Exhibit 13.) Southwest Alaska regularly goes from having no salmon harvesting employment at all in the first five months of the year to as many as 10,000 jobs during the peak months of the summer. Conclusion The fish harvesting employment estimates discussed in this article are a relatively new addition intended to fill a gap in the employment data provided in Trends and elsewhere by state and federal agencies. Because the methodology is still under review, the numbers should be considered preliminary, although significant changes are unlikely. Alaska is a state rich in natural resources and one of the most important is fish. Almost 4 billion pounds were harvested in 2004, generating close to $1 billion in gross earnings, more than 6,700 direct jobs and the core economy for much of coastal Alaska. After more than a decade of declines, there were distinct signs of improvement in the salmon fishery in 2003 and 2004, although few would deny that there is a lot of ground to recover or that significant economic challenges remain. Led by salmon and groundfish, total employment grew by 265 jobs from 2002 to 2004, a welcome change in direction after a total decline of nearly 1,500 jobs over the two previous years. Private-Sector Employment .Alaska, 2004 Construction Source: Alaska Department ofLabor & Workforce Development, Research andAnafysis Section Private-Sector Employment By industry and region, Alaska 2004 Employment 30,000 25,000 20,000 15,000 10,000 5,000 Source: A~ska Department of Labor & Woddorce Development, Research and Analysis Section Southeast Guif Coast Southwest my Salmon is Highly Seasonal Average monthly employment by species Employment 20,000 15,000 10,000 5,000 0 Jan. Feb. March April May June July Aug. Sept. Oct. Nov. Dec. 'These are averages for each month for the years 2000 to 2004. Halibut averages are for 2000 to 2003; no monthly data are currently available for 2004. Source: Alaska Department ofLabor & Workforce Development, Research andAnalysrs Section Southwest is the Most Seasonal Average monthly employment, 2000-2004' Employment t 2,000 10,000 8,000 6,000 a,ooo 2,000 ®Southwest ®Southeast ®Gulf/Coast 0 Jan. Feb. March April May June July Aug. Sept. Oct. Nov. Dec. ' Where no monthly data were available, estimates were used from the patterns from the previous years and annual totals. Source: Alaska Department ofLabor & Workforce Development, Research and Analysis SecG'on Developing a Methodology by Michael Patton and Dan Robinson, Economists In other industdes, the Alaska Department of Labor & Workforce Development can accurately count jobs because nearly every employer is required to report the number of wage and salary employees on their payroll each month as part of their mandatory unemployment insurance coverage. But fish harvesting jobs are generally excluded from unemployment insurance coverage and the taxes that pay for it. Even if they weren't, crew members on fishing boats are nearly always paid a share of the earnings rather than a wage or salary. As a result, fishing jobs don't generate the payroll records used to calculate monthly employment in other industdes.' Landings and crew factors As a substitute for detailed payroll records, state and federal fish management agencies provide the Department of Labor with information on the specific "landings" made under each permit over the course of the year. A landing is the initial sale of harvested fish to a buyer.z To then create employment estimates from landing records, the Department of Labor uses an on-going survey of permit holders to develop "crew factors" which quantify the labor needed to fish specific permits in their associated region, species and gear type. For example, survey responses indicate that it takes an average of six crew members to fish for king ' Another reason why no employment data have been available for the fshedes is that the U.S. Bureau of Labor Statistics, which governs how employment is counted in the federal-state cooperative program called Current Employment Statistics, defines fishing as an agricultural activity and agdcultural employment has traditionally been excluded from employment statistics under this program. ~ The majority of landing data come from mandatory fish ticket reporting. Data for groundfsh catcher processors -who are not required to file fish tickets- are provided 6y the National Madne Fisheries Service as compiled by the Alaska Fisheries Information Network, a network of five tederel and state agencies. ~~:s>s~ :~ 1-'l,.x = ,.% ALASKA~E~QT~IQMI~'RENCIS ,~, FEBRUARY. 2OQ6~ ' . crab with pot gear on a vessel over 60 feet long in Bristol Bay - a permit with the designation K91 T If a landing is recorded in January under a K91T permit, the Department applies the crew factor of six for that permit. In other words, six monthly jobs were created. Every permit number is unique -the K91 T used in this example is a type of permit or a permit for a specific fishery rather than the permit number itself -which allows the Department to assign only one set of jobs to a specific permit in any one month even if numerous landings are made during the month. The same concept applies to counts of payroll employment in that a person who works 60 hours a week for a single employer is counted the same as a person who works 20 hours a week.' Each is said to hold one job. A final point is that the jobs are assigned by place of work rather than by the residence of the employees. Most permits have a geographic designation as to where specific species can be harvested and with what type of gear. In the above example using a K91T permit, the K stands for king crab, the 91 stands for pot gear on a 60-plus-foot vessel and the T stands for Bristol Bay. All landings made under that type of permit create employment assigned to Bristol Bay and aggregated to 4he Southwest region. Employment generated under permits that allow fishing anywhere in the state is assigned by a special harvest area code. The estimates are conservative For a few reasons, the estimates may slightly undercount employment generated by Alaska's fisheries. First, the estimates don't reflect the amount of time spent by permit holders and their crew Dreparing to fish or winding up operations after the fishing is done for the year. Until a permit holder makes a landing, no employment is tallied, so if the permit holder works for two weeks in May getting 4he boat ready to fish and then begins making landings in June, the efforts in May are not counted, despite their obvious importance to the enterprise. The Department of Labor has begun surveying permit holders to determine how much preparation time is required in each fishery and will include those efforts in future estimates. Another way the estimates are conservative is in their selection of the permit holder as the employer. When a permit holder makes landings under two different permits in the same month, only the permit with the highest value catch is assigned employment in that month. in other words, if Ishmael Jones lands fsh under both a salmon permit and a sablefish permit in June, and he was paid more for the salmon, he will be credited with generating jobs only under the salmon permit' The assumption under this approach is that crew members who work for the same permit holder and fish for both salmon and sablefish in the same month are analogous to employees who perform different duties for one employer during a months ' Whenever possible, the Department of Labor adhered to the same concepts it uses to calculate payroll employment in other industries in cooperation wish the U.S. Bureau of Labor Statistics. Doing so allows for the most meaningful comparisons between the two. ' M alternative approach would have been to view fhe permit itself as the employer, irrespective of ownership, and assign employment to the permit in every month for which it is used to make landings. This approach would be more analogous to a person working during one pay period for two different companies owned by the same person. Some permit holders may hire different crew members to fish their different permits. Since crew members are not specifcally identif ed in fhe fish tickets that recoM landing data, turnover of this type can't be raptured. A new approach to Census data anumental changes are taking place with how the U.S..Census Bureau collects demographic, social, economic and housing information about the people in the U.S. The method used for well over a century, the decennial census' long form, is being replaced by the American Community Survey, or ACS. This new national survey will replace the sample portion of the upcoming 2010 census, as well as all future censuses, by collecting comparable statistics on a monthly basis. The increased collection frequency means state and local data, including Alaska's, will be released every year instead of every 10 years. An overview The traditional decennial census has consisted of two types of questionnaires: a "short form" and a "long form."All households in 2000 received the short form, which counts the population and gathers basic characteristics, such as age, sex and race. It asked seven questions in the 2000 Census. In 2010, the census short form will continue to go to all U.S. households to count the population. The cehsus long form finds out what a community looks like. It is more detailed and asks numerous questions about such items as income, education, rent and mortgages, commute times to work and who speaks what languages at home. In the 2000 Census, the long form went to about 1-in-6 households in the U.S., or an overall average of 17 percent of the households. The ACS - as it is planned now, given continued Congressional approval and funding in the years to come -will replace the decennial census long form. Its objective is the same as the long form's - to describe the population rather than count it. It will ask the same types of questions, but every month instead of every 10 years. It will be sent to some 250,000 addresses in the U.S. each month, or about 2.5 percent of the nation's population. Hi5t01'1/ Congress charged the Census Bureau in the early 1990s with three directives to reengineer the census: to decrease the number of people missed or counted twice (called the "net undercount"); to hold down or reduce operational costs; and to collect and release socio-economic data more often than every 10 years while maintaining consistent measurements across areas with large and small populations. The ACS was developed in response to the third directive. It will release data every year instead of every 10 years. The ACS was tested and reviewed from 1996 to 2004. Census Bureau statisticians studied 31 comparison sites to pinpoint the differences between the ACS and the 2000 Census long ' The decennial census is a count of the U.S. population conducted every 10 years by the Census Bureau in years ending in 00. " . IAA ~ . ALASKA~ECO~1oMICTK~NDS~~ ~,~ FE$RUARY'2006' ~~ , form. They conducted three supplementary surveys between 2000 and 2002 to study the feasibility of collecting long-form data using a methodology different from what was used for the regular census. They wanted to demonstrate the reliability and stability of state and large-area estimates over time, as well as the usability of multiyear estimates. The Census Bureau launched the ACS questionnaire on a national level in January 2005. The sample The ACS survey is collected in every U.S. county -census areas and boroughs in Alaska -from 12 independent monthly samples of randomly selected addresses. This equates to about 3 million of the nation's households being contacted each year, about one-seventh of the long form sample size. Over the course of the decade, one out of 4S0 households in the U.S. will be sent the ACS survey each month. No address should. receive the ACS questionnaire more than once in a five-year period. The ACS survey will expand in the 2006 rnllartiCn year to inClCale 7.S narcent of r_. ____ the "group quarters population." Group quarters include nursing homes, prisons, college dormitories, military barracks, juvenile institutions and emergency and transitional homeless shelters. Since the ACS was developed to replace the census long form -which provides data for federally mandated programs -data quality is essential. It is also critical that data users understand the similarities and differences between the data collection methods for the ACS and the decennial census long form. Data users will need to become familiar with census products based on moving averages, different reporting periods and different size samples of the ACS. Current and Future Tabulations American Community Survey O.S. States Counties County Subdivisions Places(tncorporated Places and Census Designated Places) Metropolitan Statistical Areas Congressional Districts Rural Areas Tracts Voting Districts American Indian Reservations School Districts State Legislative Districts Zip Code Areas Urbanized Areas Spume: US. Census Bureau, American Community Survey For all surveys, both sampling and nonsampling errors can affect accuracy. Sampling error occurs when a proportion or sample of the population does not accurately reflect the general population. Nonsampling error includes all nthar arrnrc inch~!di.ng nnnresponses; coverage measurements and processing errors. The sample size of the decennial long form in 2000 was selected to produce reliable estimates for areas with small populations. While-overall the sample equaled about 17 percent of U.S. households, there were situations where the sample size was increased to improve the reliability of the results. In Alaska, the Census Bureau agreed to increase the sampling rate to 50 percent for many small places and Alaska Native Village Statistical Areas, or ANVSAs.2 The increase was also done in part because for rural areas, the census was conducted in person by census takers and not by mail. Since most of the cost of collecting census information in rural areas is travel, the 'The Census Bureau defnes "places" as cities or Census-Designated Places, which are unincoryorated communifies. Places are contained within boroughs and census areas. ANVSAS are Census Bureau designations for Native villages. difference between collecting a 17 percent sample and a 50 percent sample is minimal For the ACS, the Census Bureau has indicated it plans to continue a higher level of sampling for Alaska's areas with low populations. This means that places and ANVSAs that had less than 200 people, in the 2000 Census -about 173 communities-will be sampled at a 50 percent rate, the same as in the 2000 Census. Another 131 places and ANVSAs with populations between 200 and 799 will be sampled at a 37.5 percent rate (versus a. SO percent rate in the 2000 Census). Those with populations between 800 and 1,200 will be sampled at an 18.5 percent rate (versus a 25 percent in the 2000 Census). While small places and ANVSAs will be sampled at a higher rate, the smaller overall sample size of the ACS means its estimates will be subject to higher sampling error levels. This will result in less precise data than those based on the census long form at every level of geography. The somewhat smaller sample requires that a greater emphasis is placed on securing the best initial response to each questionnaire each month. The ACS surveys are mailed out each month with postage-paid return envelopes.3 Census Bureau staff send reminder cards to those who fail to respond, then follow up with phone calls and personal interviews if the recipients still do not respond. The interviewing is done by well-trained and experienced census professionals - in contrast to the temporary work force typically hired for the decennial census. This approach yields better data quality, thereby reducing nonsampling error due to their ability to obtain more complete responses during the follow-upstages. Responding to the ACS, as with the decennial census, is mandatory. Title 13 of the U.S. Code requires participation but also protects individual responses. Census Bureau employees are sworn to protect the confidentiality of the information they collect; violators face fines and prison sentences. Comparing the ACS to the decennial census As stated earlier, the ACS does not produce independent population counts,rt provides the characteristics of the population. Each year, the Census Bureau will adjust the ACS to its yearly population estimates developed through its Federal State Cooperative Program for Population Estimates. In other words, each annual release of ACS data will describe the population that the federal-state cooperative program has estimated for that year. Accordingly, the Census Bureau will adjust the ACS to the census count during decennial census years. As an example, the 2010 Census short form will provide complete counts of race and Hispanic-origin groups. The ACS, on the other hand, will provide updated information about patterns of change in the size and geographic location of race, ethnic and ancestry groups during the decade. Another important point for data users to be aware of is that the ACS will not produce information exactly comparable to that from traditional decennial censuses even though the ACS and the long form use similar questions, similar data collection methods and similar reports. Some ACS variables will be collected differently or may be defined differently. For instance, the ACS defines residency as a person's "current residence" in contrast to the cerisus long form's "usual residence" rule. "Current residence" is defined as the location of a person's household if he or she has been living there for at least two months before he or she received the survey. "Usual residence" is where a person lived and slept most of the time during the preceding year. The difference in residency definitions affect who is included in the population being ' For Alaska's rural communities, Census Bureau staff will conduct the surveys in person. ~~~~ ~„? I ~~ „'., .~ AI~SK~ECQI~QMIGTRENI~S ~=:;~, ~rt . FEBRUARYK 2Q06~: > . , ` American Community Survey ~„` ®ata release dates • 5-Year Average-Available 2090 5-Year Average-Available 2010 • ~y'- 3-Year Average-Available 2008 ~ • o • ®Single Year-Available 2006 S 0 ~ • . ~ • • •• ~ ' ,• N ., .. ., ~ .,, .d H •Bw ~\~w~( V • ++® - •s ~' '1. ~~ . ~ * .. ~ ,~. .• ~ • ~ O Q m ca . O J` IN~O _ N n Q V O~(~,,/,"~~~~-s.F) /,.~~~)~/~y(`~~`, $OU(Ce: U.$. Can$u$ BUn?aU, AmelIC2O COmmU01(}~ SUNeY described. For instance, a large number of people in some areas may spend several months a year away from their primary residences, such as when retired people in the Midwest spend their winters in Arizona. In that case, they `JJOUId be considered An~Dna raci`ient5 fDr some winter ACS surveys, but they would have been considered Minnesota residents for the population estimate or decennial census count. This difference in the residency definitions means that the ACS and the decennial long form would not necessarily report the same vacancy rate or homeownership rate for the same area. Other variables, such as median income, may also be affected. Another difference between the ACS and decennial census relates to the time period the questionnaires reference. ACS recipients are asked to answer the survey questions based on the day they fill out the survey or the 12 months prior to that day. Since each month a new survey is collecting information, the "12 month prior" period will be shifting forward by one month for each survey cycle. The census long form, in contrast, asks recipients to answer questions as of April 1 of the census vaar nr tha nrararlino ralandar eflr, ~ __., .. _ r. ____...a _ y ACS data There will be different types of data available depending on the population size of the reporting area. The continuous nature of the ACS means it is designed to measure the characteristics of the detailed social, economic and housing data as an annual or multiyear average instead of at a fixed point in time. The most recent ACS data available now is for 2004 when the ACS survey was still limited to areas with populations of 250,000 or more.° That includes roughly 800 U.S. geographical areas, including 244 counties, 203 congressional districts; most large cities, all 50 states and the `Data are Iimded to the household population and exGude the population living in institutions, college dormitories and other group quarters. District of Columbia. For Alaska, the Anchorage Municipality is the only area that falls into this category, other than the state as a whole. Many data tabulations, or groupings, are available now; others are anticipated. (See Exhibit 1.) Beginning ih the summer of 2006, the Census Bureau will release ACS data each year for any defined area with a population of 65,000 or mores The 2006 release will be based on the 2005 ACS. In Alaska, the data will be available for the state as a whole, the Municipality of Anchorage and the Fairbanks North Star Borough. (See Exhibit 2.) In areas with populations of less than 65,000, however, it will take three or five years to accumulate a large enough sample to produce data similar to that of the decennial census. Once the data are collected, the Census Bureau will release annual tables based on rolling three-year averagesb for areas with populations between 20,000 and 65,000, and rolling five-year averages for areas with populations less than 20,000. The first ACS data for areas with populations between 20,000 and 65,000 will be released in 2008; the data will cover the 2005-2007 collection period. In Alaska, the data will cover the MdtanUcka-Cticitna a^.d ke.^.ai Pe,^,InSUIa Boroughs, City of Fairbanks, and the City and Borough of Juneau. The first ACS data for areas with populations below 20,000 will be released in 2010 and the data will cover the 2005-2009 collection period. For Alaska, the data will cover all remaining cities, boroughs, census areas, CDPs and ANVSAs. Eventually, after 2010, it will be possible to measure changes over time for areas with low populations. Comparing ACS trends to past established, historical decennial census data, however, will be difficult because the census data provide a snapshot as of April 1 of the decennial year and the ACS data provide more of a "moving picture." Detailed summary tabulations form the basis for ACS data products. There are four broad types of data available: general demographic, plus various social, economic and housing characteristics. (See Exhibit 3.) These tabulations will be available for single-year releases later this year; and will eventually be available for. multiyear statistics in 2008 and 2010. The tabulations will be available for multiple racial categories, plus whether the category falls under the overall grouping of (a) Hispanic or Latino origin or (b) not Hispanic or Latino origin. The racial categories include white alone, black or African American alone, American Indian and Alaska Native alone, Asian alone, Native Hawaiian and other Pacific Islander alone, "some other race"' alone, two or more races alone, and race alone or in combination with one or more other races. What the ACS wilt mean for Alaska's areas with small populations Much of the literature currently promoting the ACS uses terms such as community, place and small area to convey a message that the tabulations will serve the same range of geography as past decennial censuses. While the five-year rolling average was developed to address the need to collect and tabulate data for areas with small populations (under 20,000), the majority of tabulation areas and places in Alaska fall far below the 20,000 population range. Of Alaska's 27 census areas and boroughs,e 22, or 81 percent, have populations less than 20,000; 18, or 67 percent, have populations less than 10,000; and eight, or 30 percent, have populations less than 5,000. Of the state's 148 cities, 98 percent have populations less than s Based on the area's population totals from the 2000 Census a For a rolling three-year average, the oldest year of the three years will be dropped and the newest collection year wdi be added. For a rolling fve-year average, the oldest year of the five years will be dropped and the newest collection year will be added. ' "Some other race" refers to self-identification with a race other than the fve main "race alone" categories. e The 27 includes the City and Borough of Juneau, City and Borough of Sitka, City and Borough of Yakutat and the Municipality of Anchorage. 20,000: Of those, 123 have less than 1,000 people and 38 have less than 200 people. As far as Alaska's unincorporated places, 97 percent have fewer than 1,000 people. Outside of some very limited test data collected in other states during the ACS development phase, no three- or five-year collections of data have taken place in Alaska to evaluate the potential robustness of the state's small- area data. The question of whether the characteristic data for populations this small will meet the accuracy standards necessary for release has yet to be answered. And since the first set of five-year averages will not be available until 2010, it is not clear if the full range of place and other small-area data Alaska has historically relied on for social and economic characteristics from past censuses will continue to be available through the ACS. While there is no question that geographic areas with populations greater than 65,000 will benefit from the release of characteristic data on an annual basis, we will need to wait four years to make the same statement about Alaska's areas with limited populations. _ American C®mmunity Survey Population and housing profiles ~Ge !! ` a tai c tYaracferls~ ca s Sex and age Race Hispanic origin and race Relationship Households by type . OC 80. efdCfB 8 CBr. ;~;;: ~ ~ ~,.~~ ~` ~,~*`. Scholl-enrollment Educational attainment Marital status Fertility Grandparents ~ Veteran status j Disability status of the civilian noninstitutionalized population i Residence one year ago Place of birth U.S. citizenship status Year of U.S. entry World region of birth of foreign bom Language spoken at home Ancestry (total reported) i - ~. ~:- Employment status Commuting to work Occupation Industry Class of worker " Income and benefits (in 2004 inFlation-adjusted dollars) Percentage of families and people whose income in the past 12 months is below the poverty level Housing occupancy Units in structure Year strudure built Rooms Bedrooms Housing tenure Year householder moved into unk Vehides available House heating fuel Occupants per room Value Mortgage status and selected monthly owner costs Seleded monthly owner costs as a percentage of household income Gross rent " Gross rent as a percentage of household income Source: U.S. Census Bureau, American Community Survey "It amazes me to think how it all works..." c r z a elson San Juan says the real clincher is when people come into the office with pictures of the. houses they just bought with the money they made -heading, gutting, boxing and freezing salmon, herring, black cod or Pollock in one of Alaska's remote seafood processing plants. They almost always stop by to thank him. "For me, it's a big accomplishment, to see these people make good money and be able to save it," says San Juan, a seafood employment specialist at the Anchorage Midtown Job Center. "I love to see those things happen." San Juan isn't trying to promote the years-old myth that people make a killing working in Alaska's fish plants. It's just that the money can be good, considering the overtime, which is common, and the fact that many plants and all at-sea processors pay room and board (some furnish it, but charge workers a fee). People who work hard for multiple fisheries and are good at saving their money can wind up doing pretty well, he says. San Juan is part of the Alaska Department of Labor & Workforce Development's "Traveling Seafood Workforce," a program that was started in 1999. That year it arranged for the shuttle of 15 salmon processing workers from Naknek, where the salmon fishery had just ended, to Petersburg, where the plant there was desperate for experienced workers. Last summer, San Juan, his co-worker Lisa Good, and another colleague in Kodiak, Maureen Butler, helped arrange for 330 workers to go from working primarily in Naknek -but also Togiak and Ugashik in the Aleutians - to other fish processing jobs at plants in Dutch Harbor, Kodiak, Chignik and King Cove in the Aleutians, Seward, Whittier, Valdez, Cordova, Yakutat, Excursion Inlet near Gustavus, Petersburg and Ketchikan, as well as to jobs on floating processors in the Bering Sea. The three -San Juan, Good and Butler -talk to the seafood plant managers almost daily throughout the season to pin down who needs workers when and which workers finished the season (which is critical for the three to refer them to other plants). Then the three talk to the seafood workers to see if they're interested in flying to another company's processing plant ;. Au„ 2Q~:, , ALASKAsE~NQMIGTRENQS~.« ,. FEBRUARY 2006:-.• Ocean Beauty Seafoods employee Carlos Gomez peft) operates a forklift to move boxes of processed sockeye salmon at the company's Naknek plant last summer in Bristol Bay. Lisa Good and Nelson San Juan (above) are seafood employment specialists at the Anchorage Midtown Job Center. The two, plus Maureen Butler, another sea- food employment specialist in at the Kodiak Job Center, make up the Department of Labor's `"traveling Seafood Workforce:' Richard Quemado (above right) handles sockeyes after they've been headed at North Pacific Sea- foods' Pederson Point plant, three miles up the beach from Naknek. for more work. Good has flown to Naknek, !, which has an early salmon run, for four days the past two Julys to talk to the workers and plant managers face to face. Good tromps around Naknek's fish plants, ', talking to managers, but mostly to workers on their breaks about arranging jobs for them elsewhere When their CUPrent SeaSOnS are OVer. It gets fast and furious: Good, on the phone to San Juan in Anchorage, and Butler in Kodiak, coordinating all the dates, flight times and discussing which company has spots for which workers and who's paying whose airfare. Good says it gets crazy; whether she's in Naknek or at her desk in the Anchorage office. "If you think about it, that involves a lot of phone calls, a lot of merging of information," she says. "It amazes me to think how it all works." U a 0 a 0 U .~ T a 0 'c s 0. Gillnet boats going for sockeye during a July opening (above) at [he mouth of the Naknek River. Workers handle sockeye eggs in the egg room (right) at Ocean _ Beauty Seafoods in Naknek. The Department of Labor's San Juan says some people tell him Yhat the money 4hey make in the fish plants pays their kids' college tuition. San Juan says it's common for two processing plants - a Naknek plant, for instance, and the plant where the worker is going - to split the cost of the airfare. Most seafood employers pay workers' roundtrip airfare, because Alaska law says that if an employer pays, promises to pay, furnishes or advances the money for an employee to get to a job site, that employer has to pay for that employee's trip back to the point of hire (or any other agreed-upon place) as long as the employee successfully finishes his or her "contract" -working until the end of the processing season. Sometimes two seafood companies will even chip in to charter a plane to move a bunch of workers. San Juan says Butler organizes a charter each summer to shuttle workers from Kodiak to Naknek for thetwo-week herring opening that begins in April. San Juan says employers love the program because they get workers when they need them. Plus beginning workers are experienced by the end of the first fishery. That's crucial in a remote area with few other workers to step in when beginners can't handle the work. "They're saving money too," San Juan says, because the companies share the airfare to somewhere else in Alaska, then the new plant pays their way home. The official goal of the program is to increase the numbers working in the seafood industry for rural and other Alaskans, as well as to get more Alaskans into the industry's technical positions and higher-paying jobs. San )uan and Good helped coordinate 169 "moves" from Naknek at the Anchorage Midtown Job Center last summer. They also helped arrange for six workers to go to a third processing plant after they finished their contracts at their second plant. Everyone who applies for seafood jobs through Alaska's job centers has to submit an application and go through an hour seafood orientation. Many seafood companies hold interviews right at the Anchorage Midtown Job Center. San . ~i . .,.< ~ , _ : AL'ASKA:F~QNQMi~TRENI~;. ',.,; , ~,",FEBRUARY 20Q6~w. .. 9 U s 0 `c a )uan says he tells the applicants during their orientation that if they're good workers, they can be transferred tv another plant to work longer and make more money. San Juan says the pace is absolutely nonstop, especially considering that in their job center office alone, he, Good and receptionist Merlyn Yambao -the seafood employment crew in the office - see a stream of 100 seafood processing applicants a day. ` "TF;e ntinnn ~q,nn't ~tnn rinaina "Can Iran cave r,......._ ... r. ...b...b, .. .- ~.,. 'And they never stop coming. We have a big room - a conference room -and it's packed every day. Every single day. Sometimes we have three [seafood) employers interviewing at the same time [in the room]." And fish processing isn't just in the summer, either. For instance; A-season pollock starts in January, Naknek and Togiak herring are in April, B-season pollock starts in mid-June and runs through mid-November. A lot of workers want to eventually get work on a floating processor, San Juan says, because they tend to make more money, and they don't have to pay room and board. San Juan says the biggest player in Alaska, Unisea, has aland- based processing plant in Dutch Harbor that's (ike a small rity - inel~i"1!.^,g a gym and m!n!- theaterfor the workers, plus food like a buffet in a nice hotel. The Alaska Department of Labor & Workforce Development has 15 seafood employment specialists working at the department's 24 job centers throughout the state. In 2005, they made referrals that resulted in 3,300 seafood hires, according to Laurie Fuglvog, a Department of Labor seafood employment analyst in Juneau. For more information about seafood jobs, contact any Alaska Job Center, call (800) 473-0688 or go to the Alaska Job Center Network's Job Bank at www.jobs.state.ak.us. and click on "Seafood Jobs." For more information about the Traveling Seafood Workforce, contact Nelson San Juan or Lisa Good at the Anchorage Midtown Job Center at (907) 269-4708 or email them at Nelson_San_Juan@labor.state.ak.us or Lisa Good@labor.state.ak.us; contact Maureen Butler at the Kodiak Job Center at (907) 486-3105 or by email at Maureen_Butler@labor.state.ak.us. Or contact Laurie Fuglvog at (907) 465-5926 or by email at Laurie_ F ug No g@ l a b o r. s to te. a k. us. For more information about Alaska's return transportation taw or other wage and hour laws, call the nearest Wage and Hour Office: Anchorage (907) 269-4900; Juneau (907) 465-4842; and Fairbanks (907) 451-2886. Employment u I . percent over the year Anchorage/Il~lat-Su region leads the Way otal nonfarm employment fell by about 2,100 in December to 298,500, an expected seasonal drop. (See Exhibit 2.) Seafood processing jobs declined by 1,900 and construction jobs by 1,000. Holiday shopping supported an increase of 300 jobs in retail trade, and other small gains in health care, government and the oil and gas industry helped offset the seasonal losses in seafood processing and construction. Ayerege Weekly Wages Selected counties, second quarter 2005 New York Washington, DC San Francisco Anchorage' u.s. Honolulu Harrison, Miss. $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 The state's December job count was 5,300 higher than it was in December 2004, which equates to over-the-year growth of 1.8 percent. Roughly 60 percent of the new jobs were generated in the Anchorage/Mat-Su region. (See Exhibit 4.) Another 32 percent came from the Interior region where Fairbanks' job market has been growing at a healthy clip. New jobs at the Pogo mine and ongoing activity at Fort Greely also contributed to the Interior region's strong growth rate. The state's unemployment rate rose two- tenths of a percentage point to 7.O percent in December, a typical seasonal increase. (See Exhibit 3.) The rate remained slightly lower than year-ago levels. Anchorage had the state's lowest unemployment rate in December at 5.2 percent and the Aleutians East Borough had the highest at 20.7 percent. Anchorage wages grew a little slower than nation's Recently released average weekly wage data for the nation's 323 largest counties show that the average weekly wage in Anchorage was $813 in the second quarter of 2005. That's about $60 higher than the national average of 3751. (See Exhibit 1.) New York County had the nation's highest weekly wage at $1,350. With the ' The Municipality of Anchorage is the U.S. Bureau of labor Statistics' equivalent for a county. Source: U.S. Bureau ofla6or Statistics ~~~~-.wry„~~~AL,~SI~EIQI~II17:E~1[~`~"<~rE~EBRl7~#i~Y2~Q=Y~.~~ ~~w Trends Authors Michael Patton is an economist with the Alaska Department of Labor 8 Workforce Development in Juneau. He specializes in occupational information, including fish harvesting employment. To contact him, call (907) 465-6042 or email him at Michael_ Patton @ I a bo r. s to te. a k. u s. Dan Robinson, a Department of Labor economist in Juneau, specializes in statewide employment and earnings, including fish harvesting employment. To reach him, call (907) 465-6036 or email him at Dan_Robinson@ labor.state.ak.us. Kathryn Lizik is a Department of Labor research analyst in Juneau who specializes in the census. She's the state's liaison with the U.S. Census Bureau for Alaska's geographic, social and economic data and is the state coordinator for the Census and Geographic Information Network. To contact her, call (907) 465-2437 or email her at Kathryn_Lizik@labor. state. ak.us. v t Susan Erben, a Department of Labor publications specialist in Juneau, is editor of Alaska Economic Trends. To contact her, call (907) 465-6561 or email her at Susan_Erben@labor. state.ak.us. exception of three California counties, the rest of Only six counties recorded lower wages in the top 10 were also in East Coast states. the second quarter of 2005, with the largest decline coming from Pierce, Wash., at minus 7.9 Anchorage wages grew 3.0 percent from second quarter 2004 to second quarter 2005. Nationally, the growth rate was 3.9 percent. For perspective, Anchorage's inflation rate over the period was roughly 2.5 percent and the U.S. inflation rate was roughly 3 percent. Anchorage's wage growth ranked 207th out of the 323 counties. Webb, Texas saw the strongest growth at 11.3 percent, followed by San Mateo, Calif., at 10.6 percent and Clark, Nev. -the county that contains Las Vegas - at 9.4 percent. percent. The wage data are the product of a federal- state cooperative program called the Quarterly Census of Employment and Wages, which collects employment and wage information for workers covered by state unemployment insurance Taws and a federal unemployment compensation program. Nationally, 97 percent of civilian workers who are paid a wage or salary are covered by the program, and the percentage is similar for Alaska. Nonfarm age and glary preliminary revised revised Chances from: Alaska 92105 11/05 12/04 91105 12/04 Total Nonfarm Wage S Salary/ 298,500 300,600 293,200 -2,100. ' 5,300 Goods Producing 33,300 35,900 31,700 -2,600 1,600 Service-Providing 265,200 264,700 261,500 500 3,700 Natural Resources & Mining ~ 10,700 10,500 10,000 200 700 Logging 300 500 400 -200 -100 Mining 10,300 10,100 9,600 200 700 Oil d Gas Extraction 8,600 8,400 8,200 200 400 Construction 16,700 17,700 15,900 -1,000 800 Manufacturing 5,900 7,700 5,800 -1,800 100 Wood Product Mfg 400 400 300 0 100 Seafood Processing 2,100 4,000 2,200 -1,900 -100 Trade, Transportation, Utilities 61,700 61,600 60,800 100 900 Wholesale Trade 6,100 6,100 6;()00 0 100 Retail Trade 36,000 35,700 35,300 300 700 Food & Beverage Stores ~ 6,100 6,100 5,900 0 200 General Merchandise Stores 9,700 9,800 9,700 -100 0 Trans/Warehousing/Utilities 19,600 19,800 19,500 -200 100 Air Transportation 6,000 6,000 6,100 0 -100 Truck Transportation 3,000 3,000 2,900 0 100 Information 6,900 7,000 6,900 -100 0 Telecommunications 4,200 4,200 ' 4,100 0 100 Financial Activities 14,600 14,700 14,500 -100 100 Professional & Business Svcs 23,400 23,500 22,700 -100 700 Educational & Health Svcs 36,100 35,800 35,000 300 1,100 Health Care 26,300 26,100 25,300 200 1,000 Leisure & Hospitality 28,200 28,200 27,400 0 800 Accommodation 6,500 6,500 6,500 0 0 Food Svcs & Oririking Places 18,200 18,100 17,500 100 700 Other Services 11,600 11,500 11,700 100 -100 Government2 82,700 82,400 82,500 300 200 Federal Governments 16,700 16,400 16,800 300 -100 Slate Government 24,500 24,700 24,400 -200 100 State Gov't Education 7,900 8,000 8,000 -100 -100 Local Government 41,500 41,300 41,300 200 200 Local Gov't Education 23,800 24,000 23,700 -200 100 Tribal Government 4,100 4,100 4,100 0 0 Notes r Excludes self-employed workers, fishermen, domestics and unpaid family workers as well as agdcu/furs/ workers P Includes employees of public school systems and the University ofAlaska 9 Ezclades uniformed military 4 Metropolitan Statistical Area Prepared in cooperation with the U. S. Dept. oftabor, Bureau of tabor Statistics. Regional data prepared in part witfi funding lrom the Employment Security Division. Source: Alaska Department of Labor and Woddome Development, Research and Analysis Nonfarm Wage and Salary Em ploy ment By Region preliminary revised revised Chances from: Percerd Chance: '. 12/05 11105 12/04 11!05 12/04 11/05 12/04 Anch/Mat-Su (MSA)4 164,900 165,200 161,700 -300 3,200 -0.2% 2.0% Anchorage 147,000 147,500 145,100 -500 1,900 -0.3% 1.3% Gulf Coast 25,500` 26,450 25,400 -950 100 -3.6% 0.4% '. Interior 43,200 43,000 41,500 200 1,700 0.5% 4.1% '. Fairbanks 37,200 37,200 36,100 0 1,100 0.0% 3.0% Northern 16,200 16,050 16,050 150 150 0.9% 0.9% Southeast 33,050 33,500 32,800 -450 250 -1.3% 0.8°/ ', Southwest 15,750 16,650 15,850 -900 -100 -5.4% -0.6% Employment m+^ ® ~ ° ~ e~ t ®10 2004 Benchmark The of(cial definition of unemployment excludes anyone who has not active/y sough[ work in thelour-week pedod upYO and including the week that includes the 12th of the reference month. Many individuals do not meet this definition because they have not conducted an active job search due to the scarcity of employment opportunities in rural Alaska. Free services for employers at Alaska Job Centers Professional staff at Alaska Job Centers provide employers with a multitude of useful no-cost ser- vices through the Business/Employer Connection. The services include on-line job advertising through Alaska's Job Bank at www.jobs.state.ak.us; recruiting, matching, prescreening and referring qualified applicants to jobs; as well as customized interviewing and interview rooms at job centers for employers to conduct interviews. Another service, among others, is a program called Rapid Response, where people from various Department of Labor & Workforce Development divisions go to a business site or community facing layoffs to conduct free on-site workshops and counseling. The topics, for employees, range from train- ! ing for another job, resume preparation and interview skills to stress management, financial planning and filing for unemployment insurance benefits. The program also helps employers explore strategies to avoid layoffs, such as employee stock ownership plans, upgrading employees' job skills or helping with labor-management issues. The Business Connection Web site at www.alaskaemployer.com allows employers to post job adver- tisements and has links to the Alaska Employer Handbook, employee bonding, tax credits, on-the-job training, small business development, labor market information, Alaska Job Centers, Employment Security Tax, trade adjustment assistance and more. Contact your local Alaska Job Center Business Services staff for more in-depth services to match your company's needs. .. ~ .„ .. ... n ~J Poe Edit Vbw Fevor¢es Tools tidy _' ~ (: '. I~. Back - ~/ - (~ ^Q« t'~ ~ Search ~Favwites ®1Media `(,~' I l~. ~ ~ • ,~ y~ v itF ss)J 'ppwww.j66s ~i ax uojenN~OYechhn ~w I I J. Ir+~ C,p^,g12• ~~ Q}15eurh 6Veb -l ~ (~~a3]5 blaked 'QHUtaFill I ~ pptlons Job Seekers Workers Employers Researchers Labor Shortcuts ~ y°epPHnawr,,,r ~-tit Alaska Job Center Network m lobsareAlaska'sFuiure Sloe of AIasY.a > OOlVU0 e AHSka Jod t,errter Network ~ BuslnasaiEmployer Connection Nhin Menu lob Advertisement Options Quick Lints... 'Home Recruit quarAetl war§ers by advenismg+four ion 'Alaska Employer Handbook 'BUSiness~Empioyer openingswith AICN. YOUratlvanisementwillhe 'Employment Applicationt.paq Comrection viewed on the Internet hyJOb Seekers in sacs Alaska Job Cantor acrasa the atate on "Employee Bonding , 'Jo6 Seeker Resources Alaska's Job Bank, and on America's Job Bank. 'Employment Related Posters ' Job Training 'Employment S'ecuritp Tax 'Unemployment Insurance Choose an Option 'Foreign Lahor Certifcations 'Vocational Rehahilifation i)place a Job Advertisement by Phone (;~`K„c Hire a Veteran "Public Assistance ?}place a Job Advertisement 6y E-mail ~JOb Fairs ' Labor Narket Information 3)Place a Joh Advertisement by Fax (.pdf) 'Labor Standards and Safety 'Aleaka Jab Centers 'Onihe-Job Training 4)Place a Jo6 Advertisement Online "Small Business Development Hot Topics 5)Place a Seatood Job Adrertisement 'Tax Credits Trade Pd(TAA)fprAla4mt Fishernan More in-tlepm services are availsnie su<n as. 'Trade Adjustment Assistance Salmut FlsMdes Assistance- dieN pre-screening, matching and recruitment planning. 'Workers Compensation Netlonal Emerzgerwy Gmrd Resounas Please confect your local Joh Centeno tnqulre about 'Youth Work Permit t.pary atltlitional services. iha Alaska Job Cerrter flv=twork Is an egual opporlunM employer(propram. Auxi-ery aids end services ere available to Individuals with tlisebtlrtias upon request. Jab seeker, warners Empiovers aezearcners Department SttoRCats weemaner Paqe Uptlatetl Apri10, 2005 y P k l .r ~ r ` ~` " n N A r e m V .~ ~° ~ O a c O ~ rt OA a ,'~ r D W R x N 1 ,~ ® y l0 ~ C CO , ~y C m ! ~ ~ ~ Z . Vt tO~ < 3® _. O ~ ~, Z ~ ~ ~ a W v O ~ 'I'I ~~ d m can C Z ~m m ~ ~~ w 0 0 T ~~Z~ ~ ~~ t ~ ~ ~ ~ m m ~G7<~tn~ DNS N nO ~ 30®~ ~~ ~ '"' m Suggested by: Administration CITY OF KENAI ORDINANCE NO. 2160-8006 AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA INCREASING ESTIMATED REVENUES AND APPROPRIATIONS BY $28,000 IN THE AIRPORT LAND SYSTEM SPECIAL REVENUE FUND FOR UTILITIES. WHEREAS, utility costs have increased during FY2006; and, WHEREAS, as the Airport Maintenance and Operations department utility budget is insufficient to cover estimated FY2006 utility costs; and, WHEREAS, funds are available in the fund balance of the Airport Land System Special Revenue fund. NOW, THEREFORE, BE IT ORDAIA'ED BY THE COUNCIL OF THE CITY CF KENAI, ALASKA that estimated revenues and appropriations be increased as follows: Airport Land System Special Revenue Fund Increase Estimated Revenues: Appropriation of fund balance $28,000 Increase Appropriations: Maintenance & Operation -Utilities $28,000 PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 17~ day of May, 2006. ATTEST: Carol L. Freas, City Clerk Approved by Finance: (04/26/2006) hl PAT PORTER, MAYOR Introduced: May 03, 2006 Adopted: May 17, 2006 Effective: May 17, 2006 X 3U5 N. V~LI.OW Sr. SURE Z00 i~FlAB, 99611 E X7,283-7~i1 FAX 907,t833YBT a • To: Larry Semmens -Finance Director From: Rebecca Cronkhite -Airport Manager ~~~ Date: April 26, 2006 Subject: Airport Utility Costs The large increases in the cost of utilities require significant reallocation of funds to meet this year's expenses. I have researched the possible causes for these increases and discovered the following: Natura0 Gas: Reports from EnStar show that usage at the Operations facility has remained stable in relationship to average monthly temperatures. The increase in this account is attributable to a 34% increase in cost. In the Terminal account there is a significant increase in usage coinciding with the installation of heated sidewalks, exacerbated by the increase in cost. Electrical Costs: In reviewing the electrical costs the usage appears consistent with temperature fluctuations. In speaking with HEA, the power costs fluctuate quarterly, however we have experienced a blended rate increase of approximately 22% this year. It should be noted that the percentage increase in electrical includes all the runway lighting. It is apparent that we need to take steps to assess utility usage in all of our properties. We currently have a policy of turning off lights in the Operations Facility when workers leave for the day. The Terminal is more difficult as it is practically a 24 hour facility when you factor in the janitorial staff cleaning after the last flight. The security cameras in the Terminal and parking lots also function more effectively with the lights on. It should be noted that all leases and concessions in the Terminal include heat and lights. We should evaluate the increased utility costs and consider an increase in rental rates. We also provide outside plug-ins for ground handling equipment to the air carriers. We are looking at the cost of installing a separate meter for those outlets or charging an additional monthly rate for their usage. We are also evaluating the need 4o increase the rate for aircraft electrical parking. The increase cost for the heated sidewalks is offset by reduced costs in snow and ice control and safety of the traveling public. www.ci.kenai.ak.us. Municipal Airport E-a~ Suggested by: CITX OF KENAI ORDINANCE NO. 2161-2006 Administrauun AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA INCREASING ESTIMATED REVENUES AND APPROPRIATIONS BY $21,000 IN THE TERMINAL ENTERPRISE FUND FOR UTILITIES. WHEREAS, utility costs have increased during FY2006; and, WHEREAS, as the Terminal utility budget is insufficient to cover estimated FY2006 utility costs; and, WHEREAS, funds are available in the Terminal Enterprise fund unappropriated retained earnings account. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA that estimated revenues and appropriations be increased as follows: Terminal Enterprise Fund Increase Estimated Revenues: Appropriation of Retained Earnings $21,000 Increase Appropriations: Utilities $21,000 PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 17~h day of May, 2006. PAT PORTER, MAYOR ATTEST: Carol L. Freas, City Clerk Approved by Finance: (04/26/2006) hl Introduced: May 03, 2006 Adopted: May 17, 2006 Effective: May 17, 2006 ftc i ,g$_ _ i+ i ~y i ~ J9 30.5 N. WILLOW 5Y. SUrPE 2~ i63dAl, 99611 E 967,Z~i~7961 F7eX 96'7,2833737 ~ • w To: Larry Semmens -Finance Director From: Rebecca Cronkhite -Airport Manager ~~L~ -- Date: April 26, 2006 Subject: Airport Utility Costs The large increases in the cost of utilities require significant reallocation of funds to meet this year's expenses. I have researched the possible causes for these increases and discovered the following: Natural Gas: Reports from EnStar show that usage at the Operations facility has remained siabie in relationship to average monthly temperatures. The increase in this account is attributable to a 34% increase in cost. In the Terminal account there is a significant increase in usage coinciding with the installation of heated sidewalks, exacerbated by the increase in cost. Electrical Costs: In reviewing the electrical costs the usage appears consistent with temperature fluctuations. In speaking with HEA, the power costs fluctuate quarterly, however we have experienced a blended rate increase of approximately 22% this year. It should be noted that the percentage increase in electrical includes ail the runway lighting. It is apparent that we need to take steps to assess utility usage in all of our properties. We currently have a policy of turning off lights in the Operations Facility when workers leave for the day. The Terminal is more difficult as it is practically a 24 hour facility when you factor in the janitorial staff cleaning after the last flight. The security cameras in the Terminal and parking lots also function more effectively with the lights on. It should be noted that all leases and concessions in the Terminal include heat and lights. We should evaluate the increased utility costs and consider an increase in rental rates. We also provide outside plug-ins for ground handling equipment 4o the air carriers. We are looking at the cost of installing a separate meter for those outlets or charging an additional monthly rate for their usage. We are also evaluating the need to increase the rate for aircraft electrical parking. The increase cost for the heated sidewalks is offset by reduced costs in snow and ice control and safety of the traveling public. - www.ci.kenai.ak.us. Municipal Airport E -3 Suggested by: Administration CITY ®F KENAI ORDINANCE NO. 2163-2006 AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, ENACTING KMC 7.05.035, ADOPTING A COMMUNITY PURPOSES PROPERTY TAX EXEMPTION AS AUTHORIZED BY AS 29.45.050. WHEREAS, AS 29.45.050(b)(i)(A) authorizes municipalities to enact a Community Purposes Property Tax Exemption; and, WHEREAS, that exemption would provide the City of Kenai a property tax exemption for property of an organization not organized for business or profit-making which is used exclusively for community purposes if the income from the property does not exceed the actual cost to tkxe owner of use by the renter; and, WHEREAS, such an exemption would help non-profit entities that are providing services to the community by providing property tax relief to them; and, WHEREAS, the Kenai Peninsula Borough and the City of Soldotna have adopted such an exemption; and, WHEREAS, it is in the best interest of the City of Kenai to enact a Community Purposes Exemption. NOW, THEi~:Fvi~r;, BE iT vitDAINED BY 'THE COUNCIL OF' THE Cl'T'Y OI' KENAl, ALASKA that KMC 7.05.035 entitled Community Purposes Exemption is enacted as follows: 7.05.035 Community purposes exemption. Property of an organization not organized for business or profit-making purposes and used exclusively for community purposes is exempt from taxation under this chapter. Property or a part of the property from which rentals or income are derived is not exempt from taxation unless the income derived from the rentals does not exceed the actual cost of the owner of the use by the renter. PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 17~ day of May, 2006. PAT PORTER, MAYOR Ordinance No. 2163-2006 Page 2 of 2 ATTEST: Cazol L. Freas, City Clerk Introduced: May 3, 2006 Adopted: May 17, 2006 Effective: June 17, 2006 ~=~:~= ,, __~__ tlaeatyof KENAv SKA "V °lla9e wit~t a Past, Gc° y with a Future" 210 Fidalgo Avenue, Kenai, Alaska 99611-7794 Telephone: (907) 283-7535 /Fax: (907) 283-3014 www.ci.kenai.ak.us MEMQ-IZ1~~1DITIVI TO: Mayor Porter and the Kenai City Council FROM:CIC.~ Cary.R. Graves, City Attorney DATE: April 26, 2006 RE: Community Purpose Exemption During the during the last discussion on this issue, Councilor Swarner asked a question regarding the application of this exemption to the old Kenai Supply building, now owned and occupied by the Salvation Army. The question was whether the Salvation Army could receive the exemption while it owned the building but before its operations were moved there. I posed the question to Shane Horan, the KPB Assessor. He informed me that the property did not receive the exemption while vacant. It only received the exemption after the Salvation Army moved into the facility and used it. He also stated that the thrift store portion does not receive the exemption (and is taxable) because thaC portion of the building is used fora "dominant profiC motive." Please let me know if you have any questions. F-~ Suggested by: CITY OF KENAI ORDINANCE NO. 2164-2006 Administration AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA INCREASING ESTIMATED REVENUES AND APPROPRIATIONS BY $60,000 IN THE AIRPORT LAND SYSTEM SPECIAL REVENUE FUND AND THE RUNWAY SAFETY AREA IMPROVEMENT CAPITAL PROJECT FUND FOR ENGINEERING SERVICES. WHEREAS, the FAA requires projects to be bid prior to awarding a grant; and, WHEREAS, the Runway Safety Area Improvement Project needs an additional $60,000 for engineering to carry the project through grant submission; and, WHEREAS, upon adoption of this ordinance the total amount appropriated to date is $300,000, all of which is grant eligible; and, WHEREAS, funds are available in the fund balance of the Airport Land System Special Revenue fund. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, that estimated revenues and appropriations be increased as follows: Airport Land System Special Revenue Fund Increase Estimated Revenues: Appropna*~o.. of Fund Balance $60,000 Increase Appropriations: Transfer to Capital Project Fund $60,000 Runway Safety Area Improvements Capital Proiect Fund Increase Estimated Revenues: Transfer from Special Revenue Fund $60,000 Increase Appropriations: Engineering $60,000 Ordinance No. 2164-2006 Page Two PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 17~ day of May, 2006. PAT PORTER, MAYOR ATTEST: Carol L. Freas, City Clerk Approved by Finance: (03/27/200b) hI Introduced: May 03, 2006 Adopted: May 17, 2006 Effective: May 17, 2006 396 N. ST. SUm:200 K6dA1, ALASKA 99611 997~8379P.e1 FAX ~7~83373% ~.. -.,.. To: Larry Semmens -Finance Director From: Rebecca Cronkhite -Airport Manager ~~-- Date: April 26, 2006 Subject: Airport Project Funding In recent years the FAA Airports Division has changed their policy on project grants to require the Airport to engineer, design and bid the project prior to applying for the grant. There is a preliminary cost estimate and a process where the FAA "programs" the funds for the project. This programming acknowledges FAA concurrence with the need for the project and places the funds in a budget; however the sponsor (Kenai) is required to forward fund the preliminary costs. All of the incurred costs are eligible for reimbursement from the grant at 95% Federal and an additional 2.5% State match. The project was started with $240,000 from the airport fund. This amount was based on 2.5% of 9.5 million, which was the preliminary cost estimate for the project. The cost of engineering, design and bid document preparation will exceed the budgeted amount and therefore a transfer from airport fund balance is required to complete the process and apply for the grant. Once the project is complete any funds in excess of the required 2.5% match will be deposited back in the airport fund. www.ci.kenai.ak.us. ft/lunicepa! Alrp®rt E-s Suggested by: City Council CITY ®F F{ENAI RESOLUTION NO. 2006-20 A RESOLUTION OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, AUTHORIZING THE AMENDMENT OF THE CITY OF KENAI, ALASKA AND PUBLIC EMPLOYEES' RETIREMENT SYSTEM (PERS) PARTICIPATION AGREEMENT TO EXCLUDE ALL ELECTED OFFICIALS, EFFECTIVE MAY 3, 2006. WHEREAS, the City of Kenai wishes to amend the agreement dated July 1, 1969 to exclude all elected officials effective May 3, 2006. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, that effective May 3, 2006, Subparagraph 2 on Page 2 of the Participation Agreement be amended to read as follows: 2. The political subdivision agrees that all eligible employees except in the following designated category will participate in the Retirement System: All Elected Officials PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this third day of May, 2006. PAT PORTER, MAYOR ATTEST: Cazol L. Freas, City Clerk Approved by Finance:, (4/21/06) clf MEMO DU To: Chuck Kopp, Acting City Manager From: Larry Semmens, Finance Director Date: January 10, 2006 Subject: PERS for Elected Officials Representative Seaton recently published his analysis of the cost of PERS for elected officials. The results are quite surprising. He estimates the entity's total liability to be over $434,000 for an elected public official that vests after 10 years of service and retires to collect benefits for 22 years. The majority of the liability is generated from the medical benefit provided by PERS. Representative Seaton estimates this to be $368,545, but could range upward to $450,000 depending on variables. The PERS system seeks to accumulate sufficient assets while an employee is working to pay for benefits paid out over the term of retirement. Employees must contribute 6.75% of salary in addition to what the employer pays. Since council members have a relatively low salary, the amount that they pay into the system is also relatively small. The employer must make up the difference in the total cost of benefits and the amount the employee puts in. In the case of council members the City will have to put in over $13,000 annually such that there would be about $200,000 available at the end of 10 years using the PERS earning assumption of 8.25%. One other aspect of elected officials participating in PERS is that if a city council member ever works for a PERS employer in a regular salaried position, the cost of the pension benefits will be apportioned strictly by the number of years of service at each employer. For example if a council member served for 12 years (at a low salary) then went to work for a PERS employer (at a high salary) for 4 years, the City would be liable for 75% (12/16) of the pension liability. Depending on the salary level the City could incur greater liability than would be for just the 12 years of City employment. The cities of Seward and Homer have opted elected officials out of PERS. 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T ~ ~ ~ ~ O °-' o s «. ~ ~ •°= ~ .o Q U ~ J ® V7 a ~~ a \° e d L O y v Rf 0 v o ~ ~ ~ L ~ o ` N y e ~ ~ b V A OD ~ ' C N d ~ L C C ~ Q w N C ~g n. ~ o R EO ~ v ~® v C 6i ~ v O O O u EEC •~ w 3 R ~ .p d N ~ 7 ~ O R RI saw v ~°~o° `o O CC R ~ M C O M A ~ ~.. ~ ~ ~ 9 ~ .° ~ ~ ~ O I ~~ ~ N !D C'O .~ ~ ~p ® ~ \ C 4 O R W '~h hh _ ~ C £ ..~ ®_ > ~ • _ ® ® N N N ~ O 61 i m d N 0I ~ O m® ~ bD l ~~~__ -- --= tl~eayof KENA~ ASKA MEMORANDUM "V °lla9e wit~i a Past, Gc°t~ wit~t a Future `® 210 Fidalgo Avenue, Kenai, Alaska 99611-7794 Telephone: (907) 283-7535 /Fax: (907) 283-3014 www.ci.kenai.ak.us To: City Council From: Rick Koch, City Manager Date: May 12, 2006 Subject: Resolution No. 2006-20, Authorizing the amendment of the City of Kenai and Public Employees Retirement System (PERS) Participation Agreement to Exclude All Elected Officials, Effective May 3 2006 The purpose of this correspondence is to provide information regarding this resolution. This issue is complicated by any number of variables, including but not limited to interest earned and/or lost on investments, periods of service, additional employment other than as an elected official in Kenai, covered by PERS. The number of variables is almost endless. The attached spreadsheet attempts to distill the issue. Therefore, its value is really in the order of magnitude of the data, rather than exacting accuracy. For years, given the information generated by PERS, it was believed given the perceived over-funding of the plan there was little or no cost by including elected officials in the system. We now know the ultimate cost/burden to the City of Kenai is substantial. There aze two scenarios regarding elected officials that are most expensive for the City: 1. An elected official who vests in PERS tier I and who takes eazly retirement after five yeazs of service. The elected officials contributions towards a retirement pension and health benefits (for the City of Kenai) is only $ 27 per month, or a total of $ 1,620.00 after five years. The estimated cost/burden to the City will be $ 630,444. Memo to Council Resolution 2006-2Q PERS May 12, 2006 2. An elected official who has many years in PERS service who then is employed by an employer in the PERS system. The example shown on the attached spreadsheet identifies contributions by the elected officiaUemployee totaling approximately $ 38,000, while the City of Kenai's cost/burden would be approximately $ 800,000. It was helpful to my understanding of the magnitude of the issue to put this information in a spreadsheet form; I hope it helps defzne what is a very difficult issue. 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L w L O N t ~ 1. ~ t ~ J. ~ t ~ ~ L ~ ~ ~ t ° ° ° ~ ~ mo ~',~m mmomomomo w °w ° ° ° w w w z 3d Uwzwzwzwz z z wz w z z z z ~c u°~ _ ____ c~ a~ ~¢U `m dda~a~a~d wm a~ma~a~m`a~a~`m a~da~o``m a~ d o0 ~[tf N<+iv , _ 6.H F-F-hi-FF~F- f-h hhhF-i-H _ I-I--HI-FF F- y O • O (A m O Z ~ ~ y9 ` ~ ° ~ m g N~~~ 0 0 1(1 10 N N M M O O t0 i0 N N 0 0 t° 10 N N ~, d N .~- r '- ~- •- ~- ~- ~- r ~- r } ~ N U F (A c Q ~ -b Suggested by: Mayor Porter CITY OF KENAI RESOLUT%ON NO. 2®06-26 A RESOLUTION OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, SUPPORTING A GULF OF ALASKA GROUNDFISH RATIONALIZATION PLAN THAT MAINTAINS OPEN MARKETS, FREE TRADE, AND THE MOVEMENT OF COMMERCE FOR FISHERIES RESOURCES WITHIN THE STATE OF ALASKA. WHEREAS, the combined fisheries landing value of Kenai Peninsula ports in 2004 was $106 million, second only to Dutch Harbor in Alaska and the third highest in the nation; and, WHEREAS, the majority of the City of Kenai's groundfish fleet are fixed gear vessels (longline, jig, and pot gear), generally run by owner-operator independent family fishermen; and, WHEREAS, the majority of City of Kenai's processing businesses are generally small, entrepreneurial enterprises, and the strength of the City of Kenai's fisheries economy is the ability to innovate and meet changing market demands; and, WHEREAS, a proposal for a Gulf of Alaska Rationalization Plan is before the North Pacific Fishery Management Council that would allocate groundfish to vessel owners, fishermen, and processors in a manner similar to the current Bering Sea Crab Rationalization Plan; and, WHEREAS, a specific element contained in to either join a cooperative that is linked to for fish"; and, the proposed Plan would require fishermen a specific processor or continue in a "race WHEREAS, another element contained in the proposed Plan, regionalization, would require fishermen who live on the Kenai Peninsula to deliver their catch to non-Kenai Peninsula ports; and, WHEREAS, processor linked cooperatives combined with "regionalization" would have the same controlling effect as the processor quota system currently used in the Bering Sea Crab Plan; and, WHEREAS, the City of Kenai supports including hired crew with historic participation and entry level opportunities for new fishermen in any rationalization scheme. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF KENAI: SECTYON 1. The City of Kenai Council supports a Gulf of Alaska Rationalization Plan that maintains open markets, free trade, and the movement of commerce within the State of Alaska and allows all vessels in the fixed gear catcher fleet to deliver to the processor of their£ choke. Resolution No. 2006-26 Page 2 of 2 SECTION 2. The City of Kenai Council supports options in the Gulf of Alaska Rationalization PIan that promotes value added products, innovation and a working waterfront that supports local fisheries and related enterprises. SECTION 3. The City of Kenai Council supports options in the Gulf of Alaska Rationalization Plan that ensure the conservation and sustainability of all fishery resources in Alaska. SECTION 4. Copies of this resolution shall be provided to the Alaska Congressional delegation, the North Pacific Fisheries Management Council, Governor Frank Murkowski, Alaska Department of Fish and Game Commissioner McKie Campbell, and Director of Commercial Fisheries Denby Lloyd. PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 17th day of May, 2006. PAT PORTER, MAYOR ATTEST: Carol L. Freas, City Clerk E-1 Suggested by: Administration CITY OF KENAI RESOLUTION NO. 2006-27 A RESOLUTION OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, AWARDING THE BID TO EMliLSION PRODUCTS COMPANY FOR 2006 DUST CONTROL, RENTAL OF ASPHALT DISTRIBUTION TRUCK AND FURNISHING CSS- I EMULSIFIED ASPHALT FOR THE TOTAL AMOUNT OF $46,800. WHEREAS, the following bids were received on May 10, 2006: BIDDER TOTAL Emulsion Products Company $46,800 WHEREAS, Emulsion Products Company's bid was the only bid; and, WHEREAS, Emulsion Products Company's bid meets the bid specifications; and, WHEREAS, the recommendation from the Administration is to award the bid to Emulsion Products Company; and, WHEREAS, the Council of the City of Kenai has determined that Emulsion Products Company's bid is a responsible bid and award to this bidder would be in the best interest of the City; and, WHEREAS, sufficient monies are appropriated. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF KENAI, ALASK.~ *hat the bid for 2n..n.6 DUSt Cvntrvi, Rental cf Asphalt Dlstribiitioia TiuCii gild Furnishing CSS-1 Emulsified Asphalt be awarded to Emulsion Products Company for the total amount of $46,800. PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 17th day of May 2006. PAT PORTER, MAYOR ATTEST: Carol L. Freas, City Clerk . Approved by Finance: ~~ E-8 Suggested by: Administration C~'1'X 9F KENAY RESOLUT%ON HO. 2006-28 A RESOLUTION OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, TRANSFERRING $12,000 IN THE WATER AND SEWER FUND FOR SUPPLIES. WHEREAS, the cost of chemicals used at the Wastewater Treatment Plant have increased during the year; and, WHEREAS, the budget in the Operating Supplies account is not sufficient for the remainder of the fiscal year; and, WHEREAS, funds are available in the Wastewater Treatment Department Contingency account. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, that the following budget transfers be made: Water and Sewer Fund From: Wastewater Treatment -Contingency $12,000 To: Wastewater Treatment -Operating Supplies $12,000 PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 17th day of May 2006. PAT PORTER, MAYOR ATTEST: Carol L. Freas, City Clerk Approved by Finance:, (05/ 12/2006) hl FI AGENDA KENAI CITY COUNCIL -REGULAR MEETING MAY 3, 2006 T:00 P.M. KENAI CITY COUNCIL http: { lwww.ci.kenai.ak.us ITEM 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 so 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. ITEM B: SCHEDULED PUBLIC COMMENTS (10 minutes) 1. Les Krusen -- Astroturf/Multi-purpose Facility 2. Robert Ruffner/Kaleidoscope School of Arts 8v Sciences Teachers and Students -- Clean-up of No-Name Creek 3. Ricky Gease, Kenai River Sportfishing Association, Inc. -- Management Oversight Reports and Economic Information of Upper Cook Inlet Salmon Ficheriec. ITEM C: UNSCHEDULED PUBLIC COMMENTS {3 minutes) ITEM D: REPORTS OF KPB ASSEMBLY LEGYSLATORS AND COUNCILS ITEM E: PUBLIC HEARINGS 1. Ordinance No. 2158-2006 -- Amending the Official Kenai Zoning Map by Rezoning Lot A-1 and Lot A-2, Bazon Pazk Subdivision No. 6, From Split-Zoned Light Industrial (IL) and General Commercial (CG) to General Commercial (CG) Only. 2. Ordinance No. 2159-2006 -- Enacting KMC 7.40 Titled, "Grant Administration," LVhich Adopts Procedures for the Administration of Grants by the City of Kenai. 3. Resolution No. 2006-20 -- Authorizing the Amendment of the city of Kenai, Alaska and Public Employees' Retirement System (PERS) Participation Agreement to Exclude All Elected Officials, Effective May 3, 2006. 4. Resolution No. 2006-21 -- Transferring $11,000 in the General Fund for Shop Department Utilities. 5. Resolution No. 2006-22 -- Transferring $12,458 in the Water and Sewer Special Revenue Fund for Engineering. 6. Resolution No. 2006-23 -- Awarding a Lease for Two Fish Seasons (May 15, 2006 to September 30, 2007) of Kenai Dock Station No. 3 to Copper River Seafoods for the Seasonal Base Bid of $4,379 Plus $0.03/Ib. For Any Poundage Over 1,333,333 Lbs. of Total Weight From Both Stations No. 2 and No. 3 Plus $307 Per Month for Boat Storage Area No. 3. 7. Resolution No. 2006-24 -- Expressing Intent to Donate Up to 25 Acres of a 77-Acre Parcel Near Mommsen Subdivision to Frontier Community Services and Kenai Senior Connection Upon Certain Conditions. Resolution No. 2006-25 -- Transferring $19,149 From Construction to Engineering in the Terminal Modifications Capital Project Fund. ITEM F: MIIv"UTES 1. *Regular Meeting of April 19, 2006. 2. *April 17, 2006 Work Session Notes 3. *April 19, 2006 Work Session Notes ITEM G: UNFIIVISHED BUSINESS %TEM H: NEW BUSINESS Bills to be Ratifaed 2. Approval of Purchase Orders Exceeding $15,000 3. *Ordinaace No. 2160-2006 -- Increasing Estimated Revenues and Appropriations by $28,000 in the Airport Land System Special Revenue Fund for Utilities. 4. *Ordinance No. 2161-2006 -- Increasing Estimated Revenues and Appropriations by $21,000 in the Ternunal Enterprise Fund for Utilities. *Ordinance No. 2162-2006 -- Amenduxg KMC 11.20.790 to Change the Annual Minimum Rental Rate for Shore Fisheries Leases to $3,000. 6. *0?rdinance No. 2163-2006 -- Enacting KMC 7.05.035, Adopting a Community Purposes Property Tax Exemption as Authorized by AS 29.45.050. 7. *Ordinaace No. 2164-2006 -- Increasing Estimated Revenues and Appropriations by $60,000 in the Airport Land System Special Revenue Fund and the Runway Safety Area Improvement Capital Project Fund for Engineering Services. 8. Approval -- Updated Kenai City Council Policy for Conunission, Committee, Board and Council on Aging Meetings and Work Sessions. 9. Discussion -- Schedule Proposed Library Expansion Work Session. YTEM I: 1. Council on Aging 2. Airport Commission 3. Harbor Commission 4. Library Commission 5. Parks & Recreation Commission 6. Planning Sv Zoning Commission 7. Miscellaneous Commissions and Committees a. Beautification Committee b. Alaska Municipal League Report ITEM J: REPORT OF THE MAYOR %TEM K: ADMINISTRATION REPORTS 1. City Manager 2. Attorney 3. City Clerk ITEM L: 1. Citizens (five minutes) 2. Council EXECUTIVE SESSION -- NnnP Srherlulerl ITEM M: MINUTES ITEM A: CALL TO ORDER Mayor Porter called the meeting to order at approximately 7:00 p.m. in the Council Chambers in the Kenai City Hall Building. A-1. PLEDGE OF ALLEGIANCE Mayor Porter led those assembled in the Pledge of Allegiance. P_-2. ROLL BALL Roll was taken by the City Clerk. Present were: Robert Mollo Pat Porter, Ma or Joe Moore, Vice Ma or Linda Swarner Cliff Massie Rick Ross Absent was: Mike Boyle A quorum was present. Also Present: Les Krusen, Student Representative A-3. AGENDA APPROVAL Mayor Porter requested the following changes to the agenda: REMOVE: B-3, Persons Scheduled to be Heard -- Ricky Gease (rescheduled for May 17, 2006 Council Meeting) ADD TO: E-7, Suggested amendments to Resolution No. 2006-24 (Frontier Community Services/Senior Connection and donation). ADD AS: H-I0, Approval -- Council on Aging Letter to Kenai Borough Assembly supporting purchase of Heritage Place (attached letters of support from Ninilchik Senior Citizens, Inc., Soldotna Area Senior Citizens, Inc., Daniel E. Issacs, Betty Coulter, and Sterling Area Senior Citizens, Inc.). KENAI CITY COUNCIL MEETING MAY 3, 2006 PAGE 2 MOTION: Council Member Moore MOVED to remove H-5 from the agenda and Council Member Swarner SECONDED the motion. VOTE: *Student Representative Krusen: Yes Mollo Yes Bo le Absent Porter Yes Moore ,Yes Swarner Yes Massie Yes Ross Yes MOTION PASSED 'IJNANIMO*JSI.Y. A brief discussion followed related to the addition of Item H-10, approval of a Council on Aging letter of support for the Borough's purchase of Heritage Place. Council Member Swarner stated her objection to adding it to the agenda as it had not been advertised and council should have more time to review the issue. Council Member Molloy reported Central Peninsula Hospital is a client and he would abstain from voting on the issue. MOTION: Council Member Swarner MOVED to delete Item ti-10 from the agenda and Council Member Moore SECONDED the motion. Council Member Ross stated he believed the letter, if council would approve it, would be the Council on Aging's representation of its position. By approving the letter, the City Council would not be stating the letter was identifying the official position of the City Council. VOTE: *Student Representative Krusen: No Mollo Abstain Bo le Absent Porter No Moore No Swarner Yes Massie No Ross No MOTION FAILED. VOTE ON MAIN MOTION: KENAI CITY COUNCIL MEETING MAY 3, 2006 PAGE 3 *Student Representative Krusen: Yes Mollo Yes Bo le Absent Porter Yes Moore Yes Swarner Yes Massie Yes Ross Yes MOTION PASSED UNANIMOUSLY. A-4. CONSENT AGENDA MOTION: Council Member Moore MOVED to approve the consent agenda and requested UNANIMOUS CONSENT. Council Member Swarner SECONDED the motion. There were no objections. SO ORDERED. YTEM B: B-1. Les Krusea -- Astroturf/Mufti-purpose Facility Les Krusen, 1506 Toyon Way, Kenai -- Offered a digital presentation related to installation of artificial turf at the multipurpose facility at an estimated cost of ~7~,nQQ. He noted, a rntin,~ he hn1.1C'yed :'V'~ulri hennVft from ha:^~ g tl:e turf L^.Stolleyl were softball/baseball programs, lacrosse clubs, indoor/outdoor soccer programs, etc. Krusen suggested the turf be purchased through the Daubenspeck Fund. B-2. Robert Ruffner/Kaleidoscope School of Arts & Sciences Teachers aad Studeats -- Clean-up of No-Name Creek Robert Ruffner, Executive Director, Kenai Watershed Forum -- Explained the Forum worked with the Kenai Peninsula School District and the Kaleidoscope School, fmding the nearest salmon stream and monitoring it once a week during the school year. He noted, the children would be cleaning No-Name Creek the following week. Ruffner introduced teachers and children from Kaleidoscope School who discussed their project, what they learned, noting citizens' responsibility to keep the watershed and creek clean. B•3. Ricky Gease, Kenai River Sportfishiag Association, Inc. -- Management Oversight Reports and Economic Information of Upper Cook Inlet Salmon Fisheries. Rescheduled for May 17, 2006. KENAI CITY COUNCIL MEETING MAY 3, 2006 PAGE 4 %TEM C: UNSCHEDULED PUBLIC COMMENTS Paul Shadura, Kenai Peninsula Fishermen's Association -- Stated his organization objected to the council's consideration of raising the rates of the shore fishery leases. Shadura distributed a letter related to Ordinance No. 2162-2006, which he understood had been removed from the agenda. He noted, changing the rate could set a precedent and would have afar-reaching effect throughout the state. ITEM D: REPORTS OF KPB ASSEMBLY LEGISLATORS AND COUNCILS -- None. ITEM E: PUBLIC HEARINGS E-1. Ordinance No. 2158-2006 -- Amending the Official Kenai Zoning Map by Rezoning Lot A-1 and Lot A-2, Bazon Park Subdivision No. 6, From Split-Zoned Light Industrial (IL) and General Commercial (CG) to General Commercial (CG) Only. MOTION: Council Member Ross MOVED for adoption of Ordinance No. 2158-2006 and Council Member Molloy SECONDED the motion. There were no public comments. Council Member Ross reported the Planning & Zoning Commissicr. re~:ewed ~e rezone and r ..............nded Council's approval. VOTE: *Student Representative Krusen: Yes Ross Yes Mollo Yes Bo le Yes Porter Yes Moore Yes Swarner Yes Massie Yes MOT%ON PASSED UNANIMOUSLY. E-2. Ordiaaaee No. 2159-2006 -- Enacting KMC 7.40 Titled, "Grant Administration," Which Adopts Procedures for the Administration of Grants by the City of Kenai. MOTON: Council Member Swarner MOVED for the adoption of Ordinance No. 2159-2006 and Council Member Moore SECONDED the mofion. KENAI CITY COUNCIL MEETING MAY 3, 2006 PAGE 5 There were no public comments. Council Member Swarner explained she requested the ordinance be brought forward and noted, the ordinance would allow the city to charge a fee for administration of some grants. Discussion followed related to the determination of waiving a grant fee. MOTION TO AMENDS Council Member Swamer MOVED to amend KMC 7.40.040(a) as follows: "To administer grants, unless the Council determines it is otherwise appropriate, the City shall retain fees frDm the grant funds computed as follows:" Council Member Massie SECONDED the motion. VOTE ON AMENDMENT: *Student Representative Krusen: Yes Mollo Yes Bo le Absent Porter Yes Moore Yes Swarner Yes Massie Yes Ross Yes MOTYON PASSED UNANIMOUSLY. VOTE ON MAIN MOTION AS AMFNnEi). *Student Representative Krusen: Yes Mollo Yes Bo le Absent Porter Yes Moore Yes Swarner Yes Massie Yes Ross ~ Yes ~ ~~ MOTION PASSED UNANIMOUSLY. E-3. Resolution No. 2006-20 -- Authorizing the Amendment of the city of Kenai, Alaska and Public Employees' Retirement System (PERS) Participation Agreement to Exclude All Elected Officials, Effective May 3, 2006. MOTION: Council Member Moore MOVED for approval of Resolution No. 2006-20 and Council Member Ross SECONDED the motion. KENAI CITY COUNCIL MEETING MAY 3, 200b PAGE 6 There were no public comments. Council Member Molloy referred to an electronic message received from Council Member Boyle who requested the resolution be postponed to the May 17, 200b meeting as he would like to speak to the resolution. MOTION TO POSTPONE: Council member Molloy MOVED to postpone consideration of Resolution No. 200b-20 to the May 17, 200b meeting and Council Member Swamer SECONDED the motion. VOTE TO POSTPONE: 'Student Representative Krusen: Yes Mollo Yes Bo le Absent Porter Yes Moore Yes Swazner Yes Massie Yes Ross Yes MOTION PASSED UNANIMOUSLY. E-4. Resolution No. 2006-21 -- Transferring $11,000 in the General Fund for Shop Department Utilities. MOTION: Council iviember ivioiioy ivavv~D to approve Resolution ivo. 20Gb-2I. Council iviember Swamer SECONDED the motion and requested UNANIlKOUS CONSENT. There were no public or council comments. VOTE: There were no objections. SO ORDERED. E-5. Resolution No. 2006-22 -- Transferring $12,458 in the Water and Sewer Special Revenue Fund for Engineering. MOTION: Council Member Moore MOVED to approve Resolution No. 200b-22 and Council Member Molloy SECONDED the motion. There were no public comments. The delay in the billing was questioned and City Manager Koch explained it was a timing issue on the gait of the State. KENAI CITY COUNCIL MEETING MAY 3, 2006 PAGE 7 VOTE: *Student Representative Krusen: Yes Mollo Yes Bo le Absent Porter Yes Moore Yes Swarner Yes Massie Yes Ross Yes MOTION PASSED UNANIMOUSLY. E-6. Resolution No. 2006-23 -- Awarding a Lease for Two Fish Seasons (May 15, 2006 to September 30, 2007) of Kenai Dock Statior r 3 to Copper River Seafoods for the Seasonal Base Bid of $4,379 Phz: ,1;0.03/lb. For Any Poundage Over 1,333,333 Lbs. of Total Weight From Both Stations No. 2 and No. 3 Plus $307 Per Month for Boat Storage Area No. 3. MOTION: Council Member Molloy MOVED to approve Resolution No. 2006-23. Council Member Swarner SECONDED the motion and requested UNANIMOUS CONSENT. There were no public or council comments. VOTE; There were no objections. SO ORDERED. E-7. Resolution No. 2006-24 -- Expressing Intent to Donate Up to 25 Acres of a 77-Acre Parcel Near Mommsen Subdivision to Frontier Community Services and Kenai Senior Connection Upon Certain Conditions. MOTIONc Council Member Massie MOVED for approval of Resolution No. 2006-24 and Council Member Molloy SECONDED the motion. Anna Wheeler, 3S1 Senior Court, Kenai -- Wheeler explained she was there representing the Senior Connection who requested property for use as a site for an assisted living facility. Wheeler stated the Connection's support of Resolution No. 2006-24. Ken Duff, Executive Director, Frontier Community Services -- Noted, Frontier Services and the Senior Connection met and identified their needs and felt the updated plan to build on the front portion of the acreage would be of benefit to both KENAI CITY COUNCIL MEETING MAY 3, 2006 PAGE 8 organizations and because Frontier Services can assist in managing the assisted living facility. James McConnell, 19501 Wingham Circle, Eagle Ri®er, AK -- McConnell gave a brief update as to how the Frontier Services and Senior Connection's collaborative plan occurred, noting both entities had similar issues and grant funds could be more accessible with the collaborative effort acknowledged. McConnell reviewed the resolution, noting passage of the resolution would donate 25 Acres of property to both entities with separate deeds (instead of the former request of 77 acres); they would pay the $18,000 to the borough to clear the title to the property; requested the city to forgive the back taxes owed on the property; they will pay for the survey of the 77 acres to subdivide the property; upon passage of the resolution, he would submit the resolution, the development grant application, and a cover letter from City Manager Koch recognizing the mechanical steps needing to be taken; and, after submittal, a request for proposals for architectural design would be published. BREAK TAKEN: 8:06 P.M. BACK TO ORDER: 8:14 P.M. Discussion followed related to the amount of acreage to be used, survey of the property, etc. MOTION TO AMEND: Council Member Ross MOVED to include in the "now, therefore" paragraph "by adoption of this resolution, we are rescinding Resolution No. 2005-33." Council Member Moore the motion. Ross noted the resolution did not include a performance date and added, he had no objection to the Senior Connection to work with the city manager and return with another resolution for consideration identifying a performance date. VOTE: *Student Representative Krusen: Yes Mollo Yes Bo le Absent Porter Yes Moore Yes Swarner Yes Massie Yes Ross Yes MOTION PASSED UNANIMOUSLY. MOTION TO AMEND: KENAI CITY COUNCIL MEETING MAY 3, 2006 PAGE 9 Council Member Molloy MOVED to amend Resolution No. 2006-24 with his lay down Resolution No. 2006-24 which would also be amended by the Ross amendment. Council Member Massie SECONDED the motion. Molloy reviewed the changes he included in his amended resolution draft: • A requirement for separate deeds. • The two entities are not equal, i.e. the Senior Connection is a non-profit and Frontier Services is not and could participate more in the cost of the property acquisition. • The "now, therefore" paragraph includes reference to "non-profit senior assisted living facility" which he believed had been an omission. In discussing the Molloy amendments, McConnell stated they had no objection to separate deeds; he disagreed with the comment Frontier Services was not anon-profit as Frontier Services receives funding the same as the Senior Connection; and, the use of "transfer" instead of "donate" would be problematic with the funding agencies. MOTION TO AMEND: Council Member Ross MOVED to delete the word "transfer" from the title and body of the Molloy amendment. Council Member Swarner SECONDED the motion and requested UNANIMOUS CONSENT. Council Member Molloy objected to the request for unanunous consent. voTE oN AMENDMENT ~xoss~: *Student Representative Krusen: Yes Mollo No Bo le Absent Porter Yes Moore Yes Swarner Yes Massie Yes Ross Yes MOTION PASSED. VOTE ON AMENDMENT (MOLL05~: *Student Representative Krusen: Yes Mollo Yes Bo le Absent Porter Yes Moore Yes Swarner Yes Massie Yes Ross Yes KENAI CITY COUNCIL MEETING MAY 3, 2006 PAGE IO MOTION PASSED UNANIMOUSLY. VOTE ON MOTION AS AMENDED: *Student Representative Krusen: Yes Mollo Yes Bo le Absent Porter Yes Moore Yes Swarner Yes Massie Yes Ross Yes MOTION PASSED UNANIMOUSLY. BREAK TAKEN: 8:46 P.M. BACK TO ORDER: 8:50 P.M. E-8. Resolution No. 2006-25 -- Transferring $19,149 From Construction to Engineering in the Terminal Modifications Capital Project Fund. MOTION: Council Member Swarner MOVED for approval of Resolution No. 2006-25 and requested UNANIMOUS CONSENT. Council Member Moore SECONDED the motion. There were no public or council comments. VOTE: There were no objections. SO ORDERED. ITEM F• F-1. F-2. F-3. ITEM G• ITEM Ii• A-1. MOTION: MINUTES Regular Meetiag off April 19, 2006 -- Approved byconsent agenda. April 1?, 2006 Work Sessioa Notes -- Approved by consent agenda. April 19, 2006 Work Session Notes -- Approved by consent agenda. -- None. NEW BUSINESS 13ills to be Ratified KENAI CITY COUNCIL MEETING MAY 3, 2006 PAGE 11 Council Member Moore MOVED to ratify the bills over $15,000 and requested UNANI1Vi0US CONSENT. Council Member Molloy SECONDED the motion. There were no objections. SO ORDERED. H-2. Approval of Purchase Orders Exceediug $15,000 MOTION: Council Member Massie MOVED for approval of the purchase orders exceeding $15,000 and Council Member Molloy SECONDED the motion. VOTE: 'Student Representative Krusen: Yes Mollo Yes Bo le Absent Porter Yes Moore Yes Swarner Yes Massie Yes Ross Yes MOTION PASSED UNANIMOUSLY H-3. Ordinance No. 2160-2006 -- Increasing Estimated Revenues and Appropriations by $28,000 in the Airport Land System Special Revenue Fund for Utilities. introduced by consent agenda. H-4. Ordinance No. 2161-2006 -- Increasing Estimated Revenues and Appropriations by $22,000 in the Terminal Enterprise Fund for Utilities. Introduced by consent agenda. H-5. Ordinance No. 2162-2006 -- Amending KMC 11.20.790 to Change the Annual Minimum Rental Rate for Shore Fisheries Leases to $3,000. Removed from the agenda. H-6. Ordinance No. 2163-2006 -- Enacting KMC 7.05.035, Adopting a Community Purposes Property Tax Exemption as Authorized by AS 29.45.050. Introduced by consent agenda. KENAI CITY COUNCIL MEETING MAY 3, 2006 PAGE 12 H-7. Ordinance No. 2164-2006 -- Increasing Estimated Revenues and Appropriations by $60,000 in the Airport Land System Special Revenue Fund and the Runway Safety Area Improvement Capital Project Fund for Engineering Services. Introduced by consent agenda. H-8. Approval -- Updated Kenai City Council Policy for Commission, Committee, Board and Council on Aging Meetings and Work Sessions. MOTION: Council Member Molloy MOVED to approve the updated Kenai City Council Policy for Commission, Committee, Board and Council on Aging Meetings and Work Sessions. Council Member Moore SECONDED the motion. VOTE: *Student Representative Krusen: Yes Mollo Yes Bo le Absent Porter Yes Moore Yes Swarner Yes Massie Yes Ross Yes MV1TVf nAQi'~L it YVwnwTV9lxAra.F^~I.° 1 \ EAVVI'JY Vl\i'11Y11~1V 1• H-9. Discussion -- Schedule Proposed Library Expansion Work Session. A brief discussion took place in which administration was requested to review the recommendations offered by the architect and indicate which facilities could be available. The work session was scheduled for June 27, 2006 at 6:00 p.m. H-10. Approval -- Council on Aging Letter to Kenai Peninsula Borough Assembly Support Purchase of Heritage Place. Discussion followed and comments included: • Support to allow the Council on Aging to send its letter of support of the Borough's purchase of Heritage Place. • The City Council were not voting on the content of the letter. • The letter was acknowledging the criticalness of the issue. KENAI CITY COUNCIL MEETING MAY 3, 2006 PAGE 13 council. Some objection due to the short notice of the letter coming before The letter should not be sent on City/Senior Center Letterhead. There were no objections to the letter being sent by the Council on Aging. ITEM I: I-1. Council on Aging -- It was reported the next meeting would be held May 4. Mayor Porter noted the application submitted by Robert Friend (application was included in the packet) for appointment to the Council on Aging. Porter recommended the appointment. There were no objections of council. I-2. Airport Commission -- Council Member Swarner noted the Air Fair would take place on May 13 and the next Commission meeting was scheduled for May 11. I-3. Harbor Commission -- Council Member Massie reported the next meeting would be held May 8. I-4. Library Commission -- Council Member Molloy reported the May meeting had been cancelled. I-5. Parks 8s Recreation Commission -- Council Member Moore reported the next meeting would be held on May 4. I-6. Planning Ss Zoning Commission -- Council Member Ross reported the minutes of the April 26 meeting were included in the council meeting packet for review. I-7. Miscellaneous Commissions and Committees I-7a. Beautification Committee -- Swarner reported the next meeting would be held on May 9 and planting day would be held June 3. I-?b. Alaska Municipal League Report -- Swarner reported Kevin Ritchie, AML Executive Director, would be retiring in August. %-7c. Stranded Gas -- Ross reported a meeting had been scheduled for May 10 in Anchorage. He requested council approval to travel to Anchorage to attend the meeting. There were no objections. ITEM J: REPORT OF THE MAYOR -- Mayor Porter reported the following: • Attended ceremony for outstanding students in Peninsula schools. KENAI CITY COUNCIL MEETING MAY 3, 2006 PAGE 14 • Participated as a judge for the "Caring for the Kenai' competition. • She participated in the second annual Red Hat pazade. • She traveled to Juneau and met with area legislators. • She attended the Peninsula Mayors meeting where the group discussed a number of important subjects, including revenue sharing, Cook Inlet beluga whale population, etc. • She has been asked to bring farwazd a resolution in support of a groundfish rationalization plan. Individuals from Bolshoy-Kamen wiIl be visiting the area in July. ITEM K: ADMIPTISTRATION REPORTS K-1. City Manager -- City Manager Koch reported the following: • Attended VISTA training Agril 24-27, and introduced Jason Steen, the city's new VISTA representative. • Representatives of Lounsbury & Associates have begun traffic count information related to the Wal-Mart development. • He met with representatives of Lowe's and distributed information to them regarding land status, gross sales tax data, etc. • He will meet with the State Fire Marshal on May 23 to tour the PRISM building. • He received a proposal from Carr-Gottstein related to development of an event center and utilizing 11,200 square feet of the old Cams Mall, i.e. the space is available "as is" at approximately $5,600/month and the city would be responsible for costs of improvements and utilities. • Letters have been sent to owners of three abandoned buildings. He received one positive response. • He and Mayor Porter will meet with a real estate broker and Wal-Mart representatives on Friday. • He appreciated council and staff s hard work on the budget. Koch was requested to again contact Carr-Gottstein related to the use of their building for an event center. K-2. Attorney -- City Attorney Graves reported the revisions to the Airport code had been forwarded to the Airport Commission and KEDS. After receiving continents, revisions to properties outside the Airport Reserve would be forwarded to them for review. K-3. City Clerk -- City Clerk Freas reported the following: • The Alcoholic Beverage Control Board upheld the City and Borough's objection to the liquor license renewals for Alaskalanes and Kings Inn, d/b/a Mr. D's. KENAI CITY COUNCIL MEETING MAY 3, 2006 PAGE 15 • With the budget review completed, asked if the budget work session previously scheduled for May 4 was cancelled. Council agreed the work session was cancelled. • Reminded council and audience present the May 17 meeting would be held at the Senior Center due to the elevator renovation work. ITEM L: DISCUSSION L-1. Citizeas Marion Nelson, P.O. Box 3612, Kenai -- Distributed copies of the 2006 Milepost and stated her appreciation for the city's advertisement. L-2. Councii -- Molloy -- No comments. Ross -- No comments. Student Representative Krusen -- No comments. Massie -- No comments. Swarner -- Noted during her trip to Juneau, she met with area legislators. She also noted she spoke with a representative of Central Peninsula Health Center and learned Aspen Dental Clinic would remain in Kenai. Representatives of Aspen Dental Clinic will make a presentation to council in the near future. Moore -- Commented on legislative action on the proposed PERS/TERS Tier IV. __ None Scheduled ITEM M• ADJOURNMENT There being no further business before the Council, the meeting adjourned at approximately 9:30 p.m. Minutes transcribed and prepared by: Carol L. Freas, City Clerk KENAI CITY COUNCIL MEETING MAY 3, 2006 PAGE I6 *The student may cast advisory votes on all matters except those subject to executive session discussion. Advisory votes shall be cast prior to the official council cote and shall not affect the outcome of a cote. Advisory votes shall be recorded in the minutes. Student representatives may not move or second items during a council meeting. ~- 2. KExAl CITY COUNCIL BvDGEp'prgwyoryitnx sF:ssgoN lIY1Y lu ygg4~®~g®6 p~~yp q y /~yrg~~y 6/~:0pogpSy~.id1}8g• qg q p~ y~g9 p &HL'ltl6&11i888 ~r®VL~i+1L C832Y1I1B6s1i6J 1YlAE®dA ~A8 Spy®1Lryal r/p16~ SB~SJS1L311V 1®®8 ~O Council present: P. Porter, J. Moore, L. Swarner, C. Massie, R. Ross, R. Molloy Council absent: M. Boyle Staff present: R. Koch, C. Freas, C. Graves, J. La Shot, K. Kornelis, B. Frates, M. Joiner, R. Craig, R. Cronkhite, R. Kornfield, B. Springer, R. Feltman, L. Sernmens, M. Tilly, C. Kopp, M. Wichman, J. Neiderhauser Mayor Porter called the work session to order at approximately 6:00 p.m. and requested an update from Administration of any changes made to the draft budget since it was first distributed. Changes noted were: projected revenues, health insurance issues, and a request for an increase to the budget to fund staffmg for the Clerk. Cost of Laving Allowance Discussion: It was noted, the proposed budget included a three percent (3%) COLA increase for the employees. Findings: Council had no objections to includuag the three percent (3%) COLA increase in the budget. Insurance Discussion: City Manager Koch explained the proposed budget had included in it a ten percent (10%) increase for projected insurance costs; there was approximately four percent (4%) of insurance funds remaining from the current budget; notification was received from Premera/Blue Cross stating a 20% increase; and, the actual increase to the proposed budget would be approximately $70,000 or six percent (6%). He noted two suggestions: Keep the proposed amount in the draft budget and look for other coverage or change the deductible and maxirnum amount from $200 to $300 and $1,200 to $1,300 which would save $70,000. Findings: Proceed with the amount in the budget and research other coverage and include a review by the employee committee. Clerk Budget: Finance Director Sernmens explained a proposal to return a Finance Department 25- hour/week employee (who is already receiving benefits) to a 40-hour a week position and the position be shared 50/50 by the Finance Department and the City Clerk Department. He noted, benefits in doing this would be hiring and retaining better qualified personnel; the additional would be $20,000 a year; $11,000 would need to be added to the Clerk budget; and, he recommended, if council did not choose to increase KENAI CITY COUNCIL BUDGET WORK SESSION MAY 2, 2006 PAGE 2 the hours of the position and share it between the two departments, the same additional funds be added to the Clerk Department to allow additional staffing. Discussion followed during which comments included: • Sharing the position with two supervisors could be problematic. • Two commands presents a problem, but it would maximize the cost of the health benefits already being paid. • There is another 25-hour/week position in the city receiving benefits. The person in the position proposed to be shared was made aware of the proposal. • Suggestion the City Clerk position be changed from the supervision of the Council to the supervision of the City Manager, with the appointment of the Clerk remaining with the Council. • Try the split position for a year, lrnowing there could be problems and issues to resolve. Findings: Include the $11,000 to the budget to make afull-time position to be shared between the Finance and Clerk's Departments. Visitors Center Budget: -- Request was made for meeting minutes be forwarded to the City Clerk for review by council. Findings: No changes to the budget. Legislative Budget: -- Brief discussions took place related to the benefits received from membership to the Alaska Municipal League; whether to fund Project Protect, branding program, and the Alaska video. Findings: Include $12,500 for the television production; $7,500 for the Project Protect program; no on funding a branding program; and, remove the CIP brochures heading in the Legislative Printing 8s Binding budget (leaving the $500). Legal Department: Findings: No changes. City Manager° Findings: No changes. Finance Department: KENAI CITY COUNCIL BUDGET WORK SESSION MAY 2, 2006 PAGE 3 Fiadings: No changes. Lands• Findings: No changes. Non-Departmental: A brief discussion took place related to the request to purchase a new copier which is situated in the Clerk's Office. It was noted the current copier is oid; is used by all the city departments; pazts for repair aze hazd to get due to the machine's age; and, funding is included in the non-departmental budget because of the machine's use by all departments. Fiadings: No changes. Planning 8s Zoning Department: A brief discussion took place related to providing a stipend for the Planning & Zoning Commission. Fiadings: No stipend of the Planning & Zoning Commission. No changes. Safety: Findings: No changes. Police Department: A brief discussion took place related to the non-funding of police vehicles. Findings: No changes. Fire Department: A brief discussion took place related to the non-funding of a pick- up truck and extrication equipment. Findings: No changes. Communications: Fiadings: No changes. Animal Control° Findings: No changes. Public Works Administration: Findings: No changes. KENAI CITY COUNCIL BUDGET WORK SESSION MAY 2, ?006 PAGE 4 Shop: Findings: No changes. Streets: A brief discussion took place related to snowplowing and removal of snow from the middle of the streets to lessen the amount of sand that melts into grassed areas along streets. City Manager Koch stated he would have an estimate for snow removal prepared. Findings: No changes. Buildin¢s: Discussion took place related to placing another storage shed at the Senior Center. Findings: No changes. Street Lights: It was reported there was no funding included in the draft budget for new street lights, only repair of street lights. Findings: No changes. Library: Findings: Add $5,000 for the purchase of books. No other changes. Recreation• Findings: No changes. Parks° Findings: No changes. Beautification: Findings: No changes. Boating Facility: Findings: No changes. Special Revenue Funds: KENAI CITY COUNCIL BUDGET WORK SESSION MAY 2, 2006 PAGE 5 Water/Sewer Fund: Staff is to research another solution prior to the budget ordinance come before council for public hearing. Findings: No changes. Waste Water Treatment Plant: Findings: No changes. Airport Land system: Findings: No changes. Airport Maintenance and Qperations: Findings: No changes. Airport Administration: Findings: No changes. Airport Land System: Findings: No changes. Senior Citizen Grants: Findings: No changes. Senior Center Findings: No changes. Enterprise Funds° Airport Terminal: Findings: No changes. Congregate Housing Fuad: Administration is to consider a rent increase next year. Findings: No changes. KENAI CITY COUNCIL BUDGET WORK SESSION MAY 2, 2006 PAGE 6 Permanent Funds• Findings: No changes. RECAP° Adjustment was made on property and sales taxes. Budget deficit after the lapse, $232,000. Additions made during review of budget: $11,000 -- Finance/Clerk shazed position $12,500 -- Legislative/television video $ 7,500 -- Legislative/Project Protect $ 5,000 -- Library/Additional books Additional discussion: • State of Alaska Funding: A brief discussion took place related to possible legislative funding. • Shore Fishery Lease Ordinance -- It was explained, if there is interest in amending the code to change the terms of shore fishery leases, the ordinance would need to be introduced at the May 3 meeting or a special meeting held. Also, if council would want to change the renewal time to review again in the next several yeazs instead of waiting tithe current ten-year period, the ordinance would need to be iri`u vd u%ed at u~ ie relay 3 Tieetirig. Co 4ill.ii ."itatcd they WolLld disCUSS It further at the May 3 council meeting. • Budget Ordinance Calendar -- May 17, 2006/Introduction of budget ordinance which would reflect the changed made at the May 3 budget work session. -- June 7, 2006/Council consider a motion to apply the three percent COLA increase to the City Clerk and City Attorney salaries. -- May 17, 2006 -- Evaluations of City Clerk, City Attorney, and City Manager. • PERS Relief: City Manager Koch discussed the possibility of receiving additional funds from the Legislature. Koch was requested to prioritize programs to put back in the budget if funding is received from the State. The work session adjourned at approximately 8:05 p.m. Notes prepared by: Carol L. Freas, City Clerk N-i M N M N t0 fn } W F- !- J J [%] t- Q ~ J ~ ~ ~ ~ J Z _~ F Q L` d~ U Z O C7 U Z ~ W d U w x o° ~ N ~ V ~ U a J P W W K ~ d W Q O Q ~ C O O tL r d M ~ Z U O w U 9 ~ .W.I _! ~ W - ~ = O W ~ a ® > z a d a J V z U W tl.l Z s U ~~ 6 4 O N o ~ O r O ~ Q M tL o W ~ Q ~ ~ W Z W ',W ~ ~ J H ®. W O O tl° F- 2 a w W W N J I- 0 U Q 0 N 0 K a Z O J W O M O Q ® O ~ u~'{ O d ap ON J ~ S M O i~ O ~ O N O N •- •-- ~~ O # ~ W ® J ~ ~ W H q Z p ~ U Q ~ o ~ a ~ ~ ~ y ~ ~ ~ o m _ ~ ~ J ~ I 1 ~ rn ~ u i ° o ~ r ro r ~ N Z ~ ~ W C7 ~ Q ? J a Q ~ a ~ ~ J ~ ~ !a u- N J 2 F U Q ~ ~ W cn a ~ U U J ~ ~i ~ ~ 4 ~ L ? uJ ~ Z 'Q d N-a I~-3 Suggested by: Aamamstrauon CITY OF KENAI ®RDIIVANCE IdO. 2155-20®6 AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA ADOPTING THE ANNUAL BUDGET FOR THE FISCAL YEAR COMMENCING JULY I, 2006 AND ENDING JUNE 30. 2007. WHEREAS, it is a requirement of the Code of the City of Kenai, Alaska, that the City Council, not later than the tenth day of June, adopt a budget for the following fiscal year and make appropriation of the monies needed. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA as follows: Section 1: That certain document entitled "City of Kenai Fiscal Year 2007 Annual Budget" which is available for examination by the public in the Office of the City Clerk and is incorporated herein by reference, is hereby adopted as the budget for the City of Kenai for the fiscal year commencing July 1, 2006 and ending June 30, 2007. Section 2: The following sums of money are hereby appropriated for the operations of the City of Kenai for the fiscal year commencing on the first day of July, 2006, and ending the 30th day of June, 2007, to be expended consistent with and subject to the rest,^.Ct1^.ne nrnna «d C...-t L. •L.o (`...7 !':4., ..f Ki°.yiai .....7 ..,, r..,.,,,dur~°,~, w pu:reses set a~a ua lia ua~. ~.vue cf the ~.a~y ~ cuiu to be expended substantially by line item in the manner shown in the budget adopted by Section 1 hereof: General Fund $ 10,162,813 Airport Terminal Fund 555,422 Congregate Housing 346,387 General Land Sales Trust Fund 6,800 Airport Land Sales Trust Fund 19,000 Water and Sewer Fund 1,786,944 Airport Land System Fund 1,776,278 Senior Citizen Title III Grant Fund 195,362 Senior Citizens Fund 328,586 Ordinance No. 2165-2006 Page Two PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this seventh day of June, 2006. PAT PORTER, MAYOR ATTEST: Carol L. Freas, City Clerk Approved by Finance: ~~ (05/08/2006) hl Introduced: Adopted: Effective: May 1', 2006 June 7, 2006 July 7, 2006 Suggested by: Administration CYTY OF KENAI ORDINANCE NO. 2166-2006 AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA INCREASING ESTIMATED REVENUES AND APPROPRIATIONS BY $3,800 IN THE SENIOR CITIZEN TITLE III GRANT FUND FOR SENIOR AND DISABILITIES TRAINING. WHEREAS, the State of Alaska has awarded the City of Kenai a mini grant for Senior and Disabilities training; and, WHEREAS, the Kenai Senior Services is working with Frontier Community Services to hold a joint training workshop; and, WHEREAS, it is in the best interest of the City of Kenai and the Senior Citizen program to accept this mini grant. NOW", THEREFORE, BE IT ORDAINED BY THE COUNCIL OF fiHE CITY OF KENAI, ALASKA, that: Senior Citizens Title III Grant Fund Increase Estimated Revenues: State Training Grant $3,800 Increase Appropriations: Title III Senior Citizen Access-Miscellaneous $3,800 PASSED BY THE COUNCIL OF fiHE CITY OF KENAI, ALASKA, this 7the day of June, 2006. PAT PORTER, MAYOR ATTEST: Carol L. Freas, City Clerk Introduced: May 17, 2006 Adopted: June 7, 2006 Effective: June 7, 2006 Approved by Finance: (OS/ 10/2006) jl N-s Suggested by: Administration CITY OF KENAI ORDINANCE N®. 2lfs?-2006 AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, INCREASING ESTIMATED REVENUES AND APPROPRIATIONS BY $4,210.00 IN THE GENERAL FUND TO PAY FOR IMPROVEMENTS TO POLICE DEPARTMENT REPORT WRITING STATIONS AND A COMPUTER PROJECTOR. WHEREAS, the City of Kenai has received $4,210.00 from the State of Alaska as equitable sharing of a forfeiture of U.S. currency from a Kenai area drug dealer; and, WHEREAS, the Kenai Police Department is in need of additional officer report writing stations for the Code Enforcement Officer and the Seasonal Enforcement Officers; and, WHEREAS, the Kenai Police Department needs to replace a broken computer projector for instnzctional seminars and community presentations; and, WHEREAS, the transfer of these funds to the Police Small Tools account will assist the Department with its extensive report writing responsibilities, and allow for multimedia presentation capability. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA that estimated revenues and appropriations be increased as follows: General Fund Increase Estimated Revenues: DEA forfeitures $4,21U.UU Increase Appropriations: Police -- Small Tools $4,210.00 PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 7th day of June 2006. PAT PORTER, MAYOR ATTEST: Carol L. Freas, City Clerk Introduced: May 17, 2006 Adopted: June 7, 2006 Effective: June 7, 2006 Approved by Finance: _~~~~ N-b Suggested by: Councilor Molloy CITY OF KENAI ORDINANCE NO. 2168-2006 AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, AMENDING KMC 1.15.130 TO ALLOW COUNCIL MEMBERS TO TELEPHONICALLY ATTEND UP TO SIX (6) ADDITIONAL COUNCIL MEETINGS DURING A TWELVE (12) MONTH PERIOD IF THE MEMBER IS PHYSICALLY UNABLE TO ATTEND DUE TO THE NEED FOR EXTENDED MEDICAL CARE AND TREATMENT OF THE MEMBER OR THE MEMBER'S IMMEDIATE FAMILY. WHEREAS, Section 2-7 of the Kenai City Charter states a Council Member shall cease to hold office if the member misses more than one-half of the regular and special meetings within athree-month period; and, WHEREAS, KMC 1.15.130 allows a Council Member to attend up to two (2) meetings telephonically during a twelve (12) month period beginning on November 1 if the member is physically unable to attend; and, WHEREAS, even after allowing for two (2) meetings being attended telephonically under KMC 1.15.130, an extended illness of a Council Member or the member's immediate family member can require the member to be physically absent from more than one-half of the regular and special council meetings within athree-month period; and, WHEREAS, providing for an additional six (6) meetings to be attended telephonically during a twelve (12) month period would permit the member to retain a council seat while dealing with an extended illness and allow the member to be more effective for the public than if additional telephone participation were not allowed; and, WHEREAS, while a Council Member could possibly attend up to eight (8) meetings telephonically during a twelve (12) month period under this ordinance, prohibiting the member from attending two (2) consecutive meetings telephonically would limit potential abuse of KMC 1.15.130 and avoid a member's prolonged absence from the community he/she represents; and, WHEREAS, telephonic attendance at various meetings, both in the public and private sectors, in increasingly allowed; and, WHEREAS, it is good public policy to allow and encourage Council Members to help provide care and support for immediate family members when they are suffering from an extended illness. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, that KMC 1.15.010 is amended as shown on Attachment A. Ordinance No. 2168-2006 Page 2 of 2 PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this seventh day of June, 2006. PAT PORTER, MAYOR ATTEST: Cazol L. Freas, City Clerk Introduced: May 17, 2006 Adopted: June 7, 2006 Effective: July ~, 2006 (5/4/06 sp) r `~I/illa~e wa't~t a Fast, Gc~ wit~i a Future" ~E~ ~~ TO: Mayor Porter and Councilors FROM: ~ ~~ Cary R. Graves, City Attorney DATE: May 11, 2006 RE: Proposed Amendment to Extended Illness Ordinance Mayor Porter asked me to draft an amendment to Ordinance 2168-2006. Mayor Porter's amendment would substitute a new paragraph (o) in the ordinance. The new paragraph would read: (o) A Council member may attend an additional six (6) meetings by teleconference during a consecutive thirty-six month period if the member declares that he/she is unable to attend the meeting due to the need for extended medical care and treatment of the member or member's immediate family. The consecutive thirty-six month period starts the first day in which the Council member attends telephonically under this subsection. A council member may not attend two (2) consecutive meetings by teleconference under this section. This would change the proposed ordinance as follows. Instead of getting six meetings per yeaz (based on a Nov to Nov period) to attend telephonically due to an extended illness, a member would get six meetings over a three yeaz period. If the member used up his/her six meetings in the first six months, the member would not get any more until after the three year period expires. The member could also space out his/her meetings and use two a year during the period. The three year period would start the first day a member appears telephonically. The member would still get to attend two meetings per year telephonically for any reason under the existing rule in KMC 1.15.130(n). The amendment would also still prohibit a member from attending two meetings in a row telephonically whether it was due to an extended illness or under subsection (n). Let me know if you have any questions. .~~t;?~~~_ 210 FidalgoAvenue, Kenai, Alaska 99611-7794 _, _ ~ Telephone: (907) 283-7535 /Fax: (907) 283-3014 m www.ci.kenai.ak.us t~ieuyaf KENA~ SKA CRG/sp Suggested by: CI'1CY OF I{ENAI OI219IN.9NCE Nt9. 2169-2006 Admimstrauon AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, TRANSFERRING $125,000 FROM THE FY2006 PUBLIC IMPROVEMENTS CAPITAL PROJECT FUND TO THE BOAT LAUNCH CAPITAL PROJECT FUND AND TRANSFERRING $100,000 FROM THE BOAT LAUNCH CAPITAL PROJECT FUND TO THE GENERAL FUND. WHEREAS, Ordinance No. 2154-2006 transferred and appropriated general fund money to the Boat Launch Capital Project Fund; and, WHEREAS, it is in the best interest of the City of Kenai to use State grant funds for a portion of the Boat Launch project; and, WHEREAS, Ordinance 2122-2005 appropriated $290,000 of State grant funds in the FY2006 Public Improvement Capital Project Fund and identified several projects, but did not obligate the City to use the funds for those projects or in the amounts listed; and, WHEREAS, none of the FY 2006 grant money has been obligated or spent. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, that: Section I: The following budget transfers be made in the FY2006 Public Improvement Capital Project Fund: From: Construction $125,000 To: Transfers to Capital Project Fund $125,000 Section 2: Estimated revenues and appropriations be increased in the Boat Launch Capital Project Fund as follows: Increase Estimated Revenues: Transfer from Capital Project Fund $125,000 Increase Appropriations: Construction $125,000 Ordinance No. 2169-2006 Page 2 Section 3: The following budget transfer be made in the Boat Launch Capital Project Fund: From: Construction $100,000 To: Transfers to General Fund $100,000 PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this seventh day of June, 2006. PAT PORTER, MAYOR ATTEST: Carol L. Freas, City Cierk Introduced: May 17, 2006 Adopted: June 7, 2006 Effective: June 7, 2006 Approved by Finance:_ (05/09/2006) hl %° ~~ ~~ a -~ ___ -- \` E(~eu~af ~/ KENA~ SKA MEMORANDUM To: City Council °°V lfa9e wit~t a Past, Gc~ wit~r a Future" 210 Fidalgo Avenue, Kenai, Alaska 99611-7794 Telephone: (907) 283-7535 /Fax: (907) 283-3014 www.ci.kenai.ak.us From: Rick Kooh, City Manager Date: May 12, 2006 Subject: Resolution No. 2169-2006, Transferring $ 125,000 from the FY 2006 Public Improvements Capital Project Fund to the Boat Launch Capital Project Fund and Transferring $ 100,000 from the Boat Launch Capital Project Fund to the General Fund. The purpose of this correspondence is to request the Council approve the use of $ 125,000 of designated legislative grant funding for the boat launch ramp improvements, and return $ 1QO,QQO of fimrlino frnm the boat t~,,,,..t, ~ m,. to rt,e ...i ~,«a --------a _..,... .,,,....,.. r ...,. gere.u. ~~.,u. After the Council transferred $ 135,000 from the general fund to the boat launch project to supplement existing project funding we found in reviewing specific grant language (Dept. of Commerce, Community & Economic Development, Grant # 06-DC-127, attached) that an existing designated legislative grant could be used for the boat launch improvements project. The Council, by ordinance No. 2122-2005, dated September 21, 2005 identified various improvements that would be funded through grant 06-DC-127. After further defining the scope/need for those improvements administration suggests that new priorities including the boat launch ramp improvements are appropriate. Attached is a spreadsheet identifying the proposed priorities and funding amounts. Also attached is a memo from Larry Semmens explaining the specific transfer details Thank you for your attention in this matter. attachments rdinance No. 2122-2005 Increasing Estimated Revenues and Appropriations by W 290,000 Revising Budget and Scope of Identified Improvements May 17, 2006 Description of Public Improvements 1 Municipal Park 2 New Water Wells 3 Leif Hansen Park Sprinkler 4 Fire Hydrant-Well in VIP 5 Skateboard Park 6 Boat Launch Ramp Ordinance 2122-2005 9121/05 $ 125,000.00 $ 72,000.00 $ 50,000.00 $ 33,000.00 $ 10,000.00 Proposed Changes 5/17/06 $ 75,000.00 $ 40,000.00 $ 50,000.00 $ - $ - $ 125,000.00 Total $ 290,000.00 $ 290,000.00 Saurce of Funding: Alaska Department of Commerce, Community & Economic Development Designated Legislative Grant Program Grant Agreement Number: 06-DC-127 Grant Amount: $ 290,000 MEMORANDUM To: Rick Koch, City Manager From: Larry Semmens, Finance Director Date: May 10, 2006 Subject: Boat Launch Project Funding This ordinance will transfer $125,000 from the FY2006 Public Improvements Capital Project Fund to the Boat Launch Capital Project Fund. The idea is to use grant money for the project rather than general fund money. Ordinance 2154-2006 appropriated and transferred $135,000 of General Fund money to the Boat Launch Capital Project Fund to supplement the $350,000 State grant previously appropriated. This ordinance returns $100,000 of that money to the General Fund. The original appropriation was short $20,000. We made an error in calculating the amount of money needed for the project. So we charged the $20,250 maintenance portion of the project to the Dock department repair and maintenance account. This used funds which are needed to replace fuel dispensers and to do crane inspections. If council approves the ordinance, the $20,250 charged in the Dock department will be reversed and charged to the Boat Launch project. This wiii nee up funds to purchase the fuel dispensers and do the crane inspections. The total appropriation for the project, including the maintenance component and $15,000 contingency, is now $510,000, funded as follows: $350,000 State Grant # 04RR013 $125,000 State Grant # 06DC127 $ 35,000 General Fund /~ Suggested by: Administration CITY OF KENAI ORDINANCE NO. 2122-2005 AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA INCREASING ESTIMATED REVENUES AND APPROPRIATIONS BY $290,000 FOR A STATE OF ALASKA GRANT FOR PUBLIC IMPROVEMENTS. WHEREAS, the State of Alaska awarded a grant of $290,000 to the City of Kenai for public improvements; and, WHEREAS, the City Council identified the follawing improvements: Municipal Park $125,000 New Water Wells 72,000 Leif Hansen Park Sprinkler 50,000 Fire Hydrant -Well in VIP 33,000 Skateboard Park 10.000 Total $290,000 and, WHEREAS, it is the best interest of the City of Kenai to utilize these grant funds for these improvements. NOW, THEREFORE, BE YT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, that estimated revenues and appropriations be increased as follows: FY 2006 Public Improvements Capital Proiect Fund Increase Estimated Revenues: State Grant $290,000 Increase Appropriations: Construction $290,000 PASSED BY THE COUNCIL OF THE CITY OF KENA. I, ALASKA, this 21st day of September, 2005. //(\J~C./~~ ~ ~- Q~ ~/J/.t~e,A,/ h PAT PORTER, MAYOR ATTEST: c~ ,-yam Carol L. Freas, City Clerk Approved by Finance: (08/30/2005) hl Introduced: September 7, 2005 Adopted: September 21, 2005 Effective: September 21, 2005 Designated Legislative Grant Program Grant Agreement Grant Agreement Number Amount of Slate Funds 06-DC-127 $290,000 Collocation Code(s) Encumbrance Number/AR/Lapse Date Project Title 22031187 / 7047 / 6/30/2010 Kenai Public Im rovements Grantee µ` "~~ 7-epac~iment Co'nfact I'®rson a qtr~F~. ., n 1, ':;Ni §n~^iTj' Name Name Cit of Kenai Jolene Julian Street/PO Box Title 210 FicaLo Avenue. Suite 200 Grants Administrator City/StatelZip Streer/PO Box Kenai, AK 99511 PO Box 110809 Con[net Person City(Staie2ip Latry Semmens Juneau, AK 998 1 1-0809 Phone Fax Phone Fax 907.286.8227 907.283.3014 465-4758 4h5-SRfi7 AGREEMENT The Ataska Department of Commerce, Community and Economic Development, Division of Community Advocacy hereinafter `Department') and Citv of Kenai (hereinafter `Grantee') agree as set forth herein. Section Y. The Department shall pay the Grantee for the performance of the project work under the terms outlined in this agreement. The amount of the payment is based upon project expenses incurred, which are authorized under this Agreemene. In no event shall the payment exceed $290,000. Section II. The Grantee shall perform all of the work required by this Agreement. Sectia;. III. T. he work to be pcrforrrted under This agreement begins ,1uiv i, 2005 and shall be completed no later than une 30 2010. Section IV. The agreement consists of this page and the following: ATTACHMENTS Attachment A: Scope of Work 1. Project Description 2. Project Budget 3. Project Narrative 4. Project Management/Reporting 5. Forms Packet Attachment B: Payment Method Attachment C: Standard Provisions APPENDICES Appendix A: Audit Regulations Appendix B: Audit Compliance Supplement Appendix B2: indemnity and insurance Appendix C: State Laws and Regulations Appendix D: Special Requirements and Assurances for Federally Funded Projects (if applicable) Appendix E: Site Conffol Appendix F: State Fire Mazshal Review AMENDMENTS: Any fully executed amendments to this i Name and Title ° ' ---- Printed Name and Title .._..i'les M. Kopp, Aeting City Manager MelanieGreer,GrantsAdministratorIII Date ~'`$~®~ Date --~JJ Xlc~ Reviewed by: tip` - ,. -~f , ~U ttieu~af KENA~ S "I/c'lla e witti a Past Gi with `" 9 ~ ~' 210 Fidalgo Avenue, Kenai, Alaska 99611-7794 Telephone: (907) 283-7535 (Fax: (907) 283-3014 www.ci.kenai.ak.us Memorandum Date: May l 1, 2006 To: Rick R. Koch, City Manager From: Kim Hawazd, Assistant to tithe City Manager RE: Consent to Assignment of Lease -Lots 2 & 3, Block 5, General Aviation Apron/Geneva Stasek to Wendy McGahan, Lynne Dykema and Gwen Woodard d/b/a Kenai Fabric Center, Ins. Geneva Stasek leases the above referenced property from the City and has requested approval to assign the lease to her daughters, Wendy McGahan, Lynne Dykema and Gwen Woodazd, d/b/a Kenai Fabric Center, Inc. for estate planning purposes. The parcels are located on North Willow SL*eer, The IPaCP CYaYPC T}ie teccee may nnr assign the lease nor sublease without the written consent of the City and the assignment shall be accomplished as follows: a. Submittal to, and approval of, proposed lease assignment by the Kenai Planning Commission. b. After approval by the Kenai Planning Commission, final approval of assignment by the City Council. Although the lease states that the purpose for which the lease was issued was "Commercial Business Establishment and Aviation Services", the aviation services that were originally intended for the property have not developed. However, the adjacent property owner is currently using 1,150 square feet of Lot 2 for aircraft pazking. Both lessees' annual rent is adjusted accordingly. This lease was entered into in 1976 and the term of the lease expires on June 30, 2031. As the older leases have come up for assignment, we have been requiring an amendment updating the insurance requirements. The parties have signed the enclosed Assignment of and Amendment to Lease. Rick R. Koch. City Manager May I1, 2006 Page 2 of 2 The parties are in compliance with payments to the City and property taxes to the Borough. The City Attorney has no objection to the assigzunent documents. The Planning and Zoning Commission voted unanimously to recommend approval of the assignment at their May 10`h meeting. If Council approves the transfer, the Assignment of and Amendment to Lease and a Consent to Assignment can be executed by the City Manager. cc: Rebecca Cronkhiie, Airport Manager Geneva Stasek ASSYGNMENT OF AND AMENDMENT TO LEASE This assignment is entered into between GENEVA E. STASEK, whose address is 115 N. Willow Street, Kenai, Alaska 99611, hereinafter referred to as the Assignor; and WENDY McGAHAN, LYNNE DYKEMA and GWEN WOODARD d/b/a KENAI FABRIC CENTER, INC., whose address is 115 N. Willow Street, Kenai, Alaska 99611, hereinafter referred to as the Assignee. Assignor does hereby assign and transfer all of its interest in the leasehold estate as evidenced by that certain Lease Agreement with the City of Kenai as Lessor, recorded June 2, 1976, in Book 97, Page 485, Kenai Recording District, and covering the following described property: Lots 2 and 3, Block 5, General Aviation Apron, according to Plat No. 73-68, in the Kenai Recording District, Third Judicial District, State of Alaska. To have and to hold the same from the date hereof, for and during all of the remainder yet to come of the term of said Lease Agreement. Assignee agrees to comply fully with the terms and provisions of the Lease, and to hold the Assignor harmless from any liability arising thereunder. `. ASSZGNMENT OF AND AMENDMENT TO LEASE PAGE Z OF 5 That lease is hereby amended to include the following insurance requirements. INDEMNIFICATION AND INSURANCE: Lessee covenants to save the City harmless from all actions, suits, liabilities, or damages resulting from or arising out of any acts of commission or omission by the lessee, his agents, employees, customers, invitees, or arising from or out of the Lessee's occupation, or use of the premises demised, or privileges granted, and to pay all costs connected therewith. Lessee, at the expense of Lessee, shall keep in force, during the term of this agreement, insurance issued by responsible insurance companies authorized to do business in Alaska, in forms, kinds and amounts as determined and directed by the City for the protection of City and/or Lessee. Insurance requirement hereunder shall be subject to the sole determination of the City. Said insurance may include, but need not be limited to insurance coverages commonly known as, or similar in kind to, public iiabiiity, products liability, property damage, cargo, aircraft, tire, workmen's compensation, comprehensive, builders risk, and such other insurance coverage as deemed required in the sole determination of the City. All policies or endorsements thereto shall in all cases where possible name City as Additional Named Insured thereunder and shall contain a waiver of subrogation against the City. Upon approval by City of all insurance required, in the forms, kinds and amounts directed to be procured, Lessee shall deliver all policy originals or duplicate originals and endorsements thereto to the City for incorporation within this agreement as attachment thereto. In any event, Lessee is not to commence to exercise any of the rights and privileges granted under this agreement until such time as all insurance directed and required to be furnished by Lessee is in full force and effect. Lessee expressly understands and agrees that any ASSIGNMENT OF AND AMENDMENT TO LEASE PAGE 2 OF 5 insurance protection furnished by Lessee hereunder shall in no way limit its responsibility to indemnify and save harmless Lessor under the provisions of this agreement. No policy of insurance shall be cancelled or amended with respect to the City without thirty (30) days written notice by registered or certified mail to City by the insurance company. Until otherwise directed in writing by the City Manager, Lessee shall provide certificates of insurance within thirty (30) days of the date hereof as follows: Comprehensive General Liability Combined Single Limit (Bodily Injury and Property Damage): $500,000 Workmen's Compensation -Statutory Limits Notwithstanding anything to the contrary, if Lessee fails or neglects to secure required insurance or if said policy or policies are terminated, altered, or changed in any manner not acceptable to the City, then and in that event this lease may be cancelled and terminated, without penalty, on five {5) days written prior notice to Lessee. ASSIGNOR: GENEVA E. STASEK Geneva E. Stasek ASSIGNEE: KENAI FABRIC CENTER, INC. By:`~ ~/~G--~ Nam '. ASSIGNMENT OF ANO AMENDMENT TO LEASE PAGE 3 OF 5 LESSOR: CITY OF KENAI By: Rick R. Koch City Manager (If Lessee is a Corporation) ATTEST: ~fs%~,~c,.~ ~"' Title STA'1'F C1F A T ~A CT;,A ) ss. THIRD JUDICIAL DISTRICT ) THIS IS TO CERTIFY that this ~ day of Yr~ 2006, Name: t.~ ,Title: ~.~ri L~~,.-~' , of ,~-~~ ~~c.~ G . being ersonally known to me or having produced satisfactory evidence of identification, appeared before me and acknowledged the voluntary and authorized execution of the foregoing instrument on behalf of said corporation. ~~2. .. Notary Public for Alaska My Commission Expires: /v~ !~ ASSIGNMENT OF AND AMENDMENT TO LEASE PAGE 9 OF 5 STATE OF ALASKA ) )ss THIRD JUDICIAL DISTRICT ) THIS IS TO CERTIFY that on this ~ day of ~~ , 2006, GENEVA E. STASEK, being personally known to me or having produced satisfactory evidence of identification, appeared before me and acknowledged the voluntary and authorized execution of the foregoing instrument. Notary Public for Alaska My Commission Expires: ~ ~~ ~~~ STATE OF ALASKA ) )ss THIRD JUDICIAL DISTRICT ) THIS IS TO CERTIFY that on this day of , 2006, RICK R. KOCH, City Manager of the City of Kenai, Alaska, being personally known to me or having produced satisfactory evidence of identification, appeared before me and acknowledged the voluntary and authorized execution of the foregoing instrument on behalf of said City. Notary Public for Alaska My Commission Expires: Return to: City of Kenai 210 Fidalgo Ave. Kenai, AK 99611 ASSIGNMENT OF AND AMENDMENT TO LEASE PAGE 5 OF 5 ~-~ "~~,~- - -' fire city of To: City Council °°V'lla e wit6r a Past, Gi wit~i a ~ - 9 ~' 210 Fidalgo Avenue, Kenai, Alaska 99611-7794 Telephone: (907) 283-7535 /Fax: (907) 283-3014 www.ci.kenai.ak.us ~` ~ From: Rick Koch, City Manager i Date: May 4, 2006 Subject: Airport Land Lease, Lot 11, Block 1, FBO Subdivision Request for Termination of Lease The purpose of this correspondence is to request your approval to terminate the above referenced lease retroactively, as of April 30, 2006. The request was received from the leaseholder prior to April 30`h, but given agenda deadlines was unable to be placed before you at the May 3`d council meeting. I have attached the conrespondence from Trustee Services of Alaska. Thank you for your attention in this matter. attachment ~~ ~ `, ~-~_ P - -, _. _ _ _ ,; _~ - ' z /, \\ thea~of // KENA~ SKA "Vifla9e wit~r a Past, Gt`ry ~i~` ~ utuYe" 210 Fidalgo Avenue, Kenai, Alaska 99611-7794 Telephone: (907) 283-7535 !Fax: (907) 283-3014 www.ci.kenai.ak.us Memorandum Date: May 10, 2006 To: Rick R. Koch, City Manager ~/~ From: Kim Howard, Assistant to the City Manager f'" RE: Termination of Lease - 20/20 International, Inc. and John C. & Marie L. Parker/ Lot 11, Block 1, F.B.®. Subdivision The above referenced lessees, 20/20 International, Inc. and John C. & Mane L. Pazker, have submitted a request to cancel their lease. The property is shown on the attached map. The lessees' rntent2Cn `+`.'a.° tC constnact a I:a^.gar CP. t.~e prCperty, ~nnct~etlQn wac to havv_ hPr±.n completed by May 26, 2006, but no improvements have been made. The term of the lease is for 15 years, ending on June 3Q 2019. The total annual rent for the parcel is $3,660. The lease states, "Leases in good standing may be cancelled in whole or in part at any time upon mutual written agreement by Lessee and the City Council". The parties aze current in payments to the City and Borough. If Council approves a temvnation of the lease, a termination agreement will be prepared for your signature. Attachments /kh TRUSTEE SERVICES ®F ALASKA ~'~," 408 Highland Ave., Ste. #t Kenai, AK 94611 (907}283-300i Apri128, 2006 RECElVE~ ~#9i 2 8 LV.,U i i ar, ~.- City of Kenai 210 Fidalgo Avenue Kenai, Alaska 99611 Attn: Rick Koch Re: Airport Lands Lease Request for Extension of Time to Build -Lot 11, Block 1, FBO Subdivision Approval of Assignment of Lease Deaz Mr. Koch: 's letter is in response to your letter dated April 12, 2006 regazding the above captioned tease property. :er careful consideration of the concerns you outlined in your letter and consultation with David Machado, President of EAA Chapter 975, we have decided to withdraw our Assigmnent of Lease and request to extend the time to build on the above City Lease Lots. As I am unable to meet the deadline for construction outlined in the original lease, I would request that the City terminate our lease effective Apri130, 2006. If you have any questions or require further information please feel free to contact my office at your convenience. Very Truly Yours, TRUSTEE SERVICES OF ALASKA =~ ~ ~ John C. Parker, President cc: File ~azey Graves, City Attorney O 0 z 0 m .~O 4 J ~ 3 s~ z'` Subject ' ~ Parcel z 5~ z ~ '^ O' .i, s' ~ c .F O FFeFF y ~ ~O i i ASP ~ ~ io OQ~ g ? e '` 7A-9 g 7 s , e FBO NO. S 6 / 5 ~ S t 4 ,b3A g r 4.."'a. S 3A ~tA °~ 3A1 N~'4 TR.A J .°t e~ _..~ ~--~~ , ~~ , tl7eu~of KENAA~ SKA °l/clfa9e wit~i a fast, G~ y wa'ts -' 210 Fidalgo Avenue, Kenai, Alaska 99611-7794 Telephone: (907) 283-7535 /Fax: (907) 283-3014 www.ci.kenai.ak.us Memorandum Date: May 11, 2006 To: Rick R. Koch, City Manager From: Kim Howard, Assistant to the City Manager ~i RE: Lots 10 & 11, Block 1, Etolin Subdivision, No. 3/Security Assignment of Lease -Rockwell G. Smith d/b/a Preferred Plumbing & Heating The City has received a request for approval of an Assignment of Lease for Security Purposes for the above referenced properties. The lessee is in compliance with lease payments and Borough property and sales taxes. The City has reviewed the documents and has no objections to the forms. If Council approves the transaction, the Consent to Assignment of Lease for Security Purposes can be signed by the City Manager. Cc: First National Bank of Anchorage Attachments CONSENT TO ASSIGNMENT OF LEASE FOR SECURITY PURPOSES The City of Kenai, Lessor in an Agreement recorded on May 11, 2006 and assigned serial number covering the following described property. Lot 10 & 11, Block 1, Etolin Subdivision No.3, according to the official plat thereof, filed under Plat Number 82-103, Records of the Kenai Recording District, Third Judicial District, State of Alaska. by and through its City Manager, hereby consents to the assignment of the right, title, and interest of the Lessee in the above referenced agreements, for security purposes, to Rockwell G. Smith, dba Preferred Plumbing & Heating. This Consent is given by the City of Kenai without waiving any right or action, or releasing the Assignor from any liability or responsibility under the aforementioned Leases, and does not relieve the Assignee from the condition requiring City approval for any subsequent sublease or assignment. Dated this 10th day of May, 2006. CITY OF KENAI By: Rick R. Koch City Manager Consent to Assignment of Lease for Security Purposes -Page 1 of 2 STATE OF ALASKA ) )ss THIRD JUDICIAL DISTRICT ) THIS IS TO CERTIFY that on this day of , 2006, Rick R. Koch, City Manager of the City of Kenai, Alaska, being personally known to me or having produced satisfactory evidence of identification, appeazed before me and acknowledged the voluntary and authorized execution of the foregoing instrument on behalf of said City. Notary Public for Alaska My Commission Expires: Consent to Assignment of Lease for Security Purposes -Page 2 of 2 PROMISSORY (VOTE Principal Amount: 5335,000.00 Initial flats: 8.750% OaYe of Note: May 70, 2006 PROMISE TO PAY. ROCKWELL G. SMITH 1"Borrower"1 promisor n PaY n Fvae Nedort®I Bonk Alorka !'LeMar'1, or mtlm, b 4wPW momq of Me Unked Smtes K Ammriea, the prineipd amount of Thrw Hundred Thirty-five ThousmM &00/100 Ddlara Ii336.000.t101. togKher veldt inMect on th unpaid pdrwipel henna hom May t 1, 2006, arid paid b fug. PAYMENT. Subject to any payrrlaM ehmgna resuitkq from eMrgK n Me Index, eortowm wig pay Mu loan b 780 payrMnn of 83,363.26 exh payment. Borrower's firaY pmymmM b tlw Juna 15. 2006. ant ag aubaaquaM paymemm w tlw on Me serve dory of awl! mIXltlr aPYH Mat. Bmrowm'e fttnl payment will be dw on May 16, 2021, amt will M for ell prindpd ant ag awrwtl iMmK4 rwt yK pWL Psyntmtn kadrrde pNncipal and interest. Unless oHarwbs aprastl m regWrad by eppgcebb rive, peymema wN M applkd flit to am/ aewW telpab kr[mort• Mnn to prewipal: Men n any late charges; and Men ro enY wpeid cogecdar awn. Borrower wig pay Lender K UMer's adtlsems Bh0avn above m K such omsr place or LaMar may tlemipnan n wNtMp. VARIABLE INTEREST PATE. The innaet rate on Mis Note is subject to change hom Nma to Nme based on changae in en tMez which ie Me We Base Rate of the First Natbnel Bank Alaska. Bane Pan is Me 'Prime Pan' gwntl, or if more then one rata is quoted, tM hi8ttort °PNme Rate' quoted, in the last aditbn of tM Well Street Journal pubiiehed she prior month; information about thin iMett is aveWhle uMm tM heatlmg °MOney Rates' in tM feet edibon of tM Well SVort Journal published the prwr monm ItM 'IMex'1. TM Index is rwt rwcesserily the bwort rate charged by Lander on he bane end is net by Lander in its sole tliacrmion. If tM Index becomes unavailable during tM arm of Hn ben, Lender may designate a subadtun index after noafyirlg borcower. LaMar wilt tall Borrower me current tndex rate upon Borrower's regwat. The innraet rate change will not occur more often Men each five I6f yanre on Ma anniversary of He loan. Borower wdernaMS Met Lender may make bens based on other rates es well. TM Irides aMarttly is 7.750% per enMm. The knareet rots to M epplMd n drs unpaM prfnolpai beWrca K Mis NKa wig M et a rata of 9.000 parlxMega point ovm He Indaz, adiwted B rncaorary for arty Mnbxmt ant msxkrwm rete lirrdntions tlorenbed Mlow, roruldng in an initid ran K 8.760% par annum. NOTICE: Under no circumenrwee will He bteroet rata on this Nate be more than the maximum rate allowed by applicable law. WMnever increeaea occur in the interest rate, Lender, at its opton, may do onaor mare of Ma following: IA) increase Bprower's paymenn to ensure Bonewer's loan will pay pN by its original flnel maluriry den, let incraeae Borrpwer's paymenn to cover accning interest ICI increase the number of Borrower's paymenn, ant ID7 cwndmw 8orrgwer'e payments et the acme amount antl incraeae Borrower's final payment. PREPAYMENT PENALTY. 8onower agrees that ail seen fees eM other prepaid finance charges are eamatl fully ea of Ma date of Ma loan ant will not M aubjaot to ratuM upon eerW payment twhathar voluntary er es a result of tletaulU, excepi as othsrwisa required by law. UPOn prgwYment o4 d:k NKa, Laradar u emiWd n tlw fogewi.q gepawwn4 panda: Upon prepeyrn®nP K M4 Non, Lendm Y endded to aw togswbxt Prembvn: Prkwipd meY bs pdd. n whda a in pmt, bans ft is due. If enY much prspmYmeM h made wiH proeeetls K • ben made by sommena odw Men tla hdder hereof, Borrower wgl pay a premium aqud n 6.0% of tiro amoun prepaid during tM yam enrWW May 10, 2007: 4.0% oP the amawt prepaid tluNrtg He y.m eMkq May 70. 2006: 3.0% of tM amaan prepeb duMp Ma ysm erMktg May 70. 2008: 2.0% of lM amount prspdtl tlurmg Me yam eradktg May t0, 2010; eM 1.0% of drm mr:omrt prepaid dating the yam eMYq May /0. Z0Y 1. TM payment of pMwipal MK hor mabxad only by reoron of aeuNredan tar denutt eonst7MK a prepayment of prirrelpd. Than wW G no premium fm Ms prepaymmM of any amount eker MeY t0, 207 7.. Ezupl far Ma finegdrlg, Bortowm may peY ail m e portlen K ate mnmrrd owed ember Mrr h 4 dw. Early paymenn will not, unless agreed to by LaMar in venting, relieve Borower of Borrower's obligeaon to corNma to make paymenn antler the payment schedule. Rather, earty DaymeMa will reduce the principal balance due ant may rKUlt In eorrower'c making !ewer paymenn. eorcower agrees no4 @ send Lender pnymeMS marked 'paid in full', 'wiMOUt racourae", or similar IangueBe. If Borrower sends ouch a payment, Lender may accept it without bairg any of Lender's nghn under this Note, ant Borrower will remain obligated n peY any further amount owed to lender. All written commwicationa concerning diaputetl amounts, inclMing any check or othK Daymant Instrument met indicates that tM payment conetitutea °payment in full' of the amowt owed or that is tendered with other condmom K limkafiona or ea full aadsfaction of a disputed amount must M mailed or delivered to: First National Hank Aiaeke, loan Servicirg DlWabn, P.O. Box 100720 Anchorage. AK 99570-0720. LATE CHARGE. If a payment is 15 tlay9 or more late, Bgrrower will be charged 5.000% of Me regulMy sohaduMd payment m 6600.00, whkMwr is leK. INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final maturity, the total sum due under this Note will bear interest from iM den or acceiemtion or maturity et the variable interest rate on thin Nota. Tne inrereet rate wilt net exceed tM maximum ren pertntttetl by eppACabla law. DEFAULT. Each of tM folbwinq shall constitute en event of denult 1'Event of Dafeutt'I under this Note: Payment Dateufr. 8onower fails n make any payment when due under Nia Note. DMK DenuM. 8onower tails to comply with or to perform any other [arm, obiigetlon, covenant or coMition coMetned m Mu Note or in any of the relend tlocumanta or to comply with or to pertorm enY term, obligation, covenant or condition contained in any other agreement between Lender and Borrower. faW Seenmmrtn. Any warranty, representation qr etetament made or furnished to lender by Borrower or on Bortower's Mhelf antler Mis Nose or the relantl documents is false or misleading in any material respect either now or at the time made or nmiehed or becomes false or mideading at any time thereeker. Da®M m InsdvaneY• The death qt any Borrower or the disaoludon or termination of eorcawer'e existence ae a going bwineea, the insolvency of 8ortoweF the appointment of a receiver for any pen of Bortower'e property, enY assignment for the beneM of cretlhon, any type of creditor workoM, or the commencement of any proceedir:g uMer any bankruptcy or insolvency laws by or againK Bortawar. Creditor m FaAedtne Proceetlbga. CommeMemant of foreclosure or nrtaiture pracaMirge, whether by jMbial proceedhg, self-help, repossession or any other method, by any credbor of Borrower or by any govemmemal agency against any cdlateral sKUfing tM loan. This inclMea a garnishment of any of Borrower's accounn, including deposit eccown, with Lender. However, Mic EwnC of DenuM shell no[ apply if there Is a good faRh diapun by Borrower es to Me validhy or reeaoneblerre6s of tM claim which In tM beaie of die creditor or forfeiture proceedirg end If 8onower giwe Lender written notice of tM creditor or forfeture proceeding ant dapoaM wIM LeMm monies or e surety bent for Me credior or nnettura proceeding, In an emowt denrmirwd by Lerber, in tta ode diecredon, en being an atlegwta roeerw ar bent nr the dispute. EwMa Affsetlng Grunntgr. Any of tM precedirg ewnte oecura wim respect n any guerenbr, entloner, aunty, or eewmmadaaon petty of any of tM IMebtetlneae or any guarantor, eMOraer, eurery, or accommodation petty diva or becomes Incompennt, or rowkea or dispurea the validity af, or liability under, any guaranty of tM intlabtedneas evidenced by Mia Note. in Me event of a death. Lendeq at in option, may, but shall not M required n, permn the guarennr's estate to asauma unconditlonally the obligaMM ansirKt luxkr Me guaranty in a manner setianctory to Lender, eM, in doing ao, cure any Event of DafaWt. Adwres Change. A material atlwree change oecura in Borrower's finaneid conditon, or leMm Mliewe tM prospect of payment or peNormanca of this Note is impairM. IMenuriry. Lender in good faun believor itself ir:sacure. Cara Prevalent. It any default, other Men a tlafeWt in payment is curable ant if Borcowar hoe not been given a notice of a breech of the same provision of this Note within He precedirg twelve 172) months, it may M curM it Bonpwer, after receiving written notice hem Lander demaMing cure of such default: 111 curor He denWt wimin fifteen 1161 days; or 121 K He cure requires more then ffeen 1161 days, immediately initietea steps which Lender deems in Lender's sole tliscretlon to M sufficient to cure Me defeuh ant Hereafter continues antl comple[ea all reasoneba eM necessary steps sufficient to produce wmplianca or soon es reeeontbly precUCd. LENDEA'S RIGHTS. Upon default, LaMar may declare Me entire unpaid principal balance on this Note ant all awned unpaid Interest immediately dw, and then Borrower will pay that amount borrower a pereonelly obiigand ant nlty liable for the amount dw urpler this Note. lender Ma the right to sue on the Non and obteb a peraonai judgment egainet Borrower br eanafacdon of tM amount tlw under He Nate eiMer Mfora or eker a judicial foreclosure of ma Deed of Trust uMer AS 09.45.770 - 09.45.220. LeMer, at lender's sole option, dao has Me tight n sue an this Non end obtain a pereonai judgment against Borrower nr satisfaction of the amount due under the Nuts etther before or afar the exercise by lender of any other dgh[ or remedy it may hew to proceed against any of Me colleterol securing Min Non. BarrDWeP: ROCKWELL O. SM[TH Lender: Fist Netlond Bank Alaska 336 MAIN STREET LOOP Kenos Brereeh KENAI. AK 8969 t-7727 91408 Kona Spur Hwy Kenai. AK 9987 L7799 PROMISSORY NOTE Loan No: oTTSatoaoa IConrinuedl pays 2 ATTORNEYS' FEES: EXPENSES. Lander may hire br pay someone etas b help collect Mia Note rt Bonbwer ucas not pay, Borrower will pay LaMar Lnet BnbUDt. Thl9 InCIUtleD, BubjeCt t0 any IlmltB Under eppllcabie Id W, LaMer'i rea80wb1e etfdmHV3' 5409 aM Laoder'e legal expenses whether or not there is a lawsuit, Including reeaoneble ettameya' fees end legal ezpenees for osnkruptuy pro~eatlirada OnclMinq efforts to madity or vacate any automatic stay or inlunetionl, appeals, and any anticipated post-judgmem collection aarvieea. If not profehhed h+•.. eppiicabla law, Borrower also will pay any court Croats, in addition to ell other auma provided by law. GOVERNING LAW. Thla Nob w91 be gaveeread by PMerN iew epplipMla tp LaMar and, b tM eztsm me pPBMl6ted by faQavd bay, iM lay the Bt821 of Alaska withoue regard to rte corrflbb of bw provubra. This Nob hea been wcapted by LaMar in Me Stab of Altlka. DISHONORFA IYEM FEE. Borrower will pay a fee to Lender of 420.00 if Borrower makes a petlmem on 0orrowar's loan eM the check or prsauthonzed cherge with which eortower pays is later dishonored. flIGHT OF SETOFF. To the extent permitted by applicable law. Lender reserves a rght of setoff in all Borrower's accounts wiM LaMar Iwhether checking, savings, or some other accountl. This includes aF accounts Borrower holtla jointly whh someone sloe eM all accounts 0orrower may open in the future. However, this tloea rwt inclMe any IRA or Keogh accounts, or any ttwt accounts for which setoff would be prohagtad by law. Borrower authorizes lender, to the eMen[ permitted by epplicebk law, to cherge or setoff all auma owitg on Ms indebtedness ageaut any end ell such accounts. ADVANCE FEE:. Advance Fee: Borrower will psy Lender a fee of 910.00 for each advance made by Lender utMer this Note. SUCCESSOR INTERESTS. The terms of this Note shall be blMirg upon Borrower, aM upon Borrower's heire, pereonel representedvea, auceeasoro and assigns, eM shall inure to the bemM of LeMer eM its aueeeeeore eM assigns. NOTIFY US OF INACCURATE INFORMATION WE REPORT TO CONSUMER REPORTING AGENCIES. Pleesa notrfy w if ws report emr Inexeaab information about your eccountlsi to a consumer repotting agency. Your wntbn notice describing the apacifie inaccurecWieel shoWtl be seM to us at the toilowing etldrebs: First National Sank Aleake Loen Servking Division P.O. Boz 700720 Anchorage, AK 99810-0720. GENERAL PROVISIONS. If anY part of this Note cameo[ be enforced, Mla fact Will not afmct the met of the Note. LaMar may debt' ar forgo enforcirg any of ib nghb or remedies under this Note without bsirg chem. Borrower and sny other pereon who eigw, gwnmeea or endareas this Note, to the eMent allowed by law, waive preaenbnaM, tlameM for payment, eM rwdce of dishonor. Upon any sharps M the terms of Mls Note, aM unless otherwise expressly stated in writing, no party who signs this Note, whether as maker, guaraMOr, eccommMetbn make or endoreer, shell ba released from liability. All such pertl9! agree Met Lender may renew ar extent Irepeatedty antl for any lergde of tlmel this loan or release any party or guarantor pr collateral: or impair, tail to realize upon or perfect Lender's security interest in Ma collabral; ant take any other action deemed necessary by Lender without Me consent of or nonce to anyone. All such parties also agree Net Lander meY rerodity this loan without the consent of m notice to anyone other than Me party wiM whom Me modificetlon is made. The obllgatians uMar Mis Noea ere joint and several. PRIOW TO SIGNING THIS NOTE. BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS NOTE. INCLUDING THE VARIABLE INTERESY RATE PROVISIONS. BORROWER AGREES TO THE TERMS OF THE NOTE. BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORtl NOTE. RORRO /' X ~% . ,I r n ~r G~~ ROCKWELL G. SMITH uw..ww.....an,o~c...,.........u......,w,.an. .w.,~... .. .....annwmx ~.um ,.,. RECORDATION REQUESTED BY: First National Benk Alaska Kenai Branch 79408 Kenai Spur wwy Kenai, AK ss619 a7ss WHEN RECORDED MAIL TO: Firot National Benk Alaska Kenai Branch 91408 Kenei Spur Hwy Kenei, AK 9 9611-7 7 9 9 FOR RECORDER'S USE ONLY DEED OF TRUST THIS DEED OF TRUST is dated Mey 10, 2006, among ROCKWELL G. SMITH, dba Profaned Plumbing & Heatng, and Alaska sole proprietorship, whose address is 335 MAIN STREET LOOP, KENAi, AK 99619.7727 ("tremor"1; First Nedonal Benk Alaska, whose address is Komi Branch, 11408 Kenai Spur Hwy, Kenai, AK 99811-7799 (referred to below som®Hmsa as "Lender" and sometimes as 'Beneficary"1: and Flrot American Tithe of Alaska, whose address is 105 Trading Bay Roed Ste. 103, Kenai, AK 99611 (referred to below m °Truataa"1. CONVEYANCE AND GRANT. For valuable consideration, Grantor conveys to Trustee in trust, with power of sale, for the benefK of Lander ea Beneficiary, a!! of Grantor's right, title, and interest in, to and under the Lease described below of the following described real property, together with alt existing or subsequently erected or affixed buildings, improvements and fixtures; ail easements, rights of way, and appurtenances; all water, water rights and ditch rights (including stock in utilities with ditch or irrigation rightsl; and ail other rights, royalties, end profits relating to the real property, including without limitation any rights Grantor later acquires in the fee simple title to the land, subject to the Lease, and all minerals, oil, gas, geothermal and similar matters, (the "Real Property") located in the Kenai Recording Dstrict, Third Judicial District, ffie Stets of Alaska: Parcell A leasehold estate Created by tha4 Certain lease dated May 15, 9999, eecorded May 24, 9899, in Book 382 et Page 822, and emended by instrument recorded Apol 12, 9999 in Book 482 at Page 579, and amended by inateumsnt recorded April 24, 2001 in Book 004 at Page 645, wherein the City of Kenai is Lessor end Rockwell G. Smith dba Prefsrrad Plumbing & Heating is Lasses. Said leasehold estate affect the following land: Lot 70, Block 1, Etoldn Subdivision No. 3, according 40 4he official plat thereof, fill under Pint Number 02.903, Records of the Kenei Recording District, Third Judidel District, Stela of Alaska. Parcel 0 A leasehold estate created by that certain lease dated Mey 1, 2004, recorded Mey 8, 2004 under Serial Number 2004.004321-0, wherein the City of Kenai is Leaaor end Rockwell G. Smith dba Preferred Plumbing & Heating is Lasses. Said leasehold estate effsca the folowing lend: Lot 11, Block 1, Etolin Subdivision No.3, according to the official plat 4heraof, filed under DEED OF TRUST Loan No: Ot184t0704 (Confinued) pag® 2 PIe4 Number 92-103, Records of the Kenai Recording District, Third Judicial DisMcL Stars of Alaska The Reel Property or ks address is commonly known as 335 & 345 Main Stree4 Loop Rd, Kenai, AK 99611. CROSS-COLLATERALIYATION. In addition to the Note, this Deed of Trust secures all obligations, debts and liabilities, plus interest thereon, of Grantor to lender, or any one or more of them, as well as all claims by Lender against Grantor or any one or more of them, whether now existing or hereafter arising, whether related or unrelated to the purpose of the Note, whether voluntary or otherwise, whether due or not due, direct or indirect, determined or undetermined, absolute or contingent, liquidated or uniiquidated, whether Grantor may be liable individually or jointly with others, whether obligated as guarantor, surety, accommodation party or otherwise, and whether recovery upon such amounts may be or hereafter may become barred by any statute of limitations, and whether the obligation to repay such amounts may be or hereafter may become otherwise unenforceable. Grantor presently assigns to Lender )also known as Beneficiary in this Deed of Trust) all of Grantor's right, title, and interest in and to all present and future leases of the Property and ell Rents from the Property as security for the Indebtedness. In addition to this assignment under common law, Grantor grants to Lender a Uniform Commercial Code securrty interest in the Personal Progeny and Rents. THIS DEED OF TRUST, INCLUDING THE ASSIGNMENT OF RENTS AND THE SECURITY INTEREST IN THE RENTS AND PERSONAL PROPERTY, IS GIVEN TO SECURE IAI PAYMENT nc THE !NDESTEDNESE AN^_ ;9; ocpFORMANCE OF ANY AND ALL OSLIOATIONS UNDER THE NOTE, THE RELATED DOCUMENTS, AND THIS DEED OF TRUST. THIS DEED OF TRUST IS GIVEN AND ACCEPTED ON THE FOLLOWING TERMS: PAYMENT AND PERFORMANCE. Except as otherwise provided in this Deed of Trust, Grantor shall pay to Lender all amounts secured by this Deed of Trust as they become due, and shall strictly end in a timely manner perform ail of Grantor's obligations under the Note, this Deed of Trust, and the Related Documents. POSSESSION AND- MAINTENANCE OF THE PROPERTY. Grantor agrees that Grantor's possession and use of the Property shall be governed by the following provisions: Possession end Use. Until the occurrence of an Event of Default, Grantor may (t) remain in possession and control of the Property; 12) use, operate or manage the Property; and (31 collect the Rents from the Property (this privilege is a license from Lender to Grantor automatically revoked upon default). Duty to Heinlein. Grantor shall maintain the Property in tenantable condition and promptly perform all repairs, replacements, and maintenance necessary to preserve its value. Compliance with Environments) Lava. Grantor represents and warrants to Lender that: 17 During the period of Grantor's leasehold interest in the Property, there has been no use, generation, manufacture, storage, treatment, disposal, release or threatened release of any Hazardous Substance by any person on, under, about or from the Property; 121 Grantor has no knowledge of, or reason to believe that there has been, except as previously disclosed to and acknowledged by Lender in writing, (al any breach or violation of any Environmental Laws, (b) any use, generation, manufacture, storage, treatment, disposal, release or threatened release of any Hazardous Substance on, under, about or from the Property by any prior owners or occupants of the Property, or Ic) any actual or threatened litigation or claims of any kind by any person relating to such matters; and 131 Except as pveviously disclosed to and acknowledged by Lender in writing, lal neither Grantor nor any tenant, contractor, agent or other authorised user of the Property shall use, generate, manufacture, store, treat, dispose of or release any Hazardous Substance on, under, about or from the Property; and (61 any such activity shell be conducted in compliance with all applicable federal, state, and local Taws, regulations and ordinances, including whhout limitation all Environmental Laws. Grantor authorizes Lender and its agents to enter upon the Property to make such inspections and tests, at Grantor's expense, es lender may deem appropriate to determine compliance of the Property with this section of the Deed of Trust. Any inspections or tests made by Lender shall be for Lender's purposes only end shell not be construed to create any responsibility or liability on the part of Lender to Grantor or to any othee person. The representations and warranties contained herein are 6aaed on Grantor's due diligence in investigating the Property for Hazardous Substances. Grantor hereby IU releases end waives any future claims against Lender for indemnity or contribution in the event Grantor becomes liable for cleanup or other costs under any such DEED OP TRUST Lean No: 0118410704 (Continued) Page 3 laws; and 121 agrees to indemnify and hold harmless Lender against any and all claims, losses, liabilities, damages, penalties, and expenses which Lender may directly or indirectly sustain or suffer resulting from a breach of this section of the Deed of Trust or as a consequence of any use, generation, manufacture, storage, disposal, release or threatened release occurring prior to Grantor's ownership or interest in iha Property, whether or not the same was or should have been known to Grantor. The provisions of this section of the Deed of Trust, including the obligation to indemnify, shall survive the payment of the Indebtedness snd the satisfaction and reconveyance of the lien of this Dead of Trust and shall not be affected by Lender's acquisition of any interest in the Property, whether by foreclosure or otherwise. Nuisance, Weate. Grantor shall not cause, conduct or permh any nuisance nor commit, permit, or suffer any stripping of or waste on or to the Property or any portion of the Property. Without limiting the generality of the foregoing, Grantor will not remove, or grant to any other pang the right Yo remove, any timber, minerals )including oil and gas), coal, clay, scoria, soil, gravel or rock products without lender's prior written consent. Removal of Improvements. Grantor shall not demolish or remove any Improvements from the Real Property without Lender's prior written consent. As a condition to the removal of any Improvements, Lender may require Grantor to make arrangements satisfactory to Lender to replace such Improvements with Improvements of at least equal value. Lender's Right to Enter. Lender and Lender's agents and representatives may enter upon the Reel Property at all reasonable times to attend to lender's interests and to inspect the Real Property for purposes of Grantor's compliance with the terms and conditions of this Deed of Trust. Compliance with Governmental Requirements. Grantor shall promptly comply with all laws, ordinances, and regulations, now or hereafter in effect, of all governmental authorities applicable to the use or occupancy of the Property, including without limitation, the Americans With Disabilities Act. Grantor may contest in good faith any such law, ordinance, or regulation and withhold compliance during any proceeding, including appropriate appeals, so long as Grantor has notified Lender in writing prior to doing so and so long as, in-Lender's sole opinion, lender's interests in the Property are not jeopardized. Lender may require Grantor to post adequate security or a surety bond, reasonably satisfactory to Lender, to protect Lender's interest. Duty 4o Protect. Grantor agrees neither to abandon or leave unattended the Property. Grantor shall do all other acts, in addition to those acts set forth above in this section, which from the character and use of the Property are reasonably necessary to protect end preserve the Property. Compliance with Leaas. Grantor will paV all rents and will strictly observe and perform on a timely basis all other terms, covenants, and conditions of the Lease. Grantor will indemnify and hold Lender harmless against all losses, liabilities, actions, suits, proceedings, costs including reasonable attorneys' fees claims, demands, and damages whatsoever which may be incurred by reason of Grantor's failure to pay rents or strictly observe or perform under the Lease. Other Agreements Relating to the Lease. Grantor further agrees (11 not to surrender, terminate, or cancel the Lease, and (21 not to modify, change, supplement, alter, or amend the Lease, either orally or in writing, without Lender's prior written consent. Any attempt by Grantor to do any of the foregoing without Lender's prior written consent will be void and of no force and effect. At lender's option, Grantor will deposit with Lender as further security all original documents relating to the Lease and the leasehold interest in the Propeny. Unless Grantor is in breach or default of any of the terms contained in this Deed of Trust, Lender will have no right to cancel, modify, change, supplement, alter or emend the leasehold interest. No estate in the Property, whether fee title to the leasehold premises, the leasehold estate, or any subleasehold estate, will merge without Lender express written consent; rather these estates will remain separate end distinct, even if there is a union of these estates in the landlord, Grantor, or a third party who purchases or otherwise acquires the estates. Grantor further agrees that if Grantor acquires ell or a portion of the fee simple title, or any other leasehold or subleasehold title to the Property, that title will, at Lender's option, immediately become subject to the terms of this Deed of Trust, and Grantor will execute, deliver and record all documents necessary or appropriate to assure that such rifts is secured by this Deed of Trust. Notices Relating to ths Leese. Grantor will promptly notify Lender in writing DEED OF TRUST Loan No: 09 9 849 0704 (COntinued) Page 4 111 if Grantor is in default in the performance or observance of any of the Yerma, covenants, or conditions which Grantor is to perform or observe under the Lease; f2) if any event occurs which would constitute a default under the Lease; (3) if any notice of defaulI is given to Grantor by the landlord under the Lease; 141 if, pursuant to the Lease, any proceeds received for the Property are deposited with someone other than Lender, whether received from any insurance on the Property or from the taking of any or all of the Property by eminent domain; and (51 if any arbitration or appraisal proceedings are requested or instituted pursuant to the Lease. Grantor agrees to provide Lender promptly with a copy of ail written materials relating to any of the above and to provide Lender with such other information as lender may reasonably request. Grantor agrees that promptly after the execution and delivery of this Deed of Trust, Grantor will notify the landlord under the Lease in writing of the execution and delivery of this Deed of Trust and of the name and address of Lender and will deliver a copy of this Deed of Trust to the landlord. Option to Cure Lease Defauh. Upon lender's receipt of any written notice of Grantor's default under the Lease, Lender may, at Lender's option, cure such default, even though Grantor, or any party on behalf of Grantor, questions or denies the existence of such default or the nature of the default. Grantor expressly grants to lender the absolute and immediate right to enter upon the Property to such extent and as often as Lender in it sole discretion deems necessary or desirable in order to Rrevent or cure any such default by Grantor. DUE ON SALE • CONSENT BY LENDER. Lender may, at Lender's option, declare immediately due and payable ell sums secured by this Deed of Trust upon the sale or transfer, without Lender's prior written consent, of all or any part of the Real Property, or any interest in the Real Property. A "sale or transfer" means the conveyance of Reel Property or any right, title or interest in the Real Property; whether legal, beneficial or equitable; whether voluntary or involuntary; whether by outright sale, deed, installment sale contract, land contract, contract for deed, community property agreement or community property trust or other trust, leasehold interest with a term greater than three 13) years, lease-option contract, or by sale, assignment, or transfer of any beneficial interest in or to any land trust holding title to the Real Property, or by any other method of conveyance of an interest in the Real Property. However, Yhis option shall not be exercised by Lender if such exercise is prohibited by federal law or by Alaska law. TAXES AND LIENS. The following provisions relating to the taxes and liens on the Property are part of this Deed of Trust: Payment. Grantor shall peV when due (and in ell events prior to delinquency) eII 4axes, special taxes, assessments, charges (including water and sewer), fines and impositions levied against or on account of the Property, and shall pay when due ail claims for work done on or for services rendered or material furnished to the Property. Grantor shall maintain the Property free of all liens having priority over or equal to the interest of Lender under this Deed of Trust, except for the lien of taxes and assessments not due and except as otherwise provided in this Deed of Trust. Right to Contest. Grantor may withhold payment of any tax, assessment, or claim in connection with a good faith dispute over the obligation to pay, so long as Lender's infereat in the Property is not jeopardized. If a lien arises or is filed as a result of nonpayment, Grantor shall within fifteen (151 days after the lien arises or, if a lien is filed, within fifteen 195) days after Grantor has notice of the filing, secure the discharge of the lien, or if requested by Lender, deposit with Lender cash or a sufficient corporate surety bond or other security satisfactory to Lender in an amount sufficient 4o discharge She lien plus any costa and reasonable attorneys' fees, or other charges that could accrue es a result of a foreclosure or sale under the lien. In any contest, Grantor shall defend itself and Lender end shall satisfy any adverse judgment before enforcement against the Property. Grantor shall name Lender as en additional obligee under any surety bond furnished in the contest proceedings. Evidenea of Payment. Grantor shall upon demand furnish to Lender satisfactory evidence of payment of the taxes or assessments and shall authorize the appropriate governmental official to deliver to Lander at any time a written statement of the taxes and assessments against the Property. Notlcs of Conatmction. Grantor shall notify Lender at least fifteen 115) days before any work is commenced, any services are furnished, or any materials are supplied to the DEED OF TRUST Loan No: 0'178470704 (Continued) Pegefi Property, if any mechanic's lien, materialmen's lien, or other lien could be asserted on account of the work, services, or materials. Grantor will upon request of Lender furnish Yo Lender advance assurances satisfactory to Lender that Grantor can and will pay the cos4 of such improvements. PROPERTY DAMAGE INSURANCE. The following provisions relating to insuring the Property are a part of this Deed of Trust. Maintenance of Insurance. Grantor shall procure and maintain policies of fire insurance with standard extended coverage endorsements on a cash basis for the full insurable value covering all Improvements on theRaal Property in an amount sufficient to avoid application of any coinsurance clause, and with a standard mortgagee clause in favor of lender. Grantor shall also procure and maintain comprehensive general liability insurance in such coverage amounts as Lender may request with Trustee and lender being named as additional insureds in such liability insurance policies. Additionally, Grantor shall maintain such other insurance, including but not limited to hazard, business interruption, and boiler insurance, as lender may reasonably require. Policies shall be written in form, amounts, coverages and basis reasonably acceptable to Lender and issued by a company or companies reasonably acceptable to Lender. Grantor, upon request of Lender, will deliver 40 Lender from time to time the policies or certificates of insurance in form satisfactory to Lender, including stipulations that coverages will not be cancelled or diminished without at least thirty 1301 days prior written notice to Lender. Each insurance policy also shall include an endorsemene providing that coverage in favor of Lender will not be impaired in any way by any act, omission or default of Grantor or any other person, Should the Real Property be located in en area designated by the Director of the Federa! Emergency Menegameni Agency as a special flood hazard area, Grantor agrees to obtain and maintain Federal Flood Insurance, if available, within 45 days after notice is given by Lender that the Property is located in a special flood hazard area, for the full unpaid principal balance of the loan and any prior liens on the property securing the loan, up to the maximum policy limits set under the National Flood Insurance Program, or as otherwise required by Lender, and to maintain such insurance for the term of the loan. Appilcation of_Proceeds. Grantor shall promptly notify Lender of any loss or damage to the Property. Lender may make proof of loss if Grantor fails to do so within fifteen 116) days of the casualty. Whether or not Lender's security is impaired, Lender may, at Lender's election, receive and retain the proceeds of any insurance and apply the proceeds to the reduction of the Indebtedness, payment of any lien affecting the Property, or the restoration and repair of the Property. If Lender elects to apply the proceeds to restoration end repair, Grantor shall repair or replace the damaged or destroyed Improvements in a manner satisfactory to Lender. Lender shall, upon satisfactory proof of such expenditure, pay or reimburse Grantor from the proceeds for the reasonable cost of repair or restoration if Grantor is not in default under this Deed of Trust. Any proceeds which have not been disbursed within 780 days after their receipt and which Lender has not committed to the repair or restoration of the Property shall 6e used first to pay any amount owing to Lender under this Dead of Trust, then to pay accrued interest, and the remainder, if any, shall be applied to the principal balance of the Indebtedness. If lender holds any proceeds after payment in full of the Indebtedness, such proceeds shall be paid to Grantor as Grantor's interests may appear. Grantor's Report on Insurance. Upon request of Lender, however not more than once a year, Grantor shall furnish to lender a report on each existing policy of insurance showing: (t) the name of the insurer; 12) the risks insured; (31 the amount of the policy; (41 the property insured, the then current replacement value of such property, and the manner of determining that value; and (5) the expiration data of the policy. Grantor shell, upon request of Lander, have an independent appraiser satisfactory to Lender determine the cash value replacement cost of the Property. LENDER'S EXPENDITURES. If any action or proceeding is commenced that would materially affect Lender's interest in the Property or if Grantor fails to comply with any provision of this Deed of Trust or any Related Documents, including but not limited to Grantor's failure to discharge or pay when due any amounts Grantor is required to discharge or pay under this Deed of Trust or any Related Documents, Lender on Grantor's behalf may (but shall not be obligated tol take any action that Lender deems appropriate, including but not limited to discharging or paying all taxes, liens, security interests, encumbrances and other claims, at any time levied or placed on the Property and paying all costs for insuring, maintaining and preserving the Property. All such expenditures incurred or paid by Lender for such purposes will then bear interest at the rate charged under the Note unless payment of interest at that rate would be DEED OF TRUST Loan No: of 18410704 (Continued) Page s contrary to applicable law, in which event such expenses shall bear interest at the highest rata permitted by applicable law from the date incurred or paid by Lender to the date of repayment by Grantor. All such expenses will become a part of the Indebtedness and, at Lender's option, will (A) be payable on demand; (s! be added to the balance of the Note and be apportioned among and be payable with any installment payments to become due during either 171 4he term of any applicable insurance policy; or (21 the remaining term of the Note; or ICf be treated as a balloon payment which will be due and payable at the Note's maturity. The Deed of Trust also will secure payment of these amounts. Such right shall be in addition to all other rights and remedies to which Lender may be entitled upon Default. WARRANTY; DEFENSE OF TITLE. The following provisions relating to ownership of the Property are a part of this Deed of Trust: Title. Grantor warrants that: la) Grantor holds good and marketable title of record Yo the leasehold interest in the Property pursuant to the Lease, free end clear of ell liens end encumbrances other than those set forth in the Real Property description or in any title insurance policy, title report, or final title opinion issued in favor of, and accepted by, Lender in connection with this Deed of Trust, and (b) Grantor has the full right, power, and authority to execute and deliver this Deed of Trus4 to Lender. Dafenae of TIHa. Subject to the exception in the paragraph above, Grantor warrants end will forever defend the title to the Property against the lawful claims of all persons. In the event any action or proceeding is commenced that questions Grantor's titfe or the interest of Trustee or Lander under this Deed of Trust, Grantor shall defend the action at Grantor's expense. Grantor may be the nominal party in such proceeding, but Lender shall be entitled to patticipate in 4he proceeding and to be represented in the proceeding by counsel of Lender's own choice, and Grantor will deliver, or cause to be delivered, to Lender such instruments as Lender may request from time to time to permit such participation. Community Property Election. Grantor has not and will not enter into a community property agreement or community property trust without Lender's prior written consent. Transfers in Trust. Grantor has not and will not transfer any of Grantor's assets into a trust without Lender's prior written consent. Compliance Whh Lews. Grantor warrants that the Property and Grantor's use of the Property complies with all existing applicable laws, ordinances, and regulations of governmental authorities. Survival of Rspresen4edone and Wenandea. All representations, warranties, and agreements made by Grantor in this Deed of Trust shall survive the execution and delivery of this Deed of Trust, shall be continuing in nature, end shall remain in full force and efface until such time as Grantor's Indebtedness shall be paid in full. CONDEMNATION. The following provisions relating to condemnation proceedings are a pert of this Deed of Trust: Proceedings. If any proceeding in condemnation is filed, Grantor shall promptly notify Lender in writing, and Grantor shell promptly take such steps as may be necessary to defend the action and obtain the award. Grantor may be the nominal party in such proceeding, but Lender shall be entitled to participa4e in the proceeding and to be represented in the proceeding by counsel of its own choice all at Grantor's expense, and Grantor will deliver or cause to be delivered to Lender such insttuments and documentation as may be requested by Lender from time to time to permit such participation. Application of Net Proceeds. If all or any part of the Property is condemned by eminent domain proceedings or by any proceeding or purchase in lieu of condemnation, Lender may at Its election require that all or any portion of the net proceeds of the award be applied to the Indebtedness or the repair or restoration of the Property. The net proceeds of the award shall mean the award after payment of all reasonable costs, expenses, and attorneys' fees incurred by Trustee or lender in connection with the condemnation. , IMPOSITION OF TAXES. FEES AND CHARGES SY GOVERNMENTAL AUTHORITIES. The following provisions relating to governmental taxes, fees and charges are a part of this Deed of Trust: Current Taxes, Fees end Charges. Upon request by Lender, Grantor shall execute such documents in addition to this Deed of Trust and take whatever other action is requested by Lender to perfect and continue Lender's lien on the Real Property. Grantor shall reimburse Lender for all taxes, as described below, together with ail expenses incurred in recording, perfecting or continuing this Deed of Trust, including without limitation aII taxes, fees, DEED OF TRUST Loan No: 09 9 849 0704 ~Con4inued) Pega 7 documentary stamps, and other charges for recording or registering this Deed of Trust. Taxes. The following shall constitute taxes to which this section applies: (t) a specific tax upon this type of Deed of Trust or upon ail or any part of the Indebtedness secured 6y this Deed of Trust; (21 a specific tax on Grantor which Grantor is authorized or required to deduct from payments on the Indebtedness secured by this type of Deed of Trust; (3) a tax on this type of Deed of Trust chargeable against the Lender or the holder of the Note; and 141 a specific tax on all or any portion of the Indebtedness or on payments of principal and interest made 6y Grantor. Subsequent Taxes. If any tax to which this section applies is enacted subsequent to the date of this Daed of Trust, this event shall have the same effect as an Event of Default, end Lender may exercise any or all of its available remedies for an Event of Default as provided below unless Grantor either (i) pays the tax before it becomes delinquent, or 12) contests the tax as provided above in the Taxes and Liens section and deposits with Lender cash or a sufficient corporate surety bond or other security satisfactory to Lender. SECURITY AGREEMENT; FINANCING STATEMENTS. The following provisions relating to this Deed of Trust as a security agreement are a part of this Deed of Trust: Security Agreement. This instrument shall constitute a Security Agreement to the extent any of the Property constitutes fixtures, and Lender shell have ail of 4he rights of a secured party under the Uniform Commercial Code as amended from time to time. Security Interest. Upon request by Lender, Grantor shall take whatever action is requested 6y Lender to perfect and continue Lender's security interest in the Rents and Personal Property. In addition to recording this Deed of Trust in the real property records, Lender may, at any time and without further authorization from Grantor, file executed counterparts, copies or reproductions of this Deed of Trust as a financing statement. Grantor shell reimburse Lender for all expenses incurred in perfecting or continuing this security interest. Upon default, Grantor shall not remove, sever or detach the Personal Property from the Property. Upon default, Grantor shall assemble any- Personal Property not affixed to the Property in a manner and at a place reasonably convenient to Grantor and lender and make it available to .Lender within three (31 daYS after receipt of written demand from Lender to the extent permitted by applicable law. Addresses. The mailing addresses of Grantor (debtor) and Lender (secured party) from which information concerning the security interest granted by this Deed of Trust may be obtained (each as required by the Uniform Commercial Codel ere as stated on the first page of this Deed of Trust. FURTHER ASSURANCES; ATTORNEY-IN•FACT. The following provisions relating to further assurances and attorney-in-fact are a part of this Deed of Trust: Further Assurances. At any time, and from time to time, upon request of lender, Grantor will make, execute and deliver, or will cause to be made, executed or delivered, to Lender or to Lender's designee, and when requested by Lender, cause to be filed, recorded, refiled, or rerecorded, as the case may 6e, at such times and in such offices and places as Lender may deem appropriate, any and all such mortgages, deeds of trust, security deeds, security agreements, financing statements, continuation statements, instruments of further assurance, certificates, and other documents as may, in the sole opinion of Lender, be necessary or desirable in order to effectuate, complete, perfect, continue, or preserve Ill Grantor's obligations under the Note, this Deed of Trust, and the Related Documents, and (2) the liens and security interests created by this Deed of Trust as first and prior liens on the Property, whether now owned or hereafter acquired by Grantor. Unless prohibited by law or Lender agrees to the contrary in writing, Grantor shall reimburse Lender for all costs and expenses incurred in connection with the matters referred to in this paragraph. Attorney-in-Fact. If Grantor fails to do any of the things referred to in the preceding paragraph, Lender may do so for and in the name of Grantor and at Grantor's expense. for such purposes, Grantor hereby irrevocably appoints Lender as Grantor's attorney-in•fact for the purpose of making, executing, delivering, filing, recording, and doing all other things es may be necessary or desirable, in Lender's sole opinion, to accomplish the matters referred to in the preceding paragraph. FULL PERFORMANCE. If Grantor pays all the Indebtedness when due, and otherwise performs all the obligations imposed upon Grantor under this Dead of Trust, Lender shell execute and deliver to Trustee a request for full reconveyance and shall execute and deliver to Grantor ' suitable statements of termination of any financing statement on file evidencing Lender's security interest in the Rents and the Personal Property. Any reconveyance fee required by law DEED DF TRUST Login No: 01 1 8410 704 (COntinued) pag® g shall be paid by Grantor, if permitted by applicable law, EVENTS OF DEFAULT. Each of the following, at Lender's option, shall constitute an Event of Default under this Deed of Trust: Payment Default. Grantor fails to make any payment when due under the Indeb4ednesa. Other Defaults. Grantor fails to comply with or to perform any other term, obligation, covenant or condition contained in this Deed of Trust or in any of the Related Documents or to comply with or to perform any term, obligation, covenant or condition contained in any other agreement between Lender and Grantor. Compliance Defauk. Failure to comply with any other term, obligation, covenant or condition contained in this Deed of Trust, the Note or in any of the Related Documents. Default on Other Payments. Failure of Grantor within the time required by this Deed of Trust to make any payment for taxes or insurance, or any other payment necessary to prevent filing of or to effect discharge of any lien. Felae StetemeMa. Any warranty, representation or statement made or furnished to Lender by Grantor or on Grantor's behalf under this Deed of Trust or the Related Documents is false or misleading in ant material respect, either now or at the time made or furnished or becomes false or misleading at any time thereafter. Defective Collateralization. This Deed of Trust or any of the Related Documents ceases to be in full force and effect (including failure of any collateral document to create a valid and perfected security interest or lien) at any time and for any reason. Death or Insolvency. The death of any Grantor, the insolvency of Grantor, the appointment of a receiver for any part of Grantor's property, any assignment for the benefit of creditors, any Type of creditor workout, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against Grantor. Credkor or Forfeiture Proceedings. Commencement of foreclosure or forfeiture proceedings, whether by judicial proceeding, self-help, repossession or any other method, by any creditor cf Grantor or by any governmental agency agains4 any property securing the Indebtedness. -~iis includes a garnishment of any of Grantor's accounts, including deposit accounts, with ender. However, this Event of Default shall not apply if there is a good faith dispute by i:rantor as to the validity or reesonabieneas of the claim which is the basis of the creditor or forfeiture proceeding and if Grantor gives Lender written notice of the creditor or forfeiture proceeding and deposits with Lender monies or a surety bond for the creditor or forfeiture proceeding, in an amount determined by lender, in its sole discretion, as being en adequate reserve or bond for the dispute. Lease Default. Grantor defaults under the terms of the Lease, or any other event (whether or not Grantor's fault) results in the termination or cancellation of Grantor's leasehold rights. Breech of Other Agreement. Any breech by Grantor under the terms of any other agreement between Grantor and Lender that is not remedied within any grace period provided therein, including without limitation any agreement concerning any indebtedness or other obligation of Grantor to Lender, whether existing now or later. Events Affecting Guarantor. Any ofthe preceding events occurs with respect to any guarantor, endorser, surety, or accommodation party of any of the Indebtedness or any guarantor, endorser, surety, or accommodation party dies or becomes incompetent, or revokes or disputes the validity of, or liability under, any Guaranty of the Indebtedness. In the event of a death, Lender, at its option, may, but shell not be required to, permit the guarantor's estate to assume unconditionally the obligations arising under the guaranty in a manner satisfactory to Lender, and, in doing so, cure any Event of Detault. Adverse Change. A material adverse change occurs in Grantor's financial condition, or Lender believes the prospect of payment or performance of the Indebtedness is impaired. insecurity. Lender in good faith believes itself insecure. Right to Cure. If any default, other than a default in payment is curable and if Grantor has not bean given a notice of a breach of the same provision of this Deed of Trust within the preceding twelve 112) months, it may be cured if Grantor, after receiving written notice from Lender demanding cure of such default: 111 cures the default within fifteen 1151 days; or (2) if the cure requires more than fifteen (15) days, immediately initiates steps which lender deems in Lender's sole discretion to be sufficient to cure the default and thereafter continues and completes all reasonable and necessary steps sufficient to produce DEED OF TRUST Loan No: 0 7 7 8410704 (Continued) Pege 9 compliance as soon as reasonably practical. RIGHTS AND REMEDIES ON DEFAULT. If an Event of Default occurs under this Deed of Trust, at any time thereafter, Trustee or lender may exercise any one or more of the following rights and remedies: Eleedon of Remedies. Election by Lender to pursue any remedy shall not exclude pursuit of any other remedy, and an election to make expenditures or to take action to perform an obligation of Grantor under this Deed of Trust, after Grantor's failure to perform, shall not affect lender's right to declare a default and exercise its remedies. Accelerate Indebtedness. Lender shall have the right at its option without notice to Grantor to declare the entire Indebtedness immediately due and payable, including any prepayment penalty which Grantor would be required to pay. Foreclosure. With respect to all or any part of the Property, Trustee shall have She right to sell the Property pursuant to anon-judicial foreclosure sale and Trustee or Lender shall have the right to sell the Property upon judicial foreclosure, in either case in accordance with and to the full extent provided by applicable law. If the power of sale is invoked, Trustee shall execute a written notice of the occurrence of an Event of Default and of the election to cause the Property to be sold and shall record such notice in each Recording Diatrlct in which the Property or some part of the Property is located. Trustee shall mail copies of the notice of default, in the manner provided by the laws of Alaska, to Grantor and to such other persons as the laws of Alaska prescribe. Trustee shall give notice of sale and shall sell the Property according to the laws of Alaska. After the (apse of time required by law following the reoordetion of the notice of default, Trustee, without demand on Grantor, may sell the Property at the time and place and under the terms designated in the notice of sale, in one or more parcels and in such order as Trustee may determine. Trustee may postpone sale of alt or any parcel of the Property by public announcement at the time and place of any previously scheduled sale. Lender's or Lender's designee may purchase the Property at any sale. Trustee shall deliver to the purchaser Trustee's deed conveying the property so sold without any covenant or warranty, expressed or implied. The recitals in the Trustee's deed shall 6e prima facie evidence of the truth of the statements made in the Trustee's deed. Trustee shall apply the proceeds of the sale in The following order: (al to ail costs end expenses of the sale, including, but not limited to, reasonable Trustee's and attorneys' fees, and coat of title evidence; (bl to all sums secured by this Deed of Trust in such order as lender, in Lender's sole discretion, directs; and Icl the excess, if any, to the person or persons legally entitled to the excess proceeds. L'.^,.^. Remedies. With raapaw;i to ail Or airy pan' of tfie PerSdnai Properly, Lender shalt have ail the rights and remedies of a secured patty under the Uniform Commercial Code. Collect Rents. Lender shall have the right, without notice to Grantor to take possession of and manage the Property and collect the Rents, including amounts past due and unpaid, and apply the net proceeds, over and above lender's costs, against The Indebtedness. In furtherance of this right, Lender may require any tenant or other user of the Property to make payments of rent or use fees directly to lender. If the Rents ere collected by Lender, then Grantor irrevocably designates Lender as Grantor's attorneyin-fact to endorse instruments received in payment thereof in the name of Grantor and to negotiate the Same and collect the proceeds. Payments by tenants or other users to Lender in response to lender's demand shall satisfy the obligations for which the payments are made, whether or not any proper grounds for the demand existed. Lender may exercise its rights under this subparagraph either in person, by agent, or through a receiver. Appoint Receiver. lender shall have the right to have a receiver appointed to take possession of all or any part of the Property, with the power to protect and preserve the Property, to operate the Property preceding foreclosure or sale, and to collect the Rents from she Property and apply the proceeds, over and above the cost of the receivership, against the dndebtedness. The receiver may serve without bond if permitted by law. Lender's right to the appointment of a receiver shall exist whether or no4 the apparent value of the Property exceeds the Indebtednessby a substantial amount. Employment by Lender shall not disqualify a person from serving as a receiver. Tenancy at Sufferenco. If Grantor remains in possession of the Property after the Property is sold as provided above or Lender otherwise becomes entitled to possession of the Property upon default of Grantor, Grantor shall become a tenant at sufferance of Lender or the purchaser of the Property and shall, at Lender's option, either (11 pay a reasonable DEED OF TRUST Login No: 0796490]04 {Continued) Pegs 70 rental for the use of the Property, or 121 vacate the Property immediately upon the demand of Lender. Other Remedies. Trustee or lender shall have any other right or remedy provided in this Deed of Trust or the Note or by law. No4ice of Sala. Lender Shall give Grantor reasonable notice of the time and place of any public sale of the Personal Property or of the time after which any private sale or other intended disposition of the Personal Property is to be made. Reasonable notice shall mean notice given at least ten 110) days before the time of the sale or disposition. Any sale of the Personal Property may be made in conjunction with any sale of the Real Property. Sale of 4he Property. To the extent permitted by applicable law, Grantor hereby waives any and aii rights to have the Property marshalled. In exercising its rights and remedies, the Trustee or Lender shall be free to sell all or any part of the Property together or separately, in one sale or by separate sales. Lender shall be entitled to bid at any public sale on all or any portion of the Property. At4omeys' Fees; Expenses. If Lender institutes any suit or action to enforce any of the terms of this Deed of Trust, Lender shall 6e entitled to recover such sum as the court may adjudge reasonable as attorneys' fees et trial end upon any appeal. Whether or noY any court action is involved or pending, and to the extent not prohibited by law, all reasonable expenses Lender incurs that in Lender's opinion are necessary at any time for the protection of its interest or the enforcement of its rights shall become a part of the Indebtedness payable on demand and shall bear interest at the Note rate unless payment of interest at that rata would ba ccn4rsry to applicable law, in which event such expenses shalt bear interest at the highest rate permitted by applicable law from the date of the expenditure until repaid. Expenses covered by this paragraph include, without limitation, however subject to any limits under appiicable law, Lender's reasonable attorneys' fees and Lender's legal expenses whether or not there is a lawsuit, including reasonable attorneys' fees and expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunctionl, appeals, and any anticipated post-judgment collection services, the cost of searching records, obtaining title reports lincluding foreclosure reportsl, surveyors' reports, and appraisal fees, title insurance, and fees for. the Trustee, to the extent permitted by appiicable law. Grantor also will pay any court costs, in addition to all other sums provided by law. Rights of Tmetes. Trustee shall have all of the rights and duties of Lender as set forth in this section. POWERS AND OBLIGATIONS OP TRUSTEE. The following provisions relating to the powers end obligations of Trustee (pursuant to lender's instructions) are part of this Deed of Trust: Powero of Tmatee. in addition to all powers of Trustee arising as a matter of law, Trustee shell have the power to take the following actions with respect to the Property upon the written request of Lender end Grantor: lal join in preparing and filing a map or plat of the Real Property, including the dedication of streets or other rights to the public; (bl join in granting any easement or creating any restriction on the Real Property; and (cl join in any subordination or other agreement affecting this Deed of Trust or the interest of Lender under this Deed of Trust. Tmttee. Trustee shall meet ell qualificatlons required for Trustee under applicable law. In addition to the rights and remedies set forth above, with respect to all or any pert of the Property, the Trustee shall, upon default, have the right to sell the Property by notice and non-judicial sale, and Trustee or Lender shall have the right to sell the Property by judicial action and foreclosure sale, in either case in accordance with and to the fulB extent provided by applicable law. Successor Tmatee. Lender, at lender's option, may from time to time appoint a successor Trustee to any Trustee appointed under this Deed of Trust by an insttument executed and acknowledged by Lender and recorded in the office for the Kenai Recording District, Third Judicial District, State of Alaska. The instrument shall be executed and acknowledged by Lender or Lender's successor in interest, and shall contain, in addition to all other matters required by state law, the date Ehis Deed of Trust was executed, the names of the original lender, Trustee, end Grantor, the book and page where this Deed of Trust is recorded, the name and address of the successor trustee, and either an acknowledgement signed and acknowledged by the Trustee named in this Deed of Trust of a receipt of a copy of the instrument or an affidavit of service of a copy of the instrument on the Trustee. The successor trustee, without conveyance of the Property, shall succeed to aii the title, power, DEED OF TRUST Loan No: 0118490704 (COntenued) Page 91 and duties conferred upon the Trustee in this Deed of Trust and by applicable law. This procedure for substitution of Trustee shall govern to the exclusion of all other provisions for substitution. NOTICES. Unless otherwise provided by applicable law, any notice required to be given under this Deed of Trust, including without limitation any notice of default and any notice of sale shall be given in writing, and shall be effective when actually delivered, when actually received by telefacsimile (unless otherwise required by lawl, when deposited with a nationally recognised overnight courier, or, if mailed, when deposited in the United States mail, as first close, certified or registered mail postage prepaid, directed to the addresses shown near the beginning of this Deed of Trust. All copies of notices of foreclosure from the holder of any lien which has priority over this Deed of Trust shall be sent to Lender's address, as shown near the beginning of this Deed of Trust. Any party may change its address for notices under this Deed of Trust by giving formal written notice to the other parties, specifying that the purpose of the notice is to change the party's address. Foe notice purposes, Grantor agrees to keep lender informed et all times of Grantor's current address. Unless otherwise provided or required by law, if there is more than one Grantor, any notice given by Lender to any Grantor is deemed tc be notice given to all Grantors. FORCE PLACED INSURANCE. I agree that if I fail to provide any required insurance or fail to continue such insurance in force, Lender may do so at my expense. In the event Lender initiates the process of obtaining such insurance I agree to pay Lender, in addition to the expense associated with the force placed insurance, a processing fee of 550.00. Such fee is fully earned whenever Lender initiates such process regardless of whether the insurance is actually obtained by Lender. The cyst of any such insurance and prooessing fee, at the option of the Lender shall be added to the indebtedness. MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this Dead of Trust: Amendments. This Dead of Trust, together with any Related Documents, constitutes the entire understanding and agreement of the parties as to the matters set forth in this Deed of Trust. No alteration of or amendment to this Deed of Trust shall ba effective unless given in writing and signed by the party or parties sought to be charged or bound 6y the alteration or amendment. Annual Reports. If the Property is used for purposes other than Grantor's residence, Grantor shall furnish to Lender, upon request, a certified statement of net operating income received from the Property during Grantor's previous fiscal year in such form end detail as Lender shall require. "Net operating income" shall mean all cash receipts from the Property less all cash expenditures made in connection with the operation of the Property. Caption Headings. Caption headings in this Deed of Trust ere for convenience purposes only and are not to be used to interpret or define the provisions of this Deed of Trust. Merger. There shall be no merger of the interest or estate created by this Dead of Trust with any other interest or estate in the Property at any time held by or for the beneNt of Lender in any capacity, without the written consent of Lender. Governing Law. This Deed of Tmst will 6e governed by federal law applicable to Lander end, to the extent not preempted by federal Baw, the laws of She State of Alaska without regard to its conflicts of law provisbns. This Deed of Tmat has been accepted by Lender in the State of Alaska. No Waiver by Lender. Lender shall not be deemed to have waived any rights under this Deed of Trust unless such waiver is given in writing and signed by Lender. No delay or omission on the part of Lender in exercising any right shall operate as a waiver of such right or any other right. A waiver by Lender of a provision of this Deed of Trust shall not prejudice or constitute a waiver of lender's right otherwise to demand strict compliance with that provision or any other provision of this Deed of Trust. No prior waiver by Lender, nor any course of dealing between Lender and Grantor, shall constitute a waiver of any of Lender's rights or of any of Grantor's obligations as to any future transactions. Whenever the consent of lender is required under this Deed of Trust, the granting of such consent by Lender in any instance shall not constitute continuing consent to subsequent instances where such consent is required and in all cases such consent may be granted or withheld in the sole discretion of Lender. Sevarebility. If a Court of competent jurisdiction finds any provision of this Deed of Trust to ba illegal, invalid, or unenforceable as to any circumstance, that finding shall not make the offending provision illegal, invalid, or unenforceable es to any other circumstance. If DEED OF TRUST Loan No: 09 9 649 0704 ~COntinued) Pegs 92 feasible, the offending provision shall be considered modified so that it 6ecames legal, valid and enforceable. If the offending provision cannot be so modified, it shall be considered deleted from this Deed of Trust. Unless otherwise required by law, the illegality, invalidity, or unenforceability of any provision of this Deed of Trust shall not affect the legality, validity or enforceability of any other provision of this Deed of Trust. Succassoro end Assigns. Subject to any limitations stated in this Geed of Trust on transfer of Grantor's interest, this Deed of Trust shall be binding upon and inure to the benefit of the parties, their successors and assigns. If ownership of the Property becomes vested in a parson other than Grantor, Lender, without notice to Grantor, may deal with tremor's successors with reference to this Deed of Truse and the Indebtedness by way of forbearance or extension without releasing Grantor from the obligations of this Deed of Trust or liability under the Indebtedness. Time is of the Eaeanca. Tina is of the essence in the performance of 4his Deed of Trust. Waiver of Homestead Exemption. Grantor hereby releases and waives ell rights and benefits of the homestead exemption laws of the State of Alaska as to all Indebtedness secured by this Deed of Trust. DEFINITIONS. The following capitalized words and terms shall have the following meanings when used in this Deed of Trus4. Unless apecificaliy stated to the contrary, all reterencea to dollar amounts shall mean amounts in lawful money of the United States of America. Words and terms used in the singular shall include the plural, and the plural shall include the singular, as the context may require. Words and terms not otherwise defined in this Deed of Trust shall have Ohs reanings attributed Yo such teems in the Uniform Commercial Code: Beneficiary. The word "Beneficiary" means First National Bank Alaska, and its successors end assigns. Boreower. The word "Borrower" means ROCKWELL G. SMITH and includes all co-signers and co-makers signing the Note and all their successors and assigns. Dead of Trust. The words "Deed of Trust" mean this Deed of Trusf among Grantor, Lender, and Trustee, and includes without limitation all assignment and security interest provisions relating to the Personal Property and Rents. Default. The word "Default" means the Default set forth in this Deed of Trust in the section titled "Default". Environmental Laws. The words "Environmental Laws" mean any and all state, federal end local statutes, regulations and ordinances relating to the protection of human health or the en. .............. ...c!uding ..ith^ !im. the Compeehersive E^ ^I R^sponse. Compensation, and Liability Act of 1980," as amended, 42 U.S.C. .Section^9601 ~ eY seq. ("CERCLA"), the Superfund Amendments and Reauthorization Act of 1988, Pub. L. No. 99.499 ("SARA"), the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., or other applicable state or federal laws, rules, or regulations adopted pursuant thereto. Event of Defauk. The words "Event of Default" mean any of the events of defaul4 se4 forth in 8his Deed of Trust in the events of default section of this Deed of Trust. Grantor. The word "Grantor" means ROCKWELL G. SMITH. Guaranty. The word "Guaranty" means the guaranty from guarantor, endorser, surety, or ecwmmodation party to Lender, including without limitation a guaranty of all or part of the Note. Hazardous Substances. The words "Hazardous Substances" mean materials that, because of their quantity, concentration or physical, chemical or infectious characteristics, may cause or pose a present or potential hazard to human health or the environment when improperly used; treated, stored, disposed of, generated, manufactured, transported or otherwise handled. The words "Hazardous Substances" are used in their very broadest sense and include without limitation any and ell hazardous or toxic substances, materiels or waste as defined by or listed under the Environmental Laws. The term "Hazardous Substances" also includes, without limitation, petroleum and petroleum by-products or any fraction thereof and asbestos. Improvemema. The word "Improvements" means all existing and future improvements, buildings, structures, mobile homes affixed on the Real Property, facilities, additions, replacements and other COnsteuction on the Real Property. DEED OF TRUST Login No: 0998490704 1COntinued~ Page 13 Indebtedness. The ward "Indebtedness" means all principal, interest, and other amounts, costs and expenses payable under the Note or Related Documents, together with all renewals of, extensions of, modifications of, consolidations of and substitutions for the Note or Related Documents and any amounts expended or advanced by Lender to discharge Grantor's obligations or expenses incurred by Trustee or Lender ao enforce Grantor's obligations under this Deed of Trust, together with interest on such amounts as provided in this Deed of Trust. Specifically, without limitation, Indebtedness includes all amounts that may be indirectly secured by the Cross-Collateralization provision of this Deed of Trust. Lease. The word "Lease" means the lease of the Property between City of Kenai, Landlord and Grantor, which was recorded as follows: Lease dated May 75, 1991 and recorded in the Kenai Recording District on May 24, 1991, in Book 382 at Page 822, and amended by instrument recorded April 92, 1998 in Book 462 at Page 579, and amended by instrument recorded April 24, 2001 in Book 604 at Page 645, as to Parcel 1. 99 year lease with a maturity date of June 30, 2090. Lease dated May 1, 2004 and recorded in the Kenai Recording District on Mey 6, 2004 under Serial Number 2004-004327-0, as to Parcel 2. 25 year lease with a maturity date of June 30, 2029. lender. The word "Lender° means First National Bank Alaska, its successors end assigns. - Note. The word "Note"-~means'the~:prgmissory note dated May 10, 2006, In tho originst principal amount of 3335,000.00 fromsGrantor to Lender, together with all renewals of, extensions of, modifications of, refinancings of, consolidations of, and substitutions for the promissory note or agreement:? TF.a maturity date of this Deed of Trust is May !6, 2027. NOTICE TO GRANTOR: THE NOTE CONTAINS A VARIABLE INTEREST RATE. Personal Property. Theworda"Personal Property" mean all equipment, fixtures, end other articles of personal propertynbw or hereafter owned by Grantor, and now or hereafter attached or affixed to the Real Property; together with all accessions, parts, and additions to, all replacements of, and all substitutions for, any of such property; and together with all issues and profits thereon and proceeds linctuding without limitation ail insurance proceeds and refunds of premiums) from any sale or other disposition of the Property. Properly. Tha word "Property` means collectively the Real Property and the Personal Property. Reel Property. The words "Real Property" mean the real property, interests and rights, as further described in this Deed of Trust. Related Documents. The words "Related Documents" mean all promissory notes, credit agreemsnts, loan agreements, environmental agreements, guaranties, security agreements, mortgages, deeds of trust, security deeds, collateral mortgages, and all other instruments, agreements and documents, whether now or hereafter existing, executed in connection with the Indebtedness. Rents. The word "Rents" means ail present and future rents, revenues, income, issues, royalties, profits, and other benefits derived from the Property. Trustee. The word "Trustee" means First American Title of Alaska, whose address is 705 Trading Bay Road Ste. 703, Kenai, AK 99671 and any substitute or successor trustees. GRANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS DEED OF TRUST, AND GRANTOR AGREES TO ITS TERMS. GRANTOR: X . {~~L_G ROCKWELL G. SMITH DEED OF TRUST Loan No: 01'18410704 (COntinu8d) Paga 74 INDIVIDUAL ACKNOWLEDGMENT srsre oP ~\ ~, ~ k~ _ I ss \ ~~ 2 ~ JUDICIAL DISTRICT I On this day before me, the undersigned Notary Public, personally appeared ROCKVYELL G. SMITH, to me known to be the individual described in and who executed the Deed of Trust, and acknowledged that he or she signed the Deed of Trust as his or her free and voluntary act and deed, for the uses and purposes therein mentioned. Given under my hand and official seN this ~ O+ h day of ma ~' 20 Ong. By-~1 ~ K ~~~~~~-~ ~ov~ t KQ ~4, .~ K. o y nn ~p'1 ............. D Notary Public in end for the State of {~~G Sk ~ ~T ~ y on expires ~Q To: ,Trustee The undersigned is the Iegai owner and holder of al! Indebtedness secured by this Deed of Trust. All sums secured by this Deed of Trust have been fully paid and satisfied. You are hereby directed, upon payment to you of any sums owing to you under the terms of this Deed of Trust or pursuant to any applicable statute, to cancel the Note secured by this Deed of Trust (which is delivered to you together with this Deed of Trustl, and to reconvey, without wartanty, to the parties designated by tha terms of this Deed of Trust, the estate now held by you under this Dead of Trull. Please lllall iha racoavayar~ca and Waisted 6ooumenis to: Date: Beneficiary: By: _ Its: ,.~ ~.,.,......a~ .......,ti..~ ...... ~,,,. ~. .,.M.~.... .,. ..,.«.. ~. ~..,,~~.« REQUEST FOR FULL RECONVEYANCE ITb be used only when obligations have been paid in full) ASSdGNMENT OF LEASE FOR SECURTTY PURPOSES (I.esee'a Interest) Rockwell G. Smith dba Preferred Plumbing & Heating herein after called "Assignor", assigns and transfers to Fast National Bank Alaska, a mdonat banking association, hereinafter called "Assignee', a0 of its right, title and interest under the lease agreements dated May I5, 1991, and May 1, 2004 between City of Kenai as Lessor and Rockwell G. Smith dba Preferred Plumbing & Heating, as Lessee, which covers the following described real property situated in the Kenai Recording Districk Third Judicial Districk State of Alaska. Lot 10 & 11, Block 1, Etoliu Subdivision No.3, according to dte official plat thereof, fded under Plat Number 82-103, Records of the Kenai Recording Districk Third Judicial Disuick State of Alaska. This Assignment is executed as security for repayment of $33$,000.00 plus interest evidenced by a promisvory note is said amount of even date herewith executed by Assignor m favor of Assignee. Assignor agrees m execute any further documents necessary or appropriate m effectuate the purposes of this Assignment DATED:May 10, 2006 ASSIG/N~/OR//: R/~~oc/kw/ell G. Smith¢d~ba P\(re~fe'~'red/~Plu~fmbing & Heedug Rockwell G. Smith, Owner STATE OF Alaska Third JUDICIAL, DISTRICT - J THIS IS TO CERTIFY that on this 10'" day of May 2006, before me, the undersigned a Notary Public in and for the State of ALteka, duly commissioned and awom, personally appealed Rockwell G. Smith, known to me and to me known to be fhe Otwer of Preferred Plumbing & Heating, and he/she executed the same u his or her volmtary act and deed, for the uses end purposes therein mentioned WITNESS my hand and official sea! the day and year in this certificate fast written above. ~'1~~.~ Notary Public in d for. My commission Expires: q - q _ O (~ aaglqu.doc (REV I/99) j 4 .~;;~~, t -____ - -_ °= ^ ___-. ~/ tbeu~of // KENA~ SKiI "~'lla9e witti a Past, City wit~t 210 Fidaigo Avenue, Kenai, Alaska 99611-7794 Telephone: (907) 283-7535 /Fax: (907) 283-3014 www.ci.kenai.ak.us l~Iem®randu To: city Council j~ From: Rick Koch, City Manager d Date: May 11, 2006 Subject: Renewal of Six Shore Fishery Leases The purpose of this correspondence is to discuss the terms of the renewals for the above referenced shore fishery leases, and to request direction from the Council in that regard. The initial term of the shore fishery leases was 10 yeazs, and all renewals of shore fishery leases to date have been for a term often years. At the budget work session there was discussion regarding the basis upon which shore fishery lease rates maybe established. The present shore fishery lease rates mirror the rate set by the State of Alaska [KMC 11.20.790(a)]. The State of Alaska calculates the lease rate based on the cost to administer the State's shore fishery lease program. With the exception of shore fishery leases, the City has established a general policy of setting annual lease rates at six percent of the fair market value for city property. Given the nature of shore fishery leases it is not easy to ascertain the value, if any, that maybe assigned to the six leases up for renewal. The fundamental question is, "Should the City continue to mirror the rates established by the State of Alaska for shore fishery leases per KMC 11.20.790(a), or should the City attempt to determine the value of shore fishery leases, and with that knowledge discuss modifying the existing shore fishery leasing policy to base the rate on a percentage of the fair market value?" Memo to Council-Shore Fishery Leases May 11, 2006 Page 2 If the City Council wishes to continue indefinitely the practice of mirroring the rates established by the State of Alaska, these six leases should be renewed for the requested term often years. If the City Council wishes to direct the City Manager to determine the value of shore fishery leases, through appraisal or other appropriate means, then these six leases could be renewed for a period less than the requested ten-year period, allowing the administration time to research the issue. The Shore Fishery Lease Agreement, under D. General Covenants, number 42, provides "Re-leasing will not necessarily be under the same terms and conditions as the prior lease", and KMC 11.20.120 provides "Leases maybe issued for a term of not less than two (2) years, nor more than ninety-nine (99) years. Thank you for your attention in this matter. j "V °lla9e witti a Past, Gi y witti a Fr~ture" ~~'~~~. 210 Fidalgo Avenue, Kenai, Alaska 99611-7794 _ ~'- Telephone: (907) 283-7535 /Fax: (907) 283-3014 www.ci.kenai.ak.us ttieu~of KENA~ SKA Memorandum Date: May 11, 2006 To: Rick R. Koch, City Manager From: Kim Howard, Assistant to the City Manager RE: Renewal of Six Shore Fishery Leases The following shore fishery leases will expire on June 30. Lessee Aurora Holdings & Investments, LLC Johnson, Reta Johnson, Keith Campbell, Boyd O. Campbell, Boyd O. Kenai Salmon Company Legal Tract 7, Shore Fishery Plat #71 Tract 2, Shore Fishery Plat #71 Tract 1, Shore Fishery Plant #71 Tract A, City of Kenai Shore Fishery No. 1 Tract B, City of Kenai Shore Fishery No. 1 Tract 3, Shore Fishery Plat #71 Covenant 42 of the leases include a "preference right to re-lease those lands previously leased if all other sections of the Kenai Municipal Code are complied with. Re-leasing will not necessarily be under the same terms and conditions of the prior lease." The lessees have informed the City that they would like to renew their leases under this clause. One of the duties of the Harbor Commission as outlined in KMC 11.10.010 (5) is to review leases of City-owned tide, submerged, and lands or navigable waters within the City and make recommendations to the City Council. At their May 8a' meeting, the Commission voted unanimously to recommend that the lease rates for shore fishery leases be continued at the same rate and period of time. KMC 11.20.140 states, "No leased land may be changed in use, nor may any renewal lease be issued until the proposed use or renewal has been reviewed by the Planning Commission and approved by the Council." On May l0a', the Planning and Zoning Commission voted unanimously to recommend the leases be renewed under the same terms that the leases were issued in the past. Historically, shore fishery leases have been renewed on the basis that the lessees had fished the sites for many years. In the past, the proposed term of the lease was for ten yeazs. Annual rent for the Rick R. Koch, City Manager May 1 1, 2006 Page 2 of 2 current leases is $300 for each tract. The leases state that the City may amend the annual rent equal to that charged by the State of Alaska, if that amount should change during the term of the lease. The State of Alaska doesn't expect to increase their rents in the near future. Attached is a map showing the general area of our shore fishery leases. For your information, Kenai Salmon Company's lease for Tracts 5 & 6, Shore Fishery Plat #71 was renewed last year and expires in 2015. Anew lease was entered into on March 1, 2006 with Ted Crookston, d/b/a Tide Chaser Fishery, LLC for City of Kenai Shore Fishery No. 2 and it will expire in 2016. If Council approves the renewals, leases can be drawn up for signatures. Attachments Cc: .Aurora Holdings & Investments, LLC Reta Johnson Keith Johnson Boyd G. Campbell Boyd O. Campbell Kenai Salmon Company /kh Kenai City Limits SU80. N0. J Approximate Location of Shore Fishery Leases 40. BPLIFIELp 9UBDNISgN } \~4 riHr-lb-<tOC6 11 :4b HPI 9b(. L4k3.9Y. 8.4 May 15, 2006 Kena1 Clty Council 210 Fidalgo Avenue Kenai, AK 99611 907 248 9784 MAY I b ~„uo E ~. ~~0.4~3,~~~'p. Re: Keith Johnson, Tract 1, Shore Fishery Plat # 71 Reta Johnson, Tract 2, Shore Fishery Plat # 71 Dear Council Members: Keith and 1 had hoped to attend the May 17`" City Council meeting. However, due to a conflict; we will not be able to attend. it is our understanding that the Harbor Commission has recommended to the Kenai City Council that the six shore fishery leases be renewed for ten years with the same lease rate that has been effect in the past. As current leaseholders, we are asking that you honor this recommendation when renewing these leases. The possibility of increased lease fees has been a big concern for us. As most of you are aware, commercial fishing (especially on Salamantof Beach) has had some rough years recently both in restrictions by the Department of Fish and Game (shorter season and less hours of fishing) and in low fish prices. This coming season (2006) is again predicted to be a dismal year. In 2000, (due to low escapement numbers of salmon, subsistence requirements, and dip netting allotments), city shore lease site fishermen were allowed only four openings all season. In 2001, city shore leases site fishermen were allowed only five openings. This type of year seems to be more the norm than the exception anymore. High ].ease fees would be one more hardship on an already struggling profession. ~~n ~-•o-.cnno •t ovn r-in >nr ~•+a.>~o.~r >o~ .a era >~a•t r. no Gone and most likely never to be seen again are consecutive yeazs of large escapement numbers combined with high prices for salmon. Many of the families in the commercial fishing business are hanging in there because it is a family run business andlor they have been in business long enough that they no longer have a large outstanding debt. In the event the fishermen should decide to get out of the business, it is extremely difficult to find a buyer in the current market. Lease sites in the past could not be transfen°ed to anyone unless that person held a current State commercial fishing permit. Thus, the value of the city shore fishery lease site really has no value by itself. It would also be unworkable with out the proper fishing gear, which can run into thousands of dollars. If a site changes hands this equipment normally goes with the site in order to put a value on it. Commercial fishermen do contribute to the economy of the City of Kenai and the Kenai Peninsula Borough. In our case, we pay property tax an our land and the buildings where we store our equipment and house our fishing crews. in addition to this, we purchase fuel, gear, supplies, groceries, hire repair work and employ crewmembers from the Peninsula businesses and workforce. We are requesting the Council to seriously consider the effect that raising fees could have on fishermen operating from the City of Kenai Shore Fishery Leases and we urge you to renew these leases under the terms that have been in effect for the past ten years. Thank you. Sincerely ,_...., i `./_... Keith N and Reta J. Jotfnson, °,~' ;'" :> N-ia TO: Rick R. Koch, City Manager Carol L. Freas, City Clerk Larry Semmens, City Finance Director FROM: Keith Kornelis DATE: May 11, 2006 RE: Shamrock Circle Paving LID r--- - _. MAY 112~ ,, _ ,,;~ n CLER The following information is for the City Managers Report as per KMC 16.10.010: PROPOSED IMPROVEMENTS AND SCOPE This project is to provide road and drainage improvements to Shamrock Circle. The improvements include engineering design and inspection, excavation, grading and backfill, leveling course, drainage improvements, asphalt pacing, topsoil and seeding, and signage. Paving this road will decrease the road maintenance cost by eliminating dust control and summer time grading. It will also improve the drainage. i ne estimated rough cost estimate for this project If the city council decides to proceed with these proposed improvements I would recommend that State Legislative Grants for Kenai Road Improvements be used. RECOMMENDED PERCENTAGE TO DE ASSESSED City Resolution No. 2003-02 states that the assessment rate will be 50%. Attached is "SHAMROCK CIRCLE PROPOSED -LID 2006". It designates the property owners name, KPB assessment pazcel ID, and both the physical street and the legal address. Also attached is a drawing of the proposed LID that shows the lot numbers, street addresses, and owner's name. 0 N ®_ J r W J U U Y Q d N ~'- N M V' u7 CD I~ 0 0 0 0 0 0 0 J.J J JIJ.JJ .n a ~.a..n..n..n Y Y:YY '.Y:Y:Y OO O OOO'O N N N N-N' (E9~ N L t .C L L L L (n f/1 (n (n (n (n N Y Y Y Y Y Y Y O p 0 0 0 0 0 U'.c'.ccc'~.c!c ~'~ a.rnmo~Di's!rn~'~rnrn y~rnrnrn m rnrn!rn r~n¢ Q ¢ ¢ ¢C~¢ --- . _ - -_ ~~ ~~ } ~ c~ o e c c ~=a~a~ooa~a~m U YY(Q (q Y.YY N -O y : ~' U' ~ o U ` O Y (/7 J:U N: ~ NN (p. (0 N'> N'N C'N W'm ~;>' X X X X O O O O p m~h.N'LO m m m ¢~n.-M,aaaa m ~. E' ~',(n,Y, iu. c:~'. ~ m;J f/J~C-OO~U. ~C .x ~: O ~ C9 W:Q Q U fO U ~ c N'N m,> ~ :~, N ~(n L, F ~. ~. a5 '~, Y ' ~!~I J, ' ~ ~ ~ ~ ~ c. ~. ~ E:m',m q-F'-~'Y'-~'.¢~O'ln O., O.O. O. O..'_ '~U'~U'U!U IU ~I ~~!YY ~YYIY~ H ..?. U U, U", U~ Ui.~ W '~': O'OOO: O`1^ ~' N ~ N N ', N I N' (0 N F-_..C ~L L.L.L~_ N I~ ~ r M l tp (~ 0 O O O r .- ,.-- •- ¢,.r ~~- i.. _____i._~._L-.___ NININ'N'NN N O '~O;OIO'.O ~.O ;O C'~.C~V'V ~.V'V:'R N'N~N'N'NININ ®~V'V VV'V V"V' O O N t!" C 1703 ~! roc.~b- k~~~1 O°~ ~~ ~dclens o i~ G'on ZGL~eZ 1705 A ~mar~ 4 1711 C'al ~ x ,~, ~~ ~sauc5 n APR-~ 1717 ,, O~ ~4' , m 0 r 10 r SHAMROCK CIRCLE SPECIAL ASSESSMENT PETITION NEXT STEPS Prelirnin Assessment Roll to Clerk b June 16, 2006 Resolution (first) to set public hearing on Preliminary July 5, 2006 council meeting Assessment Roll b If Resolution is passed, Clerk publishes notice of public hearing/weekly for four weeks prior to public hearin Clerk sends notices of public hearing to property owners, etc. at least 15 days prior to the public hearin - Clerk prepares Resolution (second) directing continuation of LID prepared for council consideraticn at ublic heati~x . I-I COUNCIL ON AGING MAY 4, 2006 KENAI SENIOR CENTER 9:00 P.M. AGENDA YTEM 1: CALL TO ORDER & ROLL CALL ITEM 2: AGENDA APPROVAL ITEM 3: APPROVAL OF MEETING SUM y` -- April 6, 2006 YTEM 4: PERSONS SCHEDULED TO BE HEARD a. Renee Graham, Frontier Community Services ITEM 5: OLD BUSYNESS a. Discussion -- Survey ITEM 6: a. ITEM 7: a. b. c. NEW BUSINESS Discussion -- United Way Presentation REPORTS Council on Aging Chair Director VVUltl:il 1.aiuJVu ITEM 8: QUESTYONS & COMMENTS ITEM 9: PERSONS NOT SCHEDULED TO BE HEARD ITEM 10: %NFORMATYON a. Council Action Agendas of Apri15 and 19, 2006. ITEM l Y COUyNgCIL O/Ng AGING MAY 4, `Z®®6 I{ENAI SENIOR CENTER T:®® P.M. CHAIR BILL OSBORN, PRESIDING MEETING SUMMARY ITEM 1: CALL TO ORDER & ROLL CALL Chair Osborn called the meeting to order at approximately 7:00 p.m. Roll was confirmed as follows: Members present: J. Hollier, L. Flowers, E. Jones, R. Jurgensen, B. Osborn and F. Wilson, B. Friend Members absent: G. Kuntzman Others present: Council Member B. Molloy and Senior Director R. Craig ITEM 2: AGENDA APPROVAL MOTION: Member Jurgensen MOVED to approve the agenda as presented and Member Jones SECONDED the motion. There were no objections. SO ORDERED. YTEM 3: APPROVAL OF MEETING SUMMARY -- April 6, 2006 MOTION: Member Jurgensen MOVED to approve the meeting summary as presented and Member Wilson SECONDED the motion. There were no objections. SO ORDERED. ITEM 4: PERSONS SCHEDULED TO BE HEARD 4-a. Renee Graham, Frontier Community Services Ms. Graham explauaed she is the Director of Senior Services and reviewed programs available at Frontier Community Services, including Infant Learning Program, senior services, grants through the state, home services, etc. ITEM 5: OLD BUSINESS 5-a. Discussion -- Survey Discussion followed and the membership recommended the survey be sent out to all seniors on the Center's phone list. ITEM 6: NEW BUSYNESS 6-a. Discussion -- United Way Presentation Director Craig reviewed information to be presented to the United Way Board. Chair Osborn will accompany her to the presentation. ITEM ?: REPORTS ?-a. Council on Aging Chair -- None. 7-b. Director -- None. 7-c. Council Liaison -- None. YTEM 8: QUESTIONS & COMMENTS -- None. ITEM 9: PERSONS NOT SCHEDULED TO BE HEARD -- None. ITEM 10: INFORMATION 10-a. Council Action Agendas of April 5 and 19, 2006. ITEM 11: ADJOURNMENT MOTION: Member Jones MOVED to adjourn and Member Jurgensen SECONDED the motion. There were no objections. SO ORDERED. The meeting adjourned at approximately 8:30 p.m. Meeting Summary prepared by: Carol L. Freas, City Clerk COUNCIL ON AGING MEETING MAY 4, 2006 PAGE 2 I-~ KENAI AIRPORT COMMYSS%ON MAY 11, 2006 KENAI CITY COUNCIL CHAMBERS 7:00 P.M. AGENDA ITEM 1: CALL TO ORDER AND ROLL CALL ITEM 2: AGENDA APPROVAL ITEM 3: APPROVAL OF MEETING SUMMARY -- April 13, 2006 ITEM 4: PERSONS SCHEDULED TO BE HEARD ITEM 5: OLD BUSINESS a. Discussion -- Kenai Peninsula Air Fair b. Discussion -- Airport Regulation and Kenai City Code Changes/Wrap-Up of Previous Reviews c. Discussion -- Airport Construction Projects Update ITEM 6: ITEM 7: a. b. c. REPORT Commission Chair Airport Manager City Council Liaison ITEM 8: COMMISSIONER COMMENTS AND QUESTIONS ITEM 9: PERSONS NOT SCHEDULED TO BE HEARD %TEM 10: %NFORMATION ITEMS a. Kenai City Council Meeting Action Agendas for April 19 and May 3, 2006. b. 4/06 Kenai Municipal Airport Enplanement Report c. 5/6-7/06 2006 Alaska State Aviation Trade Show Information ITEM 11: ADJOURNMENT KENAI AIRPORT COMMISSYON MAY li, 2006 KENAI C%TY COUNCIL CHAMBERS 7:00 P.M. CHAIR HENRY KNACKSTEDT, PRESIDING MEETYNG SUMMARY ITEM 1: CALL TO ORDER AND ROLL CALL Chair Knackstedt called the meeting to order at approximately '7:05 p.m. Roll was confirmed as follows: Commissioners present: J. Zirul, J. Bielefeld, H. Knackstedt, E. Mayer, D. Haralson and L. Porter. Commissioners absent: C. Versaw Others present: Council Member L. Swarner and Airport Manager R. Cronkhite A quorum was present. ITEM 2: AGENDA APPROVAL MOTION: Council Member Harralson MOVED for approval of the agenda as presented and Commissioner Bielefeld SECONDED the motion. There were no objections. SO ORDERED. ETF.M ~~ ®DDC®~A8 f1T WN1A - .-,...,s ara~ETliv'G SIiIYi%v1AR'r -- Apni i3, 2006 A spelling correction at Page 2, ("Barnabus" should be "Barnabas") was noted. MOTION: Commissioner Haralson MOVED to approve the meeting summary with the spelling change. Commissioner Bielefeld SECONDED the motion. There were no objections. SO ORDERED. ITEM 4: PERSONS SCHEDULED TO BE HEARD -- None. ITEM 5: OLD BUSINESS 5-a. Discussion -- Kenai Peninsula Air Fair A general update was given by members of the Commission and the Airport Manager. It was noted, preparation for the event was complete. Thanks was given to the FAA Flight Service Station for their assistance at the Alaska Airman's Trade Show. 5-b. Discussion -- Airport Regulation and Kenai City Code Changes/Wrap-Up of Previous Reviews The Commission concurred a work session should be requested and scheduled following the next regular meeting to review the Airport Regulations and Code suggested changes. 5-c. Discussion -- Airport Construction Projects Update No discussion. ITEM 6: ITEM 7: REPORT ?-a. Commission Chair -- No comments. 7-b. Airport Manager -- No comments. 7-c. City Council Liaison -- Council Member Swarner noted the action agenda from the May 3 council meeting was included in the packet. She noted the budget ordinance would be introduced at the May 17 meeting with the public hearing held on June 7. ITEM 8: COMMISSIONER COMMENTS AND QUESTIONS A general discussion took place on overall budget and revenue issues. Additionally, the Commission generally agreed reliable fuel service is needed in supplying fuel at the Float Plane Basin. Commissioners Haraison and Mayer reported they would not be able to attend the June 8 meeting. %TEM 9: PERSONS NOT SCHEDULED TO BE HEARD -- None. ITEM 10: 10-a. Kenai City Council Meeting Action Agendas for April 19 and May 3, 2006. 10-b. 4/06 Kenai Municipal Airport Enplanement Report 10-c. 5/6-7/Ob 2006 Alaska State Aviation Trade Show Information ITEM 11: MOTYON: AIRPORT COMMISSION MEETING MAY 11, 2006 PAGE 2 Commissioner Zirul MOVED to adjourn acid Commissioner Haralson SECONDED the motion. These were no objections. SO ORDERED. The meeting adjourned at approximately 8:15 p.m. Meeting Summary prepared by: Carol L. Freas, City Clerk AIRPORT COMMISSION MEETING MAY 11, 2006 PAGE 3 KENAI HARBOR COMM%SSION MEET%NG MAY 8, 2006 CITY COUNCIL CHAMBER5 7:00 P.M. AGENDA ITEM 1: ITEM 2: ITEM 3: a. b. ITEM 4: ITEM 5: ITEM 6: a. ITEM 7: a. b. c. ITEM 8: ITEM 9: ITEM 10: CALL TO ORDER & ROLL CALL AGENDA APPROVAL APPROVAL OF MEETING SUMMARY March 6, 2006 April 10, 2006 PERSONS SCHEDULED TO BE HEARD OLD BUSINESS I-3 Discussion/Recommendation -- Renewal of Six Shore Fishery Leases REPORTS Director Dock Foreman City Council Liaison COMMISSYONER COMMENTS/QUESTIONS PERSONS NOT SCHEDULED TO BE HEARD a. Kenai City Council Action Agendas of April 5 and 19, 2006. %TEM 11: ADJOURNMENT KENAI HARBOR COMMISSION MEETYNG MAY 8, 2006 CITY COUNCEL CHAMBERS 7:00 P.M. CHAYR TOM THOMPSON, PRESIDING MEETYNG SUMMARY ITEM 1: CALL TO ORDER & ROLL CALL Chair Thompson called the meeting to order at approximately 7:00 p.m. The roll was confirmed as follows: Commissioners present: B. Eldridge, B. Osborn, G. Foster, and T. Thompson Commissioners absent: S. Romain, R. Canady Others present: Council Member C. Massie and Public Works Manager K. Kornelis ITEM 2: AGENDA APPROVAL Public Works Kornelis distributed a copy of a May 7, 2006 letter from Keith and Reta Johnson and requested it be added to Item 6-a. MOTION: Commissioner Osborn MOVED to approve the agenda with the addition of the May 7, 2006 letter from Keith and Reta Johnson to Item 6-a. Commissioner Eldridge SECONDED the motion. There were no objections. SO ORDERED. ITEM 3: APPROVAL OF MEETYNG SUMMARY 3-a. March ~, 2006 3-b. April 10, 2006 MOTION: Commissioner Eldridge MOVED to approve the meeting summaries of March 6 and April 10, 2006 and Commissioner Osborn SECONDED the motion. There were no objections. SO ORDERED. ITEM 4: PERSONS SCHEDULED TO BE HEARD -- None. ITEM 5: OLD BUSINESS -- None. ITEM 6: NEW BUSINESS 6-a. Discussion/Recommeadation -- Renewal of Six Shore Fishery Leases The members discussed the issue and it was noted, the value is in the permit and not in the lease. MOTION: Commissioner Eldridge MOVED to recommend to council the lease rates for shore fishery leases be continued at the same rate and period of time, which is $300 a year for aten-year lease. Commissioner Foster SECONDED the motion. There were no objections. SO ORDERED. ITEM 7: REPORTS T-a. Director -- Public Works Manager Kornelis reported the following: • The new boat launch ramp project is progressing. • The land trade for the boating facility exit road was completed and the City now owns the land. • Reviewed the dock lease situation and noted, Copper River Seafood would be operating both dock stations for the season. ?-b. Dock Foreman -- No report. ?-c. City Council Lamson -- Council Member Massie reported the following: • Council was pleased with the Cooper River Seafood leasing of the dock stations. • Council briefly discussed the shore fishery leases and had the same options as the Commission. ITEM 8: COMMISSIONER COMMENTS/QUESTIONS ITEM 9: PERSONS NOT SCHEDULED TO BE HEARD Student Huaf -- Questioned the ioc:ation of the new launch ramps. ine location and the project was discussed, with an explanation of the dip net fishery/commercial fishing issues at the dock. Student Cupp -- Questioned the progress of the coastal erosion protection project and a brief discussion took place related to the work entailed, costs, etc. Student Shaginoff -- Questioned who would absorb the cost of the project if it came to an absolute need. ITEM 10: INFORMATION 10-a. Kenai City Council Action Agendas of April 5 and 19, 2006. ITEM 11• HARBOR COMMISSION MEETING MAY 8, 2006 PAGE 2 MOTION: Council Member Eldridge MOVED to adjourn and Commissioner Foster SECONDED the motion. There were no objections. SO ORDEREDa The meeting adjourned at approximately 8:00 p.m. Meeting Summary prepared by: Carol L. Freas, City Clerk HARBOR COMMISSION MEETING MAY 8, 2006 PAGE 3 I-h KENAI PARKS & RECgRE/ATION COMMI: MAY 4y 6®®6 CITY HALL COUNCYL CHAMBERS 7:00 P.M. AGENDA ITEM 1: CALL TO ORDER 8s ROLL CALL ITEM 2: AGENDA APPROVAL ITEM 3: APPROVAL OF MEETING SUMMARY -- March 2, 2006 ITEM 4: PERSONS SCHEDULED TO BE HEARD a. Les Krusen -- Recreational Turf/Multipurpose Facility ITEM 5: OLD BUSINESS YTEM 6: NEW BUS%NESS a. Discussion -- Draft Budgets/Parks, Recreation and Beautification ITEM 7: REPORTS a. Commission Chair b. Darector c. City Council Liaison ITEM 8: COM1VIi55i®N QUESTIONS Ss COMMENTS ITEM 9: PERSONS PRESENT NOT SCHEDULED TO BE HEARD ITEM 10: INFORMATION a. Council Action Agendas of April 5 and 19, 2006. b. Beautification Committee Meeting Summary of April 11, 2006. ITEM 11: ADJOURNMENT KENAI PARKS & RECREATYON COMMISSION MAY 4, 2006 CITY HALL COUNCIL CHAMBERS ?:00 P.M. CHAIR DALE SANDAHL, PRESIDING MEETING SUMMARY ITEM 1: CALL TO ORDER & ROLL CALL Chair Sandahl called the meeting to order at approximately 7:15 p.m. Roll was confirmed as follows: Commissioners present: A. DeMello, D. Sandahl, J. Foglia, J. Carroll, T. Wortham, D. Hagen, and J. Beeson Others present: Parks & Recreation Groundskeeper, A. Bralley and Mayor Pat Porter A quorum was present. ITEM 2: AGENDA APPROVAL Chair Sandahl requested Item 4-a be heard as Item 6-b. The agenda was approved with the change requested by Chair Sandahl. ITEM 3: APPROVAL OF MEETING SUMMARY -- Mazch 2, 2006 There were no changes or corrections to the meeting summary of March 2, 2006 and it was approved as pr,.~.,nted. ITEM 4: PERSONS SCHEDULED TO BE HEARD 4a. Les Krusen -- Recreational Turf/Multipurpose Facility Moved to Item 6-b ITEM 5: OLD BUSINESS -- None. ITEM 6: NEW BUSINESS 6-a. Discussion -- Draft Budgets/Parks, Recreation and Beautification The Commission reviewed the draft Parks & Recreation/Beautification budgets for FY 2007, noting the inclusion of funds to purchase a used truck and mower. 6-b. Les Krusen -- Recreational Turf/Multipurpose Facility (moved from 4-a). Krusen provided a presentation related to artificial turf which he suggested be purchased for seasonal installation in the multipurpose facility at an approximate cost of $70,000. Krusen noted the availability of artificial turf in the facility would offer multiple uses of the facility after the ice is removed, i.e. Little League, softball, baseball, la Crosse, soccer, etc. MOT%ON: Commissioner Beeson MOVED to recommend to council funds be made available for the purchase of artificial turf for use at the multipurpose facility. Commissioner Wortham SECONDED the motion. There were no objections. SO ORDERED. ITEM 7: REPORTS 7-a. Commission Chair -- None. T-b. Director -- Groundskeeper Bralley reported on upcoming events including spring clean-up, cemetery clean-up, the dedication of the cemetery gazebo, hanging summer street banners, and Little League opening ceremonies. 7-c. City Council Liaison -- Mayor Porter reported on plans for the town clock dedication, budget review process, and legislative issues, including municipal assistance/revenue sharing. ITEM 8: COMMISSION OUEST%ONS & COMMENTS -- None. YTEM 9: PERSONS PRESENT NOT SCHEDULED TO BE HEARD -- None. ITEM 10: YNFORMATION 10-a. Council Action Agendas of April 5 and 19, 2006. 10-b. Beautification Committee Meeting Summary of April 11, 2006. ITEM 11: ADJOURNMENT There being no further business before the Commission, the meeting adjourned at approxunately 7:45 p.m. Meeting Summary prepazed by: Carol L. Freas, City Clerk PARKS & RECREATION COMMISSION MEETING MAY 4, 2006 PAGE 2 I-6 CITY OF KENAI PLANNING & ZONING CONLMISSION AGENDA CITY COUNCIL CHAMBERS May 10, 2006 - 7:00 p.m. 1. CALL TO ORDER: a. Roll Call h. Agenda Approval c. Consent Agenda *All items listed with an asterisk (*} are considered to be routine and non-controversial by the Commission and will be approved by one motion. There will be no sepazate discussion of these items unless a Commission Member so 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. 2. *APPROVAL OF MINUTES: a. *Apri126, 2006 3. SCHEDULED PUBLIC COMMENT: a. Mary Toll, Kenai Peninsula Borough Platting Officer -Borough Platting Procedure. 4. CONSIDERATION OF PLATS: a. PZ06-33 -Preliminary Plat -Original Kenai Townsite - Vozaz Addition -Plat submitted by Terry Eastham, PO Box 2891, Soldotna, Alaska. 5. PUBLIC HEARINGS: a. PZ06-32 An application for an encroachment permit for front yard setbacks for the property known as Lot 6, Keith Subdivision (504 McCollum Drive), Kenai, Alaska. Application submitted by Paul L. Quade, 506 Japonski, Kenai, Alaska. 6. OLD BUSINESS: 7. NEW BUSINESS: a. Consent to Assignment ofLease -Geneva Stanek to Wendy McGahan, Lynne Dykema and Gwen Woodazd d/b/a Kenai Fabric Center, Inc: Lots 2 & 3, Block 5 General Aviation Apron Subdivision No. 1 Amended -Discussion and Recommendation. b. Renewal of six shore fishery leases -Discussion and Recommendation 8. PENDING ITEMS: a. PZOS-16 - An application to rezone the area known as Tract C, Daubenspeck Property Subdivision, (170 Bridge Access Road), from suburban residential to general commercial. Application submitted by John Hammehnan, Chair, Planning & Zoning Commission, City of Kenai, 210 Fidalgo Avenue, Kenai, Alaska. (Tabled) 9. REPORTS: a. City Council b. Borough Planning c. Administrafion 10. PERSONS PRESENT NOT SCHEDULED: 11. INFORMATION ITEMS: a. Zoning Bulletin (4/10/06 & 4/25/06) b. Planning Commission Roster 12. COMMISSION COMMENTS & QUESTIONS: 13. ADJOURNMENT: C%TY OF KENAI PLANNING Ss ZONING COMMYSS%ON CITY COUNCIL CHAMBERS MAY 1®, 2®06 - ?:®® P.M. CHAIR BARRY ELDRIDGE, PRESIDIN MINUTES %TEM 1: CALL TO ORDER Chair Eldridge called the meeting to order at 7:00 p.m. 1-a. Roll Call Roll was confirmed as follows: Commissioners present: S. Romain, B. Eldridge, P. Bryson, R. F`ullinck, L. McLennan Commissioners absent: J. Jenckes, J. Twait Others present: Council Member Molloy, City Engineer LaShot, Building Official Springer, City Planner Kebschull, Department Assistant Carver, and Contract Secretary Roper A quorum was present. 1-b. Ageada Approval MOTION: Commissioner Bryson MOVED to approve the agenda and requested UNANIMOUS CONSENT. Commissioner McLennan SECONDED the motion. There were no objections. SO ORDERED. 1-c. Coaseat Ageada MOTION: Commissioner Bryson MOVED to approve the consent agenda and requested UNANIMOUS CONSENT. Commissioner Romain SECONDED the motion. There were no objections. SO ORDERED. ITEM 2: APPROVAL OF MINUTES -- April 26, 2006 Approved by consent agenda. ITEM 3: SCHEDULED PUBL%C COMMENT 3-a. Mary Toll, Kenai Peninsula Borough Platting Officer -Borough Platting Procedure. Ms. Toll provided the Commission with the Borough's Subdivision Guide, maps of the City, gave a brief overview of the Borough's platting procedures, and answered questions from the Commission. ITEM 4: CONSIDERATION OF PLATS 4-a. PZ06-33 -Preliminary Plat -Original Kenai Townsite - Vozar Addition - Plat submitted by Terry Eastham, PO Box 2891, Soldotna, Alaska. Commissioner Bryson advised he would abstain from voting related to PZ06-33 due to a conflict at the Borough level. MOTION: Commissioner Romain MOVED for approval of PZ06-33, prelimiaaary plat for Original Kenai Townsite/Vozaz Addition. Commissioner McLennan SECONDED the motion. City Planner Kebschull reported the following: • The plat would remove a lot line to create one large pazcel containing approximately 14,520 square feet. • The resulting lot size would meet the requirements for the TSH -Historic Townsite zone. • No permanent structures may be built on the right-of--way. • The Planning & Zoning Commission reviews all developments in the Townsite Historic District. Water and sewer is available to serve the parcel. Staff recommends approval. It `.T.'aS nCted tl:e r.,,,,.,. a,i ^f *~e ivt iliac wuuid aiiuw iia~rc rvCim for development. nisi, it is likely the issue would be before Commission at least two more times because, if there is development, a public hearing will be required to amend the existing conditional use permit and the development will need to be reviewed and approved by the Commission. VOTE; Jenckes Absent Romain Yes Eldrid e Yes B son Abstain Fullinck Yes McLennan Yes Twait Absent MOTION PASSED UNANIMOUSLY. ITEM 5: PUBLIC HEARINGS PLANNING & ZONING COMMISSION MEETING MAY 10, 2006 PAGE 2 5-a. P206-32 -- An application for an encroachment permit for front yard setbacks for the property known as Lot 6, Keith Subdivision (504 McCollum Drive), Kenai, Alaska. Application submitted by Paul L. Quade, 506 Japonski, Kenai, Alaska. MOTION: Commissioner McLennan MOVED for approval of PZ06-32 and Commissioner Fullinck SECONDED the motion. City Planner Kebschull reported the following: • The applicant is applying for the encroachment permit so a final inspection and certificate of occupancy may be issued for the residence. • The house is built in the setback and meets the definition of an encroachment. • The structure does not encroach upon aright-of--way or utility easement. • The type of structure is permitted in the Rural Residential 1 zone. • The house is two feet into the 25-foot required front setback. • The subdivision plat may have contributed to the building placement. It is not consistent with the Kenai Municipal Code. • Staff recommends approval. There were no public or Commission comments. VOTE: Jenckes Absent Romain Yes Eldrid a Yes B son Yes Fullinck Yes McLennan Yes Twait Absent MOTION PASSED UNANIMOUSLY. Eldridge explained the appeal process and noted it must be submitted in writing to the City Clerk within 15 days. YTEM 6: OLD BUSINESS -- None. ITEM 7: NEW BUSINESS 7-a. Discussion and Recommendation -- Consent to Assignment of Lease - Geneva Stasek to Wendy McGahan, Lynne Dykema and Gwen Woodard d/b/a Kenai Fabric Center, Inc.- Lots 2 & 3, Block 5 General Aviation Apron Subdivision No. 1 Amended. Kebschull reported the following: • The request will be reviewed as a lease. PLANNING & ZONING COMMISSION MEETING MAY 10, 2006 PAGE 3 • The current use is considered a Retail Business and is a permitted use in the Light Industrial zone. • The zoning ordinance considers setbacks and in this zone, setbacks are based on building code. • When this building was constructed it was built over a lot line and straddles the lots. • This is considered anon-conforming structure. The building cannot be enlarged without removing the lot line. • Because the Airport Industrial Land Use has not been implemented and the proposed use meets the zoning, it appears the proposed lease complies with the City's Comprehensive Plan. • It appeazs the current business does not comply with the 2997 Kenai Municipal Airport Master Plan even though the business existed prior to 1997. • The current use appeazs to be the highest and best use at this time because there is no other proposed use. Richard Dykema, Keaai, Alaska -- Explained the consent to assignment lease was for estate planning purposes and he was available to answer any questions. MOTION: Commissioner Bryson MOVED to recommend approval of the Consent of Assignment of Lease and Commissioner N~xllinck SECONDED the motion. VOTE: Jenckes Absent Romain Yes Eldrid e Yes B son Yes F`ullinck Yes McLennan Yes Twait Absent MOTION PASSED UNANIMOUSLY. 7-b. Discussion aad Recommendation -- Renewal of six shore fishery leases. Kebschull drew attention to the memo in the packet from Kim Howard regazding the six shore fishery leases due to expire on June 30, 2006. Jim Butler, Kenai, Alaska -- Explained he is a leaseholder and provided a brief overview of the leases and how they differ from those of the State. MOTION: Commissioner Romain MOVED to recommend approval of the renewal of the six shore fishery leases. Commissioner Fullinck SECONDED the mofion. PLANNING & ZONING COMMISSION MEETING MAY 10, 2006 PAGE 4 Eldridge asked ff the intent of the motion was to renew the leases under the current conditions, i.e. $300/year for aten-year lease. The maker and second of the motion indicated that was the intent. VOTE: Jenckes Absent Romain Yes Eldrid e Yes B son Yes Fullinck Yes McLennan Yes Twait Absent MOTION PASSED urrANlMOUSr.Y. ITEM 8• 8-a. PZ05-16 - An application to rezone the azea known as Tract C, Daubenspeck Property Subdivision, (170 Bridge Access Road), from suburban residential to general commercial. Application submitted by John Hammelman, Chair, Planning gs Zoning ITEM 9° REPORTS 9-a. City Couacil -- Council Member Molloy reported the May 17~ City Council meeting will be held at the Senior Center. He indicated the budget would be introduced at this meeting and the public hearing will be held on June 7. Molloy thanked the Commission for their hazd work. 19-b. Borough Plaaniag -- Commissioner Bryson provided a brief report on action taken at the Borough's May 8, 2006 meeting. 9-c. Admiaistratioa -- City Planner Kebschull reported the following: • The May 24~ Commission meeting will be held at the Senior Center. • The Mixed Use Zone work session will be scheduled for the first meeting in June. ITEM I0: PERSONS PRESENT NOT SCHEDULED -- None ITEM 11: INFORMATYON YTEMS 11-a. Zoning Bulletin (4/ 10/06 and 4/25/06) 11-b. Planning Commission Roster ITEM 12: COMMISSION COM1ViENTS 8s QUESTIONS Eldridge requested site plans for current projects be made available for the Commission. Kebschull indicated they would be included as information items. YTEM 13• PLANNING & ZONING COMMISSION MEETING MAY 10, 2006 PAGE 5 MOTION': Commissioner Bryson MOVED to adjourn and Commissioner Romain SECONDED the motion. There were no objections. SO ®RDERED. The meeting adjourned at approxunately 8:05 p.m. Minutes transcribed and prepared by: Barbara Roper, Contract Secretary PLANNING 8c ZONING COMMISSION MEETING MAY 10, 2006 PAGE 6 T-'la KENAI BEAUTIFICATYON COMMITTEE MEETING MAY 9, 2006 7:00 P.M. KENAI COUNCIL CHAMBERS AGENDA ITEM 1: CALL TO ORDER & ROLL CALL YTEM 2: AGENDA APPROVAL YTEM 3: APPROVAL OF MEETING SUMMARY -- April 11, 2006 ITEM 4: PERSONS SCHEDULED TO BE HEARD ITEM 5: OLD BUSINESS a. Discussion -- Volunteer Orientation ITEM 6: NEW BUSINESS ITEM 7: REPORTS a. Committee Chair b. Parks & Recreation Director c. Kenai City Council Liaison ITEM 8: QUESTIONS AND COMMENTS iTEin y: r xsc~ns ivtrT SCHEDULED 'i'O BE HEARD ITEM 10: INFORMATION a. City Council Action Agenda of Apri15 and 19, 2006. b. Parks 8v Recreation Commission Meeting Summary of March 2, 2006. ITEM 11: ADJOURNMENT ,;; KENAI BEAUTIFICATION COMMITTEE MEET%NG MAY 9, 2®06 7:®® P.M. KENAI COUNCIL CHAMBERS CHAIR MAR%LYN DIMMICK, PRESIDYNG MEETING SUMMARY ITEM 1: CALL TO ORDER & ROLL CALL Chair Dimmick called the meeting to order at approximately 7:10 p.m. Roll was confirmed as follows: Members present: M. Dimmick, L. Seymour, S. Hatch, P. Baxter, H. Brown, and M. LeFebvre Others present: Council Member L. Swarner and Parks & Recreation Director B. Frates A quorum was present. ITEM 2: AGENDA APPROVAL The following changes to the agenda were requested: • Add as: Item 6-b, Old Business -- Volunteer Plant Day • Add as: Item 6-a, New Business -- Planter Boxes/Challenger Learning Center. • Move: Item 9 before Item 4 MOTION: Member Brown MOVED to amend the agenda as requested and Member Baxter SECONDED the motion. There were no objections. SO ORDERED. ITEM 3: APPROVAL OF MEETING SUMMARY -- April 11, 2006 There were no changes or corrections to the meeting summary of April 11, 2006 and it was approved as presented. ITEM 9: PERSONS NOT SCHEDULED TO BE HEARD 9-a. Council Member Bob Molloy -- Reported he had heard of concerns voiced by the public related to Municipal Park upgrades. Of particular interest was (1~ tread lightly and not remove too many trees (wind concern); and, (2) do not remove too much underbrush. 9-b. Mayor Pat Porter -- Requested the Committee to begin thinking beyond just flowers and give consideration to other beautification projects that could enhance the city. ITEM 4: PERSONS SCHEDULED TO BE HEARD -- None. ITEM 5: OLD BUSINESS 6-a. Discussion -- Volunteer Orientation Parks & Recreation Director Frates provided a quick update on a digital presentation of beautification volunteer programs available which was primarily designed as an informational tool. It was suggested volunteer sign-up sheets could be available athte Kenai Chamber of Commerce during the May 13 clean up event. 5-b. Discussion -- Volunteer Plant Day Member Brown reported the following: Planting would take place from 10:00 a.m. to 1:00 p.m. A bazbecue will be held at the Fire Department beginning at 1:00 p.m. Circle planter beds will be prepped and watered in advance. It was also suggested Committee members bring food for the barbecue. ITEM 6: 6-a. Discussion -- Challenger Learning Center Planter Boxes Chair Dimmick reported a representative of the Center requested planter boxes be placed near the facility. Frates noted he would reserve two boxes for that use. ITEM ?: REPORTS 7-a. Committee Chair -- Dimmick reported she and Frates would he n,eer;r,g with staff of the Visitors Center to discuss summer flowers. She also the Committee discuss other possible beautification enhancement projects at their August meeting. 7-b. Parks & Recreation Director -- Frates reported the following: • Summer street banners are being placed. • The metal fish (crafted by high school students) were delivered. • The summer hiring process was neaz completion. • Due to cold weather, water in some parks could not yet be turned on. c. Kenai City Council Liaison -- Council Member Swarner reported on recent work sessions/meetings and noted the public hearing for the budget ordinance would be held the first meeting in June. ITEM 8: QUEST%ONS AND COMMENTS -- None. BEAUTIFICATION COMMITTEE MEETING MAY 9, 2006 PAGE 2 ITEM 9: PERSONS NOT SCHEDULED TO BE HEARD -- Heard prior to Item 4. ITEM 10: INFORMATION 10-a. City Council Action Agenda of April 5 and 19,.2006. 10-b. Parks & Recreation Commission Meeting Summary of March 2, 2006. ITEM 11: ADJOURNMENT With no further business before the Committee, the meeting adjourned at approximately 8:10 p.m. Meeting Summary prepazed by: Carol L. Freas, City Clerk BEAUTIFICATION COMMITTEE MEETING MAY 9, 2006 PAGE 3 Municipal Legislative Recap Carol Freas rom: Betty Svensson [betty@akml.org] Sent: Wednesday, May 10, 2006 11:07 AM To: info@akml.org Subject: Municipal legislative Recap uiek Review of Mayor Legislation Impacting Municipalities I-7 b This was a good legislative session for municipalities. In addition to long needed capital projects, $66.7 million will be shared with municipalities to offset cost increases. (Note: the revenue sharing program was $29.6 million in 2003, the last year it was funded.) Also, school bond debt was funded, and the 70%/60% bond debt re-imbursement program extended. Schools received long needed additional funding. Finally, most bills that would take away constitutionally established local control powers were defeated. All of this was achieved by communities, local officials, and businesses working together. Special recognition goes to the AML Board of Directors, the AML Legislative Committee, the Alaska Conference of Mayors, the State Chamber of Commerce, and the Association of Alaska School Boards. Thank you. What iLlajor Bills Passed: . SB 231 -Capital Project Bill -Section 60 - "Municipal Energy Assistance and Retirement System Funding for Increased Employer Costs for Political Subdivisions". Total funding is $66.675 million. The funding for each municipality is in two separate lists in Section 60. Together the lists total approximately $85 per capita and no municipality receives less than $40,000. The PERS is for "... by paying the fiscal year 2007 estimated increase of municipal employer costs caused by increased employer contribution rates to reduce the liability to the public employee's retirement system of municipalities that are members of that system..." The Energy Assistance funding is "to defray increased energy and other costs." While this is not a sustainable revenue sharing program, it is a _fi_rst seen and. helps small cities survive another year and halrc reriiiee local taxes by offSettL^.g major cost increases. It is important to thank legislators and positively remind them that you support a sustainable revenue sharing program for next year to maintain critical local tax relief and to save rural communities. . SB 231 -Capital Project Bill - Section 20(j) -Power Cost Equalization -The sum of $182,700,000 is appropriated from the general fund to the power cost equalization endowment fund (AS 42.45.070). BUT Section 64 (c} makes the appropriation contingent on the passage of a PPT Oil Tax Bill. • HB 13 Municipal School Bond Debt Reimbursement and School Funding Section 2 - "Public School Performance Incentive Program" - Up to $SK for teachers/$ 2.SK for other staff if performance measures are achieved. 1 Section 3 - (items 16 - 17) -Maintains school bond reimbursement at 70% for DOE approved school ejects and 60% for non approved, and extends the program to 11/30/08. Section 5 -Adopt new District Cost Factors and partially fund them. 3 Section 7 -Increase student base allocation from $4,919 to $5,380 per ADM (that is, the number of 5/10/2006 Municipal Legislative Recap students times adjustment factors) Page 2 of 2 4 Section 10 -School Improvement Grants at $81 per ADM • KB 392 authorizing the establishment of regional solid waste management authorities. • SB 291 municipal harbor facilety grant program: Grants up to $5 million per year with a 50% local match. What AML Qpnosed and Didn't Pass: . A heavily lobbied mining industry bill that would have taken away the power of existing municipalities to levy a severance tax, and taken away the power of municipalities to tax new mines at all for the first 10 years. A bill that would have mandated an increase in the Senior Citizen/Disabled Veteran property tax exemption to $250,000 per residence. . A bill that would have destroyed the equity in property tax assessments by limiting assessed value increases ±0 2% per year despite actual increases in value. . A bill that would have mandated assessment appeal fees for municipalities. . A bill that would have prohibited municipalities from participating in voter initiative campaigns. . A bill that would have prohibited municipalities from taxing tobacco at a higher rate. . A bill that would have increased workers compensation costs. What AML Opposed and Did Pass: . A provision that was added in the last days of the session to exempt church owned teacher housing from property taxes and creating as an unfunded state mandate. . A bill that takes away the local control of communities to make their own decisions on local eminent domain for certain economic development and recreation uses. Kevin Ritchie, Executive Director Alaska Municipal League kevin@akml. org office: 907-586-1325 Fax: 907-463-5480 cii ni~nn~ SIIAMR®CK CIRCLE LID F®R CITY MANAGERS REPORT TO CITY COUNCIL 'I'O: Rick R. Koch, City Manager Carol L. Freas, City Clerk -°°~ Larry Semmens, City Finance Director e .~i ~ ~- m FROM: Keith Korelis ~ p~~~y , ~ ~~~ ~ ~ DATE: May 11, 2006 RE: Shamrock Circle Paving LID ~ -- - The following information is for the City Managers Report as per KMC 16.10.010: PROPOSED IMPROVEMENTS AND SCOPE This project is to provide road and drainage improvements to Shamrock Circle. Tke improvements include engineering design and inspection, excavation, grading and backfill, leveling course, drainage improvements, asphalt paving, topsoil and seeding, and signage. THE NEED FOR THE PROPOSED IMPROVEMENTS Paving this road will decrease the road maintenance cost by eliminating dust control and summer time grading. It will also improve the drainage. The estimated rough cost estimate for this project is PROSPECTIVE & RECOMMENDED GRANTS If the city council decides to proceed with these proposed improvements I would recommend that State Legislative Crrants for Kenai Road Improvements be used. RECOMMENDED PERCENTAGE TO BE ASSESSED City Resolution No. 2003-02 states that the assessment rate will be 50%. DESIGNATION OF THE PROPERTIES TO BE ASSESSED Attached is "SHAMROCK CIRCLE PROPOSED -LID 2006". It designates the property owners name, KPB assessment parcel ID, and both the physical street and the legal address. Also attached is a drawing of the proposed LID that shows the lot numbers, street addresses, and owner's name. ess O 0 G"V _^ J p N ~. &~ U U 2' d ~ N M Ch ~ ~ ''. r '.O O O~~', OliO O~'..O I _IIJ I,J I_1;J IJ!J L LO ii A~L~L~L~L '., ~', OI OII ~',, ~~O,O IU U~U~U ~~U~.U "IO O O OI O]]Ii OO Im m m m;mc~o~lm Y Y Y Y'.Y Y jY 0 O O O,O O',O ' O 0 0 0 0 O :. O d C c C c:,,,C C'IC lfJ ' O''.. O'I O'' O ~' O'. O''.. O -J;~~O~,~~Od ~-~~- a> rni.- ~ ,- ~'~.r ~''.rn ~ m rn!rn rn'rn y'rn'.m'Im!rn.'..o~'.o~irn h Y Y Y Y Y Y Y V),d did d,d d d c ' c '. r 'm ca o ~ "~a'.~ 'm ~c c.P ~'. c: c:c a~ o o ''. o m cu'. m N ' ~, I .O N ~ ~ N aU m I J U ~ '',, ',. ~ I. O N' N', a-' '. !O _Y iM lO O! ~',,.m ~ ~ xx x',x 0 0 0 0 ~',ro rIN m''.m C9 0] a ''o°C~n°O'OO...O Q.UJ `-IM d,.. Q, d 0. N ", ~ ~ '~. I N ~ Y ~IfO C ~I ~ v,,m ~''..... CO a O ~ ~x (B I a i O c 'I. ". N > '',. I. :. O ~ 'I '. N I (~ I, F ar ',, ~ Y ', '',. ',, > >' ', N J fY, ml,. ~, E,,~'I E'.. mI. `m i - °i~ `.O O. _ _ ' U UIU''..,U IU .. '~,'~ Y Y Y.,!Y YO W '',O ~ O O`. O` O~ F- _ L L L L L u>dto~cncnrn~d O O O dl r e- N M cY ~ 0~~ N N N NiN N N O1O O O',O 1O IiO ! V V V' V ~ s!' S V ~~ ~t IN N NN,N N ,N d'.V IV V.R ~IV d'"''V O O N M ~bc.~t,-. ~~~~ I fort zrx.~ez 1703 1705 I A ~~c~~r~ 1711 ~! ~Sa~c.c5 J~ ~~ O~ ~~' , r~ c~ 10 ~- SHAMROCK CIRCLE SPECIAL ASSESSMENT PETITION Preliminar Assessment Roll to Clerk b June 16, 2006 Resolution (first) to set public hearing on Preliminary July 5, 2006 council meeting Assessment Roll b If Resolution is passed, Clerk publishes notice of public hearing/weekly for four weeks prior to public hearin Clerk sends notices of public hearing to property owners, etc. at least 15 days prior to the public hearin . Clerk prepares Resolution (second) directing continuation of LID prepared for council consideration at ublic hearin MAKE PAC T° a~ COUNCIL PACKET DISTRIBUTION COUNCIL MEETING DATE: Ma or/Council Attorne v Ta for/S rin er/Kebschull ~~ Clerk Cit Mana er / Public Works `- Police De nrtment Finance ~ En inset Senior Center Air ort v Kim Librnr ~% Parks & Recreation ~% Clarion Fire De artment ~' Schmidt ~ Mellish '~ VISTA ~ Student Re . `' KSRM ~ ~~"- Brenc~k~s AGENDA DISTRIBUTION Sewer Treatment Plant ( ~ Streets ~ -- Sho Dock Building Mnintenance Animal Control Wnter/Sewer ~ Counter DELIVER Council and Student Representative Pockets to Police Department Dispntch desk. The Clarion, KSRM, Mellish & Schmidt's Office will pick their packet up in my office. The portion of the agenda published by the Clarion should be emniled as soon as possible rafter Noon on pocket day. The camera-rendy ngendn c:/myfiles/documents/minutes/agenda form for pnper) is emniled to Denise at Peninsu/a C/orion (at emnil folder Work Session/Special Meetings, or Composition in Contracts or Ibe1lC~acsnlnska.net). Home Pnge documents (ngenda, resolutions, ordinances for public hearing, rand ordinances for introduction) are usually emniled to me and I hold them in my HTML file. Place them onto the city's website from there ns soon ns possible before leaving the office for the weekend. AGENDA ENAI CITY COUNCIL-REGULAR MEETING MAY 77, 2006 .-.,~'~., 7:00 P.M. ,,.y./ "**KENAI SENIOR CENTER"*" pX°r"v m http:/iw,wu.ci.kenai ak.us ITEM e: SCHEDULED PUBLIC COMMENTS (70 minutes) t. PresentationN.F.W. Poppy Week Proclamation 2. Tam Atlams, Lounsbury 8 Associates -- Wal-Mart Project Update. 3. PhilBryson/Casey Madden, Winee-COrthell-Bryson--Airport Runway Project Update. 4. Ricky Geese, Kenai River Sportfishing Association, Inc. -- Management Oversight Reports antl Economic Information of Upper Cook Inlet Salmon Fisheries. ITEM E: PUBLIC HEARINGS t. Ordinance No. 2160-2006 --Increasing Estimated Revenues antl Appropriations by 528,000 in the Airport lantl System Special Revenue Fund for Utilities. 2. Ordinance No. 2161-2006-- Increasing Estimatetl Revenues and Appropriations by $21,000 in the Terminal Enteryrise Fund for Utilities. 3. Ordinance No. 21fi3-2006 -Enacting KMC 7.05.035, Adopting a Community Purposes Property Tax Exemption as Authorized by AS 29.45.050. 4. Ordinance No. 2tfi4-2006 -- Increasing Estimated Revenues antl Appropriations by $60,000 in the Airport Land System Special Revenue Funtl antl the Runway Safety Area Improvement Capital Project Funtl for Engineering Services. 5. Resolution No. 2006-20 --Authorizing the Amendment of the city of Kenai, Alaska antl Public Employees' Retirement Sysfem (PERS) '. Participation Agreement to Exdutle All Elected Officials, Effective May '.. 3,2006. ', 6. Resolution No. 2006-26 -- Supporting a Gulf of Alaska Grountl(~sh '.. Rationalization Plan that Maintains Open Markets, Free Trade, and the '. Movement of Commerce for Fisheries Resources Within the State of Afaska. 7. Resolution No. 2006-27 -Awarding the Bid to Emulsion Protlucts Company for 2006 Dust Control, Rental of Asphalt DisUibution Truck antl Furnishing CSS4 Emulsified Asphalt for the Total Amount of $46,600. 8. Resolution No. 2006-28 --Transferring $12,000 in the Water antl Sewer Funtl for Supplies. ITEM G: UNFINISHED BUSINESS ITEM H: NEW BUSINESS t. Bills to be Ratifed 2. Approval of Purchase Ortlers Exceetling St5,000 3. Ordinance No. 2165-2006 -- Atlopiing the Annual Budget for the Fiscal Year Commenting July 1, 2006 antl Entling June 30, 2007. 4. `Ordinance No. 2166-2006 -Increasing Estimatetl Revenues and Appropriations by $3.800 in the Senior Citizen Title III Gront Funtl for Senior and Disabilities Treining. 5. 'Ordinance No. 2167-2006 -Increasing Estimatetl Revenues and Appropriations by $4,210.00 in the General Funtl to Pay for Improvements to Police Department Report Writing Stations antl a Computer Projector. 6. "Ordinance No. 2166-2006 --Amentling KMC 1.15.130 to Allow Council Members to Telephonically Attend Up to Six (6) AdtliOOnal Council Meetings During a Twelve (12) Month Periotl if the Member is Physically Unable to Attend Due to the Need for Extendetl Metlical Care antl Treatment of the Member or the Members Immetliate Family. 7. 'Ordinance Nc. 215o_2pnc _ r.ynyferi.^.g $i2F nnn Prom the FY2006 Public lmprovemenis Capital Pmjeet Fund to the Boat Launch Capital Project Funtl and Transferring $100,000 From the Boat Launch Capital Project Funtl to the General Funtl. 8. Approval -- Consent to Assignment of lease/Lots 2 8 3, Block 5, General Aviation Apmn/Geneva Stasek to Wendy McGahan, Lynn Dytlema antl Gwen Woodard tl/b/a Kenai Fabric Center, Inc. 9. Approval --Termination of Lease-- 20I201ntemational, Inc. and John C. 8 Mane L Parker/Lot it, Block t, F.B.O. Subtlivision. 10. Approval -Assignment of Lease for Security Purposes, Lois 10 811, Block t, Etolin Subtlivision No. 3-- Rockwell G. Smith, d/b/a Preferretl Plumbing 8 Heating. 1 i. Approval -- Renewal of Six Shore Fishery Leases. t2. Discussion- Proposetl Shamrock Circle L.I.D. -- Report o(City Manager to Council t3. Approval -Cost of Living Salary Increase/City Clerk and City Attorney EXECUTIVE SESSION -- Evaluatlons of City Attorney, Ciry Clerk and City Manager. fTEM N: ADJOURNMENT The public th invited to aflentl and participate. Additional information is available through the City Clerk's offce at 210 Fitlalgo Avenue, or visit our website at htto://www.ci.kenai.ak.us. Carol L Frees, Ciry Clerk D925t211 ~°i Pebble Project Anchorage Office Iliamna Site 3201 C Street, Suite 604 P.O. Box 267 Anchorage, AK 99503 Iliamna, AK 99606 Telephone: 907-339-2600 Telephone: 907-571-1788 'I 1-877-450-2600 Fax: 907-571-1789 Fax: 907-339-2601 _ _ www. ndmpebblemine. com Bruce Jenkins Chief Operating Officer bruce~hdgold.com Ella Ede Environmental Project Manager ellae(a~northerndynast JanycefIarpel Anchorage Administrative Office Manager ianyceh(lnorthernd~sty.com Iieidi Franklin Stakeholder & Community Relations Manager heidif(c~northernd, i~lastv.com Richard Moses Geology/Site Manager -Iliamna richardm~hd~old.com Michael C.T. Smith NEPA & Permitting Manager michaels(cc~northernd~ .eom Michelle Brunner Business & Worlcf~orce Development Manager michelleb/a~northerndynast~om Joanie 1i'Ioses Iliamna Administrative Office Manager ioaniem(a~hdgold.com Martha Anelon Local Hire Coordinator marthaanelon~a I~old.com 5/1012006 9:49:15 AM '~. Facts at a ~~ance - The Pebble Project is still in fhe early stage of development. - NDM will not finalize its proposed mine plan and apply for permits until late 2007, at the earliest. - Pebble is located on state land designated for resource development. - NDM is undertaking extensive environmental studies and stakeholder consultation (nearly $30 million spent in 2004/05) to develop the best possible mine plan for the Pebble Project. - NDM has gone beyond regulatory requirements to cornrnit that its project will result in no net reduction to any fishery - be it commercial, recreational or subsistence. - NDM has a "local hire" policy, as well as workforce development initiatives, to ensure that Bristol Bay residents and local businesses are the P~rst to benefit from the Pebble Project. - More than 2,000 construction jobs and 1,000 operations jobs are anticipated at the Pebble mine. - The Pebble Project employed 609 people during 2005, including 457 Alaskans and 121 reSldentS from reg!onS arrnir~d RnSt01 Bay. - NDM spent 82.8 million on goods, services and salaries in the Bristol Bay region in 2005. - NDM attended 309 meetings and visited 25 communities during 2005. - NDM has stated its commitment to develop the Pebble Project in a manner that protects fisheries, subsistence resources and other environmental values, while optimizing project benefits for Alaskans. 20060418 '~ ~ f Per 1 Pebble Misperceptions: Facts: "Pebble will confribute nothing to fhe ( .The Pebble Project contributes to the Perrnanent I Permanent Fund." Fund (PF) today, and will contribute significantly more in the future if ii is permiBed and becomes an operating mine. I • Under current legislation, one-quarter of the rent NDM pays to the state government for mineral claims and I I leases goes to the PF. • Should the Pebble Project be permitted and become an operating mine, one-quarter of the mineral royalties (currently set by the State at 3% of net profits) NDM pays to the state govemment would go to the Permanent Fund. "The State will pay for and maintain Phe • This issue is currently being studied by the Alaska road." Department of Transportation and Public Facilities (ADOT&PF) and NDM. In all cases NDM would expect to pay for its fair share of the portion of infrastructure development that would benefit the Pebble Project. • One scenario is that the state and federal governments would pay for the road, and Northern I Dynasty would pay an annual fee for its use. • The communities being directly affected by the potential road are being consulted as part of the decision-making process. "Cyanide will be used of Pebble." • Northern Dynasty has not yet made any decisions related to the possible use of cyanide in a closed- circuit, in-facility system. "...every village downsfream of fhe project • It would be unusual for a large project like Pebble to opposes the mine." not encounter varying degrees of opposition and support. • We can confirm that 16 entities (boroughs, tribal governments, municipal governments and Native corporations) in the Bristol Bay region have signed ', resolutions or otherwise indicated their support for the Pebble Project so long as it can be developed in an environmentally and socially responsible way. • Some of those groups that have issued resolutions in opposition to the project have indicated a willingness to work with NDM to see if their concerns can be addressed through project design. 20060418 ~' t "We'll be left with a giant bole in the ground • Typically, wildlife habitat is given strong consideration and damage to wildlife habifat." when mine reclamation plans are developed. Areas disturbed by mining operations are re-contoured to resemble natural conditions and promote desired drainage patterns. ' There are terrific examples of reclamation, including at the Fort Knox Gold Mine near Fairbanks. It's reclamation has resulted in extensive wildlife and fish use. I »NDM is still developing its official mine plan for i i Pebble, which will include its reclamation plan. "Pebble executives cannot be held liable for .NDM executives are not immune from prosecution potential environmenfat damage, since fhey ~ under US laws. are not part of a US company." ~ ! I Since 1989, Alaska courtjudgments are enforceable against British Columbia residents under a shared court order enforcement act. • Prospectus language about enforceability exists as standard SEC disclosure language. j "NDM is not a mining company...it is a sfock ! •NDM is indeed a mining company and is backed by play." I its parent company, Hunter Dickinson Inc., whose mining experience includes operation of the Gibraltar copper-molybdenum mine in BC. ' I •NDM has long stated that it will seek a partner with ' j experience operating large mines. •NDM will remain involved in Pebble's operations within a consortium of partners who bring the I maximum possible expertise to this undertaking. j "IPs fishing or mining... theycannof • Fishing and mining can coexist. '. ~ coexisf." • Look to BC's Fraser River system as an excellent '. example where no fewer than eight operating and 1,800 historic mines exist in its headwaters today, with no discernable effect on Canada's largest and I healthiest salmon runs. "All mining tailings dams leak." .Tailings embankments do not leak in the usual sense of the word. Rather, seepage is allowed to occur in a planned and controlled manner to enhance the ', stability of the embankment. ' • Seepage actually strengthens the embankment, and is an important engineering feature in areas where seismic activity can occur. • Seepage water is directed by gravity and drains into a seepage collection and recovery system where it is pumped back into the tailings impoundment for re-use in the mill. 20060418 ~~ I r ~ "Pebble is behind the mixing zone issue." ~ •NDM has not aligned itself with any proposal for mixing zones. • The fact is that Pebble would not be a beneficiary of a mixing zone, because, as presently conceived, no process water will be discharged, so no discharge permit would be required. "Tailings are a toxic material that must Under the present design, the vast majority of tailings undergo `treatment' in perpetuity." would not require any treatment. • The small portion of potentially acid generating tailings at the Pebble Mine would be stored under water so that they never need "treatment" • Removing potentially acid generating tailings from an oxygen environment renders them non-toxic in perpetuity. Pebble has, "... been quietly progressing •NDM has had a well publicized and expansive ~ toward obtaining the permits required..." community relations program under way for the past ~ two years ! •NDM has attended 373 stakeholder meetings in 25 communities in the past two years. • Applications for permits won't be submitted until late '07 at the very earliest. The permitting process itself is a very open, transparent process. "Jay Hammond is against Pebble." • In fact, former State of Alaska Governor, Jay Hammond, stated that he was not "unalterably opposed" to the Pebble Project. • He elaborated on this position by further stating that his support for or opposition io the project was dependent on whether Pebble could meet his four criteria test required to assure minimal harm and ! i maximum benefit. j • NDM remains confident that it can and will satisfy each of the four criteria Jay Hammond established. "bold mining will destroy salmon spawning •NDM has established protection of fish habitat as a grounds." fundamental objective for Pebble's development. • NDM has gone beyond the regulatory requirements that the State has outlined by committing that Pebble will result in no net reduction to any fishery in the region - be it commercial, recreational or subsistence. • As currently conceived, the Pebble mine will have no direct effect on important salmon spawning or rearing habitat. 20060418 "/d memorandum of understanding that • DNR's Large Mine Permitting Team facilitates the i currently exists between DNR's Large Mine permitting process with state agencies. i Permit Team and NDNt could cause a conflict ',' oPinterest in the permeating process." i • The Team's activities are funded by entering into a j standard large project MOU with DNR to reimburse the State's incremental costs for handling any proposal. This has been the process for large projects in Alaska for many years • Thus, it seems ridiculous to believe that individual ~ state regulators will be influenced by what is essentially a "user fee'. ~ • NDM's reimbursement to DNR for expenses it incurs during permitting of NDM's large mine proposal, is embodied in one of Governor Nammond's criteria - thatthe project pays ifs own way. "It's a gold mine...buf gold really isn'f I • Actually the Pebble Project is primarily a copper necessary..." ~ mine...there's far more potential revenue available from copper than from gold. ® Molybdenum is also found in abundance at Pebble. • Moly is most often used to strengthen alloys and is a major component in stainless steel, cast iron and ', titanium and super alloys -frequently used in aircraft ' ~ production. The addition of moly in titanium alloys ~ basically revolutionized jet engine development. • Copper's industrial importance is also well documented. One of its main industrial uses is in the production of cable, wire and electrical products for both the electrical and building industries. The construction industry also accounts for copper's second largest usage in such areas as pipes for plumbing, heating and ventilating as well as building ~, ~ wire and sheet metal facings. • It is the combination of these three important minerals which makes the Pebble deposit such an important geological discovery. 20060418 P ~ wnae's yew what is the eb(e r®ject? The Pebble Project is an initiative of Northern Dynasty Mines Inc. to develop, build and operate an open-pit go{d, copper, molybdenum and silver mine in the Bristol Bay Region of southwest Alaska. On this site you will find information about various aspects of the Pebble Project including: • mine planning; • updates on environmental and cultural studies; ® Northern Dynasty's project team; ® the latest news releases and project updates; • employment and contracting opportunities, and; • community meeting program updates. The Pebble Project website will be continually updated as the project proceeds. Please return to view the latest news and information on the Pebble Project. For HEw? Pebble Project information, clck_I!hs. link. Stakeholder Resolutions See the growing list of Pebble Project Resolutions. Environmental Baseline tudies Northern Dynasty's studies are establishing a comprehensive, pre- project baseline description of existing natural and social resources. See draft documents currently available. Submit a (tuestfor, Have your questions about the Pebble Project answered click here to send us an email. Sign•up for Updakes Wish to know about project updates as soon as possible? Sign-up and we'll send you infonmatior automatically. pick here to sion-uo. bb raj t ~t Pebble Project N®RTkERW Dl"IVASTV MIRtES IWC. In recognition of the economic potential of the Pebble Project for the people of southwest Alaska, tVorthern Dynasty Mines has under- taken the following activities related to work- force development in the Bristol gay Area. • NDM made scholarship donations to Bristol Bay Native Corporation and Lake and Peninsula School District in 2005. In 2006, NDM is expanding this program to include: - Southwest Regional School District, - Bristol Bay School District, and - Dillingham School District. • NDM invested in AMEREF (Alaska Mineral and Energy Resource Education Fund), a program that provides teachers with resource kits and educational models to raise awareness of mining industry contributions and potential careers among school aged kids. ® NDM worked with University of Alaska to bring the ANSEP (Alaska Native Science and Engineering Program) to the Lake and Peninsula School District in 2006. The program acclimatizes Native students to university life, and exposes them to careers in engineering and science while developing peer groups and industry relationships. • NDM is working to advance educational initiatives with several other entities in the region, including: -Southwest Alaska Vocational Educational Center (SAVEC), - Bristol Bay Native Association (BBNA) Workforce Development Program, and - Bristol Bay Economic Development Corporation (BBEDC). ®u$Bne~S eVel®~tTtent In 2005, Iliamna Pebble Development (IPD) was contracted to manage all local hire (payroll and HR services), plus Camp Services for the project on site in Iliamna. IPD was formed as a partnership of Iliamna Natives Limited and Chiulista Camp Services. ~1 Pebble Pr iect N~~rHER~ ®Y~I~S~Y ~l~l=_s ~~c. Public Support f®r Pebble Pr®ject: • Congressman Don Young Recognizes Potential of Pebble Mine for Bristol Bay Region. In a letter to Northern Dynasty Mines Inc., the Congressman said that, - "1 wholeheartedly support your efforts to bring the opportunity for family-wage, year-round, community friendlyjobs to the Bristol Bay Region." Young's comments struck a historical note related to statehood promises that gave state land selec- tions for purposes such as mining, when he stated, - "Oftentimes, people forget that while much of • The Pebble Project employed a total, vvorkforce '' of 609 during 2005. • 457 Alaskans (75% of total employees) were ` employed at the Pebble Project in 2005: ..A ~I ~ I YEAR EN D. 2005 ' wer 48)'. 14 iii our state !s off limits for industrial activity, certain ~""'s ~ `' parts of our state were selected for mining, timber and other natural resource development. The /ands being explored for the Pebble Mine are ' • 45 consultant firms, were employed at Pebble lands selected by the state and designated for during 2005. mining, as envisioned by the advocates of state- .112 workers (25% of the employed Alaskans) hood. These are areas that did not end up in a were from local (Bristol Bay) communities. federal or state park, did not end up in a federal or state refuge, did not end up in a federal or • Northern Dynasty spent $2.8 million on goods, , state wilderness area. This is what is left for the services and'salaries in the Pebble Project area peop/e in rural Alaska, which is why what the m 2005. communities think about the mine is important - to me. " Recognizing that the Pebble Project deserves a fair hearing, however, the Congressman said, - "What matters to me is using sound, honest information and following the process outlined by law to reach fair and honest conclusions. Decisions based on reason and good information should win over emotion and environmental extremism every time." • The BBNC Advisory Resolution asking Shareholders whether or not they supported 'Environmentally Safe Mining Development' passed with 107,109 votes (78%) 'for' and 30,464 votes (22%) 'against'. St~l~ehaider Ftes®itati~ns meetings over the past two years & visited 25 communities in 2005 •tocal hireeoordinatoremployed in Iliamna • Two Community Leaders Meetings and one Regional Meeting held • Stakeholder tours of.project site and Fort Knox Gold. Mine • Public website launched: www: ndmpebblemine.com N13 C®rt~munity Investment: A significant and growing number of community organizations, institutions, businesses, and individuals have signed resolutions, written letters, or otherwise indicated their support for Northern Dynasty in its efforts to develop the Pebble Project in a socially and environmentally responsible way. Others have signed resolutions, written letters, or otherwise declared a willingness to reserve judgment on the Pebble Project pending the out- come of mine planning. Those that have given us permission to post their names are presented here: • NDM made scholarship donations to Bristol Bay Native Corporation and Lake and Peninsula School District in 2005. In 2006, NDM is expanding this program to include: -Southwest Regional School District, -Bristol Bay School District, and -Dillingham School District. • NDM invested in AMEREF (Alaska Mineral and Energy Resource Education Fund), a program that provides teachers with resource kits and educational models to raise awareness of mining industry contributions and potential careers among school aged kids. • NDM worked with University of Alaska to bring the ANSEP (Alaska Native Science and Engineering Program) to the Lake and Peninsula School District in 2006. The program acclimatizes Native students to university life, and exposes them to careers in engineering and science while developing peer groups and industry relationships. • NDM is working to advance educational initiatives with several other entities in the region, including: -Southwest Alaska Vocational Educational Center (SAVEC), -Bristol Bay Native Association (BBNA) Workforce Development Program, and -Bristol Bay Economic Development Corporation (BBEDC). Alaska Outdoor Council Alaska Peninsula Corporation Alaska Power Association Alaska Village Initiatives Aleknagik Traditional Council Bristol Bay Borough Bristol Bay Native Corporation Iliamna Natives Ltd. Kijik Corporation King Salmon Tribe L&M Supplies Lake & Peninsula Borough Levelock Village Council Levelock Natives Limited Paug-Vik Inc. South Naknek Village Council Southwest Alaska Municipal Conference Togiak Tribal Council Twin Hills Native Corporation • Northern Dynasty will hostli#s third Community Leaders Meeting and its second Regional Meeting in February 2006: ~ Pebble Project ®~THE~N ®Y~A~fY ~'NE~'N~. iner~l Resource 11~easured and Indicated: ® Gold - 31.3 million ounces • Copper- 18.8 billion pounds • Molybdenum - 993 million pounds Inferred: • Gold - 10.8 million ounces • Copper-5.9 billion pounds • Molybdenum - 361 million pounds 2005 Pr®ject Heghlihts • The 2005 geological program totaled more than 75,000 feet of drilling in 42 holes. • Assay results from six drill holes in the east zone indicate a major new porphyry system with a substantial volume of copper-gold-molybdenum mineralized material. As a result of this discovery, Northern Dynasty will undertake an $18 - 20 million drill program in 2006, and defer its feasibility study and permit applications until 2007. • Discussions continue with major mining companies regarding a partnership. • More than $27 million invested in environmental and socioeconomic baseline studies, as well as public consultation • Northern Dynasty continues to pursue: -commercial contracts with local businesses; -workforce development, skills training & education program for local communities; -active employment for local people. • tVDM attended more than 300 stakeholder meetings over,the past two years & visited 2~ communities • Local hire coordihator employed in lliamna • Two Community Leaders Meetings and one Regional Meeting heltl • Stakeholder tours of project site and Fort Knox Gold Mine • Public website launched: www.hdmpebblem ine.com continued... .a i w.~ rv ~ y 20Q5 Ernpl~yrrt~nt • The Pebble Project employed a total workforce of 609 during 2005. • 457 ALASKANS (75% of total employees) were employed at the Pebble Project in 2005. YEAR END 2005 rver 46) 74% 1! % AN 75 % • 45 consultant firms were employed at Pebble during 2005 • 112 workers (25% of the employed ALASKANS) were from local (Bristol Bay) communities. • Northern Dynasty spent $2.8 million on goods, services and salaries in the Pebble Project area in 2005. En~rir~nmental Study Pr®r~rri • Northern Dynasty has collected environmental baseline data for two years (2004 & 2005) -progress reports from 2004 environmental studies are now available -comprehensive environmental baseline document to be prepared in 2006 • Environmental study program includes: -33 mine site surface water stations -350 fish sampling and survey locations - 127,000 acres surveyed as part of the wetlands delineation program. • Review meetings held with state and federal agencies. Additional meetings are planned. a ne ionawmy wnuccun~~y oryani~a uuns, .institutions businesses and individuals have Pebble Project, so long as it can be developed ared a willingness to presentedlhere `Alaska :Outdoor Council Alaska Peninsula Corporation Alaska Power Association .Alaska Village Initiatives Aleknagk Traditional Council Bristol Bay.. Native Corporation. Bristol Bay Borough, Iliamna Natives Ltd 'Kijik Corporation King Salmon Tribe L & M Supplies Lake & Peninsula Borough Levelock Village Council .Levelock Natives Limited Paug Vik Inc South Naknek Village Councih Southwest Alaska Municipal Conference Togiak Tribal Council Twin Hills Native{orporation DOt~ YOUNG CONGPESSMAN FOR ALL ALASKA WASHINGTON OFFICE 2111 F1AVau acv BuILO WG TE~_EVSioNE 202'225-5765 wwrrt~. House.0av/oouvauN~/ January 13, 2005 Bruce aenkins Northern Dynasty Mmes, Inc 3201 C Street, Suite 604 Anchorage, AK, 99503 Dear Mr. Jenkins, CHAIRMAN COMMITTEE ON TRANSPORTATION COMMITTEE ON RESOURCES COMMITTEE ON HOMELAND SECURITY I appreciate yom~ letter and the 2005 summary of your wm~1: on the Pebble Mine. ~,'hile we have yet to meet, I recall the very good briefing I received in the Spring fiom your CFO, Mr. Brian Mountford. I want to ihar~li you for investing in Alaska on lands that were selected by the State of Alaska and. designated for mining. Oftentimes, people forget that while much of our state is off-limits for indushial activity, certain parts of our state were selected for mining, timber, and other natural resource development. 1'he conm~unity ouheach work (with Trefon Angasan} fllat you outlined in the updated summary is impressive. Developing a project in concert with the needs and dcsiTes of the local commtnities is quite importantto me. I am glad ihatyour company appears to be respecting the views of local residents near the mine site, particula~]y chose of the Bristol 'Bay Native Corporation and surrounding communities. The supportive BBNC votes and the local governxnentresolutions that Ireceived are encouragnrg. As with u.y huge project, t?:ere is never a uuforrl opinion. What matters to me is using sound. hones~h information and following the processes outlined by law to reach fair and honest conclusions. Decisions based. on reason and good hifonnation should win over emotion and environmental extremism every time. 1 have added confidence when the informatimi about an Alaskan proj ect is generated by Alaskans. The 441 Alaskans involved in the work on mine development in 2005 gives me added confidence that what you are doing iu the f eld has credibility. I wholeheartedly support your effores to bring the opportwrity for family-wage, year-round, colnrnuuity fiiendly jobs to the Bristol Bay region. If there is anythn~g that I can do to assist or facilitate your effort; please letme know- Again, thai~lc you for investnig hi A,1aslca. Your project is exactly what statehood adsrocates envisiolsed-Alaska supporting itself urd its residents on Iand granted to the state for econonuc development. ~cerely, Don 1' ung ~ Congressnla~ for all f~laska DY/co 113 31t W iaow 5- '10 12n~ P.v~ue 971 Ft eau... eu~ ~iNG 190 Tarewe env Roi+a 540 Win=_a uiivET B5 ~ GtsT WeaTroier Damt , 610 ~raE~ S~rre 580 PO. BOx 1030 Box 1G P.O.B r21247 Snrn 105 SUire t0l SUire 307 AI:99501 56THE1.. P.K99659 ce ANCao FneanNi¢,Av.a~99701 Juuenu. Av a<n 99802 I«Nm AUSwr.99611 KL CwanN,AtisrzA 99901 W~_i_u,Aus~u 99&54 . _ 90]-271-5976 907549-1637 90]-456-0210 90]-586-7400 907-283-5808 909-225-fid80 9G7-3764665 l7.IIY33Tl~7"ES£ Ztf?~E ~YC7IE1~~~'EIfCB ~'AA1S46A' n{ ~t;YP~Tri?~ElTfr'1ft4tiPS - ~iltx~_liingfnr., ~Cr 2Q15 l~`( ~ ~~` ~"~ 9Y El Cl [ R ~ f4 FK ~ 5 !Y H ~ ~ ~F FY6 L i`[ L J k 9t' ~ . ~~~~~~~~jn~e~~~ ~ ~'r~iz~i~~~ C)~~~~~~~~it~es To learn abotiit ~~~~ aa~d ~~1~~~~~ opportunities for the Pebble Project 'located near Iliamlla, Alaska Contact It~~~-~ha A.~,e~o~a, Local ~IiI°e Coordinator Toll Free: 1 (888) 533-7455 ~~ ~II~~ Use the email address or fax number below E-mail: pebbleem~~layn7ent(a,northe~~rnd~~nasty.com 1"ax: 1 (907)- 571-1759 Be sw'e to include "Pebble Employment' ni the sLibject 1n1e of your ,fax. In your resu~n7e, be sure to indicate the tyre of work thaf interests you. wunundmpebblemine.com P:A7000-Administrative Activities\1100-Atlminis.~ztive\ll20-Forms-0rg Charts-Logos\Peb6ie Employment flyer.doc ~~'.~'~ ~~'_4T~~~~i F'C~~ ~'~iF'LC~I~~~i~~' rr~t~ ~Wh ~,~ LL11 ~t~t,!t r;~ ~YIC b p~.lb~~ ~'~i~tt~~Fa ~~~~re ~~~~~~~~~r '~ nsau~mr o~ . an~rtt ~[ior ~P,po~riian. ~ pi 5:: prin+ r..ar:} mm2 r1, oli an.,l~~anon comp, c h "'h. ¢ yi a~ior. vn~ L- r inta:n »T ohs ~ - ?'ou; ~~sid rauaL a~ as?_~ p~,riion dap nds upon ,.ampl..t~ anC eccurate;pfo>saatrorL If nn ~ ir~orra..o. you inc:ud v tnW zpp~r.ztion cdan~ .., b.,forc ~n i employment otter a ma~3e, yov mus! terse tiffs applicattnn or snbmi. a nec onc. i i ! Ple¢re do no! use "sae resume" tlsk for an e;.nlanation ai anv au~tiam° vary do nar understand 1. Gen:raiInfo;mation mss. Ida~c fi.... W'~ ~ 3o:,ial ~e very tdumoer ~, i ~acec 2ippiicauon ' 7 'o. I~titW Ada:es at.-o pcwio Vcai flLO o_vo-rl ~y is 3'n lr th'. l.ni["~SLLC ,'! a - ~ ~ e v NO i1Qr f .._re3 am to vme `. qn~ v. r u res7ui. ~ t u'emit dacuraAntatior, reooJrc~br lRG.il I Cig~ 3fatE i lip ~ Some phone i ~ 1>!Lnazo Phone i Dnyuc hnver`errec wurkinC.oCalism Corpore~on or C n'mtis[c Comp Serve ~ ~ Have yo eve. ap~ieY-o-e[eploymera ~ rjnvc yor ever wori.e~or Chiul{sm n ~ ^ art; comoan, b ~orv? Parnp 5 vi es 'ocfore% ., Nc ~ ~ _ r Se vame', ~ '-~ Yee '~.hvo ~ `~ Fes i~ No P rw.orshSpm Y01!I Whsre7 Whew V'bere7 Wlreu9 ~ ! R'mcn Cov:psuttQ i ~ ~ irsi~ed posmon7 Saiaq~desimd% hate uvaSianta% I t a~ you evc-us rl auy other n T ' li sq pl specify. ('o 'oacL~unn nno crrmurai edec4:,j 2. .ANCSfi. Sbar Yrolder Information (Checl: eP t~<a~ pn~_y): ^ won StJareno]der ^ H-NCL~ euorae: ^ OCherL.,gtot, ~ ~fne~ S;egim~~?dama: ~%;L7n~e :Jc^ I I ~LI~DwcendentofSbare¢older:7vame: ^ OfnerNativeAmeric¢u:Tribe_ i Jrl referred yov to fdte compan}? ^ Employmen Agency _7 1Veads..aper Advertisement ^ Mate ~mploymanr O.fiee '~ ^ T.e;aP:ve ^ ..;end ^ tz%~?!:i~r ^ OLier - CCSI ~~'.=cr^~ ^, 1 Ernploymen'. 4pp!icaiiem, G'sv u~/0£ 4, Warl; hours; travel and scheduling preferences: Wanid you prefer: Q ?aY,-time only Q FeL-time only ^ Temporary ^ No Preference Hours per day, would yon prefer; Q 4 or less2 ^ 8 ^ Up to 12 Q No Preference Hours per weep, would you prefer: tQ 2C or Less? ^ 40 ,~ lip to 64 Q Up to 84 ^ No Praivrence Shifts, would you be willing to work: ^ Sam-Spm ^ 4nm-12am Cl. i.2am-8am ^ 12h: days ^. IZhr niehts ^ No Preference Are you wi[Iing to wore: P.way from Home? Q Yes C3 No Out of State? Q Yes Q No Out ofUS? ^ Yes 0140 Ff sc, how long could you be away? Q 1 week ~ 2 weeks Q 3 week. ^ 4 weeks Q Other: 5. Lrducation and Training Lnfarmation Cireie the ]ugliest year of sohooiing completed: ] 2 3 4 5 6 7 S 9 i0 i1 12 13 14 15 36 17 1S Q Gc- $e~tnning with high school, list bafow all teaming and education inoluding college, trade or weational schools, courses such es First Aid, CPR, EN`T, S-Iaz1vIAT, HazWOPEF:, apnrenticesniP traiaing= and significant professional eduoahon courses or oertificarions. `Jse atiditional paper if necessary. ~T L t i ~ ' Nlnnt n #e P 1° ~ y ~~ ' ~ - nc i t au htt~ngnr a , , _ -~i~1CACCt7A E 8Yi ~Y~ fs'r 10'~~ H v l}t 3f f fie e~ I" ~i A ~~°E.~a ,~ i^ ~^ ~~73T 'orC-07ir$B ~ ~ .,. ~ ' t : , ~ ~ h - ,rt,^, . . _ ~. ; ° ~ 7 . f ~'_ .[9'.GGeIU ; ~~ ~ ~ ~ ~ . ..' ~ ~._:.. , , _ s , ~ r ~_ .. , . , „ .. I . ~ ..- ~ ~ ~ .-__. .._._.__.._._-I-.---- ._~_- ._ ._-. -__._i ___- ~ ~ L 6. TvIilitary Liecord Branch of Service: _.,e~_ Current lY.ti.litary Affiliation: Q None Kiud of irainirsg and duty vrhile ht service_ ~am: To: Last Rant: Q Reserve (,active) .Q Reserve (ina~ive) 7. Lmp[oymentRecord Startiag with the present or most recent; list your least 10 years of employman?, Including seli-emnioyment, summer and part4une lobs. If more space is needed, use tt separate sheet. If you have a resume for the last 70 years of employment, you may also attach it here, but _____.,_._..~_:,.____.. _._... ____-ai,...., n,,...,r.,..a nOnn Axrrrsrort lw fHic.carAinn. Company Type of business lob title Adt3ress ~ °hone Brief deecription o.`job duds City State ZiP Supervisor's name Wage/Salary Date< worked From To Ree,on for Ienving May we oontact finis employer ^ Yes ^ No If ^a, v>hy? ~ CCSI dorm '19 Employment Flpplication, Rev D8l03 Gnmmny ~}m~c-"burin";'. ~ni~: ti9e rydnrn-- 'none 1 H~eiaesorip[ion ofjo7 duties I ~~in' E~.av. Zir '~ '. ~ I Supen~ism`s nerve U r ISalrp' ~ I ~ Lm swed.?o x o i - To - ~ - I, i I2 n.,;o-nta..ctn~ emxiloYa rn 1Nr' ^Yes ^130 Idea. o~iorlexvipg i Compzny ~ 7wecY ousincsu ]o6 otin 7 i `.ncrc, Pnont ` Hriei: descriotlcn a;jr.D oulirs i I Cin Sra.- Lir, i '~~ Svpenasor'!', nam= i I ~' ~T,'IDN Tl I }~Q21n W: conmcnh5 B0~J[IYEf T.r -C. R'-SZ J 505 ^~J C; i I(E~1^i Cn SO'lEa1Rn S Four 1 . ~:nlayln ', pllc3li~ _~- ~c10 Have you ever beer: hied, disckmrged or as%ed to resign $om any posit[an? u Yes Cl No Ii yes; explain from what organization and reason. Have you eve- been convicted of a crime? A conviction record vrill not necessarily ba* you from employment with Chiulista Camp Sarvicas, Inc. Yas ^ No L°yes, please give date, nature of ofranse and explain eireumstznees. 9. WarkRefereaces t ;ter +h.e~,.,....,io ,,.,«,.a~~+o,t +., .,~„ .~,r,~ t,a.,F kmnwlerlve nr"your qualifications far the nosition(s) in which you may be apnlvin~: ,..,~o 3} ~._~_ e ~~~~~ L ~ ~ ~d~013Fi;~~~~~~~~ .I ~i 1 ~G -~.s~41~~ ~ ~-s~~.l:~.f~5~h`5vt}4~~}'~ ' ,~.@$CCp~laEt6tg~-'~I :_....,m.. .... ...1 . ._ . . ! _ __ i 1 I IQ. Agpiicauf ~erEif~cation 2nd Release I hereby certify that the ir7}nrmatian contained irr this application for employment is true and complete to the besa ofmy lrnowledge. 1 understand thaf arty false or misleading statements or omissions regarding this opplicatiore are considered su~cienz groauzds for disguafy9catian from further consideration odor my dismissal if emplayed,~ amt thatthe information ir. this application may be released in ar. authorized IegaZ irzuestigattoru p'or the purpose of the certification, a photocopy of rrry original signature shall have the same-force un,r ~ c! a~ , aa, nr ~;.mrrr„rz, lily • agti~ ...d..~.~... Z understand that my emplaynzenf shaiZ be contingeru zgZan proof a,;`identity and ver~cah'on ofeidgiditityfor employment in the United States ir. accordance with the Immigration Refarzn and Control Pict of 1986. I further understand that any o}jer of emaloyment is contingent upon successful cmnpfetian of the emplcrymeni process which may include, but is not limited ta, referetzce checks, driving record criminal sectc•it)~ bac,~~round check current credit rating, drug screen results and other information bearing upon my employmeruf frtnes„ and goal j~oation;. I cansentTC and authorize Chiulista Camp Services, Inc, to request arzy iz formation concerning rrgr previous employment, educatiorurf histoty character, and backo aund information. 1 hereby release all parties and persons connected with arty request for information from all claims, Ziabifities, and damages for whatever reason arising out offurnishing such information. If employed 6Y the Company, l further authorize the Camparry to provide truthful iriformatian regarding my ensplaymentto anypoteniz'al ar future employer and release and waive any claims against the Company for truthfufry communicating arty such information to a poiential or_Future employer. Zfttrther understand tl-rat thin ApplicaKon. for- Employment is not a oontraci of employment and {fl am employed Z understand that my employment is for no definite period of lime and may, regardless of the date afpayment orwages or salary, be terminated for any reason and at arty time withoutpreviaus nok'ce. Printed Applicant Name Si~SaMre of signed CCSI Porm 19 Employment Appllca5on, Rev 66103 '~ 301 C Street, Suite 664 1f120 ° 800 W Fender St. Anchorage, AK Vaneauver BG f1S,~\ 99503 Canada V6C 2V6 Tel (907) 339-2600 1'ei (6©4j 684 G365 Fax (907) 339-2601 ~ ax (604) 6648092 ff oli Free 1(8'77) 450-2600 I oll 6r~ee 1 (800) 6672114 httrt:/Otwr.rrtartherndunasfw.carrc ~IvT~I,lr~~z ~~~~~~~~, l~ ~~~~~ ~~IJ~e:~~ ~lartbsr~~ ~~atasts~ TvlLnes Inc. ("TVP911/1"} respects ~Che~ subsistence hunting= ~ishirag, and gathering an the laude or the waters adjacent tc> the I~ebble Pr®jecf and lees riot intend fo place at8ditir~nal baxrdens ©r4 these activitses tbroagh hunting and fishi~xg by its staff on the ]ands and waters witl>ixr the Pebble Paoject area. 'Therefore, NI7Ivf and its varioats agents, emisloyees; contractors, and consultants i~ha are curre~Ztly undea contract to iVtJT'/T and have entez~ed the Pebble Pr~jec~t area on IttL)~ Business and a@ IV~I~i's e;~pense ("TV'T~IvI Staff='j shall abide by the following policy. ~.I<I "NI~T~f ~taP~` are g~r°eshll3iEerl fxn~ ~ r•ea~enrer-ea~iis s~®rt; eby x~kxsfstesra:€ taYr~~ aI' fsb aid garrro res®aer°~es a~~ ~r Pe6y-~Ie Pserp~~t are~y ~a~IRIs the ~®~e~e~~g ~~~~gteo~e I. 5laffr who are residents fhoBn corzni~unities in the IIianma Y,al-e area employed by ~I~1~ oa its ronh~actorswho participate i~ their customary and traditional subsistencepractice and rtse of wildlife resources an the Pebble Projoct on bouts when the~~ are; not working ion 1VI~lUl. vla~latu®ns w~9 caBl i ®r° ~Is~r°o~~f~ta aid ls~n~df~te ~fs~f~ar~r aetxo~ ark to a~€tr~xata€ding ter°a~iraate®€c ®I eaeeltles~~snent. /, ~T ,, _~ A p'E \~ Pebble Project '~` ~s~~~~>iE~Ie I~~~7~e~°~I ~~=~~~a~a~ta~~t ~e~~rc~, Northern I]ynasty is eonnnitted~ to developing the pebble i'rc~ject fn a manner that conserves and protects the focal environment, optimizes benefits for focal eommtmiities, and addresses local issues and caneems° This Responsible Miner°al I7e~~elopr~aeni FoZiep has beer developed to ensure that these objectives are rnet at Query phase ofi project development. Both Northern 13}rnast5+ personnel and all of its cent, actors, suppliers and consultants are required to observe the following prineipf€s as a condition of thee- employment of the Pebble Froject. 1sdr~t°t~er~'k~~s~~s~~ 1~~~~°} ~atc~ ~~r~~t ~ Apply the highest qualit}~ ersviroavnental management standards to all study, development, construction and operateonal activities nnderCaken at the ?'efsble project; K Ensure that all Csuhnical; environanental and cultural studios undertaken in support of the Pebble Project. are: thorough and rigorous; Ensue°e that all regulatory requirements for the development, construction and operation of fne Pebble Project aze met and / or ez.ceeded; e l~ctively work witb local residents, communities and governments to ensu4-e tEcat the Pebble Project s-espects Ioe„al priorities, and advances local interests in such areas as employment, business opportunities and infrastructure development; Be. open, honest and forthright with all project stakeholders; ~ Seek input and dialogue with local communities and project stakeholders; Ensure that local people and local companies receive priority consideration for employment and business o7sportnnities, teased on qualifications and merit; Develop and implement the best possible mini plan for the Pebble Project fi-orn art enviromnental, social and economic perspeeflve. Y:AI OOD-AdminisVaiive AeriwiiesV71 o0-Ad~sxinisll~etiveA1200-Policies 7 U/18%L005 ~~~al f~ir~ P'e~~f~y a'he Pehlrle Project will create employment and business opportunities at eves, stage of its development - &•om development through. construction, mine operations and closure. t~iorthern Dynasty is committed to ensuring that these opportunities bexxefit local communities, Local businesses and Local people in the immediate project area, ?n the Bristol 13ay region and throughout the State of Alaska. '1'lais L~~al Fire Policy is being developed to ensure that these- objectives are met at every phase of projecf development. Both 1'~oathern Dynasty personnel and all of its s;onfractors, suppliers and consultants are required to observe the following principles as a condition of their emplo}orient on the Febble .Project. f~~wx°~ht~t4u I~~n~.sty ices h~~= ~~1, Ensure that local people receive priority consideration for employment, based on qualifications and merit; Ensure that local companies (contractors, suppliers and consultants} receive priority consideration based on qualifications and merit; work with local colleges, training institutions and private companies to ensure that local residents have access to the training and education programs that need to gain the qualifications necessary for future employment at the Pebble Project; g Assist 1®cal companies and ]Deal commmunities fo identify future contract and other business opportunities made available by the Pebble Project, and to build the capacity necessary to benefit from this opporiuavties. i'ox-more information about employment associated with the Pebble Project, call 1 (&88j P©2~~478 or email us at p~bbl~ecnpl©t~raent(~e~©etfiee~dvrs~s .czrrn P:U 000-Adminien~~live AclticitiesAI 100-Achninvstrative\1200-Policies 1D/18/2005 ~' Northern Dynasty Menerats Ltd. 9620. 600 W Pender St. Vancouver BC Canada V6C 2V6 Tel 604 604-6365 Fax 604 664-8092 Toll Free 1 800 667-2994 http:/fwww. no rthern d vnasty. corn RESOURCE ESTIMATE FOR PEBBLE EAST CONFIRMS A WORLD CLASS PORPHYRY COPPER-(sOLD-MOLYBDENUM DEPOSIT 3anuary 24, 2006, Vancouver, BC -Ronald W. Thiessen, President and CEO ofNorthem Dynasty Minerals Ltd. (1'SX VenWre: NDM; AMEX NAK) is pleased to report the results of an initial mineral resource estimate for the Pebble East deposit at its Pebble Project in southwestern Alaska. The resource estimate shows that Pebble Fast represents a significant increase in copper, gold and molybdenwn resources for the overall Pebble Project and substantially augments its higher grade resources. The Pebble Fast deposit is conliguous with the Pebble West deposit and will be assessed for its amenability to low cost, bulk underground mining (see Pebble Project Deposit Alan and Section posted on Northern Dynasty's website at www.northerndynasry.com). The Pebble West pozphyry copper-gold-molybdenum deposit is currently being studied at the feasibility level as a major open pit mine. At a 0.60°/n copper equivalent cut-off, the estimated inferred mineral resources in the Pebble East deposit are: • 1.83 billion tonnes grading 1.05% copper equivalent, containing 24.3 billion pounds of copper, 22.1 million ounces of gold, and 1.5 billion pounds of molybdenum. At a 1.00% copper equivalent cut-otl, the higher-grade inferred mineral resources aze estimated at: • 947 million Tonnes grading 1Z8°/n copper equivalenf, containing 16.0 billion pounds of copper, 14.5 million ounces of gold, and 830 million pounds of molybdenum. A summary of n>ineral resources fox the Pebble East deposit at various cut-off grades is tabulated below. TABLE 1 -PEBBLE EAST DEPOSIT INFERRED MINERAL RESOURCES Cut-Off Size ' Grade Contained Metal CuEQ °/n" Million Touges Copper "fin :Gold Molybdenum CaEQ /t % %r Copper B }b Gold Molybdenum M oz M Ib 03a 2,l_>E 0.55 J.U3 0.)7 25.v 23.5 1,717 0.60 1.832 0.60 0.37 0.038 1.05 24.3 22.1 1,547 0.70 1,611 0.64 0.40 0.039 1.10 22.6 20.5 1,398 1.00 947 0.77 0.48 0.040 1.28 lE>.0 14.5 ! 830 Note 1 By prescribed definition, "Mineral Resources" do not have demonstrated economic viability. An Inferred Mineral Resource is that pan of e mineral resource for which quantity and grade can be estimated on the basis of geological evidence and limited sampling and reasonably assumed, but not verified, geological and grade continuity. Note 2 Copper equivalent calculations use metal prices oT US31.OOllb for copper, US5400/oz for gold, and US$6.OOlib for molybdenum. Copper equivalent has not been adjusted for metallurgical recoveries. Adjustment factors to account for differences in relative metallurgical recoveries for coppor, gold and molybdenum will depend upon the completion of definitive metallurgical testing. Cu EQ = Cu % + (AU g/t x 12.86/22.05) + (MO x 13228/22.05). Note 3 A 0.30% CUED cutoff is considered to be comparable to that used for porphyry deposit open pit mining operations in the Americas For bulk underground mining hiyher cut-offs, such as 0.6C % CuEQ, are typically used- All cut-offs are subject to a feasibilitystudy. Note 4 The resource estimafes for Pebble East were prepared by the technical staff of Northern Dynasty and audited by independent wnsultants, Roscoe Pnstle Associates Inc. The Pebble Fast deposit is open to expansion in all lateral directions and to depth. There is excellent potential to establish significant additional resources with further drilling. Northern Dynasty is now focused on thoroughly assessing Pebble East through drilling, engineering and endvonmental programs in order to integrate this exceptional discovery into an overall thine plan that is optimal for the project. The dolling component of the programs consists of 30,500 metres (100,000 feet) at a brulgefed cost of US$20 million and will commence as soon as rigs with deep drilling capability can be mobilized to site, expected in March. Comprehensive engineering, environmental, and socioeconomic programs, designed for the completion of a feasibility study and permit applications for a modem, long-life mining ~~~ HUNTER Responsible DICKINSON Mineral /® INC. Development -2- operation with large scale annual metal output will continue in parallel with the Pebble East drilling program Af this point, expectations are that the projecC will integrate production from high volume, low cost, open pit and underground mines. A compuison with the mineral resources and the metals contained in the Pebble West deposit at the same cut-offs, shown in Tables 2 and 3, clearly demonstrates the substantial value that the Pebble East deposit could add to the Pebble Project. TABLE 2 -PEBBLE WEST DEPOSIT MEASURED PLUS INDICATED MINERAL RESOURCES Cut-bff Size (>rarle Contained Metal CuE;Q % Million Tonnes Copper % Culd /t ' Molybdenum CuEQ % % Copper B Ib Cold M oz Molybdenum ' M Ib 0.30 3,026 0.28 032 0.015 0.56 18.8 31.3 993 I 0.40 I 2,413 0.3I 035 0.016 ~ 0.61 16.5 27.0 I 855 Q50 1,628 0.35 0.39 0.018 0.69 12.7 20.5 629 0.60 0.70 970 ~ 569 0.41 0.46 0.45 0.50 0.020 I 0.78 0.021 j 0.88 8.7 5.8 13.8 9.1 _ 420 265 TABLE 3 -PEBBLE WEST DEPOSIT INFERRED MINERAL RESOURCES Cut-Off Size Grade Contained Metal CuEQ Million Tonnes Copper % Csold /t Molybdenum % CuEQ % Copper B Ib Uold M oz ' Molybdenum I, M ]b I 0.30 1.130 0.24 0.30 0.014 0.50 5.9 10.8 361 I 0.40 756 0.27 0.34 0.017 0.57 4.5 8.2 278 I 0.50 417 0.31 0.42 0.018 0.67 2.9 5.6 168 0.60 22G 0.36 0.49 0.020 0.77 1.8 3.6 101 0.70 143 0.40 0.56 0.020 0.85 1.3 2.6 62 Note 1 By prescribed definition, "Mineral Resources' do not have tlemonstrated economic viability. An Inferred Mineral Resource is that part of a mineral resource for which quantity and grade can be estimated on the hasis of geological evidence and limited sampling and reasonably assumed, but not verified, geological and grade continuity, Note 2 Capper equivalent calculations use metal prices of US$1.00/Ib far copper, USS400/oz for gold, and US96.00/Ib for molybdenum. Copper equivalent has not been adjusted for metallurgical recoveries. Adjustrnent factors to account for differences in relative metallurgical recoveries for copper, gold, and molybdenum will depend upon the completion of definitive mefallurglcal testing. CuEQ = Cu % + (Au g/t x 12.86!22.05) + (MO x1922&2205j. No[e 3 A 0.30% CuEO cuFOH is considered to be comparable to that used for porphyry deposit open pit mining operations in the Americas. For bulk underground mining higher cut-offs, such as 0.60% CuEQ, are typically used. All cut-offs are subject to a feasibility stutly. Note 4 The resource estimates for Pebble West were prepared by independent consultants, Roscoe Pos?le Associates Inc. as tlescribed in Northern Dynasty's news release dated March 4, 2005. Bob Dickinson, Northern Dynasty's Chairman commented, "The on*oing success of our drilling programs at Pebble demonstrates the extraordinary potential o'f the Project's mineralizing systems. The combined Pebble West and Pebble Bast resources rank among the Largest copper, gold and molybdenum accumulations in the world. This initial resource estimate of the Pebble East indicates a substantial increase in the copper, gold and molybdenum available, with significant promise to further expand that resource. Pebble is an exceptionally important discovery because it is located on American soil -astable jurisdiction in which the development rules are well-known - at a time when the demand for capper, gold and molybdenum is increasing worldwide while available new supplies are limited °" The Pebble East resource esthnate is based upon drill core assay results from 20,890 metres (68,500 feet) of drilling in 22 holes cmnpleted by Northern Dynasty. The estimate was prepared by the technical staff of Northern Dynasty and audited by industry Leading geological and mining consultants at Roscoe Posrle Associates Inc., under the direction of David W. Rennie, P. Eng., an independent Qualified Person as defined by National Instrmnent 43-101. A technical report detailing the resource estimate will be filed on wwwsed~ar.com within 45 days. ~~~ HUNTCR Responsible DICKINSON Miner°I ~® INC. Development -~- Mark Rebagliati, P.Eng., is the Qualified Person supervising the quality control and assurance program for the Pebble Project. Logging and sampling is completed in Northern Dynasty's secure facility at Iliamna, Alaska. The NQ-size core is split and samples are transpori~ed to the ALS Chemex laboratory in Fairbanks for drying, weighing and crushing. Samples are shipped by airfreight to the main ALS Chemex laboratory, North Vancouver, Canada (an ISO 9002 certified laboratory) for final preparation and analysis. Gold is determined by 30 g Fire Assay (I'A) fusion with an Atomic Absorp6oa Spectroscopy (AAS} finish. Copper and molybdenum assays are by four acid digestion with an Inductively Coupled Plasma-Emission Spectroscopy (ICP-ES) finish. All samples are also analyzed for 23 additional elements by four acid digestion ICP-ES. Northern Dynasty includes standards, duplicates and blanks in addition to the laboratory's internal quality control work. Duplicate samples are analyzed by Acme Analytical Laboratories of Vancouver, Canada. For further details on Northern Dynasty Minerals Ltd. and its Pebble Project please visit Northern Dynasty's website at www.northemdvnasty.com or contact Investor Services at 604-684-6365 or within North America at 1-A00-667-21 I0.. Ronald W. Thiessen President anct CEO Forward Looking and other Cautionary Information Neither the TSX Venture Exchange nor any other regulatory authority accepts responsibility for the adequacy or accuracy of this release. This release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address estimated resource quantities, grades and contained metals, possible future mining, exploration and development activities, are forward-looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements should not be in any way construed as guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices for metals, the conclusions of detailed feasibility and technical analyses, lower than expected grades and quantities of resources, mining rates and recovery rates and the lack of availability of necessary capital, which may not be available to the Company on terms acceptable to it or at all. The Company is subject to the specific risks inherent in the mining business as well as general economic and business conditions. For more information on the Company, Investors should review the Company's annual Form 20-F filing with the United States Securities Commission and its home jurisdiction filings that are available at www.sedar.com. Information Concerning Estimates of Measured, Indicated and Interred Resources This news release also uses the terms "measured resources', 'indicated resources' and 'inferred resources'. Northern Dynasty Minerals Ltd. advises investors that although these terms are recognized and required 6y Canadian regulations (under National Instrument 43- 101 Standards of Disclosure for Mineral Projects), the U.S. Securities and Exchange Commission does not recognize them. Investors are cautioned not to assume that any part or all of the mineral deposits in these categories will ever be converted into reserves. In addition, 'interred resources' have a great amount of uncertainty as to their existence, and economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or pre-feasibility studies, or economic studies except for Preliminary Assessment as defined under 43-101. Investors are cautioned not to assume that part or all of an inferred resource exists, or is economically or legally mineable HUNTER Responsible ® DICKINSON Mineral INC. Development 1020.800 W Pender St. Vancouver BC Canada V6C 2V6 Tel 604 684-6365 Fax 604 684-8092 Toll Free 1 800 667-2114 www, n o rt h e rn d v n a stv. c o m Northern Dynasty Minerals Ltd. Drilling at Pebble Continues To Expand High-Grade East Zone Porphyry Discovery Initial Resource Estimate of East Zone in Progress Assessment of Potential Significant Benefits of East Zone and Feasibility Study and Permitting Timing January 9, 2006, Vancouver, BC - Konald W. Thiessen, President and CEO of Northern Dynasty Minerals Ltd. (TSXV:NDM; AMEX:NAK} announces assay results for core Holes 5334 through 5337, recently completed in the newly identified East Zone porphyry copper-gold-molybdenum system which adjoins the Pebble deposit on the east'. Drilling continues to expand this major new discovery. Highlights include: • Hole 5334 intersected 915 feet grading 1.38"/o copper equivalent (CuEQ) comprising O.b2% Cu, 1.06 gh Au, 0.023% Mo. Included in this intersection is a 330 foot interval grading 1.82% CuF,Q (0.64% Cu, 1.81 g/t Au, 0.019°/o Mo). • Hole 5335 intersected 2478 feet grading 1.21°/~ CuEQ comprising 0.81°/o Cu, 0.44 g/t Au, 0.023% Mo. • Flole 5336 intersected 2584 Feet grading 1.13% CuEQ (0.67% Cu, 0.23 g/t Au, 0.055% Mo). Included in Chis intersection is a 646 foot interval grading 1.42% CuEQ (0.$5°/n Cu, 0.33 g/t Au, 0.052% Mo). • Hole 5337 intersected 2028 feet grading L28"GU CuEQ (0.83% Cu, 0.34 g/t Au, 0.041% Mo). Included in this intercept is a 758 foot interval grading 1.70% CuEQ (1.25% Cu, 0.37 gft Au, arld 0.038% Mo). (results from Holes 5334 through 5337 /4 hoiesl, rnmhitlfdd with drIll hole results announced on September 21 (8 holes), October 20 (2 holes), and November I, 2005 (1 hole), indicate the new porphyry system hosts a substantial volmne of mineralized material with excellent copper, gold and molybdenum grades. A tabulation of assay results from all 2005 East Zone discovery holes is attached to this news release. The area influenced by these widely-spaced drill holes measures about 4000 feet by 4000 feet. Drill intercepts have a vertical dnnension of about 2000 feet on average and most holes stopped in mineralization due to depth (imitations of the drills. The East Zone deposit is open to expansion to depth and in all lateral directions. A Location Plan Map and Cross Sections are posted on Northern D}masty's website at www.northerndvnasty.com. All results 'from the 2005 drilling program have now been announced. The bid process for a contract 'for follow-up drilling is complete. A four-rig, deep drilling progranl to fully delineate this exciting new discovery has been contracted to start in March 2006. An initial resource estimate for the East Zone is also underway, for release early in 2006. Hole 5334 was drilled on an azimuth of 090 degrees at a dip of 75 degrees and entered the mineralized system at a vertical depth of 2645 feet below surface. Holes 5335, 5336 and 5337 were drilled vertically and entered the mineralized body 1690, 1645, and 1550 'feet, respectively, below surface. Detailed results for the four new boles are listed below. H'J NTER Responsible ~~~ DICKINSON N~i+ue•al IN ~. ~'JOVP.~Ppnl Bni -2- NEW EAST ZONE ASSAY RESULTS Drill Hole I. From To Intercept ~ Cu -~-- Mo --r- CuEO Numbe - r feet feet - feet -'- %° 9d /t % _ °° -- 5334 335 335 4 5334 - 2706 Inc! 2755_ and 3078 ' _ _3766 3670 3408 1060 __ __ 915 330T 0.58 0.62 , 0.64 _ 0.95 002 1.06 ~ 0.023 1.81 0.019 1.38 ---- 1.82 5335 _ 169 6 ~ 2478 __ 0.81 0.44 0.023_ I 1.21 5335 Inc! 1690 i, 3436 1746 0 97 ~ 0.42 0.023 1.35 5335 - - I 5336 and 1698 -- 1645 I 2548 4228 850 `L584 I _ 1.09 0.67 _ 0.44 _ 0.022 0.23 0.055 _ 1 48_~ 1 13 'I _ 5 36 _ Inc! 1645 - 1794 _. 150 1.16 _ 0.71 0.059 __i 1.92 _ 5336 I~ - ~ 5336 Incl. _ 1862 i Inc! 3178 2508 3878 _ 646 700 0.85 0.81 __ 0.3~ 0.063 ~ 0 27- 0.052 -' 1.42 1.28 5337 5337 '' 5337 - -- 1650 Intl ~ 1650 and ; 1650 - 3678 2838 2408 _- 2028 1188 ~ 758 '. -i 0 83 ~ 1.10 1.26 --- 0 34 0.041 0 48 0.036 0.37 0.038 1.28 1.60 1.70 Note t Copper equivalent calculations use metal prices of US$t.00llb for copper, US$4001oz for gold, and US$6.00lIb for molybdenum. Adjustment factors to account for differences in relative metallurgical recoveries for gold, copper and molybdenum will depend upon the rompletion of definitive metallurgical testing. CUEQ = Cu % + (Au g/t x 12.86!22.05) + (MO % x 132.28/22.05} Note 2 Au values > 5.0 g!t cappetl at 5.0 g/i During 2005, significant progress was achieved by Northern Dynasty on its comprehensive C$44.7 million dulling, engineering and environmental/soeio-economic programs. Objectives for 2005 included the preparation of a feasibility study by yeaz end and preparation of applications for project permitting by state and federal agencies, for submittal in mid-2006. However, plans are currently being revised to incorporate this recently discovered substantia? high-grade porphyry deposit adjoining the Pebble deposit on fhe east. Until the new deposit is extensively drilled and delineated, it is premature to finalize the feasibility study or fo prepare permit applications. The Company's current goal is to optimize the project design with regard to mineral resources as well as social, environmental, and economic factors. Accordingly, the completion of the feasibility study and environmental applications has been defen~ed until the results of the East Zone drilling are integrated into the overall Pebble Project plan, in order to assess the impact of this new zone. Mark Rebagliati, P.Eng., is the Qualified Person for the exploration and drilling programs for the Pebble Project and is supervising the quality conn~ol and qualify assurance programs. Core logging and sampling are completed in Northern Dynasty's secure faciliey at Iliaimia, Alaska. The NQ-size core is sawn and samples are transported to the ALS Chemex laboratory in Fairbanks for drying, weighing and crushing. Samples are shipped by airfreight to the main his %irernex laboratory, Nortn Vancouver, Canada (an iSO 9Gu2 certified Laboratory) for Einar preparation and analysis. Gold is determined by 30 g Fire Assay (PA) fusior_ with an Atomic Absorption Specfroscopy (AAS) finish. Copper and molybdenum assays are by four acid digestion with an Inductively Coupled Plasma-Emission Spectroscopy (ICP-ES) finish. All samples are also analyzed for 23 additional elements by four acid digestion ICP- ES. Northern Dynasty includes standards, duplicates and blanks in addition to the laboratory's internal quality control work. Duplicate samples are analyzed by Acme Analytical Laboratories of Vancouver, Canada. For further details on Northern Dynasty and the Pebble Project please visit the Company's website at www.noreherndynasty.com or contact Investor Services at (604) 684-6365 or within North America at 1-800-667- 2114. Review Northern Dynasty's Canadian public filings at wwwsedar.com and US public filings at wwwseaaov. Comments on Forward looking Information, Estimates and other Cautionary Factors Neither the TSX Venture Exchange nor any other regulatory authority accepts responsibility for the atlequacy or accuracy of this release. Tbs 2$ase includoa certain statements that may be tleemed "fprwa4!-looking 6tafemonts". All statements in Nis release, Uther than slatemenLS of hisfodca facts, espedslly fhoae that atldB65 estimated resource quanlriES, grados and contained metals, ate fe[Ward-IOOIVng stalaments bacaJSa they e!e generarly made on the basis of es(imBlon end eMrapolation from a lim4ad number o4 drlil holes antl metallurgica; stutlles. Although diamond tlnli hole core provides valuable information about the size, shape and geology of en exploration pro)ect, there will always remain e slgnlficant degree of uncertainty In connection with Ihese valuation lectors untli a tleposY has been extensively drliled on cosely specatl centers winch has occurretl only in specdic areas on the Pebble Project Although the Company believes the expectations expressed In its forward-looking statements are based on reasonable assumptions, such statements ahoultl nq! be in any way eonsirusd es guarantees of the ultimata size, quality or commercial feeslbBity q( Vie Pebble Prgject or of the Compaeys future performance- Subsequent results antl developments may tllffer meterlally hom those postulated In the estimates antl forward-look'mg statements. Other factors that could cause Iba Company's aclval results and performance to tltHer meterlelly hom those In fonverd-looking statements tnelude adverse market paces far metals, the conclusions of tletalled leasiblliry and technlcet analyses, lower than expected gretles antl quentitles o! resources, mining rates and metal recovery rotes antl the tact [hat necessary capital may not bo available to the Company qn leans acceptable to I[ or at all. The need !or compliance with extensive anvlronmental and socio-economic rules antl practices antl the requirement far [he Company to obtain govemmenY permitting can cause a tlelay or even abandonment of a mineral project. The Company i5 subject to [he specific risks inherent in the mining business as well as general economic antl business conditions. For mere mfgrmatlUn Un IiB Company, nVBBtgrB 6hOnd [BVIBW the Ciompany~6 ann Ua PUrm 2q-r flung Wlttl ItIB iJnltad SIafB6 SBCUlIHE6 (iemmis510n find kB hUma IIIIISdCIOn t1ngB the( aft aVyl8bt0 at v_uwwsedaccom. Information about Cu EQ Copper equivalency or"CUEQ°IS a manner of expreasing poly-metalric deposits es a grade of the principal mineralization (by value)- As used herein, goltl antl molybdenum values have been expressed es part of the copper grade. CUEQ as calculatetl heroin Is based on assumed metal prices of US$1.00/Ib for capper, US$400/oz far gold, and US$6.00/ib for molybtlenvm_ Copper equivalent has not bean atlfusted for metallurgical recoveries. Ad)usiment factors to account for differences In relefrve melallurgiwl recoveries for goltl copper and molybtlenum depend upon Ne completion of tlafinl6va metallurgical testing- Slgniflcant shlfta In Vie relsflve values of these metals can signlflcantly change the CuE-0. CuEC is provided for illuskrative purposes only. H IJ NTER Respan sih le ~~~ DICKINSON Mineral l9JC. Davelopmrnt NORTHERN DYNASTY MINERALS LTD. PEBBLE PROJECT TABLE OF EAST ZONE ASSAY RES6JLT5 - rVertical Depth Hole ..Hole -: i - -- Drill Hole` Ito Cretaceous ! Di I Direction From To interce t' Cu Au' Mo CuEQ' ' i number: feet': derees de rees '#eet feet ;r feet % It "% % ' ~ _ 310 I 0.37 i 0 32 '' 0.015 106 0.64 ', _ 1618 21 88 0.46 0 41 0.019 570 H s 0.81 5316 ~ ~ 958+ ~ 90 0 , . ry ole Lo t rn Tertia Rocks - No Assays I _ 5317 5318 __ _574 y I _^ 90 _ ~ -__ __ ' __ _0 - - _-- ---~ 574 2078 1504 0.40 0 41 0.030 Incl. 708 1218 510 0.59 0 62 0.026 , ~ 0.82 1.10 5321 730 - I -65 92 804 1868 ! 1065 0.42 0 47 0.019 0.81' 5321 Incl. 804 I, 1123 320 0.58 0.66 0.023 1.10 ~, 5324 1300 -60 I 109 - ._ ~ 1937 4017 _. ---- 2080 0 54 ~ -~ 0 26 0.026 ~ .---- 1 0.85 ' - ~ 5324 i Inc! 4017 2447 , 1570 ~ 0.59 I 0 30 0.031 0.9 ~ I 'and , 2 _ 8 1130 0 65 0 38 0.033 1 06 5324 ~ and 87 - 3017 3847 1 28 - 830 0 66 _ 0 43 0.039 ~ 1 14 ' 5325 ~ -- + 780 65 90 2 656 0.37 0 55 0.009 I 0 74 __ 5325 I - -_ Inc! 1158: 1378 220 0 44 0.67 0.009 0.89 5326 - 1760 -65 ~ 125 i -- 2003 4258 - 2255 0 45 - 0 50 0.030 0.92 ~26 ~ ; _ Inc! 2008 30 08 j 1000 0 64 } 0 83 0.029 1.30 5326 __ ; 5326 I - ----_ 5327 - 1 500 I --- 65 ~ __ - 90 and and -~ + ~ _ 2008 2348 ' __ 2488 2998 1719 ~ 4338 _ 340 I 510 1 2619 0 77 ; I 0 61 1 0.87 ~ _ 1 07 ,0.039 ' - - 0 81 0.021 I r- ---- , 0 70 I 0.028 ' 1.63 _ 1.21 ' 1:45 5327 , _ _ _ ; Incl. 1732. 2337 j 605 0 90 _ 1.06 0.013 1.60 5327 __ Incl. 2457 3977 1520 0 95 0.70 0.034 1.56 ~! 5327 and 2897 3187 ' 290 1.08 1.30 ', 0.029 2.00 5330 1530 -60 60 1869 ~ 4211 2342 0.99 0.26 I 0.036 1.36 ' 5330 ~ Inc! 1869 2815 946 ~ 1 37 ~ 0 15 0.031 1.64 5330 _ ~ _ ____ and I 1869 ! 2235 366 I __ 1.70 _ 0 11 0.028 _ - _ 1.93 ~ .. 5330 I Inc! 4005 4211 ; 206 1.12 0.22 0.054 1.57 I 5331 1275 -60 90 1521 3946 2425 0.55 0.28 0.040 0.95 1 5331 ~ Inc! 1 5 1 63 0 4 0 39 I 0.036 1.18 ' ~ '~ 5331 JJy ~ ~-- ~ ~ ~~ - ~~ and 1 y ,1 3 v ~ 3468 I 3946 5~( 478 ~ 0 74 ~ fj 43 fJ.l~G`J 0.0421 0 39 '. i.ib 1.22 5332 1595 - 60 - 90 - -- 1839 ~ 420' 6 i - 2367 0 89 _ _--0 33 0 055 ' _ _ 1 41 ' - - 5332 _ T ncl. . 1839 2656 17 .28 . ~_.- 0 28 I 0.050 _ __ . , 1.74 5333 3650+ _ -60 90_ _ Hole Lost in Tertiary Rocks - No Assays 5334 I 2560 -75 90 2706 3766 1060 0.58 0.95 I 0.022 1.26 ' 5334 Incl. 2755 . 3670: 915 I 0.62 1.06 ~ 0.023 ~ 1.38 5334 ~ and ', 3078 3408 i 330 0.64 I 1.81 0.019 1.82 53 5353 1690 -90_- ~ 0 ~~690 14168 2478 I _ __0.81 . F _0.44 I 0.023 ' 1.21 I 5335 i Incl. i 1690 3436 1746 0.97 0.42 0.023 1.35 ; { 5335 and ', 1698 2548 850 1.09 0.44 '' 0.022 _ 1.48 5336 _1645 __-9_0_ 0 _ _1645 4228 2584 0.67 0.23 i 0.055 1.13 ' 5336 ; ' Incl. 1645 ' 1794. 150 1.16. 0.71 0.059 1.92 5336 ~I _ ___ Incl. 1862 2508 646 0 85 ~ 0 33 ' 0.063 ~ 1.42 - 533b I - _ _ Inc! 3178 ---- 3878 700 0.81 I -- 0.27 ' 0.052 ._ ---. 1.28 ' 5337 1550 -90 0 1650 3678 2028 0.83 _ _ 0.34 0.041 1.28 ~' ' 5337 ~ ~ Incl. 1650 2838 ~ 1188 1 10 0 48 0.036 1.60 ~ 5337 - ~- ~ ~ - _ ; and 1650 2408 L 758 1.26 ~ _ 0 37 0.038 _ ~ 1.70 Note 1 Copper equivalent calculations use metal prices of US$1.00/Ib for copper, US$400/oz for gold and US$6.00/Ib for molybdenum. Adjustment factors to account for differences in relative metallurgical recoveries for gold, copper and molybdenum will depend upon the completion of defnitive metallurgical testing. CuEQ = Cu °/ + (AU glt x 12.86!22.05) + (Mo % x 132.28122.05) Note 2 Au values > 5.0 g/t capped at 5.0 g/t HUNTER Responsible ~~~ DICKINSON Mlaoml INC. Developm©nt __ _____.___. - 2 Z 2 Z ~ 0 ~ 0 ~ 0 ~ 0 ~ o ° o~ ° o ti ° o~ ° o~ o ° ° o o o o ~ o N o ~ o [p ~ r C V r C ~ r .C N r ~- C O . O €O O , U J O O 5 ~ ; N ~ i ~ I h M N W M N e ~ i~ ... ~ ~ ~ ~~ N p ~ ~ 0 ~ ~ N $ ( o i o ~ Y ~ , G U () N §t v> . N O m N II ~ ° ~ N CC ~ I ttt (n ~ ~ yin' ~ M p ... + O ~__ ~ ~- o O U ~ ~ 0 0~ w 3 ° I ~M ._.. __O_ N •ro N 4 O ~_.~ -N~- i~ ~[ _..._- qty/' ~~"~ ~~.~~ ~ '...,. •~ ° ',. 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'* ~ ~~ za -• ~ ~. p. ~ ~ ~ ~ ~~" ' " '~ ' La~,ee Fala rih ~ ~~ z c J' ___-.__. r ,~a :~ ~, <~? rxi ~~~ j fj zo ~~ ; JI Jj ;. ,1~ a~ni,n, P~~ ~~ ~~:~- ~- ~.~a'~w -..c ~~ r ~~*~ ~`~~~ w.,v ~. . ~'~ ~;;~ ~ ,, a,o...~ ~~.~~ ~,~.. vtrars ~~~ ,m.~...~.,.. fRre I n xxn n...l.1'. I.~ n.~n... r. ~~ a~( lU~~)- eui vntle„1 ~)'lhe eNll air (]n _ U.hl~le rn. vi. _ iiii~ilf N~.vizlilbr(3opmin0oi, 211011-~~i ~orv..auJ M.oaJ ~~4 z~; ,.; ~; ILA ~Tw ~ k Y~ C ~~ +` I C 1$ I F ~. Historically, mining was a cornerstone of the Alaska greatest potential economic benefts from mineral r?tonrmv ItAarv roads ddd<s z,nd cithe~ infrast°uctu re rescsce develotomcnt. .raining industry Today, a-rejuvenated mining industry is dr ipging a broad range of economic benefits to Alaskans rind Alaska communities. For example, mining: Offers some of the highest paying occupafions in A!:ska Providesjobs in rriany rural areas in Alaska; where there are few other private sector jobs available: i Makes signi5cant local governmei it tax payments.' materials, such as sand;. gravel and rock I n 2004' ~~ ==T.nere were 26 significane exploranon,projeres in Alaska. Exploration spending totaled 571 million (2005 I exploraYian expenditelres are over $95 mtllior~j `. ~`- Another $209 million was invested {or development of Benefits Native corporatronsfrom mining activity on new mines i7 Alaska. ' their land', laoth rn jobs for shareholders and through,. v Alaska's three largest metal mines, Red. Dog, FortJ<nox, S direct payments ' and Greens. Creek, spend approximately $170 million annually in, Alaska in support of their operations. ' The future prornises even greats r economic benefits ~~~ Approxmately73::open-pit, underground, mechanical ti~~wever, the corning industry requires a stable and placer, and suction dredge mines were in production in eruitable tax environment for Alaskans to realize the Alaska. f't*~.~`t'&B~r1'rd Ct1".r.;t...fi~.~i ;dpp :ff average direct rpirnng jobsrin Aiaska ~. _ rti~ ,, at yeast 37 ~ock q,:a•re, nd ?? ac* .,and ^d gravel operations. r~.,; `%.~~'- ,i~r f ~' paid by the mining industry to state cioverriment in royalties, fee,,and taxes u.;.; ; paia by mines to local governments C ..~erl Ksaid by rnicres tv Native corporations %` ~~ ,.r ;, pard'o Alaska Railroad to mcve coal, ::and and, gravel to state and international markets ,l~ rn paidto tPie Alaska Industrial Development F~ Export Authority (AIDEA) for !COeLong lfl:ountain r2c-gionalaransportatioii System r.~ser fee.=, .. ~~ ~ r ~~ y In 2004, the mining industry directly employed 2,900 dR~3W~ ~~~~ ggiq~ ~~ ~~t~ ~R@~~4W~u~ ~„~ ';i~sl.an., pa)nng them x194 millior in wages: If indirect ' The mining industry has a higher restdent'hire rate, at ~,,nd induced jobs are added rn, a total of 5,100 Alaskans 83 percent, than the statewide average of 80,percent, and `.r:riih S2£;O.millian in navrnll rant ha aitrihntPr! rn the mininn ~: ~r ,:... . , „... S'.ai. m"a„t I~~`n~sr't~k?$ll Isic6~: ~ 3'~u:rY ~h'G~~fl~i331`r~„~~!~'71 ~u ~$ :vPPS Nrorluna in . 9rdustny %LOlaska Residerok 9PJorBcers , ;`3tska's metallic mirieral rrunes is 170,750, 83 percent above 1,7c~ statetroide ave! age annual wage, Foci Knox Mine employees' average salary was 70 per cat-; higher than the Fairbanks North Star Borough average. iexr~~ens Creez fVline'sr2_60 employees are among the highest ;:}~=tc~ workers in Juneau vaith average annualwages of nearly S%1;,000, almost triple the average 529,000 wage for Juneau F,i°ivate sector workers. r Prior to:Red DaaMine's opening, average income in ~ S?s Pdorthwest Arctic Borough tNas well below the 'statewide ; su=rage Following cfevelopmehtofRed DoglViirie,the = rs Sian household income in the Borough increased by , i gout 87 percent. Annual wages at the mine range from C ~ x;,000 to'$85,000 per year, plus benefits. ,.~ ~~ad°a~~ ~~~ 6~ rah ~~ Many jobs offered by the mining industry are rural- s<=d, including those at Red Dog, Danlin Geek, Pogo, c n ~w!~. ~ ,, ~ ~. ? >~ i.;bs ~ ~ .,`f, tact ."~ ~ `, va i a .y other rviplayment oppa hmities are available. Red Dog. Mine is the second largest em to er in the Mining 82.8% Construction 80.1 OII and Gas Extraction 77.3 Accommodation and Food Services 73.1 Seafood Processing 28.9 All Industries 81,9 ~ouira:.Ala,ka Ce~arPrr:entnf tabor and Workforce Deveiopmen, Mining projects offer employment and busyness opportunities to Ftlaskans Forerample: Approxfrrrately300 wo~kers have been hired for the Pago Mine construction project near Delta Junction. Pogo's labor force is 85 percent Alaska resident. For construct!on of the Kensington Gold Project near Juneau, 542 rnllion in contracts have been awarded sc far, 85 perccnt'CO Alaskan companies. rT In 2005, Calista shareholders made up 94 percent (111 employees) of Donlin Creek's direct and'contract employees. Seven of eight supervisors on the project are shareholders. p y d;;rthwest Arctic Borough. including contract employment g~ , In 2005, for the Pebble project, 45 consulting firms , accounts for 17 percent of all employrent in the Borough. have been hired to conduct environmental. baseline studies, planning, and research. These firms reported 441,Alaslran employees worked on some. aspect of the project. Of the Alaska workforce, 21 percent were hired locally from the Bristol Bay region and 26percent were Alasl<a'Native. ~~ ire a~aoe~ng gates on fhe r~ 1 t ~ w ' ~ T ~ ~ w= r ,- With the Pago and Kensington protects com!ng on line ~,;~r , ~ within tl7e neXt two years, metal mining will introduce 500 n f more high paying jobs for Alaskans, increasrngmining's r s ~ ` ~ payroll by $35 million. T r x it ~_~ ~.` " , ` Projects currently m exploration, such as Pebble Donlin t~ x ~ ` ~ ' : „` ~ ; ! ° ~ , Creek, Roelc Creek, and Chuitna Coal, have the otential to P < y ° Nr ,F,. '~ ' ~ y employ 1,506 Alaskans. ~~. gx,.. ~; ~ '~~ai~is~~ ~ n~ Manyjobs in the mining industry offer transferable skills in an industry.. rapidlygrowing in Alaska and worldwide. There are a number of Alaska education institutions and organizat!ons that provide training for and with the mining e industry throughout Alaska. fVlining companies are a significant sour c~ of revenue ror oral governments In 2004: :Red Dog paid $6 2 mfliion in payment in lieu of taxes (PICT) to the f\nrthwest /arctic Gorough, representing p three fourths of its General Fund receipts °,, I-~Yi ~ I,~iox/sT u~ ~(ct~'r )vv U `hc~ scccrnd ~arr,~est t~rope°ty, rax payer to the Fairbanks Northr:Star Borough, paying: +$3 5 million m property taxes 'Greens Creek M{ne is the largest private property tax payer, paying 5660,000 m property tares tothe Cary and 'Boroughbf Juneau. ' -- Usibelli Coal Mine paid property taxes of $125,000 to' the Farbanks hJorth Sta' Bcro:}gh and $155,000'to the. fvlatanuska-Susitna Eorough, and $75,000 in other taxes 'to the Denali Borough :Alaska Gold Company; a subsidiary of NovaGold, vas the `fourth largest pro~ertytax payer to the City of Nome„ '.paying $53,300 in real property taxes. ~s. ire ia~~at gta~~~¢n~a~fi ~¢app~r@ ~x ~ In a PILTagreement between the Pogo Mine acid ~:hc: City of Delta Junction, mine developers paid the city D0,000 in 2005, will pay another $500;000 in 2006, and ece~ther $1,000,000 in 2007 (if a Borough has not yet been ~~n~rating ate g~~~rnmeoat renu The mining industry paid $15.II million to the State of ".iaska in 2004 through a variety of taxes, rent, royalties, ::d fees. Mining license taxes veere the (argest source of t,venue, totaling $10.3 mtlhon irrFY 2005, a year when atal prices werejust beginning to improve. Mining is an important source of revenue for the Alaska ?ailroad Corporation. In FY 2004, the railroad earned - ;~proximately $17 million from movement of coal and avel destined for Alasf<a or exhort markets jrepresenting percent dfits total operating revenue). Red Dog"Mme paid the Alaska Industrial :Development Export Authority dose to $18 million in annual user fees r use of the state-owned DeLona Mountain Regional ':nsportation System road and port that senses Red Dog /ine. >~ rung a kia~a a 6 itlt Tr The Alaska Mental Health Trust earned $167,000 in nts and royalty payments from the mining industry in,2004. f.e Trust also earned $b0,000 from construction material 7dafC'S. Rods Crook DoveHr~~fnene Phoro courtesy ~f NoVarold Rey~uhrns `~ , ~ ."~ Revicwin_y core samples aT the Pebble Project Photo courtesy of ~~ Nort~hem CJynasty Mmcials v'C<~ mur[asy of I<Annocoti -: Greens Geel< Mine ~k ~ P{, ;~ '~ e ~. k t F ~ ~ I r ~ c ~ ~ iy ~ ` ;° ~v..- ~ ~r kn ~`- ~ ~ Yr~ "' e't l rt `~ 4 a.~ ` ~~:-. rt f _I- ~.~ w l ~(~ r ~. ~r~ FysC L e~ Krw.. rk„ _ ~,. h :~. P, .u ~„ '~ .k ~ k: h.. r-G ar, Fr~~ G.<~~ Recr Dog is operated by TedcGonvnco under arr ~sreernenf with NAI\IA Regional Corporation. NANA is the ',~.ndawner and Ted<'Cominco is the. opera tar. Tecf: Cominco pays a netsmelEer return royalty to NANA, wfiich in 20104 rra ; $1 G 9 millron. Of the 2J04 royalty payment NANA ~ ~ ~?p'' ,:r~istributed "z5.9 millioia to the other 11 ANSCA regional s.~ ~~~~ ~~°x~,~~'p~~ v, ~~;' u 5:. >/'1 _r T_J. /-~ __ _.,J~~~~« t-y~ _~ ~i~°wfhem-e ri aj n. rci 1;~~=. I:>< wfiQ ough Placer Dnnrn and NcvaGold, developersgfihe ~hn G'eekpra)cct, have entered. irrto-exploration and rng lease <~greements with Calista Corporatron and rvhe ko~kwim Corpnra'Cion, and are~talking wrth Calrsta ahd i:okwm about or~portunities for service contracts. Alaska~Gald Company, a subsidia-y of NavaGold; has ..oration and mining. lease arrangements with Bering. ' rits,Native Corporation and Sitnasuak Native Corporation mining and surlace use. Oil Knor. Mine. I'lui ~~nrrrt'~sy n`Kinr uss Gord DELcn a Mountaui ReGwnaf Yr msPo't~Yron Syswni Port Photo coirrie~y of Tr c la Cnrnlnco ~~~W aF The mining industry has historically played a key role in the development of important infrastructure in Alaska. Development of the Alaska Railroad, the Richardson Highway, and tlae settlement of Anchorage, Fairbanks, Juneau, Skagway, and (`Dome are all linked with early mining industry activity. The mining industry is also responsible for the development of smaller communities throughout Alaska, such as Eagle., Circle, and McGrath, among others. Mining industry development of Alaska infrastructure :continues today Examples include the Detong Mountain PRegionaLTransportation System port and road (developed in support of he Red Dog Mine}, the Seward coal loading facility, and the Pogo Mine road Minirg-related infrastructure can also :reduce the cost of basic services to Alaskans. For examlale, because Ft. Knax is a large purchaser of electric power, other local customers enjoy lower power rates C.ontei;is of this i Handout are Taker, from the report, The Economic 6npact of Alaska's NFining fi~dustry (February 2006), prepared by McDowell Group, Inc. The full study is available online at wvew.alaskamir~ers.org or from the Alaska Miners Rnssociation in Anchorage at (907} 563-°229. ~ ~ "' ' ~ _, ~ `~ ~~ ~ ~ - ~- l~ Pebble Project O 6 r , - ~ i1N -n ~ i ~ ( ~„~~. ,' yam,, ~ NO BTH ERN D`IN ASTY MINES INC. . ' u .~ ` - - f` General Land Status ~., .... -' ~ ' i / / Collings Proposed Route ~r ~ 11 e` lea t mar = a~.~ ~ d P ve ~ Legend ~~~~ t" ~ ! ` r. ~' ° -~ Possible Power Llne ~~ ~ :,~ u --- Possible Submergetl Power Cable 1 ~. ~ ~ ( 1,., -- Collings Roatl Stutly Corridor (10/11/06) ~9 t _ ; ~ k ;E, \ ~ ~~ / ~ - ' Exieting Reads _ ,~ U ~ . ftt r S ~ General land Status (BLM 145-200x1) r { ~ -,. / ~ ~ Bureau of Land Management 1 ~` "'~: , ,. t- - ~ ! I !:' ~ Natlonel Perk6ervae ~ -le '` t ~ ~ ~ Native Patentor IC ~' " ~ Native Selected ','~ =y Cj State Patent o= TA I. as ~ I ~~' State Selectetl \ ~ y ~ Native Allotments/Private Lands Cab / ~ r ~ (RDI reviewed 5/05) , P ..~'R r t ~'- P ~ , Village Corp. Boundaries (B`c ESG) .. i ~ National Park and Preserve tk" 1 v~.*: ' C ADOT&PF Possible Port Slte (7-27-2004) . sF b~F..3 r I J: -..r r.iv ,..e k Limestone Depoeits (NDM 9/1/04) n,~no, laoa~sms it„rl_m,i o6a,ma ~ oare. N omoa.,e z6oe ve,~mna nwnor nolowa Mllef e 3 6 ,2 NAamefers 6 9 9 12 16 Scale ?362.006 Alaeke State Plane Zoe,e 5 (unXS feet) 1903 NortM1 American oaNm w iss°a~o~w iao°vo^w xn•av~w im°orow ~~~ r~ a°r I ~ '~i~ ~ .. 'fir "f ~ ~s ~y:oMP~f ~~+.,Is ~ s ~ ~ ~ F ~~ li >+~ ~ ,a .ra a ~ , ~ r" ~ ~~~it~ .T~neks It ^'$s _.-. a-.rr^zven *~-~.ano-._ v ~a~ _ . ~ -~ ,,,er ,'~~ ~ ,; ~ \, "`r'te' :~s ,~~ a ,~,°°.,..a^ ~ 'S?f1 u.. ~ y tt ~( ~ FS~~ Y ~~ X'~ 'y ~ 1^ ~t~ ~! P ptry8 J ~~ ..~~`..,~ ~.+sr~ ~ Cla Soh °o '~O'~. 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Regional Map Legend ® Pon sna --^--~ C II' 9 P 'hl Acce55 Roatl ~P bl P L'e ----~ P DI S b ergetl Power Cable - Ez stop Roahs Nat anal Park or P~eseme ^" ay ~~ ~~~ nFles N C 20 <C 6 BC Ki ame(ars 0 30 60 2a scale to sao coo Alaaka State Pane Z 5 i fa feet) 198] North Amer can Datum