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Home My WebLink About2011-01-13 Airport Commission PacketKENAI AIRPORT JANUARY 13, 2011 KENAI CITY COUNCIL CHAMBERS 7:00 a. Discussion /Recommendation -- Zoning Setbacks --- Airport Properties ITEM S• REPORT a. Commission Chair b. Airport Manager C. City Council Liaison ITEM 9: NEXT MEETING ATTENDANCE NOTIFICATION a. Februa --j 10 2011 ITEM 10: COMMISSIONER COMMENTS AND QUESTIONS ITEM 11: PERSONS NOT SCHEDULED TO BE HEARD ITEM 12: INFORMATION ITEMS a. Kenai City Council Meeting Action Agendas for December 15, 2010 and January 5, 2011. b. Airport Endowment Fund Investment Review C. Airport Manager's Report -- December 2010 d. December 2010 Enplanernent e. Ordinance No. 2524 -2010 and Ordinance No. 2525 -2010 f. Resolution No. 2011 -01 and Resolution No. 2011 -03 g. Resolution No. 2011 -04 ITEM 13: ADJOURNMENT PLEASE CONTACT US IF YOU WILL NOT BE ABLE TO ATTENb THE MEETING: CAROL -- 283 -8231 OR MARY -- 283 -7951 AGENDA ITEM 1: CALL TO ORDER. AND ROLL CALIF ITEM 2: AGENDA APPROVAL ITEM 3: ELEC'T'ION OF CHAIR AND NICE CHAIR ITEM 4: APPROVAL OF MEETING SUMMARY -- December 9, 2010 ITEM 5: PERSONS SCHEDULED TO BE HEART] ITEM 6: OLIN BUSINESS ITEM 7: NEW BUSINESS a. Discussion /Recommendation -- Zoning Setbacks --- Airport Properties ITEM S• REPORT a. Commission Chair b. Airport Manager C. City Council Liaison ITEM 9: NEXT MEETING ATTENDANCE NOTIFICATION a. Februa --j 10 2011 ITEM 10: COMMISSIONER COMMENTS AND QUESTIONS ITEM 11: PERSONS NOT SCHEDULED TO BE HEARD ITEM 12: INFORMATION ITEMS a. Kenai City Council Meeting Action Agendas for December 15, 2010 and January 5, 2011. b. Airport Endowment Fund Investment Review C. Airport Manager's Report -- December 2010 d. December 2010 Enplanernent e. Ordinance No. 2524 -2010 and Ordinance No. 2525 -2010 f. Resolution No. 2011 -01 and Resolution No. 2011 -03 g. Resolution No. 2011 -04 ITEM 13: ADJOURNMENT PLEASE CONTACT US IF YOU WILL NOT BE ABLE TO ATTENb THE MEETING: CAROL -- 283 -8231 OR MARY -- 283 -7951 •, r • •: Ip fi��ii �ii�:� *7002.11W `k a. Discussion/ Recommendation -- Float Plane Basin Development Alternatives a. Discussion w-- FY 12 Airport Budget b. Discussion/ Recommendation -- Terminal Side Ramp "Welcome Sign" ITEM 7: REPORT a. Commission Chair b. Airport Manager c. City Council Liaison ITEM 8: NEXT MEETING ATTENDANCE NOTIFICATION a. January 13, 2011 ,Twwkqj Us • _ • •, •. a. Kenai City Council Meeting Action Agendas for November 3, 23 and December. 1, 2010. b. Kenai Nikiski Pipeline, LLC (KNPL) Lease Application (Portion of Tract A, Plat No. 78 -111. c. 11/ 12/2010 M. Bondurant memorandum of appreciation/ Randy Parrish, Shop Foreman. d. Snow Plowing /Sanding Services Contract/ Airport Terminal Building, Kenai Flight Service Station and Alaska Fire Training Facility. e. Kathy Chircop, Realtor, d /b /a Reflections Realty Group of Kenai /Assignment and Assumption of Lease Agreement. f. 11/3/2010 Alaskan Region Airport Certification Bulletin g. 10/2010 and 11 /2010 Airport Manager Reports i. 11/30/2010 Memorandum regarding Kenai Municipal Airport Supplemental Planning Assessment/ Status of Implementation. wf 8 ►lkl I OR... KENAI AIRPORT COMMISSION DECEMBER r 10 KENAI CITY COUNCIL 7:00 ., CHAIR HENRY y PRESI MEETING SUMMARY RIMM Chair Knackstedt called the meeting to order at approximately 7:00 p.m. Roll was confirmed as follows: Commissioners present: J. Zirul, J. Bielefeld, H. Knackstedt, L. Porter, G. Feekera, and R. Rogers Commissioner absent: E. Mayer Staff/ Council Liaison present: Airport Manager M. Bondurant and Council Member R. Marquis Commissioner Bielefeld MOVED for approval of the agenda as presented and Commissioner Rogers SECONDED the notion. There were no objections. SO ORDERED. I'T'EM 3: APPROVAL OF MEETING SUMMARY -- October 14, 2010 Commissioner Zirul MOVED to approve the October 14, 2010 meeting summary as presented and 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/ Recommendation -- Float Plane Basin Development Alternatives The Commission reviewed comments made at the October 14, 2010 meeting related to the proposed lease lot development at the Float Plane Basin. Commission comments included: ® Supported the taxiways running all the way to the North. Supported the layout which kept in mind the need for long lots for t- hangars. Rick Koch, City Manager -- Stated Administration's recommendation would be forwarded to the Commission for its January meeting. Commissioner Bielefeld MOVED to recommend Design. 6A and Commissioner Zirul SECONDED the motion. There were no objections. SO ORDERED. 6 -a. Discussion -- FY 12 Airport Budget Rick Koch, City Manages -- Discussed the financial status of the airport, including FY 11 and FY 12 budgets and the Airport Permanent Fund. 6 -b. Discussion/ Recommendation -- Terminal Side Ramp "Welcome Sign Airport Manager Bondurant reported requests had been made for a welcome sign to be placed on the airfield side of the terminal building. Suggested sign designs were included in the packet for review. 1l i U Commissioner Bielefeld MOVED to recommend Design #2 as a welcome sign to be placed on the airfield side of the terminal building. Commissioner Porter SECONDED the motion. There were no objections. SO ORDERED. ITEM 7: REPORT 7 -a. Commission Chair -- No report. 7 -b. Airport Manager -- Airport Manager Bondurant noted the following: • The FAA Certification Inspectors would be in Kenai from January 4 -7, 2011. • She was working with the Fire chief to finalize the new Airport Emergency Control Plan by December 31, 2010. • Reviewed the information items included in the packet. 7 -c. City Council Liaison -- Council Member Marquis reviewed the November 10, November 23, and December 1, 2010 Council Meeting Action Agendas which were included in. the packet and stated he looked forward to working with the Airport Commission and learning more about the airport. ITEM 8: NEXT MEETING ATTENDANCE NOTIFICATION 8 -a. January 13, 2011 AIRPORT COMMISSION MEETING DECEMBER 9, 2010 PAGE 2 There were no notifications of planned absences for the January 13, 2011 meeting. ITEM 9: ITEM 10: ITEM 11: 11 -a. 11 -b. 11 -c. 11 -d.. 11 -e. 11-£ I 1 -g. 11 -i. 1TEM 120 MOTION: Kenai City Council Meeting Action Agendas for November 3, 23 and December 1, 2010. Kenai Nikiski Pipeline, LLC (KNPL) Lease Application (Portion of Tract A, Plat No. 78 -111. 11 / 12/ 2010 M. Bondurant memorandum of appreciation / Randy Parrish, Shop Foreman. Snow Plowing /Sanding Services Contract/ Airport Terminal Building, Kenai Flight Service Station and Alaska Fire Training Facility. Kathy Chircop, Realtor, d /b /a Reflections Realty Group of Kenai /Assignment and Assumption of Lease Agreement. 11/3/.2010 Alaskan Region Airport Certification Bulletin 10/2010 and 11 /2010 Airport Manager Reports 1 I / 30 / 2010 Memorandum regarding Kenai Municipal Airport Supplemental Planning Assessment/ Status of Implementation. �* � - U. wmaj Commissioner Zirul MOVED to adjourn and Commissioner Bielefeld SECONDED the motion. There were no objections. S® ORDERED. There being no further business to come before the Commission, the meeting was adjourned at approximately 9:10 p.m. Minutes prepared and submitted by: Carol L. Freas, City Clerk AIRPORT COMMISSION MEETING DECEMBER 9, 2010 PAGE 3 U �1 TO: Mary Bondurant, Airport Manager Airport Commission FRONT: Marilyn Kebschull, Planning Administration DATE: December 29, 2010 SUBJECT: Zoning Setbacks — Airport Properties Title 14 of the Kenai Municipal Code (KMC), Planning & Zoning, regulates development in the City of Kenai. Included in these regulations are building setbacks from property lines. Setbacks are listed in KMC 14.24.020 (copy attached). Prior to May 2010, building setbacks in the commercial /industrial zones were based on building and fire codes. In May of 2010, Ordinance No. 2472 -2010 was adopted requiring building setbacks in all zones. Due to the limited size of some airport lots and the types of development, the Commission may want to consider recommending an amendment for developments within the airport proper. The exception would not exempt development from meeting the 2006 International Building, Fire Codes (IBC and IFC), and airport Building Restriction Line (BRL) but would eliminate the requirement for a zoning variance. The City's Building Official, Larry Floyd, has provided information on IBC setback requirements for aircraft hangars. That information is attached and can be reviewed at your meeting. Basically, the following applies: Aircraft Hangars are usually considered a S use occupancy; and, Hangars must be designed by an licensed architect; and, Hangars require an IBC building setback of 30 feet from the property line (centerline of a street or public way can be used when calculating the 30 -foot setback), or, Construction with a 2 -hour rated wall (i.e. concrete block walls, 2 -518" sheet of gypsum wall board on each side of the wall (a total of 4 sheets). There are other methods to meet the requirement which would be determined by the architect designing the building). • There is no fire separation required for multiple buildings on a single lot until the combined building area exceeds 17,500 square feet. At that point, a 60- foot building separation is required or 2-hour fire rated walls. • Kenai Zoning Code requires a minimum 6 -foot building separation for buildings on the same lot. It is my recommendation that any proposed exception be limited to those properties with access to taxiway, ramps, or parking aprons. The BRL is a stricter standard than the zoning setback so the setback along the taxiway and aprons would not be affected by an exception. The problem is usually with side setbacks. Setbacks along streets and right -of -ways outside of the airport fence should be maintained. A footnote could be added to the Development Requirements Table located at KMC 14.24.020: "Properties contained in the airport perimeter fence or having access to aircraft movement areas, ramps, taxiways or parking aprons are exempt from the building setback. The building restriction line (BRL) identified on the Airport Layout Plan (ALP) must be maintained. Setbacks along streets and right -of- ways outside of the airport perimeter fence are not exempt." The Commission may have other suggestions for consideration. I will be available to attend the meeting on January 13 to discuss zoning requirements. Attachments KMC 14.20.010 —Development Requirements Table IBC Setback Examples cc: Planning & Zoning Commission Rick Koch, City Manager 4 .2 4.02��3 11 Genc al ZON:)CNG MSTRICI ",S V JS� S Cif G V ➢tNfl JM `tl' Ckl (feel) .MINIM )m LOT 5'f7F, Cl1�Yt 9D RM 9" � „ RS 60 - � �2St 60 j RSA i 60 &Z IBS' � 60 I MAM/cc/cc/Cm Sec individual sections of Cc dc fer 90 I 9�� l 90 .... _�I ➢orit' 25 25' 25 2S 25 10 i 25 2.5 25 25 Side ire - story' S S 5 S 5 t 5 10 1S )5 15 3ayligl?f,13a3'ernenfli 5 l0 10 To 10 3 � )0 is i5 � 5 Split Leve1.� 1 two- Scary' l5 1.5 1f l.5 5" 7.0 1` 1.5 15 .1 IlZeat ?D 20 ?u l0 20 i0 l0 20 20 20 Niaximirm trot J�30% 3O'K 30% 30 3D% 0% 30% 30% 36 CO g- E 11'axiin:;an }� €;eighC : 35 35 35 35 35 1�coCnotes O.; PrGV)dcd thal. III e minimum front sctbackis measured from an} nght -of -way oz access casc.merrt. {_2) Side setbacks are ktc.rmined mdGPendeetly fxo.m the fY:mi view of Che strtirciu.re Plot p1a,T /as- L�uilt Will distirlgt:ish single and. two - S(my per!ions of are ;fret (3) Story is that portion of a building included between the tipper starface of ary Door &n0, the trplasr surFacr of dre 17oor next above or the ccling or roof above. One -story is dcf3wA as a stoz y having direct access fiorn grade, lcvcl without a ?owci story A siruclurc having a iowc story situated below a one - story is col-mdorcd a. sirueCtiuc m i is epksrri;- Two- stony is d.cfr'ned as one-story plus lnore than one -half (1 /2) the lac ght or the stogy all silua,ted abo grade. Daylight bascnlenb'spht;evct is defncd as one -story plus 1855'tl1 ]] ono -half (112) 610,1169)]C efihe lGWC7 sCOry a1i situakd above grade. for p ses of these ootnot:s, Gradc is deCned as the lowcsC point of elevation of the faisbne surface of the gr'o'und bctureerr Cl;c buiidirrg and a lit7c five (5) feat from the "'milding. 4) Excepl drat for. each story ovc: two (2 stories, each side aad rear yard shall be i.TZCreased. three. {:t) :CceC, but neec'� , vt exceed. fouftecn (14):( sideyazd and noAQ - tcen (19) fa,e 'forthc. rcrr yE"d. dunng 7 -7 -99 suj�p1tmt.a , Ords. ) S6?.200G, 7898- :1956 -2002, '1962 -2002, 2081 -2005 2185 -2006, 2 2412 -2010f _ "K,ca s:,p ; -No 96, 11 -10) 298 412.2 Aircraft hangars. Aircraft hangars shall be in accordance with Sections 412.2.1 through 4122.6. 412.2.1 Exterior walls, Exterior walls located less than 30 feet (9 144 mm) from property lines, lot lines or a public way shall have a fire- resistance rating not less than 2 hours. 503.1 .2 I3uildi s on same lot. Two or more buildings on the same lot shall be regulated as shall 01' The provisions of this code applicable to the aggregate building shall be applicable to each building. This would limit the combined size of several buildings on one lot treated as one without separation to 17,500sf . TIRE SEPARATION DISTANCE. The distance measured from the building face to one of the following: 1. The closest interior lot line: 3. To an imaginary line between two buildings on the property. 3 Ce � fc r Z ✓ .�� / � � Uc��i.tys Gvt �hC SRm2 Ic �66 '36 i f 14 �n G c� r P. rEP.J= E. 1 ! KENAI CITY COUNCIL - REGULAR MEETING DECEMBER 15, 2010 7:00 5-.195. KENAI CITY COUNCIL CHAMBERS h.ttp: / /www.ci.kenai.,ak.us ITEM A: CALL T O RDER I . Pledge of Allegiance 2. Roll Call 3. Agenda Approval 4. Consent Agenda (Public comment limited to 3 minutes per speaker. Persons m.a.y give their time over to another speaker present, however no single speaker present may speak for more than 30 minutes combined on their own and on others' behalf.) *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 (Public comment limited to 10 minutes per speaker) Brendyn Shiflea, First National Bank Alaska -- Kenai Community Library Donation Presentation ITEM C: UNSCHEDULED PUBLIC: COMMENTS (Public comment limited to 3 minutes per speaker) ITEM D: PUBLIC HEARINGS (Testimony limited to 3 minutes per speaker. Persons may give their time over to another speaker present, however no single speaker present may speak for more than 30 minutes combined on their own and on others' behalf.) 1. ADOPTED. Ordinance No. 2519 -2010 -- Amending Title 3 of the Kenai Municipal Code, "Animal Control," to Amend the Definition of the Term. "Kennel" to Distinguish Between Commercial and Non - Commercial Kennels, to Establish a Notice Process for Kennel License Applications and Renewals, and to Provide for a New Appeal Process of Kennel Licensing Decisions. (Clerk's Note: Ordinance No. 2519 -2010 was postponed from the December 1, 2010 in order to allow for a further review of information and a second public hearing. The motion to adopt Ordinance No. 2519 -2010 is active and no additional motion to adopt is needed.) 2. ADOPTED. Ordinance No. 2523 -2010 -- Increasing Estimated Revenues and Appropriations by $2,600.77 in the General Fund for State Traffic Grant Overtime Expenditures. 3. PASSED UNANIMOUSLY. Resolution .No. 2010 -64 -- Awarding a Contract to Cornerstone Equipment Rentals for the Project Entitled, "Kenai North Shore Restrooms /Marathon. Park Restrooms- 2010," for the Total Amount of $96,000.00. 4. PASSED UNANIMOUSLY Resolution No. 2010 -65 -- Adopting an Alternative Allocation Method for the FY11 Shared Fisheries Business Tax Program and Certifying that this Allocation Method Fairly Represents the Distribution of Significant Effects of Fisheries Business Activity in the Cook Inlet Fisheries Management Area. 5. APPROVEDICONSENT AGENDA. *201112012 Liquor License Renewal -- Kenai Golf Course (License #4708) ITEM E: MINUTES 1. APPROVED. *Regular Meeting of November 23, 2010. 2. APPROVED. *Regular Meeting of December 1, 2010. ITEM F: UNFINISHED BUSINESS ITEM G: NEW BUSINESS APPROVED. Ratification of Bills 2. APPROVED. Approval of Purchase Orders Exceeding $ 15,000 3. .TNTRODUCEDICONSENT AGENDA. *Ordinance No. 2524 -2010 -- Increasing Estimated Revenues and Appropriations by $23,000 in the General and Airport Funds for the Purchase of Approximately 20 Acres of Property Described as E 1 /2 NE 1 /4 NE 1 /4, Section 31, T6N, RI1W, Seward Meridian, Third Judicial District, Kenai, Alaska to be Retained by the City and Reserved for Public Use, and for Airport Purposes. 4. INT.RODUCEI) C ®NSENT AGENDA. *Ordinance No. 2525 -2010 -- Increasing Estimated Revenues and Appropriations by $80,000 in the General and Airport Funds for the Purchase of Approximately 40 Acres of Property Described as SE 1 /4 NE 1 /4, T6 N, RI IW, Section 31, Seward Meridian, Third Judicial District, Kenai, Alaska to be Retained by the City and Reserved for Public Use, and for Airport Purposes. 5. INTRODUCEi) /_CONSENT' AGE1Vg1e4. *Ordinance No. 2526 -2010 -- Increasing Estimated Revenues and Appropriations by $25,000 in the General Fund for the Purchase of Approximately 7.28 Acres of Property Described as Tract C, Inlet View Subdivision, Second Addition, T5N, RI 1W, Section 4, Seward Meridian, Third Judicial District, Kenai, Alaska to be Retained by the City and Reserved for the Purpose of Maintaining A Component of the City's Storm Drain System. 6. WORK SESSIQMTERRUARY 16, 2 011, 6:00 P.M. Discussion -- Schedule Work Session. to Discuss Utility Rate Study. 7, WORD SESSTONIFEBRU Y 15, 2011, 6 :00 P.M. Discussion -- Dip Net Report 2010 S. .A.P,PROVAL /$250.00 CO-SPONSORSHIP. Discussion -- Request for Financial Support/ Second Annual Industrial Outlook Forum 1. Council on Aging 2. Airport Commission 3, Harbor 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 C, Mini -Grant Steering Committee d. Kenai Convention 8, Visitors Bureau e. Reports of KPB Assembly, Legislators and Councils 1. City Manager 2. Attorney 3. City Clerk 1. Citizen Comments (Public corn.ment limited to 5 minutes per speaker) 2. Council Member Comments EXECUT11VE SESSION --- None scheduled. ITEM L: FENDING LEGISLATION (This item lists legislation which will be addressed at a later date as noted.) KENAI CITY COUNCIL - REGULAR MEETING JANUARY 5, 2011 7:00 P.M. KENAI, CITY`' COUNCIL CHAMBERS ht tp:/ /www.ci.ken.ai.ak , us 1. Pledge of Allegiance 2. Roll Call 3. Agenda Approval 4. Consent Agenda (Public comment limited to 3 minutes per speaker. Persons may give their time over to another speaker present, however no single speaker present may speak for more than 30 mutates combined on their own and on, others' behalf.) *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 U: SCHEDULED PUBLIC COMMENTS (Public comment limited to 10 minutes per speaker) Dennis Barnard -- Twin Cities Raceway /Stock Car Only Policy 2. Robert Flanders -- Twin Cities Raceway/ Opposition to Motocross Track 3. Barney Phillips -- Kenai Peninsula Racing Lions /MX Division Noise Mitigation Program for 201.1. ITEMM C: UNSCHEDULED PUBLIC COMMENTS (Public cornmen.t limited to 3 minutes per speaker) ITEM[ D: PUBLIC HEARINGS (`Testimony limited to 3 minutes per speaker. Persons may give their time over to another speaker present, however no single speaker present may speak for more than 30 minutes combined on their own and on others' behalf.) PASSED UNANIMOUSLY. Ordinance No. 2524 -2010 --Increasing Estimated Revenues and Appropriations by $23,000 in the General and Airport funds for the Purchase of Approximately 20 Acres of Property Described as E 1 /2 NE 1 /4 NE '/4, Section 31, T6N, R11W, Seward Meridian, Third Judicial District, Kenai, Alaska to be Retained by the City and Reserved for Public Use, and for Airport Purposes. 2. PASSED UNANIMOUSLY. Ordinance Igo. 2525 -2010 -- Increasing Estimated Revenues and Appropriations by $80,000 in the General and Airport Funds for the Purchase of Approximately 40 Acres of Property Described as SE r /4 NE 1 /4, T6N, RI IW, Section 31, Seward Meridian, Third Judicial District, Kenai, Alaska to be Retained by the City and Reserved for Public Use, and for Airport Purposes. 3. PASSED UNANIMOUSLY. Ordinance No. 2526 -2010 -- Increasing Estimated Revenues and Appropriations by $25,000 in the General Fund for the Purchase of Approximately 7.28 Acres of Property Described as Tract C, Inlet View Subdivision, Second Addition, T5N, RI IW, Section 4, Seward Meridian, Third Judicial District, Kenai, Alaska to be Retained by the City and Reserved for the Purpose of Maintaining A Component of the City's Storm Drain System. 4. .PASSED UNANIMOUSLY. Resolution No. 2011 -01 -- Authorizing the Purchase of Approximately 20 Acres of Property Described as E2, NE4, Section 31, T6N, RI IW, Seward Meridian, Third Judicial District, Kenai, Alaska, for $46,000.00 to be Retained by the City and Reserved for a Future Trail, to Preserve a Drainage -Way Through the City and for Airport Purposes. 5. PASSED UNANIMOUSLY. Resolution No. 2011 -02 -- Authorizing the Purchase of Approximately 7.28 Acres of Property Described as T5N R11W, Section 4, Seward Meridian., Third Judicial District, Kenai, Alaska for $25,000.00 to be Retained by the City for the Purpose of Maintaining a Component of the City's Storm Drain System. 6. PASSED UNANIMOUSLY. Resolution No. 2011 -03 -- Authorizing the Purchase of Approximately 40 Acres of Property Described as T6N R 1 I W, Section 31, Seward Meridian, Third Judicial District, Kenai, Alaska, for $160,000.00 to be Retained by the City and Reserved for a Future Trail, to Preserve a Drainage -Way Through the City and for Airport Purposes. 7. PASSED UNANIMOUSLY. Resolution No. 2011 -04 -- Pertaining to the Authorized Investments of, the Investment Allocations of, and Establishing Appropriate Benchmarks to Measure Performance of the Airport Permanent Fund. 8. APPROVED CONSENT AGENDA. *Liquor License Renewals -- Don Jose's Mexican. Restaurant/ Beverage Dispensary (License #3039) 2 Go Mart /Package Store (License #4544) ITEM E: MINUTES APPROVED/CONSENT AGENDA. *Regular Meeting of December 15, 2010. r APPROVED. Ratification of Bills 2. APPROVED. Approval of Purchase Orders Exceeding $ 15,000 3. RENEWALS NEST APPOINTMENTS APPROVED. Approval -- Commission /Committee Member Terre Renewals 4. Discussion --- Airport Land Permanent Fund 5. DIRECT.IOMPREPARE ORDINANCE FOR CONSIDERATION Discussion -- Possible Amendments to the Election. Code. 1. Council on Aging 2. Airport Commission 3. Harbor Commission 4. Library Commission 5. Parks 8, Recreation Commission b. Planning &, Zoning Commission 7, Miscellaneous Commissions and Committees a. Beautification Committee b. Alaska Municipal League Report C. Mini -Grant Steering Committee d. Kenai Convention & Visitors Bureau e. Reports of KPB Assembly, Legislators and Councils ITEM I: RE PORT OF a' 1. City Manager 2, Attorney 3. City Clerk u 1. Citizen Comments (Public comment limited to 5 minutes per speaker) 2. Council Member Comments EXECUTIVE SESSION -- 1) Concerning a matter that could prejudice the reputation and character of another: Municipal ethics and violation of City ordinances by elected officials; and, 2) Concerning a matter that could prejudice the reputation and character of another: City Manager personnel issues; 1. Motion to convene to executive session failed. 2. Council met in an executive session with the City Manager and agreed to meet again in two weeks at the next Council meeting. ITEM L: PENDING LEGISLATION (This item lists legislation which will be addressed at a later date as noted.) *; "Villaye witk a Past, C# wN a Future FINANCE DEPARTMENT 210 Fidalgo Avenue, Kenai, Alaska 99611 -7704 Telephone: 907 -283 -7535 exk 221 / FAX. 907 - 283 -3014 M RECEWED To: Mayor Porter Council Members 0 1 Thru: Rick Koch, City Manager 4 From: Terry Eubank, Finance Director Date: January 5, 2011 JAN -.. 5 2011 KENAI CITY CLERK Re: Airport Permanent Fund December 31, 2010 balance and FYI 1 transfer amount. Pursuant to KMC 7.30.020 the annual transfer from the Airport Land Sale Permanent Fund (ALSPF) shall be equal to 5% of the five -year average of the funds value at December 31 This is the third fiscal year of the current investment methodology and a three year average is being used as called for in KMC 7.30.020. FY12 will utilize a four -year average and a five year average will be used beginning in FY 13, The December 31, 2010 market value of the ALSPF was $21,909,110, 17,281,883 was originally invested in September 2008 and since the ALSPF has transferred $1,174,312 to the Airport Special Revenue Fund. The FYI I transfer amount calculation is as follows: December 31, Portfolio Balance 2008 Market Value 2009 2010 $17,825,369 $20,264,072 $21,909,110 $19,999,517 X 5% $ 999,976 Average $19,999,517 The FY11 budgeted transfer amount was $968,157. A supplemental appropriating ordinance will be prepared for your consideration increasing the transfer amount to the policy limits. RIVIE ..... ................. .. .. ... . .. .. ...........----- . A1 1%."I'll"I'll DO '-' W. MM Airport Endowment Fund for period ending November 30, 2010 ............................. "'AIKA P Ei11,! A CANTAL MANAGEMENT': U! IS i. Economy a P RM tNt. CAPITAL MANAGEMENT' Portfolio Review . . . . . . . . . . . The account was established in September of 2008 with a deposit of $17.4 million in securities and cash. Equities were purchased throughout the fourth - quarter as prices fell. Existing security positions were selectively sold or allowed to mature to provide funds for the purchase of both equities and fixed - income securities. The September 2008 —March 2009 period was the worst financial crisis sense the great depression. With the sole exception of US Treasury securities, all financial asset prices declined during this period. In March. 2009 a dramatic. reversal took place in the equity markets and prices began to rise. In June 2009, $289,136.43 was transferred from the account for the annual airport operations payment. During 2010 the markets continued the recovery which began in early 2009. In June 2010, $891,268 was transferred from the account for the annual airport operations payment. 'ALAS KA PRMANN AMM CAPITAL. MA"AGEMENi 2 Asset Allocation for Kenai Airport Endowment Funi as of November 30, 2010 Fixed income 0 Large Cap Equity * Mid Cap Equity 9 S ail Cap Equity ^ Int'I Equity Emerging Markets R, Rea[ Estate CK cA iL MANAGEMENT 3 A 40% Fixed Income 40.1% 45% 40 -65% $8,463,319 Large Cap Equity 24.8% 20% 15 -25% $5,231,681 Mid Cap Equity 9.5% 10% 5 -15% $2,008,689 Small Cap Equity 4,2% 5% 0 -10% $882,638 Int'I Equity 10.2% 10% 5 -15% .$2,143,745 Emerging Markets 6.8% 5% 0 -10% $1,425,402 Real Estate 4.5% 5% 0 -10% $945,677 Tota l $21,101,151 Fixed income 0 Large Cap Equity * Mid Cap Equity 9 S ail Cap Equity ^ Int'I Equity Emerging Markets R, Rea[ Estate CK cA iL MANAGEMENT 3 Portfol R ev i ew — Appraisal as O f November 30, 2010 l''€clti 1"Itit °Iwal M -1rcVI Pet, Annual Accrued to Quzintily Seturily Cost Cost Price Value t` sset:i l€li'mue 11I1trot Abgl tlrit }' 1. ?. . 'l It L' A S3. M SY it) t00 i.l$ 1Ru'A`;1.=83 fs( #11fS 9011.40 - I(1 €.WN 100, 1.911 ,1,a €}l) 100 023 [ to 04--' !.1 1.000.000 U" I UASURY NO U, 10111.12 1.T ?ttL 175 1119.54 1.11P ;iA:30 =1 ?5 10j)(W 2.541 11.27 1. rlWl•! a 1 )n 44 -3I -1 I {;bruin OS IRl"AMiRY N171 - ES 99.71U 14 9�. 2: 148 0.710 187i 1 €1 1A3 1,'15(3°' -Doc I 1 1 - 11 - .i? 310.0111 C15 1RHASURYt:0 l. 'S E4 289.'1 -13 102. -{ 3('7, 194 1..16 S,n) 2A2 2. =13 175W'6 13uc 150.1)r)ij US IREANUIZ aO) U. 104.04 1;6 106.75 11.0..125 11,76 - -'-51) 232 2.69 T3€' 0e - {5.20 � criled 117 € Clc:til h.. (113. JE, 411 7JII.R 172 9,61 5 2 R.(11i7 ANIFIZ I(`:L 1. !'It! SS f314 P,J 1')tC; S_Il;'lRAN I F1I:.13) 103: 16 3i..0 ?Yti 1C1?- ,R'(l. 2z; 914 1 -22 3 (fA 3.1IM1 0m, 12-fly- 11 75111$00 60[ D , \NSU:'1isGtyt1•DIC(A.,ARA iI'I: <.I ^.1)? lii:?:AS 75'1,23? 1w. €8 vtr(3 i.:?j $.1,`x.7 3,74 11,52 ;x,2'3(! 761)1 €e Clr_ 15-12 ;S!rt aJnr€ I' t 1E i)1`,(a (L( Q1' (fl) kRAIN € I I D 100.142 561, M2 12 ; 1 E -?8 ;7 7 !,SVt 5!)115111(! 5';`'51:1 I(ii -( }7 5 9 !DSA ' <?:Ij 2:1151 11 :171 6,78,9 OM 2:87 Dime 1 . -1? z.00,000 1 : 1TL11 11t7,35 55'1;72 1 l$,:3 ;91,47% 2.91) 2ti,873 070 1'1-' 5375'"v Oue u5 -19 -16 1,(i,rAlit? 111 €Nvw I10:tin :li_i?<aili II522 515.,185 2. 6 21,917 111.237 2.63 8775'o 1? €x 0- 13 -1 t \N .Ned 1€1tcre'i 3G,5g4 0,14 ' 1,244 17(A 050 I?. - ti11 1(09.2 230.0 I,i�, lJi€tk 071 o i 1tc 1Nr€ic I €1131 ,'Si,2g0 111 [ Yi.l 254,7 -1i 1.33 15.9717 5.312 0,53 (07 > -. Dtie 08 -01 -8t n') f+iYl'3 _Y €K1 W1RI. ±19,zS,SVUSIN 111..20 1t8 W2 Jrp9r4 i?111,542 I 16,,250 1.754 1.05 €1: Doe Or 20 D.000 300; y' 1 - 4TR1 CAP11 Ca)12.J' 9719 IV ?989 M7 07 .2159. €$ I.,Q 9,900 4a1 (7 d.OQ 4.95(y,'6 Mic €2-17-1? "IStI.IM11 131It51`.il!IICi 111 "fJJai1':5Y INC 1(_111,19 2t_10.-112 1I €2,0.1 2(1. €Ifi(; 11.9' l,'a{1 1,29=7 `1tii },ti 1 }13G 02-'1 3. -33 a1100110 4; G 973.:'-€ 1b?; 1 0j] 2119j,1€ 5.17 4 7,71H1 4e11 I.OI 4,94;Wt D 05 I.:I., . 260TW0 11311 CORP 1(12 - 71 247.1 - 22 115.14 230.294 1.09 I. 1 1.13 PfRM T 6543n °i 17[X1(1 -13 - €3 APG M: : ChQhRL hlEiNf4GEMEHT r Portfol R ev i ew — Appraisa as of November 30, 2010 y idd Qw.Intily SectiYI[Y C om Conk Price VnItte AK E14 Entle. 111terrst MREurity '0!3.0[1 4IESIt'6 ILt�E -Ytii£ EI �' -C' a 98.47 1lg%t316 1(16,4$ 12 —.917 1.01 111 -9ol) 4 3 q4 5A$0% I }w.(MIS. -I4 2041,1100 J!' MORGAN ( JAY- & C SK 118 177:764 10911 , IC,,226 1 ,0 9,5[1[1 i 3ls 2,72 4,750 Due -14 200,000 Ntl.Y S.!_t 11y4-()(.)!1 E[tSb17 ?[r.3 {.) 1, €.13 11j)(f I.IQI) :1,79 200000 IISBCE-INLtNCF(:OM' 96-1$ 192 - ? °![ 1. 100 221,3?)4 1.9( 11 -000 5._�8 i1 I)m 01- tt3 -16 9[ut ra9n I:Y }ht3C[:51'I IIt.hII'S (,71)11 ja12Ci I i7t:i CQ 174,718 I I6,EtO 24-780 1-.1 1 11-260 t,�K37 S L 5.62iN Dite 10 -15=1 2rut OW) S #'A1 1111 1SA 191.11 2¢1,7.212 1.132 ?It tat , 5r 9 O, W 6.259 [.S()€ 1 3. l' �9'a fhtc ti$- E 7 - 17 Yt( ixllt 11 ACA 1 LI)RP C'sE:C1RAL IFIEDIUM 85.50 171 bov 112:14 221;? tk V96 1 1,5111E 1,1;33 3,#I l 5.7gl;a Dim, N -01 -m 1 600 MCT)ONAJ_DS C6RJ' NMAN 1011.35 i R,09 115 21- 23tf �t?{s LIN 2! rQQ � ('75 3.119 5 - 3.;( Diw41; -IR wL.f190n kq gt.71 FG { 1 V)..0.3 218[]6S 1.113 11.250 937 1 19 .1.a 54; >131 €t;oE .()I -:1R ;� CriiCtl tiiii•�Cf ,1� - l;42 0.17 15.13* 3662 I7()ISEF -S I W I RGF: CA EsQUI I F 44A52 S.PI)t2 5 E' [71) I k'1 (Rt.(S1 93:1: fjvd `w i 1r,49 �21I,6Rt DOMESTIC i1IID C=ad :V EQUITY FLflEMUlf 1 ESilt]_ SSE' IIE)K::tE' 3 (1 23 , 1- E 52.43 1 4,279 45. : .2 ?,lltlR. €1$11 9.52 tiii 10MrS'TIC SNIAL L CAP.E QUITY FE'NDSIE . 134(19 ISHARE SS &Pq:i4AII.,Ci.1 15.21) 625 t -c35 892JJ:i,"s 4.1.1 N_-1 INTERNATIONAL FUNDSO'll" Fit :{ k',:1. £ zi ,; 11tl:)t:lzELt1PG1At']11C'I41 2 JJM2 191 31,1(1 2,1= 1,1,74 10,16 NIA FAIER(M. .,��;�RK , f'Er �d)S!GIF il.i[1i1 t�ell�GIJARDI'�EI.Etiir (3 1 =1[tl rl °t iE 35_51 7+)t[_42? 4;;: 54 1;125 6.76 NA I2 EA I, ESTATE 17.1:6: Vi1NCi['AR ;t W I E L 11 AI 5 ?54,[125 �$ 945,(M T AS '� i CASH AND EaQUIVALEN'IS Welk l'tTg Sectgrcil Nlon vNhJ M z 3(,S-2 ) ;4;� 292 1 7 IIIAS {A I€)IAL- .I(3EitEt)LE(# Ifi.+ICI;47� 21,!_(Il.lfi?. -- .111[1(IE.3i 7 PERMlI�IEi�fi; crt�triit � +aancei�exr i r Portfolio Review Account Performance (is of November 30, 2010 15% 10% c Cr m a 5% 0 °% 8.92 9.69 2010 YTD Kenai APF Benchmark ALASKA FERMWNEN APICR Inception performance is annualized and begins on September 30, 2008. CAPITAL MANAGEMENT 6 We currently estimate that the current allocation will return approximately 7.2% per annurn over the next five years. The lower expected return is primarily due to a lower expected future return for the fixed income portion of the portfolio. Interest rates are currently ALAS at very low levels and as rates rise it will have a negative impact on APCM the fixed - income portfolio. CAPITAL MANAGEMENT 7 Last Year's Recommend As the current allocation has been in place for just over one - year., it is recommended that the existing allocation be maintained. The past year has been horrific, resulting in several clients abandoning their allocation. at the worst possible time. In hindsight, their allocations contained more risk than they could handle. It is important that everyone understand that the past year has been the "100 year flood" in financial terms. The account survived this event and performed well. The account has a risk profile similar to but a bit more conservative than the Alaska Permanent Fund (t has about 5% less equity exposure than the average endowment and greater amounts of fixed- income (bonds) exposure). We continue to monitor and. evaluate other asset classes but at this time recommend the City maintain the existing structure. ALASKA ERMANt CAPITAL MANAGEMENT 2 010 Recommenda Maintain the status quo. Predictin the future has r di tra The ba , a cross vari a sset classes which should, over time, provide growth- ... ......... .................... A! �lSKA EIA ARV GOITAL MANAGEMENT w7 a� APCM costs the City of Kenai 30 basis points on the first $10 million And 25 basis points on any amount over $10 million ®n a $20 million dollar portfolio: 30 by x$ 1.0million 25 by x $10 million $30,000 $25 000 $55,000 per year .................... ALASKA DERMA#' �: CAPITAL MANAGEMENT Paid monthly in arrears 10 -_, C A PIT.AI. MANAGEMENT COMPANY is relationship driven and views itself A W a long-term partner with its clientj YOUR- BUSINESS IS IMPOR-TAN J US! ALA IA �TER Ai CA PITAL. MANAGEMENT Fconomy& Financial Markets ALASKA' .PERMAHENt APM 'i'iL ITAt 016GEMENT $160 $120 $80 $40 $D 1996 1998 2000 2002 2004 2006 2008 2010 Bloomberg Job Growth and Unemployment Rate 600 400 10.5% 200 10.0% D 3. -200 9.0% 400 __ _ 85% -600 ? _ 8.0% Aug09 Nov 09 Feb 10 May 10 Aug 10 Nov 10 Change in Payrolls ([loo`s) Unemployment Rate Bureau of Labor Statistics Consumer Price Index (YoY) 13 Oil Price - West Texas Intermediate 115-i 11111111� ALASKA APGM A ' ■ s a • a - i i ! t3lrr'�iestl� Ecji�ltles Large cap S &P 500 0.0 13.1 9.5 9.9 Mid Cap S &P 400 3.0 18.6 116 26 -3 Small Cap s &P 600 3.6 20.3 10.0 27 -5 )ttt+5tnatiorJal Egtiitids '` Developed A45CIEAFE -4.8 8.3 13.7 1.1 Emerging MSQ Emerging Markets ... .... ___ -2.6 1 1.3 17,4 15.3 ... Otltet ... _. commercial Property S&P U.S.RE1T -2.0 7.2 10.2 31.5 �emmedltles [li -UB5 C ommodity -0.4 12.2 17.1 7.6 f ixe Ir7COIY3 ' Total Baird Market Barclays Aggregof. -0.6 -0.1 1 9 6,0 1 -3 Yr U.S. Treasury /Agency Barclays 7 -3 Gov -0.2 0.2 1.2 1.8 Ent'l Treasury 6arcloys 6lobol Tsy ex -U5 -6.0 -0.3 7.4 - 3.7 3 4'� I i i 2 . Sources: Standard & Poor's, Treasury, J.P. Morgan Asset Management S &P 500 Index Bloomberg 1600 th i5 1400 1200 1000 800 s. 600 2004 2006 2008 2010 Source: J -P. Morgan Asset Management Average asset allocation investor return is based on an analysis by Daibar Inc. All returns are annualized (and total return where applicable) and represent the 20 -year period ending 12/31/09 to match Oaibar's most recent analysis. 14 1996 1998 2000 2002 Economy le . Mark it _, Fi nanc i a l 5% 4% 3 % 2% 1 °% E 0% 0 Bloomberg `p;L1lSKA Wont MAIMEMERT 5 10 15 20 25 30 Bond Maturity (Years) ; /2aso ��13a/za�o 10 Year Treasury Note Yield 3% F i 2 Y- 2000 2002 2004 Bloomberg 2006 2008 209.0 Yield Curve Comparison ........ ......... ......... 6% ?..... I 5% Nov 30th 2.80% 4% E 9 � 3% F i 2 Y- 2000 2002 2004 Bloomberg 2006 2008 209.0 Yield Curve Comparison xm.�9,115 Me Economic Outlook The economy faces major headwinds from the ongoing deleveraging of consumer and financial balance sheets_ The unemployment rate rose to 9.8% last month. Job gains are slowly improving. Manufacturing activity is picking up, however both the residential and commercial property markets remain sluggish. Third. quarter GDP growth was +2.5 %, compared to +1.7% in Q2. Most economists expect 2 -3% growth going forward. Worldwide GDP declined -0.6% in 2009 and growth of +4.8% is estimated for 2010. The IMF does not believe a double -dip recession is likely, and forecasts world growth of +4.2% in 201 1. This growth will likely be led by the emerging markets -- many of which have had economies that continued to grow throughout this crisis_ In 2011 the U.S. is forecast to grow +23%. while the euro -zone expects only x-1.5% growth. Inflation Outlook Inflation is up +1.2% year -over -year and the "core" rate is i 0.6% - the lowest level since 1957. Inflationary pressures are likely to remain muted given substantial unused capacity in the labor and product markets. Commodity prices have climbed higher recently and Alaska North Slope crude . jumped to $88 per barrel in early December. Gold has set new all time highs above $1,400 per ounce. Policy Actions The Federal Reserve is maintaining a ZIRP (zero interest rate policy) with the federal funds rate pinned close to zero for a "considerable period." The Fed recently announced another round of quantitative easing dubbed "QE2" where they will buy 5600 billion of Treasury bonds through June 2011. Some worry about the inflationary implications of this and the dollar has weakened as a result. Republican gains in the US midterni elections suggest gridlock and an end to stimulus spending. The Bush tax cuts will likely be extended in the lame duck session of Congress. The President's deficit commission reports back in early December with ways to reduce soaring deficits and debt. Overseas, Europe continues to grapple with a financial system that was pore levered than the U,S. The EC13 and EMF have taken significant steps to shore up confidence and provide liquidity to EU governments struggling with deficit/debt problems. Greece and Ireland have accepted bailouts. Many countries have undertaken "austerity" measures to close their budget gaps. Bond Outlook Quantitative easing will probably keep interest rates low for a considerable period, though rates did back up in December. Corporate spread product and CMBS securities have performed well and that should continue. We remain underweight Treasuries and MBS securities. We believe that interest rates are eventually headed higher. Equity Outlook Stocks sold off in November especially SAFE and emerging markets_ Corporate earnings have been strong and companies are beating expectations. ALASKA We generally like domestic large company stocks over smaller names. Globally we favor emerging markets over developed international (EAFF). KnroA t! REH's have performed well, but they are overvalued in our judgment. Very low interest rates and reasonable valuations trump a soft economy, so .,,, we remain tilted towards equities. December 2010 16 CfiCETAL igl�NgfEMEtlt . Asset Allocation RevIeA . , ALAS IA PER AP CAl�1TA[: Ml1tlAGET�IEHT'. Asset All .... .......................... �RMNNT APCM t CAPITAL MANAGEMENT Asset Alloc Pop Construct efficient, diversified portfolios using state of the art optimization software coupled with solid fundamental research and experience. Use low cost index or exchange - traded funds to gain exposure to the various equity asset classes. Minimize expenses, keep turnover down. and execute trading efficiently. Markets are mainly efficient. Wherefore, adhere to the chosen benchmark portfolio tactically deviating as investment opportunities arise. ........... ................. . 'ALAS TERMdN �APCW Milk MhHAGEMENr 19 Asset Allocation Philosophy Basis o fPloqfolio Construction Importarice of Asset , Security Selection and 90% Several studies report that asset allocation may account for more than 90% of the return of a portfolio compared to the policy portfolio The initial strategic allocation. among asset classes is more important than. choosing PERMANW the actual stocks and bonds that you will owu : Brinson, hood, and Beebower (1986) and Brinson, Singer, and Reebower (1991 }, lbbotson /Kaplan (2000) offer statistical evidence far the importance of asset allocation. WiTAL MAIIAGEMEHT 20 Asset Allocation Philosophy Consistent with best practices "Determining what percentage of the portfolio will be invested in various asset classes stocks, bonds, real assets, private capital, hedge funds —is the single most important component of a policy. Numerous studies have shown that asset allocation not only has the greatest impact on investment results, but it also accounts for the lion's share of investment performance. Naturally, asset - allocation guidelines should be logically consistent with. the endowment's specified return. objectives and relevant risks. Many investment committees spend far too much time on activities that often subtract value —such as manager selection and market timing —and not enough time on establishing and adhering to their asset - allocation targets, where their efforts could really add value." .............. Endowment Management: A Practical Guide (2004) -Wage 26 ALAS F A I PER M hlEm'T By Jay Yoder, Published by the Associatioti of APCO Governing Boards of Universities and Colleges 21 CAPITAL MUMMER,' Asset AllocaPhilosophy Consist vr "Since asset allocation is the most important component of an investment policy, Chapter 3 is devoted solely to this topic. Here, though, is a final word on asset allocation for this chapter: For most institutions, the allowable ranges or variation. from target should be relatively narrow. A. policy that states U.S. equities will be 50 percent of the portfolio, plus or minus 25 percent, is of little value. One often hears this opposing argument: `We need to build flexibility into the guidelines so that we can respond appropriately to market conditions.' Unfortunately, history shows that most market- driven responses are made at the wrong time in exactly the wrong direction. Narrow asset - allocation ranges allow the flexibility to snake small bets or tactical tilts, while protecting the investinent policy and the endowment from the pressure to abandon sound, long -term strategy in the face of short - term. adversity." ................... _.... - -_..: Endowment Management: A Practical Guide (2004) - Page 26 ALASKA P R ANN By Jay Yoder; Published by ti - tc Association of APGM Governing Boards of Universities and Colleges 22 CAPITAL MANAGEMENT L i i i S p; H !/ p PC CAPITAL MAN14CEMEN7' APCM believes PE & HFs are strategies, not asset classes. 23 Asset Class Selection Projected Correlation of Various Asset Classes vs. S&P 500 S &P Soo Mid Cap Small Gap Foreign Emerging Real Estate Commodities U.S. TIPS Barclays U.S. Foreign Cm 3 Month Equity Equity Aggregate Government U.S. T -6111 ......................... ............................... i ALASKA t ERMA IM 'APGR CAPITAL MANAGEMENT' 24 Tr a di t i ona l M ean V .......... .. ... 15% U.S. REITs 14% C Emerging Markets 12% Russell MidCap MS EAF E 10% _ _ _ Russell 200fl_ 0 S&P S00 Commodities ......... U n Kenai Airport � U.S. Treasury TI PS U.S. Bonds: Foreign Government Bonds 4% . " T -Bills 0 °0 0% 5 % 10% 15% 20% 25% 30% 35% 40% 45% 50% } ...... LASKA ' �� Investmen t Risk (Standard Deviation) MGM CAP ITAL AN AGEMENT'. 25 sset Allocation Philosohy Consistent with bestpractices "The evidence is now so overwhelming that all but the die -hard anti - indexers agree that the majority of U.S. stock and bond mutual funds underperform their benchmark. Thus, the benefits of indexing — low costs, superior long-term performance, predictability versus the benchmark., broad diversification — get lost or forgotten. in the striving for outperformance, or less charitably, in the rush to embrace the latest, hottest, top-quartile manager of fund." Endowment Management: A Practical Guide (2004) -Page 32 -34 ALASKA PeRM By Jay Yoder, Published by the Association of 'APCM: Governing Boards of Universities and Colleges 26 CAPITAL MANAGEMENT r �.1 �., 4W-I- it LASKA r DERMA i Apcmi Over a 5 year period ending June 30, 209.0. Equal weighted. Net Returns. Source: Standard & Poor's 27 CAWAt MARAMMENT M. Expense Ratios in Morningstar Mutual Fund Universe for Active Managers — June 2007 Income 1.09% .. . .......... ... iALASKA..... AMN. CAPITAL MANAGEMENT . . . .. .. ... .. .. .. ......... . ............. .... 0.20% 28 Benefits o f �� Consistent performance and low tr e rror — Extremely high correlations ( >95 %) for most asset classes Y ou .. mar g market returl — Generally, you 1xil.l. beat average equity manager N O un ............... _ - - -___ ALAS APGM 'i CAMAL MANAGEMENT 29 0 Airy ®rt Projjects Apron Rehabilitation: Project is shut down for winter. Float Plane Basin Facility Improvement Project: The Phase 1 Design process is continuing. Master Plan — City Administration is rescheduling a meeting with the FAA to develop a work scope for this plan. Winter Snow Removal Operations - The airport continues to receive appreciation comments from airport users about the crew's efforts with snow removal operations to ensure safe operations. Airport Administrative Assistant Position Vacancy - Airport Administration is interviewing the week of December 6 and hopes to fill the position this month. New Airport Emergency Control Plan — The Airport Manager and Fire Chief are editing the final AECP to submit to the FAA by the December 31, 2010 deadline. Annual FAA Certification Inspection — Two FAA certification inspectors will be on airport January 4 — 7, 2011, conducting the annual inspection. They will meet with airport and fire department staff. T'h& X A Wpo*vr stuff woui& Uel to- w i4k eA/eycYn& cc Safvl a,4A& happy Ghwistmak if o.dy r December 21 y. L ERA GRANT Change KENAI Combined Month AVIATION AVIATION Total 2009 from AVIATION Month Total 2009 January 4,466 1,797 6,263 6,824 -561 129 6,392 February 4,171 1,805 5,976 5,971 5 110 6,086 March 4,787 2,023 6,810 6,029 781 116 6,926 April 4,366 2,018 6,384 5,804 580 126 6,510 May 4,556 1,922 6,478 6,611 -133 198 6,676 June 4,879 2,126 7,005 6,857 148 202 7,207 July 7,825 2,467 10,292 9,612 1 680 270 10,562 August 7,271 2,582 9,853 9,153 700 246 10,099 September 5,148 1,961 7,109 7,379 -270 224 7,553 October 5,555 2,058 7,613 6,919 694 185 7,798 November 5,324 2,047 7,371 6,714 657 132 7,503 December 4,307 2,128 6,435 6,260 175 150 6,585 Totals 62,655 1 24,934 1 87,589 84,133 3,486 2 89,897 Terminal -Vehicle Parking Revenues December 2009 $14,176 2010 $13,105 NEF t, ALASKA V Suggested by: CITY OF KENAi AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, INCREASING ESTIMATED REVENUES AND APPROPRIATIONS BY $23,000 IN THE GENERAL AND AIRPORT FUNDS FOR THE PURCHASE OF APPROXIMATELY 20 ACRES OF PROPERTY DESCRIBED AS E 1 / NE 1j NE 1 4, SECTION 3I, T6N, RI IW, SEWARD MERIDIAN, THIRD JUDICIAL DISTRICT, KENAI, ALASKA TO BE RETAINED BY THE CITY AND RESERVED FOR PUBLIC USE, AND FOR AIRPORT PURPOSES, WHEREAS, the total purchase price for 20 acres is $46,000 of which the General Fund and Airport Fund will each pay $23,000 and receive approximately half ( + -ID acres) of the property to be subdivided at a later date; anal, WHEREAS, the purchase of the property would preserve a natural drainage -way at the perimeter of a residential area and provide for a potential future site of a City trail system; anal, WHEREAS, the purchase would provide the City's Airport additional property reserved for Airport purposes; and, ..................... WHEREAS, it is in the best interest of the City of Kenai and its Airport to purchase the above described property to be retauaed by the City and reserved for public use, and for Airport purposes. 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: Appropriation of Fund Balance Increase Appropriations: Non - Departmental - Land Airport Fund_ Increase Estimated Revenues: Appropriation. of Fund Balance Increase Appropriations: Other Buildings & Areas - Land New Text Underlined [DELETED TEXT BPACKETED] $23,000 $23,000 $23,000 $23,000 -1- Ordinance No. 2524 -20710 Page 2 of 2 PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this fifth day of January, 2011, PAT PORTER, MAYOR ATTEST: Carol L„ Freers, City Clerk Approved by Finance: —I Z, " Introduced: December 15, 207103 Adopted: January 5, 20111 Effective: January 5, 2€711 New Text Underlined; IDELETED TEXT 2RACKETED'i N Pl Vlda e mM a Past C# mM a are f/ 210 H=idalgo Avenue, Kenai, Alaska 99811 -7794 , Telephone: 907- 283 -7535 / FAX: 907 - 288 -3014 1 1992 TO: City Council FROM: Rick Koch DATE: December 9, 2010 SUBJECT: Ordinance No. 2524-2010, Purchase of Real Property from Crew and Robert Cox The purpose of this correspondence is to submit for your consideration of Ordinance No. 2524- 2010 to appropriate funding for the purchase of real property described as E1/2 NE1 /4 NEI /4, T 6 N, R 11 W, S.M., Alaska consisting of 20 acres, more or less, and to recommend Council approval. This property is located west of Float Plane Basin Road and the Kenai Municipal Airport, The property's topography consists of a drainage /wetland and well - graded uplands. In the past the City has purchased properties though which natural drainages are located to protect environmentally sensitive areas and possibly provide public access through future trail systems. Future development of the Kenai Municipal Airport in the specific area of the float plane basin will locate airport improvements near the existing Airport property boundary in this area. Purchase of this property will provide additional property for airport use. The agreed upon purchase price is $46,000, and the value has been verified through an appraisal Administration proposes to utilize funding in equal amounts from the General Fund and Airport Fund to purchase the property. Subsequent to purchase, a subdivision will be accomplished to delineate General Fund Property and Airport Property. Sufficient reserves are availabie in the General and Airport Funds for this purchase. M Attached, please 'find an aerial photograph identifying the property and the approximate subdivision, If you have any questions, please contact me at your convenience E ya � � a» y � . �•,.- � � � � . �. . �� d\ Owners -- Greta & Ro ) Subject Property 1 4301023 I r i in OPTION TO PURCHASE This Option to Purchase is made on this � day of jIk_ N&_, 2010 between the City of Kenai, 21D 1= idalgo, Kenai, Alaska 99611 (the "Buyer ") and Greta Cox and Robert L. Cox, a husband and wife, of 509 Fine Avenue, Kenai, Alaska 99611 (the "Sellers. ") WHEREAS, the Sellers are the owners of certain real property described as E2 NE4, Section 31, TSN, R1 IM Seward Meridian, a parcel consisting of approximately 20 acres located in Kenai, Alaska with a Kenai Peninsula Borough Parcel Number of 043- 010 -23. WHEREAS, the Buyer wishes to purchase said property and the Sellers wish to sell said property to the Buyer. NOW THEREFORE, in consideration of the covenants and obligations contained herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Sellers hereby grant the Buyer an exclusive option to purchase the above - described property. 1. OPTION TERM!. The option to purchase shall begin on the day of 2010 and expire at 11:59 PM on the day of _ 1 201 2. NOTICE REQUIRED TO EXERCISE OPTION. To exercise the Option to Purchase, the Buyer must deliver written notice to Robert L. Cox either in person or via mail of Buyer's intent to purchase. Notice shall be delivered prior to the expiration of the Option Term and shall specify a proposed closing date consistent with the time set forth in paragraph 7 below. Deposit of the notice in the mail to Greta Cox and Robert L. Cox, at 509 Pine Avenue, Kenai, Alaska 99611 shall be presumed to be valid delivery of the notice on that date, 3. OPTION CONSIDERATION. In consideration for this Option to Purchase, the Buyer shall pay a non - refundable fee of $500.00 (Five Hundred Dollars and No Cents), receipt of which is hereby acknowledged by the Sellers. This amount shall be credited to the purchase price at closing- if the Buyer timely exercises the Option to Purchase and closes on the conveyance of the Property. The Sellers shall not refund the fee if the Buyer fails to exercise the Option to Purchase or fails to close on the property through no fault of the Sellers. 4. PURCHASE PRICE. The total purchase price for the Property is $46,000.00 (Forty Six Thousand Dollars and No Cents), 5. 2010 PROPERTY TAXES. The 2010 Kenai Peninsula Borough and City of Kenai Property taxes on the property shall be prorated between the Buyer and the Sellers as of the date of closing. 6. EXCLUSIVITY OPTION. The option to purchase is exclusive and is not assignable and exists solely for the benefit of the name parties above. Should the Buyer attempt to assign, convey, delegate or transfer this {Option to Purchase without the express written permission, any such attempt shall be deemed null and void. OPTION TO PURCHASE Page 1 of 4 M 7. CLOSING AND SETTLEMENT. If Buyer timely exercises its option granted hereunder, closing shall occur within b days of the end of the Option Term at a title company or at a mortgage company or bank in the Kenai area, as determined by Buyer. Buyer shall inform the Seller of this the location for closing in writing, Buyer shall be responsible for all closing costs except Seller's pro -rated share of the 2010 Kenai Peninsula Borough and City of Kenai property taxes. At the time of Closing, Seller shall deliver to Buyer a statutory warranty deed for the subject property, properly executed and acknowledged in proper fora for recording, so as to convey to Buyer good and marketable tide to the subject property free and clear of all liens, leases, encumbrances, mortgages, easements, reservations, limitations, covenants, conditions, restrictions, encroachments, Native allotments or claims thereto, deeds and tenancies, except for permitted exceptions identified on a title report. Seller shall further deliver to Buyer such other instruments and documents as may be reasonably required and customarily given by a seller to consummate the sales transaction herein contemplated, and as may be reasonably required by the Title Company. 8, REMEDIES UPON DEFAULT. If Buyer or Sellers default under this Option to Purchase, the non defaulting party is entitled to all remedies included in this agreement and/or any and all remedies at law or it equity. 9. COMMISSION. No real estate commission or any other commissions shall be paid in connection with this transaction. IQ, RECORDING THIS AGREEMENT. Buyer shall not record the Option to Purchase on the Public Records of the State of Alaska without the express written consent of the Sellers. 11. ACKNOWLEDGEMENT& The parties are executing this Option to Purchase voluntarily and without any duress or undue influence. The parties have carefully read this Option to Purchase and have asked any questions needed to understand its terms, consequences and binding effect and fully understand them. The parties will be given an executed copy of this agreement. The parties have had the option to consult an attorney of their respective choosing if so desired prior to the signing of this Option to Purchase. 12. TILTING. Time is of the essence in this Option to Purchase. 4 13, GOVERNING LAW AND VENUE. This Option to Purchase shall be governed, construed and interpreted by, through and under the Laws of the State of Alaska. The parties further agree that the venue for any and all disputes related to this agreement shall be in the State of Alaska, Third Judicial District at Kenai. 14, ENTIRE AGREEMENT, MODIFICATION. This document sets forth the entire agreement and understanding between the parties relating to the subject matter herein and supersedes any prier discussions between the parties. No modification of or amendment to this Option to Purchase or any waiver of the rights under this Option to Purchase will be effective unless in writing signed by the parties to the Agreement, OPTION TO PURCHASE Page 2 of 4 in S1 =LLRS //� By Greg Cox Robe 14 L. Cox a husband and wife C ITY OF t<ENAI By: Ric R. Koc lt5: City Manager State of Alaska ) ) Ss Third Judicial District ) The foregoing instrument was acknowledged before me this � day of p� C ?, 2010 by Greta Cox. F h P Z � IF Notary Public of Alaska My Commission Expires: E 4 OPTION TO PURCHASE Page 3 of 4 M State of Alaska ) ss Third Judicial District ) The foregoing instrument was acknowledged before me this pia day 2010 by Robert L. Cox. Notary Public of Alaska. My Commission Expires: uI State of Alaska ) ss Third Judicial District ) The foregoing instrument was acknavviedged before Mme this clay of� �� 2€10 by Rick R. Koch, City Manager for the City of Kenai. f rfir9 F�� ILI ''r;;U� Notary Public of Alaska My Commission Expires: tN C,- OPTION TO PURCHASE Page 4 of 4 \\ ll:rciy £ A� S Suggested by: Administration CITY OF KENAI ORDINANCE NO. 2525-2010 AN ORDINANCE OF THE COUNCIL OF T HE CITY OF KENAI, ALASKA, INCREASING ESTIMATED REVENUES AND APPROPRIATIONS BY $80,000 IN THE GENERAL AND AIRPORT FUNDS FOR THE PURCHASE OF APPROXIMATELY 40 ACRES OF PROPERTY DESCRIBED AS SE 1 /h NE ' /,, T6N, R1IW, SECTION 31, SEWARD MERIDIAN, THIRD JUDICIAL DISTRICT, KENAI, ALASKA. TO BE RETAINED BY THE CITY AND RESERVED FOR PUBLIC USE, AND FOR AIRPORT PURPOSES. WHEREAS, the total purchase price for 40 acres is $ 160,000 of which the General Fund and Airport Fund will each pay $80,000 and receive approximately half ( +/ -20 acres) of the property= to be subdivided at a later date; anal, WHEREAS, the purchase of the property would preserve a natural drainage -moray at the perimeter of a residential area and provide for a potential future site of a City trail system?; anal, WHEREAS, the purchase would provide the City's Airport additional property reserved for airport purposes; and, WHEREAS, it is in. the best interest of the City of Kenai and its Airport to purchase the above described property to be retained by the City and reserved for a public use, and for Airport purposes. 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: Appropriation of Fund Balance $80,000 Increase Appropriations: Non - Departmental - Land $80,000 Ainport Fund Increase Estimated. Revenues: Appropriation of Fund Balance $80,004 Increase Appropriations: Other Buildings & Areas - Land $80,000 New Tex[ Un.dcTlined (DELETED TZXT BRACKETED] -11- Ordinance No. 2525 -2010 Page 2 of 2 PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this fifty day of January, 2011, PAT PORTER, MAYOR ATTEST: Carol L. Freas, City Clem Approved by Finance: - Introduced: December 15, 2010 Adopted: January 5, 2011 Effective: January 5, 2011 New Text. Underlined {DELE'T'ED TEXT BRACKETED] Il Villaqe wA a Past CiN witk a Emote' 210 Fidalgo Avenue, Kenai, Alaska 99611 -7794 Telephone: 907 - 283 -7835 / FAX: 907- 283 -8014 F 1992 EM WN ME TO: City Council P , FROM: Rick Koch LATE: December 9, 2010 SUBJECT: No. 2525 -2010, Purchase of Real Property from Clint D. Hall The purpose of this correspondence is to submit for your consideration of Ordinance Nei. 252.5- 2010 to appropriate funding for the purchase of real property described as SE1 /4 NEB. /4, T 6 N, R 11 W, S.M., Alaska consisting of 40 acres, more or less, and to recommend Council approval. This property is located immediately to the north of Fifth Avenue, and immediately west of Float Plane Basin Road and the Kenai Municipal Airport, The property's topography consists of a drainage /wetland and well- graded uplands, in the past the City has purchased properties though which natural drainages are located to protect environmentally sensitive areas and possibly provide public access through future trail systems. Future development of the Kenai Municipal Airport in the specific area of the float plane basin will locate airport improvements near the existing Airport property boundary in this area. Purchase of this property will provide additional property for airport use. The agreed upon purchase price is $160,000, and the value is to be verified through an appraisal. The Option to Purchase releases the City from any obligation to purchase should the appraisal be less than $160,0003, Additionally, should the appraisal be in excess of $160,000 the seller remains obligated to sell forthe agreed upon purchase price. Administration proposes to utilize funding in equal amounts from the General Fund and Airport Fund to purchase the property. Subsequent to purchase, a subdivision will be accomplished to delineate General Fund Property and Airport Property. Sufficient reserves are available in the General and Airport Funds for this purchase. -13- Attached, please find an aerial photograph identifying the property and the approximate subdivision. If you have any questions, please contact me at your convenience IN A py wo r tip, i � t T ANN G f ,i 4�: 4 Cn 4 NOTE TWO WE f } 4 s T -[ s c: .. .� + �, 4 k F r s — ,' r ANN G f ,i 4�: 4 Cn 4 NOTE TWO WE f } 4 s T -[ KPB Parcel #0430 008 Own er RE,70FJAT h41F I +� a E , ' S 1 Sul F'ro r rty wrt_Nr3; A E i l i � f m f � f ♦ 430100$ HFI— n � m I I --�� rWRTRauA_ f L. EWL T / f T IRZDAVF, Iia F SEC6N0 AV_ � 5141 OPTION TO PURCHASE This Option to Purchase is made on this ' day of f: , 2010 between the City of Kenai, 210 Pidalgo, Kenai, Alaska 99611 (the "Buyer ") and Clint D, Hal{, of P.O Box 2829, Kenai Alaska 99611 (the "Seiler. ") WHEREAS, the Seiler is the owner of certain real property described as T6N R, 11W Section 31, Seward Meridian, a parcel consisting of approximately 40 acres located in Kenai, Alaska with a Kenai Peninsula Borough Parcel Number of 043- 010 -08, WHEREAS, the Buyer wishes to purchase said property and the Seller wishes to sell said property to the Buyer. NOW THEREFORE, in consideration of the covenants and oUigations contained herein and other goon and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Seller hereby grants the Buyer an exclusive option to purchase the above - described property. OPTION TERM, The option to purchase shall be in on the day of 010 and expire at 11:59 PM on the _� day of = /-? 2010. NOTICE REQUIRED TO EXERCISE OPTION. To exercise the Option to Purchase, the Buyer must deliver written notice to Clint D. Hall either in person or via mail of Buyer's intent to purchase. Notice shall be delivered prior to the expiration of the Option Terra and shall specify a proposed closing date consistent with the time set forth in paragraph 7 below. deposit of the notice in the mail to Clint D, Hail at P.O. Box 2829, Kenai, Alaska 99611 shall be presumed to be valid delivery of the notice on that date. 3. OPTION CONSIDERATION. In consideration forthis Option to Purchase, the Buyer shall pay the a non - refundable fee of $500.00 (Five Hundred Dollars and No Cents), receipt of which is hereby acknowledged by the Seller. This amount shafl be credited to the purchase price at closing if the Buyer timely exercises the Option to Purchase and closes on the conveyance of the Property. The Seller shall not refund the fee if the Buyer fails to exercise the Option to Purchase or fails to close on the property through no fault of the Seiler. 4, PURCHASE PRICE. The total purchase price for the Property is $160,000.00 (One Hundred Sixty Thousand Collars and No Cents). The purchase price is subject to an independent appraisal to be performed at the Bayer's expense, and, in the event the appraised value is determined at less than $160,000,00, the Buyer is not obligated to purchase under the terms of the Option to Purchase. If the appraisal value is determined to be $160,Q00.00 or greater, the Seller is obligated to sell the Property to the Buyer for a total purchase price of $160,000. 5. 2010 PROPERTY TAXES. The 2010 Kenai Peninsula Borough and City of Kenai Property taxes an the property shall be prorated between the Buyer and the Seller as of the date of closing. OPTION TO PURCHASE Page 1 of 3 g. EXCLUSIVITY OPTION. The option to purchase is exclusive and is not assignable and exists solely for the benefit of the name parties above. Should the Buyer attempt to assign, convey,, delegate or transfer this Option to Purchase without the express written permission, any such attempt shall be deemed null and void. CLOSING AND SETTLEMENT, If Buyer timely exercises its option granted hereunder, closing shall occur within C/O days of the and of the Option Terra at a title company or at a mortgage company or bank in the Kenai area, as determined by Buyer. Buyer shall inform the Seller of this the location for closing in writing. Buyer small be responsible for all closing costs except Seller's pro -rated snare of the 2010 Kena'€ Peninsula Borough and City of Kenai property taxes. At the time of Closing, Seller shall deliver to Buyer a statutory warranty deed for the subject property, properly executed and acknowledged it proper form for recording, so as to convey to Buyer good and marketable title to the subject property free and clear of all liens, leases, encumbrances, mortgages, easements, reservations, limitations, covenants, conditions, restrictions, encroachments, Native allotments or claims thereto, deeds and tenancies, except for permitted exceptions identified on a title report, Seller shall further deliver to Buyer such other instruments and documents as may be reasonably required and customarily given by a seller to consummate the sales transaction herein contemplated, and as may be reasonably required by the Title Company. 8, REMEDIES UPON DEFAULT, if Buyer or Seller defaults under this Option to Purchase, the non - defaulting party is entitled to all remedies included in this agreement and /or any and all remedies at law or it equity. 9. COMMISSION. No real estate commission or any other commissions shall be paid in connection with this transaction. 10. RECORDING THIS AGREEMENT. Buyer shall not record the Option to Purchase on the Public Records of the State of Alaska without the express written consent of the Seiler. 11. ACKNOWLEDGEMENTS. The parties are executing this Option to Purchase voluntarily and without any duress or undue influence. The parties have carefully read this Option to Purchase and have asked any quesiions needed to understand its terms, consequences and binding effect and fully understand them. The parties will be given an execed copy of this agreement. The parties have had the option to consult an attorney of then' respective choosing if so desired prior to the signing of this Option to Purchase. 12, TIMING. Time is of the essence in this Option to Purchase, 13. GOVERNING LAW AND VENUE, This Option to Purchase shall be governed, construed and interpreted by, through and under the Laws of the State of Alaska. The parties further agree that the venue for any and all disputes related to this agreement shall be in the State of Alaska, Third Judicial District at Kenai. 14, ENTIRE AGREEMENT; MODIFICATION. This document sets forth the entire agreement and understanding between the parties relating to the subject matter herein and supersedes any prior discussions between the parties. No modification of or amendment to this Option to Purchase or any waiver of the rights under this Option to Purchase will be effective unless in writing signed by the parties to the Agreement. OPTION TO PURCHASE Page 2 of 3 i SELLER Clint D_ Hall CITE' ®F KENAI � ,-A1 . 111 Bye m f'� ` k kA Rick . Kdc t Its: City Manager Stag of Alaska } } ss Third Judicial District ) The foregoing instrument was acknowledged before me this M day of Wt VF , 2010 by Clint D. ball. State of Alaska Third Judicial District e i z' �� P I�VnJl�� } ss Notary Public of Alaska My Commission Expires Efjj n The foregoing instrument was acknowledged before me this 2 1 day of ta�tg 2010 by Rick R, Koch, City Manager for the City of Kenai. OPTION TO PURCHASE Page 3 of 3 >7 ai: i�... r !] 7:•..' � ...'411 tl� Notary Public of Alaska My Commission Expires : AM A S "s E101, ALAS \W CITE" OF KENAI RESO LUTION NO. 2011 - 01 Suggested oar. t 1L A RESOLUTION OF THE COUNCIL OF THE CITY OF =NAI, .ALASKA, AUTHORIZING THE PURCHASE OF APPROXIMATELY 20 ACRES OF PROPERTY DESCRIBED AS E '/L NE '/,, NE 3 -A, SECTION 31, T6N', R l I W, SEWARD MERIDIAN, THIRD JUDICIAL DISTRICT, KENAI, ALASKA FOR $46,000 TO BE RETAINED BY THE CITY AND RESERVED FOR A PUBLIC USE AND FOR AIRPORT PURPOSES. WHEREAS, KMC 22,035.135 states that the City may purchase real property after authorization by the City Council; and, WHEREAS, the purchase of the property would preserve a natural drainage -way at the perimeter of a residential area; and, WHEREAS, the City Manager desires the City to purchase a portion of this property to preserve .a natural drainage -way and reserved for a potential future site of a City trail system and airport purposes; and, WHEREAS the o'�xrners of the property desire to sell the property to the City of Kenai for $46,000.00; and, WHEREAS, the City Manager has ordered an appraisal of the property as required under KMC 22.05. 135 which shall be available to the Council prior to the purchase being finalized; and, WHEREAS, the ovkmer's of the property and the City of Kenai. have entered into an option to purchase agreement giving the City of Kenai the option to purchase the property for $46,000.00; and, WHEREAS, the total purchase price for 20 acres is $46,000 of which the General Fund and Airport Fund will each pay $23,040 and receive approximately half 10 acres) of property to be subdivided at a later date; and, WHEREAS, it is in the best interest of the City of Kenai to purchase the above described property to be retained by the City and reserved for a future trail, tc preserve the drainage. -way and for Airport purposes, NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITE' OF KENAI, ALASKA authorizes the purchase of approximately 20 acres of property described as E2, NE4 Section 3l, T6N, RI IW, Seward Meridian, Third Judicial District, Kenai, Alaska for $46,040 to be retained by the City and reserved for a public use and for airport purposes. -29- Resolution No. 2011 -01 Page 2 of 2 PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this fifth day of January, 2011. ATTEST: PAT PORTER, MAYOR Carol. L. Frets, City Clerk -30- 4 ,--r � ✓' X15; G F \\ iA, '."�y' f ' // KENAI. ALASKA CITY OF XDNAI Suggested by: Administration RESOLUTION NO. 2011 A RESOLUTION OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, AUTHORIZING THE PURCHASE OF APPROXIMATELY 40 ACRES OF PROPERTY ?.DESCRIBED AS SE '/a NE, TSN, RI 1W, SECTION 31, SEWAR.D MERIDIAN, THIRD JUDICIAL DISTRICT, KENAI, ALASKA FOR $1.60,000.00 TO BE RETAINED BY THE CITY AND RESERVED FOR PUBLIC USE AND FOR AIRPORT PURPOSES. WHEREAS, KMC 22.05.135 states that the City may purchase real property after authorization by the City Council; and, WHEREAS, the purchase of the property would preserve a natural drainage -way at the perimeter of a residential area; arid, WHEREAS, the City Manager desires the City to purchase this property to be retained by the City and reserved for public use; and, WHEREAS, the purchase would provide the City's airport additional property reserved for airport. purposes; and, WHEREAS the owner of the property desires to sell the property to the City of Kenai for $160,000; and, WHEREAS, the City Manager has ordered an appraisal of the property as required. under KMC 22.0S. 135 which shall be available to the Council prior to the purchase being finalized; anal, WHEREAS, the owner of the property and the City of Kenai have entered into an option to purchase agreement giving the City the option to purchase the property for $160,000; and, WHEREAS, the total purchase price for 40 acres is $ 160,000 of which. the General. Fund and Airport bond will each pay 580,000 and receive approximately half ( +/- 20 acres) of property to be subdivided at a later date; anal, WHEREAS, it is in the best interest of the City of Kenai. to purchase the above described property to be retained by the City and reserved for a future trail, to preserve the drainage -way and for Airport purposes, -33- Resolution No. 2011 -03 Page 2 of ? NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL, OF THE CITY OF KENAI, ALASKA, authorizes the purchase of approximately 40 acres of property described as SE ,I' NE '/4, T6N, RI IW, Section 3I, Seward Mel dian, Third Judicial District, Kenai, Alaska for $160,000 to be retained by the City and reserved for a future trail, to preserve a drainage -way through the City and for airport purposes. PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA., this fifth day of Jam- ary, 2011. PAT PORTER, MAYOR ATTEST: Carol L. Freas, City Clerk m t`Jrc 6i�Of KENAI, ALASKA I V Suggested by CITE'' OF KENAI R ESOLUTION NO. 2011-04 A RESOLUTION OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, PERTAINING TO THE AUTHORIZED INVESTMENTS OF, THE INVESTMENT ALLOCATION'S OF, AND ESTABLISHING APPROPRIATE BENCHMARKS TO MEASURE PERFORMANCE OF THE AIRPORT PERMANENT FUND. WHEREAS, the City of Kenai Council is authorized to establish investment policies for the Airport Permanent Fund; and, WHEREAS, the KMC 7.30.050 (b) permits investment of the Airport Permanent Pond in various asset classes and the Council believes that establishing asset allocation criteria for these various asset classes is in the best interest of the City of Kenai; and, WHEREAS, the Council intends to annually review the asset allocations and performance of the Airport Permanent Fund-, and. WHEREAS, prop >iding benchmarks to measure the performance of the fund is prudent. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF TIME CITE' OF KENAI, ALASKA, that the Council designates the following investments for the Airport Permanent Fund: AUTHORIZED IN FOR THE AIRPORT PERMANENT FUND (1) Investments authorized by KMC 7.22.030 (2) Corporate obligations of investment grade duality as recognized by a nationally recognized rating organization. If, alter purchase, these obligations are do wrigraded below investment grade, they shah be sold in an orderly manner within ninety days of downgrading. (3) Domestic Equities, which taken as a whole, attempt to mirror the characteristics or replicate the Standard & Poor's 500 Index, including both mutual funds and exchange traded funds (ETF's). (4) Domestic Equities, which taken as a whole, attempt to replicate the Standard & Poor's 400 Mid -Cap index., including bath mutual funds and exchange traded funds (ETF's). (5) Domestic Equities, which taken as a whole, attempt to replicate the Standard & Poor's 600 Small -Cap Index, including bath mutual funds and exchange traded funds (ETF's). (6) International Equites, which taken as a whole, attempt to replicate the Morgan. Stanley Europe, Australasia, Far East (EAFE) Index, including bath mutual funds and. exchange traded funds (ETF's), (7) Equities, which taken as a whole, attempt to replicate the universe of domestic real - estate investment trusts as represented by the Standard & Poor's REIT composite index, including both mutual funds and exchange traded funds (ETF's). -35- Resolution No. 2011 -04 Page 2 of 3 (S) Emerging Market Equities, which taken as a whole, attempt to replicate the Morgan Stanley Emerging Market index including bath mutual funds and exchange traded funds (ETF's) . BE IT FURTHER RESOLVED BY THE COUNCIL OF THE CITY DF K.ENAI, ALASKA, that the Council adopts the asset allocations and performance measurement standards as follows: AIRPORT PERMANENT FUND ASSET ALLOCATION PLAN AND PERFORMANCE MEASUREMENT TARGETS Section l.: The Asset Allocation Plan and Target Weightings with range restrictions are as follows. ASSET CLASS Fixed Income Large -Cap Domestic Equity International Equity Mid -Cap Equities Sniall -Cap Equities International Emerging Markets Real - estate equities TARGET % WEIGHTING RANGE % 45 40 -65 20 15 -25 10 5 -15 10 5 -15 5 0 -10 5 0 -10 5 t1 -10 Section 2: The performance of the Fund and investment managers will be measured as follows: Performance measurement of the Fixed Income allocation will be measured against the Target weighting, „sing the Barc ttys Intermediate Government/ Credit Index for the benchmark. Performance measurement of the Large -Cap Domestic Equity all.ocati.on will be measured against the Target weighting, using the Standard &, Poor's 500 index for the benchmark. Performance measurement of the International Equity allocation will be measured against the Target weighting, using the Morgan Stanley Europe, Australia, Far East (SAFE) Index for the benchmark. Performance measure -ment of the Mid -Cap Equity allocation will be measured against the Target weighting, using the Standard &, Poor's 400 Mid -Cap Index as the benchmark. Performance measurement of the Small -Cap Equity allocation will be measured against the Target weighting, using the Standard. & Poor's 600 Small-Cap Index as the benchmark. -36- Resolution. No, 2011.04 Page 3 of 3 Performance measurement of the International Emerging Markets allocation will be measured against the Target weighting, using the Morgan Stanley Emerging Markets Index as the benchmark. Performance measurement of the Real- Estate Equities allocation will be measured against the target weighting, using the Standard & Poor`s REIT Composite Index as the benchmark. PASSEL"? BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 5th day of January 2011. PAT PORTER, MAYOR ATTEST: Carol L. Frca_s, City Clerk Approved by Finance; -37- "' Kllaye witk a Past Ci iM s Patine FINANCE DEPARTMENT 213 Fidalgo Avenue, Kenai, Alaska 9911 -7794 Telephone 907-283-7535 ext 2211 FAX: 907- 283 -3014 To: Rick Koch, City Manager ' Frorn: Terry Eubank Date. December 22, 2010 Re: Airport Land Sale Permanent Fund Investment Authorized Investments and Asset Allocation Plan for CY20I I. Pursuant to KMC 730.020 the Council shall annually designate by resolution the authorized investments and allocation plan for the Airport Land. Sale Permanent Fund, Resolution 2011 -04 reauthorizes the authorized investments and allocation plan used by the Fund since inception in September 2008 $17,281,883 was invested in September 2008 and since the fund has transferred $1,174,312 to the Airport Special Revenue Fund and had a market value of $21,101,151 at November 30, 2010. The portfolio has returned nearly 13% since September 2008. In contrast the City's investment portfolio has yielded between 3.0% and 0.85% for the same ,period. When originally adopted tole investment model being used was projected tv returns S.0% annually. Due to depressed rates in the fixed income portion of the portfolio (which constitutes 40 -65% of the portfolio's value) the current projected rate of return for the portfolio is 7.1% annually. Risk of the portfolio is measured in. standard deviation fxom the expected rate of return. One standard deviation is equal to abort 66% of all possible outcomes acid two standard deviations is equal to about 95% of all possible outcomes. 66 (one standard deviation) of the time, the portfolio is expected to return between (5.0) and 19.2 %, with an average return of 7.1%. 95% (two standard deviations) of the tune, the portfolio is expected to return between (12.3) and 26.5 %. At this time it is not being recommended to change the- portfolio's investments or their allocations. Over time it is expected that the fixed income markets will return to historic rates of return and should return. the portfolios performance to the 8% level. m e