Council rejects fee increases on harbor properties, maintains $5 parking fees

Posted on: February 9, 2010 | musiclover | 3 Comments | Print Article | Rate Post:

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By Heidi Zemach for Seward City News

At Monday’s regular meeting the Seward City Council discussed, but rejected for the time being a proposal instituting a two-percent increase in fees on the city’s rental properties. The city’s 37 property leases along the harbor are due for their mandatory five-year reappraisal, where a Fair Market Value is determined for each. For the past two decades, city rental leases have been set at eight-percent of their appraised amount. This means that for a property worth $100,000, the annual lease fee is $8,000. City Manger Phil Oates asked for council guidance on whether the council wanted to have the appraiser increase that fee to 10-percent.

“Council and Administration continue to evaluate ways to increase revenue into the General and Harbor Funds to pay for critical City services,” the city said in a background and justification statement to the council. The statement then listed a number of private and private sector land lease rates ranging from 8-10-percent as examples: Cordova charges 9-percent on its leases; Valdez and the city and borough of Juneau charge 10-percent; the Alaska Railroad Corporation, Bureau of Indian Affairs and Bureau of Land Management charge 8-10-percent. “The City mindfully strives to fulfill our duty to insure the citizens of Seward are receiving the highest and best return on the property we manage for their benefit,” the city stated. It added that the proposed increase would bring in 2-percent additional revenue to pay for critical city services.

Tom Tougas, who manages Four Seasons Marine Services/ Alaska Coach Tours, and Ron Willie, operations manager of Kenai Fjords Tours, harbor businessmen who rent leases at the harbor, objected to the proposed increase. They said a 2-percent fee increase on their properties would actually mean a 25-percent increase in rental revenues to the city. That’s because a property worth $100,000 would now have a $10,000 fee assessed, rather than $8,000—a $2,000 increase for that business. An increase on their rents would be another blow to harbor businesses already suffering a 35-percent decline in business last year, Tougas said. The idea comes at a time when the city also recently increased fees for water, sewer, electric and moorage in the 2010/2011 budget, and would be a particular hardship for Seward Fish, which is located on a particularly large city lot. The proposed fee increase also does not take into account the results of the upcoming Fair Market Value re-appraisals, which could mean increased—or decreased property values. At their last appraisal five years ago, Kenai Fjord’s rental property was re-appraised at 145 percent of what it had been previously, Willie said.

While appearing confused by issue, or why the proposed increase had even come up, the council members that spoke mostly questioned whether or not the decision to could be made administratively, as city solicitor Cheryl Brooking claimed, or should be made by them, after soliciting public input. According to her reading of city code, it should be a council decision, said Councilmember Marianna Kiel. Dunham suggested they allow the appraisals to take place without suggesting an automatic fee increase—and then, once they see how the appraisals go—leave open the option to revisit the proposed fee increase at that time. That idea stuck, but Oates warned that to change fees after properties had been appraised would be an onerous task, as the lease agreements all have different terms, and would need to be renegotiated on a case-by-case basis if property owners objected to them.

Monday night the council also grudgingly agreed to lower summer daily parking fees in the harbor area lots from $10 to $5 for another year. Mayor Willard Dunham and Councilman Bob Valdatta voted against the resolution however, making the vote 4-2. (Councilmember Linda Amberg was absent from the meeting.) Dunham called the council “penny wise and pound foolish” for doing so. The mayor and councilman argued that parking fees in Anchorage and elsewhere are frequently higher. If visitors can afford fancy boats, they can surely also afford $10 parking fees, Valdatta said. But the other council members say they had already had given the city guidance during FY 2010/2011 budget discussions to allow the fees to remain at the lower rate in order to encourage people to choose Seward as their recreation or business destination. The harbor budget that passed earlier was based on the lower parking fees.

On another matter, the council approved a letter to the Kenai Peninsula Borough, strongly objecting to changes to a proposed ordinance that would allow area board members to be appointed by the borough mayor, and confirmed by the borough assembly when vacancies occur outside an election cycle. All of the Seward area boards, including the Lowell Point Emergency Service Area Board, the Seward/Bear Creek Flood Service Area Board and the Bear Creek Fire Service Area Board have unanimously opposed he proposed change, one that would take away their own (local) power to appoint their own members, and give it to the mayor and assembly in Soldotna. Dunham insisted the letter include the fact that Seward is home-rule. Seward Assembly representative Sue McClure told the council she was confident that the proposed change would fail at the next assembly meeting, as it has encountered such widespread opposition.

Finally, the Council presented a proclamation designating February 20 and 21, 2010 Juriro Wada and Alfred Lowell Days. Wada and Lowell were hired by Seward Commercial Club in 1909 to demonstrate the feasibility of a trail from Seward to the Iditarod country, which would make Seward a major outfitting and departure point for those bound for the Iditarod. They later blazed and marked the trail. Seward musher Dan Seavey who heads three generations of Alaska mushers, and has long worked on behalf of the Seward Iditarod Trail Blazers, accepted the proclamation. He said his group has worked for 28 years to develop and improve the trail, and that it still hopes to put Seward back on the map as the southern terminus of the National Historic Trail.

Betty Casey Skinner also spoke out against fluoridating the city water, asking the council to slow down and consider its economic cost as well as its effects on older people, and those without teeth.

Finally, the council went into Executive (closed) Session to discuss the city’s possible role in pending litigation commitments in regards to a lawsuit brought against the Alaska Railroad Corporation and Aurora Energy Services LLC by Alaska Community Action On Toxics, and the Alaska Chapter of the Sierra Club. No word was released on their decision.

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