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HomeMy WebLinkAbout06222009 City Council MinutesCrry of'Sewar~l, Alaska City Council Minutes June 22, 2009 Volume 38, Page100 CALL TO ORDER The June 22, 2009 regular meeting of the Seward City Council was called to order at 7:00 p.m. by Mayor Clark Corbridge. OPENING CEREMONY Police Lieutenant Louis Tiner led the pledge of allegiance to the flag. ROLL CALL There were present: Clark Corbridge presiding and Jean Bardarson Bob Valdatta Willard Dunham Betsy Kellar Marianna Keil Tom Smith comprising a quorum of the Council; and Phillip Oates, City Manager Jean Lewis, City Clerk Cheryl Brooking, City Attorney ABSENT -None CITIZENS' COMMENTS ON ANY SUBJECT EXCEPT THOSE ITEMS SCHEDULED FOR PUBLIC HEARING Keith Campbell requested council support and approval for Resolution 2009-053 for the issuance of GO bonds on the Library/Museum Project, and also for Resolution 2009-054 which would pay for the bonds with a half cent sales tax increase. Campbell stated that if these issues were put before the voters, the Seward Library/Museum Building Committee would help to sell the project to the community. Monica Hinders had submitted paperwork to be on the Historic Preservation Commission. She introduced herself and stated she would make them proud for their appointment of her. David Squires, received a late fireworks permit request for the McDonald property on Mile 2 of Nash Rd for Saturday night at 5 pm. He requested an addition to the agenda to schedule a special meeting for this and hoped it would be approved. APPROVAL OF AGENDA AND CONSENT AGENDA Motion (Bardarson/Dunham) Approval of Agenda and Consent Agenda The following was added to the agenda: Ciry of Seward, Alaska June 22, 2009 City Council Minutes volume 38, Page101 Scheduling of a special meeting for a Carlile Fireworks on city land request. --~ The following was removed from the consent agenda: Resolution 2009-051, Accepting A Grant From The State Homeland Security Grant Program In The Amount Of $350,000 For The Purpose Of Expanding And Updating Infrastructure Security Cameras. Motion Passed Unanimous The clerk read the following approved consent agenda items: The June 8, 2009 Regular City Council Meeting Minutes Were Approved. Monica Hinders Was Appointed To The Historic Preservation Commission With A Term To Expire May 2012. Resolution 2009-050, Authorizing The Discharge Of Fireworks By The Chamber Of Commerce During The 2009 Independence Day Celebration. Resolution 2009-052, Authorizing A One Year Contract For $449,472.00 With The State Of Alaska, Department Of Corrections, To Provide For Operating The Seward Community Jail •- And Housing Prisoners Charged And/Or Sentenced Under Alaska Statutes. SPECIAL ORDERS, PRESENTATIONS AND REPORTS Proclamations and Awards Mayor Corbridge highlighted the displayed award trophies sent by Mayor Sunagawa from Obihiro Japan that were gifted annually to the Mt. Marathon Race for the 1't 2"`~ and 3rd place winners and the Silver Salmon Derby Trophy gifted by Toshio Otomo, Chairman of the Obihiro Committee for International Friendship. A proclamation was read for Parks and Recreation Month. Alaska Flag Day was recognized with a proclamation. City Manager's Report. City Manager Phillip Oates stated there were no expenditures between $10,000-$50,000. He informed that the city was requesting sealed competitive proposals for the Evan Casey Skate Park upgrade and had attached and provided the criteria for the selection process for the council to see. He notified that as of June 18, 2009, the Alaska Department of Health and Social Services had confirmed 23 cases of H1N1 (Swine Flu) in Alaska. City of Seward, Alaska City Council Minutes June 22, 2009 volume 38, PaQe102 • Library/Museum Project. The Library Museum Building Committee thanked those who attended the site dedication on June 18, 2009. Dot Bardarson, Kyle Schneider, and Seward Singers providing the tunes and the Seward Ministerial Association blessed the project. • Harbor/SMIC. The harbor had taken steps to permit an improved fish-cleaning station in the NE area. The Alaska Department of Fish & Game had committed $100,000 for this project, but approximately $300,000 in additional funds would be needed to reach completion. PACAB held a work session to outline capital improvement priorities and funding possibilities for the Seward Marine Industrial Center Storage and Maintenance Yard. The prioritized improvements with grant applications already completed for the top two are: o Vessel Washdown Pad & Water Treatment Facility o Electrical Infrastructure Improvements o Drainage, Culverts, D-1 Gravel Layer, and Water Infrastructure o Fence surrounding Block 4 of SMIC o Public Restrooms New fish hanging racks would be installed on Q float, along with new life rings being installed at travel lift docks in accordance with OSHA requirements. • Community Development. A volunteer appreciation picnic was scheduled at the Branson Pavilion for Friday June 26`h beginning at 5 p.m. On June 2, 2009, Community Development partnered with the Alaska Small Business Development Center and the Procurement Technical Assistance Center (PTAC) to provide a free Government Contract Seminar titled 10 Steps to Successful Government Contracting. Oates informed that the Planning & Zoning Commission had. begun examination of the Title 15 code revisions. These revisions had been distributed to the Port and Commerce Advisory Board, Historic Preservation Commission, City Council, were posted on Seward City News and were made available to the public. Additional work sessions would be scheduled. Oates also presented information and photographs of the progress at Seward Mountain Haven. Oates extended his thanks to the fire department volunteers that responded to sixteen emergency calls while the Fire Chief and the Deputy Fire Chief were away in Michigan purchasing the new firetruck. Other Reports, Special Presentations Co. An Overall Audit Presentation Was Given By Michelle Drew of Mikunda, Cottrell & A Wellness-For-All Presentation Was Given By Patty Beals. This groups mission was to establish Seward as a city of wellness. They had focused on five areas for improvement; reducing tobacco use, fostering fitness, oral health, awareness and access group to resources, and choosing healthy behaviors. Ciry of Seward, Alaska Ciry Council Minutes June 22 2009 volume 38, Page103 NEW BUSINESS Resolution 2009-049, Authorizing The City Manager To Amend And Extend The Maintenance And Operating Agreement With Seward Ship's Drydock, Inc. Through September 30, 2010. Motion (Kell/Kellar) Approve Resolution 2009-049 Oates wished to summarize the background and justification of the long pursued development of the Seward Marine Industrial Center for the public. The city had extended over $40 million dollars for improvements and infrastructure to this area. An initial maintenance and operating (M&O) agreement was signed on 4/25/95 between the city and the operator, Seward Ships Drydock. A second M&O agreement was signed on 3/30/2000, and extended in 2005. The current M&O agreement now expires 6/30/2009. The Seward City Council went into executive session on 3/10/2009 to discuss possible litigation with Seward Ships Drydock (SSD) in regards to their maintenance and operating agreement, and approved a unanimous motion which found them in default of the M&O agreement and authorized the city manager to discuss defects and conditions with SSD in whatever detail deemed appropriate. If addressed defects were corrected, the council was willing to discuss negotiations for a successor M&O agreement. If conditions and timelines set by the city manager failed to be met, the council would proceed to terminate the M&O agreement because of default. If the council terminated the M&O agreement, the city would act to terminate Seward Ship's Drydock's ground lease within 30 days thereafter. At another executive session held on 6/1/2009, the city council again gave direction to the city manager on how to proceed with SSD on the M&O agreement. Oates had discussions with SSD on the cofferdam cells and the importance of having the splash zone coated to avoid further corrosion. He felt a 15-month extension gave SSD the time needed to determine the best course of action in accordance with the M&O agreement. Coating needed to be applied and completed by SSD before 9/30/2010. If completed the M&O agreement maybe extended beyond that date, subject to council approval. This 6t" amendment would extend the term period for the purposes of allowing the operator to cure all defaults and to amend Section 3.04 changing the inspection agency from NEI Syncrolift, Inc to Pearlson Shiplift Corporation for certain annual inspections, all subject for attorney review. Passage of this resolution today was important because it would supersede the council motion passed on 3/10/2009 which finds SSD in default of the M&O agreement on 6/30/2009. Oates indicated the maintenance of the shiplift was a primary concern for the city, and with three areas of the M&O agreement needing attention: 1. The cathotic protection s.. sue, which the consensus from council and independent inspectors was it had not been maintained properly. Arbitration found this would be a capital improvement but did not address whether the facility had been properly maintained. There was still an issue on how much damage was done and if this system had been properly -~ maintained. City of Seward, Alaska Ciry Council Minutes June 2l, 2009 volume 38, Page104 2. The splash zone area, which needed coating to protect the metal from the salt water. The city's position was that if this coating had been applied, it was not applied properly and not '~ maintained over the years. SSD argued this was a capital improvement. 3. Maintenance of the Synchrolift, which was a lessor concern and had some issues because of changes in manufacturers. Oates concluded that this resolution protected the city's position that SSD is in default with the M&O agreement but allowed additional time for SSD to have the facility properly maintained. He pointed out that Seward Ship's Drydock disagreed that they were in default. Oates clarified it was not the city's intent to kick out the operator, but to insist the facility be properly maintained. City Attorney Cheryl Brooking stated the alternative for not approving this sixth amendment was that the existing agreement would expire in eight days. At that point, the city would take over the lift and either shut it down or run it themselves. Seward Ships Drydock was in default now and they could either agree with the extension or walk away. She emphasized there were two agreements which were somewhat linked together. The agreement for the maintenance and operation of the facility and an upland lease, that the city had paid $400,000 in lease credits to make sure the splash zone coatings were replaced, which the city contended weren't done. Brooking stressed the sheet pile and cofferdam cells were actively corroding at an aggressive rate. Ifthe M&O agreement was terminated the city could terminate the upland lease with a 30-day notice. Valdatta wanted a definite completion date set for the maintenance. Dunham thought this was in the best interest for both parties even though it was not completely palatable for either side. He understood Whitman disagreed and was not pleased but noted this needed to be worked out for the parties to co-exist in the future. He stated this agreement gave arock-solid date for the repairs to be fixed. In response to questions by Keil, Oates stated only the lease could go to arbitration. He had informed D.J. Whitman that depending on all the factors, Oates was prepared to consider an extension of the lease as a capital improvement and take that to the council if the particulars were made known during this extension. Brooking stated all indications were a refusal to do the work. Amendment (Smith/Bardarson) On the 6"' WHEREAS, remove the words "will use its best efforts to improve the condition of the City's Shiplift Facility" and replace it with "will provide the city with its recommended procedure which complies with NACE standards for correcting the splash zone maintenance problem. The City will review the recommended procedures and if accepted by the City, Seward Ship's Drydock will complete the corrected maintenance by September 30, 2010. Ciry of Seward, Alaska Ciry Council Minutes June 22, 2009 volume 38, Page105 Amendment Passed Yes: Dunham, Bardarson, Valdatta, Smith, ..... Corbridge No: Kellar, Keil The rules were suspended by unanimous consent to allow D.J. Whitman to speak and answer questions fora 15 minute period. In response to questions by council, D.J. Whitman stated he disagreed on being in default and also disagreed with the terms of this amendment. His suggestion was to extend the current agreement for 90 days until both parties could come to an understanding. He thought this agreement was more like a demand and he also thought the NACE standards language was too vague. He didn't disagree that there was a problem. Whitman announced the problem started in 1983 not 1995. He acknowledged the sheetpiles absolutely needed to be re-coated. He felt it was now a major capital improvement and could not beband-aided. If SSD was going to spend $500,000 they would want their lease extended and credits for it. Whitman thought the agreement was a written demand and too open-ended and didn't state that any capital credit would be allowed. He also felt he didn't get a fair chance to go over this agreement beforehand. In response to questions by Council member Smith, Whitman had agreed to perform all the routine, annual and regular maintenance. He noted there was also a specific list of deferred -r- maintenance that was a hit list from NEI Synchrolift which he thought was all tied together. Whitman stated after reading NEI Synchrolift and Lloyd's reports you would find the cell structure and piling mentioned in them. He agreed one of the major items of contention was whether this maintenance was a capital improvement or general maintenance item. Whitman felt it was a capital improvement because the coating system had outlived its useful life and was put on in 1983 prior to the driving of the sheetpiles. Smith felt paint coating was preventive maintenance, not a capital improvement. Whitman stated the coating was designed to last 15-20 years, and had ten years of failure on it when they accepted it. Dunham saw this as a way to get this accomplished between the two parties. He didn't see it as a do or die situation, but a workable situation for the next 15 months and thought there shouldn't be anymore side-stepping. Bardarson concurred this was not a capital improvement, but both parties needed to share responsibility and noted Section 3 stated both parties must agree. Whitman stated their attorneys had advised them not to sign this agreement as written. Suspension of rules ended. City of Seward, Alaska Ciry Council Minutes June 22, 2009 Volume 38 Page106 Harbormaster Kari Anderson stated they had contacted SSD about the problem with the protective coatings in 2008, so this was not a newly addressed issue. Oates stated this was not the partnership he would hope for. Every step had been a struggle. Oates reiterated he was not trying to run them out of the shiplift, but wanted the City's facility maintained. It was his contention that SSD was in default of the M&O agreement for not maintaining the cathotic protection system and the maintenance of the coating on the splash zone. He reminded that the city had 3'~a party independent decisions that supported the city's claim. Oates had no objection to consider this as a capital improvement but needed the system in place to protect it from this point forward. 90 days will not resolve this issue and would only result in more of the same. Smith stated the city owned the facility and had a vested right to agree to how it was maintained. He felt this 15 month extension and the requirement to fix it was reasonable. if SSD felt they received it that way in 1995, they shouldn't have accepted it. He also felt this was a maintenance issue. In response to questions by Keil,City Attorney Cheryl Brooking clarified that arbitration was a provision in the lease itself. The lease was also scheduled to expire the end of June 2009. The lease provision allowed extensions for capital improvements done on either the leased area or the shiplift facility which included the synchrolift and the dock. The reason this went to arbitration was because the capital improvement suggestion was replacement of the electrical cathotic protection system which council felt was already a required obligation under the M&O agreement. It was not a new improvement that would qualify for a lease extension. The arbitrators felt the lease did not define improvement and authorized the extension of the lease to 2013. Brooking stated the arbitrators specifically did not address any obligations under the M&O agreement or whether it was already required. City Council took a ten minute recess at 8:50 p.m. City Council resumed at 9:00 p.m. Amendment (Keil/Bardarson) Add a new "WHEREAS, upon completion of the coating the city may consider the cost of the coating as a capital improvement. Keil hoped this amendment would get the parties where they needed to go because she couldn't stand litigation. Amendment Passed Amendment (Bardarson/Keil) Amendment Passed Unanimous Add the word "substantially" to Section 1 Unanimous Main Motion Passed as Amended Unanimous City of Seward, Alaska Ciry Council Minutes June 22, 2009 Volume 38, Page107 Resolution 2009-051, Accepting A Grant From The State Homeland Security Grant Program In The Amount Of $350,000 For The Purpose Of Expanding And Updating Infrastructure Security Cameras. Motion (Kellar/Bardarson) Approve Resolution 2009-051 Oates stated the city had recently completed a security vulnerability assessment to protect city of Seward infrastructure. Acceptance of this grant would better enable Seward to protect critical and expensive infrastructure. It was his position to make the positioning of these cameras a council matter. He reminded this resolution was only for accepting the grant. Oates said these cameras were monitored occasionally by dispatchers and were used to solve crime and as evidentiary evidence. Some members wanted a policy developed on how these cameras would be installed, where located, how controlled, and approved finally by the city council. Council requested and Oates had no objection bringing a written surveillance policy for the security cameras back to the council. Mayor Corbridge declared Council member Keil's comments out of order. Kellar wanted the cameras used for security vulnerability assessment issues only. She did not think it was the role of government to follow citizens. Keil apologized. She just objected to having cameras on the streets and wanted people to be aware when they were under surveillance. Oates mentioned having cameras in the harbor had been extremely valuable for deterring crime in that area. Amendment (Kellar/Keil) In the 2°`~ WHEREAS, delete the words "and expansion of Oates stressed it would kill the grant without that wording in the resolution. Amendment Failed Unanimous Motion Passed Yes: Smith, Valdatta, Bardarson, Dunham, Corbridge No: Kellar, Keil Resolution 2009-053, Providing For The Submission To The Qualified Voters Of The City Of Seward The Question Of The Issuance Of Not To Exceed $5,000,000 In General Obligation Bonds Of The City To Finance All Or A Portion Of The Construction Of A Combined Library/Museum Capital Improvement Project. Motion (Keil/Smith) Approve Resolution 2009-053 Ciry of'Sewa~°~t, Alaska June 22. 2009 City Council Minutes Volume 38, Page108 Oates stated this resolution put the question on the ballot this fall. He stated if the vote of the people was successful, it would come back to council only after all other funding was available and binding. A revenue source would have to be decided. Valdatta was concerned and wondered if the people could afford it in this economy. Dunham understood if the match money wasn't there, it wouldn't happen. There would have to be a commitment by the community for a portion of this to be paid. He also mentioned that in this market there was a chance the bonds wouldn't sell. Oates stated the community would need to put in matching funds and have this project at 35% design to address funds from the legislature. Motion Passed Unanimous Resolution 2009-054, Providing For The Submission To The Qualified Voters Of The City Of Seward, An Advisory Question On Whether To Increase The Sales Tax Rate By 0.5% As Needed To Fund Operating And Capital Costs Of A New Library/Museum, Understanding That Sales Tax Revenues Cannot Be Dedicated For A Specific Purpose. Motion (Bardarson/Dunham) Approve Resolution 2009-054 Oates stated this was an advisory vote because the city council had the authority to establish a sales tax regardless of the vote of the people. All revenue sources were considered but sales tax was picked because it went across all demographics. A half cent increase would put total sales tax at 7.5% and would generate $500,000 a year. Oates reported this would fund the cost of the debt service of the $5 million dollar bond plus the full cost of operation (possible addition of 3 people) and maintenance of the new facility. Council could repeal the tax once repaid but could not dedicate it as a revenue source for repayment of the GO bonds. The building committee thought this was the fairest way to re-pay the bonds. City Attorney Cheryl Brooking stated the payoff period would be 25-years and clarified a sales tax was an operating tax. A future council could get rid of it. The amount would have to be appropriated every year to pay the bonds. This would provide the sufficient funds for the additional costs. Libraries were not typically a money making venture. Motion Passed Unanimous OTHER NEW BUSINESS A work session on the evaluation process was scheduled for July 13, 2009 at 6:00 p.m. A special meeting was scheduled by Mayor Corbridge for Wednesday, June 24, 2009 at 5:15 p.m. to address a resolution allowing Carlile Transportation Systems to shoot off fireworks on their land within the city limits. City of Seward, Alaska Ciry Council Minutes June 22, 2009 volume 38, Page109 INFORMATIONAL ITEMS AND REPORTS (No action required COUNCIL COMMENTS Keil wanted to make sure Obihiro, Japan was properly thanked for the beautiful trophies they traditionally sent each year. Smith after a long meeting, was quoted as saying; "if we wrote the constitution we would still be a colony." Dunham spoke of the letter Senator Stevens sent about Wyndam. He asked for clarification on the difference between bids for the lift station, and congratulated the Chamber of Commerce ahead of time on their 4r~ of July festivities they always put on. He was sorry to hear of the passing of Frank Dieckgraeff. Dunham said Dieckgraeff was a real friend and a huge booster of the community and he sent his sincere sympathy to his family. CITIZENS' COMMENTS Jerry Woods said the council was welcome to tax him for the new library/museum project. He was on the committee and stated they had put in many hours into this project. He wanted it noted that this was the day this facility got off the ground and started. He thanked the city council for their support. COUNCIL AND ADMINISTRATION RESPONSE TO CITIZENS' COMMENTS Oates mentioned that around $11,000 was involved in supporting the Senator Stevens letter on Wyndam and he would possibly bring it back to the council. He said the lift station needed workable parts and he would see that council got their answer soon. Keil thanked the library/museum committee for all their hard work. ADJOURNMENT The meeting was adjourned at 1.0:00 p.m. _,E ~r Jean Lewis ~ ~ {- a City Clerk w• ~`~~~~ ~ ~ ~~°~~ .~" ~ t .® (City Seal) ~ ~~~ ~~ ~ ~~~ ;, r~ ~ ~ ~~ . __. ... ,~ f' a. Y d •,.....~ r p~ e ~e•ts! ~•~ ~~n~P~~w Clark Corbridge Mayor