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HomeMy WebLinkAbout01232023 City Council Minutes City of Seward,Alaska City Council Meeting Minutes January 23, 2023 Volume 42,Page 211 CALL TO ORDER The January 23,2023 regular meeting of the Seward City Council was called to order at 7:00 p.m.by Mayor Sue McClure. OPENING CEREMONY Police Chief Alan Nickell led the Pledge of Allegiance to the flag. ROLL CALL There were present: Sue McClure,presiding, and John Osenga Liz DeMoss Mike Calhoon Randy Wells Kevin Finch Robert Barnwell comprising a quorum of the Council; and Janette Bower, City Manager Kris Peck, Acting City Clerk Sam Severin, City Attorney Excused—None Absent—None McClure stated she wished to extend the 36-minute time limit for citizen comments in order to allow all members of the public to speak. There was no objection from council. CITIZEN COMMENTS ON ANY SUBJECT EXCEPT THOSE ITEMS SCHEDULED FOR PUBLIC HEARING Rissie Casagranda,inside the city, asked for a reconsideration of Resolution 2023-001 so the decision could be made with a fair process. As a representative of the buyers, Casagranda was confident there would be no grounds for denying ZPA, LLC from purchasing the Breeze Inn. The reason that ZPA owners Elliot Jackson and Toni Strauss were absent during the January 9,2023 city council meeting was because lease assignments had always been a matter of procedure. ZPA was compliant and in good standing with the City of Seward, the State of Alaska, and the Kenai Peninsula Borough. Michael Zinis, outside the city, said he was currently the operations manager of the new adventure park.He felt the owner went above and beyond for safety requirements and was very fair overall. Zinis also read a letter from a J-1 student from Bulgaria in support of working for ZPA. City of Seward,Alaska City Council Meeting Minutes January 23, 2023 Volume 42,Page 212 Nate Smith,outside the city,read a letter from the AlaskaUSA Federal Credit Union which supported the sale of the Breeze Inn. Smith also read a letter from the Small Business Development Center, also in support of the reconsideration of Resolution 2023-001. Melody Jordan,outside the city,read letters from Exit Glacier Lodge,Phillips Cruises and Tours, and McLane Consulting in support of the Breeze Inn sale to ZPA. J.T.Smith,inside the city,said he was a maintenance man for ZPA. Many of the buildings were very old, such as the Van Gilder Hotel, and needed a lot of work. The incident at the Marina Motel that resulted in a city water main leak was due to a series of miscommunications. Elliot Jackson and Toni Strauss were good people to work for and he recommended the lease transfer. Toni Strauss, inside the city, said she was the 50%owner of ZPA, LLC. There were three points to qualify for the lease transfer described in the packet and she felt ZPA met all the criteria. She intended to continue to operate the Breeze Inn year-round. Many of ZPA's staff were J-1 employees because there were not enough American workers to support summer tourism.Strauss did not think ZPA had a monopoly on local restaurants or hotels. Elliot Jackson, inside the city, said was the 50% owner of ZPA, LLC and marketed his businesses collectively as the Seward Hospitality Group. He thought the lease transfer would be a simple administrative process and had no idea it was going to be controversial. The purchases that ZPA had made in Seward helped others retire.ZPA contributed to local charities and he had planned to redo the Breeze Inn exterior and add murals. Patrick Marrs, outside the city, said the decision to deny a transfer of a lease seemed arbitrary and eroded confidence in the city's leadership. Marrs was concerned this decision would affect future business transactions because buyers would be reluctant to develop or build on city- owned land. Callie Bacon,inside the city,supported the reconsideration of Resolution 2023-001.Along with Nicole Lawrence,she represented Juris Mindenbergs in the sale of the Breeze Inn.The time had come to sell the Breeze Inn and ZPA was the only qualified buyer. The seller should have the right to sell the business and his legacy.Council decisions made on speculation,hearsay,or popularity set a concerning precedent. Bacon suggested the city council develop a framework of criteria when considering a lease transfer. The community deserved further discussion on this lease transfer. Susan Mindenbergs, outside the city, said she owned the Breeze Inn, along with her husband, Juris Mindenbergs. She urged the council to reconsider the lease transfer. The business owners' perspective was not heard at the January 9,2023 council meeting. This denial would set a bad precedent for future business in Seward. Annie Johnson,inside the city,spoke on behalf of Seward Properties which represented the sellers.Johnson read a letter of support for the reconsideration and approval of Resolution 2023-001. Sue Ward, inside the city, said that Article 14 of the city land lease included three conditions, and she believed ZPA met all three conditions. The continued operation of the Breeze City of Seward,Alaska City Council Meeting Minutes January 23, 2023 Volume 42,Page 213 Inn was in the public's interest. There was no evidence that any of ZPA's businesses were in any type of financial troubles. The Breeze Inn consisted of a hotel, restaurant, and retail space, which were right in line with ZPA's expertise. Andrea Brady, inside the city, felt that ZPA did not have a monopoly on restaurants or hotels. As an employee of the JAG shipyard, she noted that JAG had spent $5 million dollars on lease holder improvements to city-owned land. She was concerned the denial of the Breeze Inn sale would make business owners think twice before making improvements on city-owned land. Tim Jagielski,outside the city,said he supported the reconsideration of the lease transfer.As the owner of JAG shipyard, he recalled a similar public outcry back in 2008. Fortunately, administration conducted their due diligence and gave JAG a chance to field questions.Businesses like JAG spent million dollars on improvements on leased property. The denial of the Breeze Inn lease transfer should be a wake-up call to every business currently operating on city property. Bruce Jaffa,outside the city,said the applicant for the lease transfer had addressed the core issue of staying open over the winter. Every citizen who spoke at the January 9,2023 meeting was against the lease transfer to ZPA, and Jaffa wondered if council was so easily swayed by public opinion. Peter Micciche, outside the city,thanked the citizens of Seward for their support over the past eight years. As a former senator,Micciche said council was always a pleasure to work and he was proud of their collaborations. Micciche wanted to mention the extrication equipment on the Seward Highway was very important, because modern equipment could save the lives of our families in a vehicle accident. APPROVAL OF AGENDA AND CONSENT AGENDA Motion (DeMoss/Osenga) Approval of Agenda and Consent Agenda Motion Passed Yes: Osenga, Barnwell, DeMoss, Calhoon, Wells,McClure No: Finch McClure wanted to move the reconsideration of Resolution 2023-001 ahead of the two public hearing items out of consideration for the citizens in the audience. There was no objection from council. The clerk read the following approved consent agenda items: Approval of the January 9, 2023 City Council Joint Special Meeting with the Planning & Zoning Commission Minutes. Approval of the January 9,2023 City Council Regular Meeting Minutes. Introduction of Ordinance 2023-002,Amending Sew and City Code Title 2—Administration. City of Seward,Alaska City Council Meeting Minutes January 23, 2023 Volume 42,Page 214 Resolution 2023-009, Accepting Extrication Equipment Funded By The State Of Alaska Legislative Grant Agreement Number 23-DC-022, Emergency Extrication Equipment Clearing House With A Total Value Of$15,200.95 With No Additional Funds Allocated. Resolution 2023-010, Authorizing The City Manager To Enter Into A Contract With OpenGov, Inc. For Licensing And Professional Services Related To The Expansion Of The Online Business License Portal In An Amount Not To Exceed$45,746.00,And Appropriating Funds. Resolution 2023-011,Authorizing The City Manager To Enter Into A Contract With Metco Alaska,LLC For Fire Hydrant Snow Removal And On-Call Sidewalk Snow Removal Services For A Three-Year Period,With Two Optional 1-Year Extensions,And Appropriating Funds Resolution 2023-012, Adopting An Alternative Allocation Method For The FY2023 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 And Authorizing The City Manager To Apply For Funds From The Shared Fisheries Business Tax Program. SPECIAL ORDERS, PRESENTATIONS AND REPORTS Proclamations and Awards—None City Manager Report City Manager Janette Bower said her trip to Juneau last week was very successful and it was great to meet with our legislators. City Clerk Report was provided in the packet. Other Reports and Announcements—None Presentations—None UNFINISHED BUSINESS Items for Reconsideration Resolution 2023-001,Authorizing The City Manager To Enter Into A Consent Assignment To ZPA,LLC,To The Lease Agreement L04-096 With Juris Mindenbergs,For Lot 3B,Block 1, Marina Subdivision, City Of Seward, Kenai Peninsula Borough Plat 2005-8, Seward Recording District, Third Judicial District, State Of Alaska, To Amend Articles 3, 6.1, 11.2 And 12.3,And Extending The Term Of The Lease For 17 Years,And To Add Two Five-Year Options To Extend. This resolution had a public hearing and was failed at the January 9, 2023 meeting.A request for reconsideration was filed by Council Member Calhoon on January 10, 2023. City of Seward,Alaska City Council Meeting Minutes January 23, 2023 Volume 42,Page 215 Motion to Reconsider(Calhoon/Barmy ell) Reconsider Resolution 2023-001 Calhoon felt that city council didn't have all the information at the time of the January 9, 2023 meeting which is why he brought the item back for reconsideration. Motion Failed Yes: Wells, Osenga,Calhoon,McClure No: Barnwell,Finch,DeMoss Clerk's Note:A motion to reconsider must be passed by a 2/3 vote in the affirmative, which would require a minimum of five council members out of seven. Council recessed at 8:00 p.m. City Attorney Sam Severin left the meeting. Council resumed at 8:08 p.m. PUBLIC HEARINGS Ordinances for Enactment Ordinance 2023-001,Amending Seward City Code Chapter 3.50.010 To Recognize Easter As A Paid City Holiday For Regular Full-Time And Regular Part-Time Employees. Motion (DeMoss/Wells) Enact Ordinance 2023-001 DeMoss said her intention was not to have a religious holiday, but rather an additional holiday coming from the standpoint of employee appreciation and retention. Notice of the public hearing being posted and published as required by law was noted and the public hearing was opened. Bruce Jaffa,outside the city,said he understood keeping employee morale high.However, paid holidays didn't increase an employee's yearly income.Jaffa felt a wage increase would be more beneficial to employees than an additional holiday.Jaffa also noted that Easter was most definitely a religious holiday. No one else appeared and the public hearing was closed. Osenga said Easter was not a common paid holiday. He noted there were 12 paid city holidays and wondered if there could be an additional floating holiday that the employee could use at their discretion. Finch said city employees accumulated annual leave which could be used to take time off as needed. City of Seward,Alaska City Council Meeting Minutes January 23, 2023 Volume 42,Page 216 Bower added that each department had their own protocol for employees to use their leave. Barnwell noted that Easter was always on a Sunday and wondered if that holiday only applied to employees who were on shift on a Sunday. He agreed that raising pay would be a better avenue to increase employee retention. Wells said he would not support another paid religious holiday, but would discuss wage increases. Motion Failed Yes: DeMoss No: Calhoon, Finch, Osenga, Wells, Barnwell,McClure Resolutions Requiring Public Hearing Resolution 2022-096,Recommending Kenai Peninsula Borough Approval Of The Preliminary Right Of Way(ROW)Acquisition Plat For The Seward Airport Located In T 1N& IS R 1W Sec 34,35,2 &3,Seward Meridian SW,That Point Known As The Seward Airport,Physical Location,2310 Airport Road;Acquiring And Replatting Various Legals Located In Sec 34,35, 2 &3,Seward Meridian SW. Bower wished to postpone this resolution again because Department of Transportation (DOT)officials were not present, and more research needed to be done on usage of the runway. Notice of the public hearing being posted and published as required by law was noted and the public hearing was opened. Bruce Jaffa, outside the city, said both the long and short runways were in use. The DOT wanted to consolidate the runway and push it back into the Resurrection River.The DOT had offered an embarrassingly low amount of money for the tidelands.If this property was in Seattle,it would be worth millions of dollars rather than two thousand dollars. Jaffa had spoken with property owners around the area and their property had sold for substantially more than the DOT offer to the city. Rissie Casagranda,inside the city,noted this had been a very long process.She agreed with the previous comment and urged the city not to give away the wetlands for such a low amount of money. No one else appeared and the public hearing was closed. Motion to Postpone (McClure/DeMoss) Postpone Resolution 2022-096 until a representative from the Department of Transportation can attend. Motion to Postpone Passed Unanimous City of Seward,Alaska City Council Meeting Minutes January 23, 2023 Volume 42,Page 217 NEW BUSINESS Resolutions INFORMATIONAL ITEMS AND REPORTS Boards and Commissions Minutes Planning&Zoning Commission Minutes from the October 11,2022 and November 8, 2022 Meetings. Historic Preservation Commission Minutes from the November 10, 2022 Regular Meeting. Other Items Planning & Zoning Commission Report for 4th Quarter 2022. Robertson,Monagle and Eastaugh Federal Lobbyist Report through December 2022. Happy Youth Programs&Educational Resources(HYPER)Financial Report through November.2022. CITIZEN COMMENTS Bruce Jaffa, outside city limits, appreciated how difficult these decisions were and he appreciated the council's services. He thanked former senator Peter Micciche for making an appearance at tonight's meeting.Jaffa felt the Eastern Kenai Peninsula had been somewhat neglected and needed strong representation.Jaffa noted the potential sale of the city electric utilities was a very important topic that would soon be at the forefront.He said the city council had voted in favor of the sale to Homer Electric and he wanted to learn more about how council made their decision.Most of the meetings regarding the sale took place during executive session and Jaffa was looking forward to that information being made public. Lastly, Jaffa wanted to invite everyone to the Moose Pass Winter Rendezvous on January 28, 2023. Andrea Brady,inside city limits,wanted to share some employee data about JAG shipyard. They shipyard averaged 135 employees since 2022;JAG peaked at 165 employees during last winter and spring. When they lost the US Coast Guard Healy it caused JAG a substantial layoff. JAG currently had 55 full-time Alaskan residents working in Seward.When JAG took over the shipyard in 2018, there were six Alaskan residents employed at the shipyard. A lack of affordable single- family housing,childcare,and access to womens'healthcare were the three main factors preventing JAG from obtaining a larger Alaskan workforce. Brady also provided updates on various JAG projects. 111 Rissie Casagranda,inside city limits,felt extremely vulnerable tonight as a business owner and was nervous to invest in Seward. She provided a laydown written in a satirical manner to show City of Seward,Alaska City Council Meeting Minutes January 23, 2023 Volume 42,Page 218 city code written based on the way council voted tonight. Casagranda questioned why lease assignments even came before city council in the first place. Tim Jagielski,outside city limits,wanted to thank the electric department for their response to a problem JAG had experienced last week.The electric department responded in the middle of the night and helped JAG get back to operational status. As a business owner, Jagielski expressed disappointment that the reconsideration of Resolution 2023-001 had failed. He felt the city council should represent what the majority wanted, rather than the minority. Jagielski implied there was a conflict of interest among council that was not disclosed. Toni Strauss, inside city limits, recited a story about a character with a megaphone who would show up at a large party and drown out everyone's voices. Over time,the other party guests stopped enjoying themselves and stopped believing in themselves. Elliot Jackson, inside city limits, said he flew all the way up from South Dakota for this council meeting. Jackson felt strongly that he should be able to do business,buy business, and sell business as he saw fit. Jackson loved to help other business owners succeed in this town. Jackson knew he would never make a profit on the Van Gilder Hotel, but he wanted to give back to the community.Jackson had big dreams for Seward,such as building a hockey rink and more housing, and now he was reconsidering everything.Jackson said that city council made a big mistake tonight and they should be prepared for a fight. COUNCIL AND ADMINISTRATION COMMENTS & RESPONSE TO CITIZEN COMMENTS Barnwell acknowledged it was a tough evening. He felt the council decision to not reconsider Resolution 2023-001 did not reflect a lack of support for the business community.Rather, it was a rare chance for the community to speak up and share community values. Tonight, council made a strong statement that Seward had values that we wanted to strive for. Council deemed that ZPA was not competent to run the Breeze Inn.There was no support for ZPA owning the Breeze Inn for the best interest of the community. Finch thanked year-round businesses who stay open during the winter and retain their employees. He commended JAG for their excellent work at the shipyard. Wells had a laydown to share with everyone;it was based on a public records for documents and correspondence that related to all of Elliot Jackson's businesses.Wells emphasized his decision was not based on hearsay or backdoor deals. Wells had compiled enough evidence of violations with the city to show that Jackson would be in default of the lease agreement. Wells noted the city had given Jackson ample time to make the necessary repairs because the city was pro-business.From the group of ZPA supporters,the phrase"setting a precedence"came up and how this denial would be setting a bad precedence for future business;however,Wells felt that the city had shown they had worked with Jackson and all entities he represented. On the flipside, Jackson had set his own precedence of ongoing fire and safety failings. It was a constant struggle between the city and Jackson. Wells said he did not make an emotional vote,but rather a vote based on facts. Wells felt City of Seward,Alaska City Council Meeting Minutes January 23, 2023 Volume 42,Page 219 that the city should continue to set a precedent for leasing city property to only those entities and individuals who follow city code requirements. Calhoon clarified that the city council did not vote to sell the electric utility,but rather chose a company to negotiate with. He thanked the boards and commissions for all their hard work and hoped the Planning & Zoning Commission attendance issues could be resolved because it was holding up progress. DeMoss said the trip to Juneau was great and the city manager did the most amazing job and shined for all of Seward. She wanted to address the citizen comment which implied a conflict of interest existed among the council members.DeMoss explained that a conflict can only be declared if it's a financial conflict of over$5,000. DeMoss did her research on the Breeze Inn lease transfer though public record requests and made her decision based on facts. She emphasized that city council was pro-business and any statements to the contrary would be doing harm to Seward. Osenga thanked the board and commission members for showing up in the audience during the special meeting.Being on city council was a lot of hard work and they tried to make the best and most informed decision possible. McClure noted this was the most difficult meeting in her many years. She emphasized that no one on city council made their decision tonight without considerable thought involved.McClure commented that the special city council meeting went well, and she looked forward to more interaction with the boards and commissions.McClure said the trip to Juneau with the city manager was fabulous. Lastly, McClure reminded council the evaluations for the city clerk were due to the human resources office by 5:00 p.m. on February 10, 2023. ADJOURNMENT The meeting was adjourned at 9:12 p.m. Kris Peck Sue McClure Acting City Clerk Mayor voilirrrr (City Seal) .t%** SE r,'•. • o 1 . FsAL _ • r i 4.• -