Bluff issues limit potential

Kenai's Millennium Square won't be developed until erosion addressed

The first draft of the City of Kenai’s Comprehensive Plan includes little about developing Millennium Square, said Peter Hansen, a member of the Kenai Economic Development Strategy organization.


“I would really recommend we get in here all the concepts KEDS was asked for for the 2003 (comprehensive) plan,” he said in Wednesday’s Planning and Zoning work session.

The 21-acre property is the last major piece of undeveloped land in the city’s business district — however, because it abuts the Kenai River, it will remain undeveloped until the eroding bluff is stabilized, City Manager Rick Koch said.

“Let’s just say Princess Tours comes along and says, ‘We want to invest $220 million dollars in a hotel tourism kind of complex on that property that ties into the water front and ties into some of the old Kenai processing plants,” Koch said. “They’re not going to spend $220 million when the bluff is eroding three feet a year.”

Currently, Koch said he does not know when the city will be able to complete the Bluff Erosion Project. The city has contributed its share of funding to the project, but it is waiting for the last $20 million from the federal government, he said.

“It’s a tough row to hoe in Congress,” he said. “I mean, the last four years have been very, very hard to try and understand what’s going on at all with funding.”

Hansen said developing Millennium Square would spike the tourism industry in Kenai, and in the 2003 Comprehensive Plan the KEDS organization included a detailed drawing of how the city could develop the property.

“Tourism is a renewable resource,” he said. “It’s going to keep bringing people back time after time.”

In the 2003 plan the KEDS organization outlined recommendations for developing the area.

The first one suggested rezoning the area from suburban residential to general commercial, and he pushed for that change again in the work session.

The commission said they would rezone the area general commercial to comply with potential future development.

Aside from the unstable bluffs, Koch said there are other factors limiting development of Millennium Square.

The Kenai Municipal Airport owns plats in Millennium Square, and development of those plats must benefit the airport, he said.

“What has to happen with property that belongs to the airport is not necessarily the same of what happens with general fund land,” he said.

Dan Schwartz can be reached at