This story has been changed to correct the title of Ronald Smith, originally described as a realator. A realator is a licensed member of the National Association of Realators; Smith is not.
The Kenai City Council on March 16 voted not to negotiate a proposal to buy the city-owned lot at the intersection of the Kenai Spur Highway and Main Street Loop, though a vote to reconsider will be on the agenda at their next meeting on April 6.
Kenai mayor Pat Porter and council members Mike Boyle, Bob Molloy, and Terry Bookey voted against the ordinance that would waive a code requirement, allowing a negotiation for the land to take place between Kenai City Manager Rick Koch and Ronald and Shirley Smith, the prospective buyers. Council member Brian Gabriel was absent.
In February, Ronald Smith made the city an unsolicited offer to buy the .66 acre property — next door to the Bargain Basement thrift shop — for $170,400. The property’s value was assessed in 2015 at $142,600.
The failed ordinance would have allowed the sale by waiving a requirement that lands sold within the airport reserve be directly airport-related. The airport reserve is an area that roughly covers the Kenai airport, but extends to the north side of the Kenai Spur Highway between western Main Street Loop and a point near Birch Street. Land inside the reserve is dedicated to uses directly related to the airport, although exceptions exist — Kenai Fabric Center, Ron’s Rent-it Center, and Bargain Basement are non-airport related properties within the reserve.
Kenai has previously refused offers to sell airport land, both inside the airport reserve and outside, where many Kenai business owners lease their land from the city. Two people who have advocated for land-sales spoke at the March 16 meeting: Duane Bannock of Schilling Commercial Real Estate and Fred Braun of Jack White Real Estate, who in May 2015 had made an offer for the same property as Smith. Braun, on behalf of a client, offered $134,350 and was denied.
Speaking to the council, Braun asked a question that would be taken up in the coming debate.
“Will there be wording in that sales contract that there will be a development plan?” Braun said. “I think that’s a real, real important thing. … The last thing we would want to see is an investor purchasing a property and letting it sit vacant for many years with no development.”
Boyle, a past opponent of city land sales, said he would also prefer to see the Smiths’ plans for using the property.
“If we’re going to get in the practice of selling land that belongs to the city — especially our prime land, and I consider that a piece of prime land — we should get in the practice of demanding a plan, otherwise what we are doing is disposing of our land so that others may speculate,” Boyle said.
In response to a question from council member Tim Navarre, city attorney Scott Bloom said code “does not require a development schedule for the sale of property, however it’s certainly a condition that council can choose to impose.”
Koch said development plans are required for lease of property, though not for sales.
Council member Henry Knackstedt moved to postpone the vote until council’s next meeting on April 6 to allow the Smiths time to create a development plan. The motion failed with Boyle, Molloy, and Bookey voting against it.
Council member Tim Navarre said that if the city were to sell vacant land he would prefer to hold a public offering for interested buyers, rather than accept a single unsolicited offer.
“Some people might not have been aware that it was on sale, and they might want to put something on it,” Navarre said. However, he supported the sale to the Smiths, saying it would encourage investment.
Navarre said he was also in favor of moving the airport reserve boundary back from the Kenai Spur Highway — freeing the Spur-fronting properties from the legal obligation to be aviation-dedicated — so the council would not have to make code exceptions to allow commercial development in the area.
Knackstedt said the Kenai Airport Commission had unanimously supported the sale and moving the airport reserve boundary. He said he also supported it, though he wanted to see a development plan.
Molloy said he was prevented from supporting the sale by the airport reserve boundary.
“I could support this, if the line was moved, and then we had a good offer,” Molloy said. “My problem with that tonight is that hasn’t happened. That’s something that needs to get done, otherwise we’ll have more people coming up and wanting to buy property.”
At the meeting’s end, Porter called for a reconsideration of the sale. The council will be able to vote on whether to discuss and vote again on the ordinance at their next meeting on April 6.
Reach Ben Boettger at ben.boettger@peninsulaclarion.com.
