Kenai may buy back land

Under terms of a sale contract amendment approved Wednesday night, the city of Kenai will buy back property being sold to Lowe's Home Improvement Warehouse if the economics of building a new store do not favor proceeding with the project.

The ordinance passed unanimously at this week's city council meeting allows Lowe's to return the property to the city within one year of closing the sale, "because of uncertainties in the costs of construction."

Lowe's applied to lease 15 acres of city property along Marathon Road in January 2006 and announced plans to build a 139,000 square-foot store on the land.

Later that year, a change in the city code allowed for the purchase of the property and the company agreed to do so for $1,650,000. Proceeds from the sale would be deposited in the Airport Land Sale Permanent Fund.

Lowe's has now asked the city to add a "put right" clause in the sale contract for a period of one year from the date of closing, saying the city would buy back the property minus any real estate commissions paid by the city.

Interest earned on the proceeds of the sale would be retained by the city.

Addressing the city council telephonically Wednesday, City Manager Rick Koch said the closing date for the property sale is Sept. 17. Lowe's also plans to close on another real estate sale the same day on a piece of private land it would need to acquire to have access to the Marathon Road parcel.

Responding to a question by Councilman Bob Molloy, Koch said Lowe's also agrees to pay for a second appraisal of the city land.

Earlier, Lowe's had said the new store would be open before the 2007 holiday season. Construction has not yet begun.

In other business, the council postponed action on an ordinance that would extend the maximum lease term for land within the city's airport reserve from 35 to 55 years.

Molloy, the council's representative to the Airport Commission, reported that the commission failed to have a quorum for its last meeting and would like action delayed until commission members have an opportunity to consider the latest revisions to the proposed ordinance.

The postponement was approved with one dissenting vote.

Molloy also reported on an Aug. 8 work session on broadcasting city council proceedings over the Internet.

Councilman Rick Ross said, "During budget talks, I took this to be a project of the high school ... not a project of ours." He said it was his understanding that if the high school students could not make the broadcasts work, the project would not be something the city would do.

Mayor Pat Porter asked if council members would like the city administration to prepare a contract agreement between the city and Kenai Central High School for the council's review before voting on an eventual resolution.

Councilman Joe Moore said, "My understanding is that someone from the high school will have a camera set up in the back of the room ... turn on a switch and begin recording ... then push stop during breaks and things. It is their project."

The council agreed with Porter's proposal to see a contract prior to voting on whether to have council meetings broadcast.

The mayor also reported that due to internal problems, the Boys and Girls Clubs of the Kenai Peninsula did not clean the city's beach following the dipnet season and did not enforce barriers keeping people from the dune areas.

"The dunes were badly damaged," she said.

Porter also said the Boys and Girls Club would not be going forward with a $7,500 grant request from the city.

The council also approved a list of Kenai residents who have agreed to work as election board members in the city during the Oct. 2 election.

In precinct 1, election workers will be Mary Troy Castimore, Diane Craig, William Hatch and Mary Quesnel. Richard Hultberg will serve as an alternate. In precinct 2, board members will be Christine Cook, Lucille Barton and Deborah Fullinck. Election board members in precinct 3 will be Kari Mohn, Gayle Ross and Katherine Phillips.

Phil Hermanek can be reached at phillip.hermanek@peninsulaclarion.com.