In the Oct. 4 municipal election, current Kenai City Council member Brian Gabriel is running for the Kenai mayor’s seat against his former Kenai Central High School English teacher and football coach, Harold “Hal” Smalley.
Gabriel, manager of the Alaska Department of Transportation’s Soldotna Station and a commercial fisherman, has been on the council since 2010, serving the last two years as vice-mayor.
Smalley, now retired, has also spent time on the Kenai City Council, sitting from 1988 to 1999, and again from 2007 to 2010, when he lost his seat to Gabriel and current council member Terry Bookey. He was also a member of the Alaska House of Representatives from 1999 to 2001, and on the Kenai Peninsula Borough Assembly from 2009 to 2014, serving one year as both an assembly member and a Kenai council member.
One point on which the two candidates differ is their views of business in Kenai.
“I’ve heard a lot of people say that the city’s not friendly to business or open for business,” Gabriel said, when asked to describe the state of Kenai’s business climate. “But there’s been a lot of new businesses that have expanded into Kenai over the last year and a half. PRL (Logistics company) on the south side of the (Kenai) River has invested a lot of money and continues to expand their business. We’ve got some retail shops and professional businesses moving into Kenai. So I don’t think it’s horrible.”
Smalley echoed criticism that Kenai has received from business owners regarding the affordability of commercial property within the city, especially for businesses that lease city-owned land.
Smalley said high commercial property leases — both for municipal lessees and those that lease from private landlords — have driven businesses from Kenai. As mayor, Smalley said he would favor revising leases between municipal lessees and the city “to make sure the city is protected, but also to make sure the lease holder has some protection and is able to seek out financing if they want to expand their facilities.”
“As far as the language in them for the renewal of leases, they’re kind of short-termed and the renewals are short-termed and after the renewal there’s no guarantee that you’ll even be able to keep your lease,” Smalley said. “That causes a lot of problems with an individual who’s invested a lot of money into infrastructure. To potentially lose it means ‘why would we upgrade our facility if there’s no guarantee that we’re going to able to keep even our building?’ If you can’t keep the lease you can’t keep the building. It will belong to the city.”
He also said city officials could actively solicit businesses to fill some of Kenai’s vacant commercial space.
“I think partnering with the (Kenai Chamber of Commerce), the city can work on perhaps trying to fill these buildings with businesses,” Smalley said. “Which means we’ll have to go out and do some recruiting, either by phone or happenstance maybe. Maybe somebody from the city will have to travel up to Anchorage or somewhere else in the state to try to recruit business or work through telephone calling and working through your chamber (of commerce) because your chamber is your business connection.”
Gabriel pointed to Kenai’s Airport Industrial Park as a business opportunity that “could be more aggressively marketed” by the city government.
In 2013 the Kenai divided some land east of the Kenai Airport on Marathon Road into 19 lots and designated it the Kenai Airport Industrial Park. According to previous Clarion reporting, some of the land was originally leased to Buccaneer Energy, and later to AIX Energy, which bought the former company’s assets after Buccaneer’s bankruptcy. AIX’s two well-pads are presently the only developments in the area.
Gabriel said the 17 remaining vacant lots in the Airport Industrial Park present opportunities for a business “that would enhance the products we produce here, or are shipped out by private people.” He gave seafood shipping as an example.
“There’s a lot of fish that are shipped out of here that we get every summer, and we’ve got no cold storage facility over there (by the airport),” Gabriel said.
City budget
Smalley and Gabriel both said Kenai’s budgeting is appropriate to the city’s needs. Future budgets, however, will be made with greatly reduced state contributions. Kenai’s budget for Fiscal Year 2016 included $415,798 of state Municipal Assistance. The FY 2017 budget contained $277,930 in Municipal Assistance. In that budget, Kenai’s Finance Department projected that number to drop to $129,651 in fiscal 2018 and to $42,631 by FY 2020.
Smalley said he couldn’t speculate on future city budgets without knowing future state budgets.
“I don’t think you can make those decisions until you know what the final number’s going to be,” Smalley said.
Gabriel also said future budget planning is “a wait-and-see type of situation, where you’ve got to keep an eye on economic indicators of where things are heading.”
He said one such economic indicator is sales tax revenue, historically a significant source of Kenai’s revenue. Kenai’s FY 2017 budget included $7.1 million in sales tax earnings, projected to reach $8 million by 2020. Gabriel said sales tax revenue “sort of gives you a temperature of where we’re at as far as people coming to town and spending,” though Gabriel doesn’t expect it to continue rising.
“As the oil and gas industry has contracted, in my mind there’s probably going to be no question that that’s going to affect the city,” Gabriel said. “It already has, from state revenue sharing. But also from people losing their jobs and being cut back on overtime with their hours, they’ll have less money to spend, and we’ll get less sales tax from that.”
Gabriel did name a specific fiscal measure he’d recommend in future budgets: a fund dedicated to the rising and unpredictable cost of health care for city employees, which in the past 10 years has had annual increases of up to 31 percent, as well as decreases as much as nearly 13 percent. At the June 1, 2016 city council meeting in which the council passed its FY 2017 budget, Gabriel successfully moved to commit $100,000 from Kenai’s general fund balance to an employee health insurance reserve fund. As mayor, Gabriel said he’d like to elaborate on the dedicated health care fund idea.
“I’d like to have a work session to more thoroughly flesh out contributions to the fund and where we’d look at a fund balance that would be appropriate for something like that,” Gabriel said.
Commission appointments
Members of Kenai’s 10 commissions, who make decisions on matters ranging from animal control and the airport to beautification and the harbor, are appointed by the mayor from a pool of applicants and confirmed by the city council.
This year one important commission, Planning and Zoning, has an open seat left by former commissioner Jack Focose, who died in August 2016. Though this seat may be filled by a nomination from current Mayor Pat Porter before the Oct. 4 election, there may be two more open seats after the election — Planning and Zoning commissioners Jim Glendening and Glenese Pettey, who are running in the city council race.
In a previous Clarion interview following an Aug. 24 Kenai mayoral candidate’s debate at the Kenai Chamber of Commerce and Visitor’s Center, Smalley said the decisions of current planning and zoning commissioners were too homogenous.
“It’s a feel-good thing to have all like minds, but I don’t think it’s realistic and probably destroys the overall effectiveness of a board or commission,” Smalley said. “Having something that’s little more diverse, a little more opposition, is I think a good thing. It makes you think a little more clearly about what you want to support.”
Interviewed for this story, Smalley said the public meetings surrounding the 2016 Kenai Comprehensive Plan revision, which the city council passed on Sept. 7, 2016, showed city officials failing to heed public voices. Kenai’s previous comprehensive plan revision in 2013 was rejected in a ballot measure by a 580 to 221 popular vote.
“It appeared that not a lot of credence was given to some of the public testimony,” Smalley said of the comprehensive plan meetings. “The 2016 comprehensive plan so closely resembles the 2013 plan that the voters overwhelmingly threw out. There’s very few changes in the 2016 documents from that one. And there was a sizable amount of public input. At the planning and zoning level and even on kind of the council level, a lot of it went on deaf ears.”
Gabriel said many of Kenai’s commissions and committees have had persistent vacancies arising from a lack of public interest. He said he’d encourage younger people to apply for commission seats.
“There needs to be some outreach to pull in some younger people to get involved,” Gabriel said. “I know people are busy, and that plays into their decision, especially if they have families and things like that. I’ve had young friends of mine from the community that would make wonderful commission and committee members, but they’re busy raising their families. Obviously trying to stir some interest will be important to get people to come out and volunteer.”
Reach Ben Boettger at ben.boettger@peninsulaclarion.com.
