The covered stall outside the Stikine Inn is one of the first things visitors see when arriving by way of Wrangell's city dock. Purchased by the hotel's owners last week as part of a larger tidelands sale, the shed will be getting an overdue facelift before the summer season.
At its rescheduled meeting last week, the City and Borough Assembly approved a bid by the Stikine Inn to purchase adjacent tidelands for less than assessed value.
Southeast Properties LLC, which has owned the hotel for a decade, proposed purchasing from the city 5,450 square feet of submerged tidelands and 2,000 square feet of uplands to the north and west of the property's current boundaries.
The assessed value of the site was at $101,200, based on estimated fair market value as of July 1, 2015. The offered price was about two-thirds that, at $64,507. Speaking for Southeast Properties owner Bill Goodale, Stikine Inn manager Jake Harris explained they saw the appraised value as a suggested price, and that the offer was likewise subjective.
"Mostly it's based off (Goodale's) experience buying properties," he explained. Harris noted there were some substantial obstacles to overcome to develop the tidal portion of the property. "It's the best offer he can make to put it on the table, in a way that will work for both parties."
The owners are hoping to expand the hotel by an additional 30 rooms, about doubling the inn's capacity. At past meetings with the Planning and Zoning and Port commissions, Harris and Goodale explained the additional rooms will be critical to accommodating the local visitor industry, particularly after the repurposing of the next two largest nightly lodgings, most recently the Sourdough Lodge. Both commissions had expressed support for the bid in meetings this month.
The purchase also includes the northern roadside strip of land leading up to City Dock, which has the visitor shelter run by the Chamber of Commerce. Built decades ago by volunteers using materials from the Alaska Pulp Corporation, the seaside stalls have subsequently shantied, and the hotel owners plan to spruce it up with new stain, more rock, and fresh materials. Harris explained $5,700 worth of materials have already been acquired, and a contractor lined up for the work. As before, the sheltered stalls would be free for use by the public.
In three to five years, Harris anticipates the Army Corps of Engineers permitting process will have been navigated and the project completed. As well as the new rooms, the hotel will replace the dockside shelter with a more modern shopfront extension to the building. In all, the expansion is projected to add six full-time jobs and seven peak-season jobs with longer hours.
City ordinance allows for the disposition of real property below assessed value, so long as the price does not exceed $1,000,000 and the purpose is for economic development. Talking amongst themselves, Assembly members expressed comfort with the sale.
"I really don't see a downside to it," said Mark Mitchell, who noted the hotel would be paying taxes on the property, and at its assessed value.
Patty Gilbert, curious, compared the asking price to that of other lots the city has for sale. These range from $2.25 to over $3.80 per square foot, while the tidelands offer comes to $2.35 per square foot.
"It seems fairly comparable to what we're selling right now," Gilbert said.
"I think the balance of the public benefit is definitely there," commented Julie Decker, participating by phone.
The Assembly voted unanimously in favor of the item. Afterward, Harris commented the project would be expedited as quickly as the thorough and at times lengthy Corps permitting process allows.
"We're going to start our engineering immediately," he said.
In other business, the council elected to restrict future use of the city's Secure Rural Schools Fund to school funding. In his item notes, Borough Manager Jeff Jabusch explained the SRS program was initially set up to help offset reduced timber activity in national forests, to primarily assist schools but to also be used for roads on a smaller scale.
Currently the reserve fund is at better than $4M, but the future of the program is uncertain. Noting his own impending retirement next month, Jabusch recommended that to preserve the account the Assembly formally memorialize the fund for Wrangell Public Schools.
The Assembly also approved purchase of upgrades to its beleaguered swimming pool's temperature control system, at the cost of $15,320. It also approved $30,000 for the acquisition of municipal assessment software from Alaska CAMA Company, or $92,000 over a three-year period.
The software would make the assessment process more efficient in the field, and Jabusch estimated it would save about $15,000 per year, paying for itself in time. As a boon, the public would also be able to access basic information online.
"If we can streamline things, I think it'll help in the long run," he explained.
Assembly members also agreed to combine a pair of lots on Etolin Avenue, with the option to combine other adjacent lots in the event of further development down the road.
"Some of the complaints we got are that these lots are really small," Jabusch elaborated. The two lots, when combined, would come to just over 15,000 square feet.
Wrangell also formally filed a resolution showing support for an appropriation of disaster relief funding by Congress which would mitigate the effects of last year's commercial pink salmon fishery in Alaska. Southeast was particularly hard-hit by the harvest, with its fishermen bringing in only 18.4 million fish. This was a 62-percent loss in numbers and 74 percent in value.
With professional ties to the industry, Decker strongly supported the motion.
"This was a really unusual year," she commented. "Some folks even lost their vessels and permits."
The resolution supports a letter from Gov. Bill Walker to the Department of Commerce requesting the relief appropriation.
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