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Condo owners seek clarification on city’s natural gas assessment

Posted: June 25, 2014 - 3:15pm

Condominium owners once again are expressing their concerns over the city’s assessment of condos within the Natural Gas Homer Special Assessment District.

Margarida Kondak of the High Tide Condominium Association on Monday read a letter signed by numerous condo owners to the Homer City Council asking for clarification of the city’s assessment plan following Kenai Superior Court Judge Charles Huguelet’s decision in a lawsuit filed by Homer condo owner Ken Castner. 

“If it is the city’s intent to individually assess each condo unit, it is also the intent of the undersigned condo unit owners to individually appeal the assessment based on Castner v. city of Homer, resulting in increased legal expenses for the city,” read Kondak during the council’s Committee of the Whole meeting, as well as its regular meeting. 

David Duke, president of Baywatch Condos, also asked the council for clarification of its assessment plan “so that we can plan accordingly.”

In February 2013, the six-member council unanimously passed an ordinance establishing the special assessment district to fund construction of a $12.7 million natural gas distribution line serving almost every city property from Skyline Drive to the tip of the Homer Spit. Property owners within that area, including condominium units, were assessed $3,282 per parcel. 

A month later, Castner, owner of several business condominiums within the city, filed a lawsuit in Superior Court against the city and Homer City Council, seeking to have the ordinance overturned. Castner claimed the ordinance violated his rights to equal protection and due process of the law, and that the city’s natural gas line assessment plan violated statutory law. At the time, Castner said the assessment plan disproportionately assessed his property and outweighed the value or benefit of the gas line to him.

Prior to Castner filing the lawsuit, the city obtained legal opinions from city attorney Thomas Klinkner and two law firms specializing in real estate law. Referring to state statute, as well as the Alaska Uniform Common Interest Ownership Act, an opinion from the law office of James H. McCollum said, “Any assessment must be levied on the individual condominium units.” However, in January Huguelet concluded “the city’s assessment with respect to condominium owners is arbitrary and unreasonable.”  

Homer City Manager Walt Wrede said he told condominium owners the city was looking at Huguelet’s decision, and reevaluating and researching how condos will be assessed. He said he hoped to have a report on the natural gas project as a whole, as well as recommendations for  condominium assessments, at the council’s July 28 meeting.

“I understand the need to come out with some kind of recommendation sometime soon,” said Wrede. “We will probably have a new assessment roll in front of you sometime in October.”

There are approximately 188 condo assessments on 16 lots within the special assessment district. Not using a per-unit assessment would result in a net loss of 102 assessment properties and an increased per-parcel assessment of about $88. 

“From my perspective, we’re not just trying to be fair to condo owners, but other property owners who have to assume the cost,” said Wrede. “They don’t see it as being fair. It’s a balancing act, as usual.” 

The council also drew criticism from Kachemak City residents with regard to Resolution 14-060, maintaining the water and sewer fees at the 2014 rate and updating the Homer fee schedule accordingly. Kachemak City council member Bill Overway testified Kachemak City residents are being charged for 3,500 gallons a month when a survey showed residents use less than 2,000 gallons. Residents Helyn and Shep Schoepke made the same argument in writing and urged the Homer mayor, council and city manager to “do your job by fixing the inequities of this resolution.” 

“Kachemak City is vehemently opposed to the rate plan. It is unnecessary,” said Kachemak City resident David Raskin. “The increase on us in Kachemak City is more than 50 percent.”

According to Raskin, Kachemak City repeatedly tried to work with the city of Homer “to get them to discuss this, to work out an equitable solution. So far, that has been met with a stone wall. You have not responded to any attempt to negotiate this.”

Homer council member Beau Burgess disagreed.

“The city of Homer has not stonewalled Kachemak City,” said Burgess. “Quite the contrary. We have tried to work with them.”

Asked by council member David Lewis if he would be in favor of a water meter placed on each residence in order to get an exact amount of water used, Raskin said, “I would not. I get my water off the roof.”

Council member Francie Roberts noted the absence of comments about the water and sewer rates from Homer residents. She interpreted that as a positive sign.

“There’s not one Homer citizen here to talk to us. That tells me we’re on the right track,” said Roberts.

The resolution was adopted without objection.

Also drawing attention at the Monday meeting was a borough-wide bed tax ordinance introduced to the Kenai Peninsula Borough Assembly by assembly member Bill Smith, who represents Homer. Shanon Hamrick of Kenai Peninsula Tourism Marketing Council gave a presentation to the council on the tax. Smith also addressed it in his borough report to the council.

The council unanimously approved Resolution 14-078, awarding the contract for construction of the Homer Harbormaster’s Building and Deepwater Dock Trail Boardwalk to Steiner’s North Star Construction in the amount of $2,082,697. 

“Congratulations to the Port and Harbor,” said Mayor Beth Wythe. “You’re going to get a new building.”

As part of the consent agenda, the council:

• Introduced Ordinance 14-30, accepting a $110,000 U.S. Fish and Wildlife Service grant for reconstruction of a section of the Beluga Slough Trail and providing for an in-kind match from the city, public hearing and second reading July 28;

• Introduced Ordinance 14-31, appropriating $84,000 for a traffic-calming pilot project in Old Town, public hearing and second reading on July 28;

• Adopted Resolution 14-073, urging Gov. Sean Parnell and the Alaska Department of Fish and Game commissioner to hire an interim on-site director for the Kachemak Bay Research Reserve and find a new state partner for the reserve;

• Adopted Resolution 14-074, renaming and dedicating the Rotary Garden at the Homer Public Library as the Peter Larson Memorial Rotary Garden.

Not finding the council’s approval were Resolutions 14-075 and 14-076, accepting two separate donations from Bunnell Street Arts Center. One was a “fanciful loon windsock sculpture” by Alaska artist Rachelle Dowdy; the other was a marine debris relief sculpture of silver salmon by Homer artist Lynn Marie Naden. The items were to be placed at Bishop’s Beach Park. Both resolutions were referred back to the city’s Public Arts Committee with a request for more information concerning maintenance of the pieces.

The next meeting of the Homer City Council will be 6 p.m. July 28, with a Committee of the Whole at 5 p.m.

McKibben Jackinsky can be reached at mckibben.jackinsky@homernews.com.

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