Homer Alaska - News

Story last updated at 3:55 PM on Wednesday, July 18, 2012

Chamber, city manager encourage public to get involved in gas issue

By McKibben Jackinsky
Staff writer

Natural gas will be the topic of the day when the Homer City Council meets Monday, first at the 5 p.m. Committee of the Whole meeting and again during the council's regular meeting at 6 p.m.

Public involvement on the issue is being called for by the Homer Chamber of Commerce and Visitor Center and encouraged by City Manager Walt Wrede.

Wrede reduced what is at issue for city residents to a simple question: "If you want gas, if you want to hook up to gas, you'll pay for it one way or another. ... So the question is: Will you pay Enstar to put it in for you and pay them up front in full or should the city finance it by providing easy terms for its businesses and residents?" said Wrede.

"That's exactly what this is about."

A letter sent last week to members of the Homer Chamber of Commerce and Visitor Center from Monte Davis, the chamber's executive director, encouraged contact with council members in support of a city-led process to provide natural gas to the entire city.

Pat Melone, chamber board president and owner of Spyglass Inn B&B on Fairview Avenue, said she hasn't calculated the savings she expects to experience by switching to natural gas, "but I know based on the price of propane that it will be a big change."

Fairview Avenue, where Melone's residence and business are located, is the route being proposed for bringing the pipeline through Homer.

"It will come right by my house," she said. "It's too bad I can't just stick a little plug in it."

Although he lives outside the city limits, Don Cotogno, treasurer for the chamber board of directors, also supports natural gas coming to Homer and Kachemak City "because it's a good thing economically for the whole area."

"I'm sure there'll be plenty of people at Monday's council meeting," said Cotogno.

A presentation on topics related to natural gas distribution systems will be given by city attorney Tom Klinkner during the Committee of the Whole meeting.

"(Klinkner) will be talking to the council about some of the issues we have to address as we're moving ahead," Walt Wrede, city manager, said of bringing natural gas from Anchor Point to Homer. "The big part of it will be financing. If a local improvement (special assessment) district is formed, how would the city finance it? It would be about $12 million to do the whole town and we'd have to borrow the money."

During the council's regular meeting, natural gas will be addressed during:

• A public hearing on Ordinance 12-30, accepting and appropriating an $8.15 million legislative grant for construction of a natural gas pipeline from Anchor Point to Homer and Kachemak City;

• Discussion of a resolution approving a construction contract with Enstar Natural Gas Company to build the 22-mile gas pipe line from Anchor Point to Homer and Kachemak City; and

• Discussion of a resolution authorizing the initiation of a special assessment district in which natural gas would be distributed.

Accepting the legislative grant and approving a construction contract with Enstar would allow work to proceed on the pipeline.

"As soon as we can get the grant agreement done and signed, then we will be asking for an advance from the state on the grant so Enstar can immediately begin the permitting process and right-of-way acquisition process," said Wrede.

Right-of-way acquisition refers to properties along the pipeline's proposed route from Anchor Point to Homer, via the Old Sterling Highway. Permits include those needed by the Alaska Department of Fish and Game and the Alaska Department of Transportation and Public Facilities, as well as permits from the U.S. Army Corps of Engineers to work in wetlands. Also needed is a "review by the Alaska Office of Historic Preservation to make sure no sensitive historical or cultures sites could be disturbed," said Wrede.

If details for a construction contract with Enstar have not been finalized by Monday, that resolution would be postponed, according to Wrede.

While the pipeline would get natural gas to the southern peninsula, a special assessment district would ensure distribution to individual property owners with financing by the city and repaid by the property owners.

"Everybody could get hooked up more quickly and we would do it all at once and everybody would get the same price and everybody would be guaranteed to have access," said Wrede.

The other option involves each property owner dealing separately with Enstar. Because Enstar does not offer financing, that approach would require individual pay in full prior to each distribution being installed.

Developing the special assessment district can be done one of two ways: through a petition of property owners or by a super majority or three-fourths approval of the council.

"Since (council member) Beth Wythe has been determined to have a conflict of interest, all of the other five have to vote yes," said Wrede.

In June, Mayor James Hornaday ruled Wythe's employment with Homer Electric Association constituted a conflict of interest due to HEA's "substantial financial interest" in natural gas being brought to the area and the possible financial loss if members chose to heat with natural gas rather than electricity.

Passage of the resolution would begin the process outlined in city code that includes public meetings, establishing boundaries of the district and determining what the cost to each property owner would be.

"It's written in such a way to make sure everyone knows what's going on, with adequate time for property owners to comment and express concerns," said Wrede. "We hope to go out of our way to make sure that the public understands what we're talking about."

Wrede anticipates the process would take about four months.

He urged residents to "stay tuned."

"If the council passes this resolution, then we'll do what we can to get as much information out there on the website, in newspapers, maybe even direct mailings," he said. "We're going back and forth about how to best reach the most people."

For the complete agenda for Monday's meeting of the Homer City Council, visit www.cityofhomer-ak.gov/cityclerk, click on agendas/minutes.

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