Petersburg’s city council last night authorized the city manager to start up negotiations over the purchase of waterfront land in Scow Bay. The city and members of the fishing fleet have looked at the property for future marine services, gear storage or vessel support. Council members questioned the condition of the property and raised other questions about the purchase, including how to pay for the land.

For iFriendly audio, click here:
A June 1st letter from the Reid family says they have agreed to sell the parcel to the city for 1.4 million dollars. It includes three point four acres, along with tidelands and a dock. The land is owned by Martha Reid along with a trust made up of her children, Glen Reid, Celia Carlson and Jean Ellis. In the letter, the family members feel the location adjacent to deep water with abundant water frontage makes this a valuable acquisition for the city of Petersburg’s future economic growth.

City officials may not want to pay the asking price. For one thing, the property’s tax assessment is about 600-thousand dollars less than that amount. The council Monday took the unusual approach of scheduling a closed door executive session, and then deciding to keep the discussion in the open.

Don Koenigs argued against the closed meeting. “The city council met in work session and there was full disclosure during that proceedings,” Koenigs said. “An appraisal price was known by the public that were in attendance at that meeting. They also knew what the assessed value was. During that work session there were questions asked relating to the condition of the dock, in terms of conditions to provide a business plan for operations.” Koenigs thought the council did not have all the facts before deciding on going forward with negotiations.

City manager Steve Giesbrecht thought the council could provide him with some direction. “There’s one particular question that the council may or may not wanna talk about in executive session, which is, what’s the maximum price you wanna pay? Generally that’s a negotiation issue,” Giesbrecht said.

That prompted a response from councilor Rick Braun. “I understand,” Braun said. “And I envision some time in the future we will go into executive session and make that determination. But at this point I don’t know if I could do that.”

Other councilors agreed and voted unanimously not to hold a closed door discussion of the issue. Instead they talked about questions they had with the potential purchase. Councilor Braun thought the city was jumping the gun with negotiations. “We still don’t know a lot of stuff,” he said. “One of those things is the conditions of the dock. We don’t know if the dock is going to be usable for what we wanna use it for, if it’s safe and what work needs to be done on it and what its expected life is, which I feel has a big affect on the value of the property.”

Braun and councilor Koenigs also asked to see a business plan or some figures for anticipated revenue from the land. City staff told the council the property could not pay for itself strictly off revenue from bait shed storage or other use of the property.

Koenigs questioned how the city would pay for the purchase, whether it was new taxes or money from the Petersburg Economic Development Council. “Are we going to look at property taxes within the city to support this? Are we going to take and borrow money from PEDC? Take all of PEDC’s money and infuse it into this one project? I mean that’s a concept, we could get 5 percent interest, they pay it back to us. Are we going to look at increasing sales tax? Or are we going to create a special taxing district? Which I kinda favor. I say go to the harbor create your own taxing district and let them pay for it,” Koenigs said.

Whether the city bonds for the purchase, or uses economic fund money, the question will likely go before voters. To put the measure before voters in October, the council has until early August to decide on a purchase price and payment option.

Councilor John Jensen thought there were more important questions than repaying the purchase price. “You gotta remember. When you make these decisions, I’m not advocating one way or the other, that all these public facilities we have pay for theirselves. I mean that was one of the first questions I heard, ‘is this thing going to pay for itself?’ Probably not, realistically. Then again is the library going to pay for itself? Not rentin’ books. You know, so, that’s one of the questions we gotta ask ourselves. Does this town need this? Do we need it? If we want to compete in the future with the rest of the fishing communities, possibly. That’s just some of my thoughts,” Jensen said.

Jensen’s brother Mark wanted the city to proceed with negotiations while finding out answers. “I’m not saying go spend a million and a half dollars and come back later and say this isn’t going to work. That isn’t how I operate. I think it’s important to keep the process moving ahead. That’s fine if we wanna get the dock analyzed. I don’t see why we can’t move ahead with discussing the situation with the Reid family trust, along with getting the facilities assessed, for strength of the dock,” he said.

Councilors directed staff to seek an engineer’s analysis of the dock for up to $15,000 and voted unanimously for the city manager to start negotiations with the realtor for the Reid family.