Petersburg’s project-funding wish-list could eventually include a new electrical substation to power a proposed lumber mill, but not yet. The Petersburg Economic Development Council recommended the City Council add the million-dollar item to its project list with the understanding that no funds would be spent unless the developer secured the financing and property to build a mill on Mitkof Island.
While the Mayor and councilors have expressed support for the idea of a new mill, they weren’t ready to add a substation to their list of projects Monday night.
Councilor Mark Jensen. said, “I think that’s a little premature, myself. I agree with the business coming to town but if we get it (the substation funding) and they build a million dollar substation out there and no one builds a business, then what do we do?”
A former mill owner from Washington State, John Glenn, has proposed development of new Southeast Alaska mill a few times over the years. He has ties to Petersburg and first laid-out his latest plan a year ago in a meeting with the City Council Finance Committee. He wanted to build a medium-sized operation that would use a mix of young growth and old growth Alaska timber to manufacture finished lumber. At the time, he hadn’t yet decided whether he wanted to locate in Wrangell or on South Mitkof Island near Petersburg.
Councilor Don Koenigs was still excited about the possibility of a new mill near town. He suggested the city should consider using some of its economic development fund to help make it happen but he also encouraged a cautious approach.
“If we could use some of that money to help finance or help restimulate a timber enterprise, we should give careful consideration. I’m not saying give away the farm but we should at least be willing to carry on a sensible dialogue and he should meet the requirements that the council has set in the past as we move forward with that discussion,” said Koenigs Monday night.
Last summer, the council approved a memorandum of understanding pledging to work cooperatively with Glenn if he chooses Mitkof Island for a mill. Early this month, the city provided a letter of support for Glenn to use if he applies for financing. The City has not committed any money to the project.
Glenn recently met with Forest Service staff as well as City Manager Steve Giesbrect and Economic Development Council Director Liz Cabrera. According to Cabrera, Glenn has indicated that he is pursuing a site on Southern Mitkof Island, just south of Olson’s log dump. Such a Mill would need a substation to access power from the main lines, which is why Cabrera recommended the council put that item on their list.
“Mr. Glenn hasn’t asked the city to pay for that or anything like that but I think having it on the priority list just sort of shows that it could be important to us in the future and that it could be a community priority and puts us in a position to be able to seek funding for it if necessary,” Cabrera said in an interview this week.
Glenn has not yet said publicly whether he has chosen Wrangell or Petersburg for a mill site. In response to an email request for an interview, Glenn told KFSK radio that right now, “there isn’t anything to report other than we are working on the project and studying different costs and locations.”
The Mayor and Council cut their conversation short this week as the mill proposal was not on the agenda. They plan to put it on the agenda for an upcoming meeting.
