Harbor employee Ben Hinde works out of several container vans used for storage and maintenance work in the Middle Harbor. The harbor department also stores gear at other spots around town but wants a centralized work space. (Joe Viechnicki/KFSK)

Petersburg’s harbor board is supporting a proposed land exchange with fuel company Petro Marine Services. Harbor staffers are hoping the swap would provide space for a centralized maintenance workshop and storage.

Petro Marine is hoping to take over ownership of land it currently leases from the borough. It’s the site of the Southeast Island Fuel gas station on South Nordic Drive and a warehouse behind that on Dock Street. Plant manager Bob Volk updated the harbor board on his company’s hopes for the swap.

“Petro Marine’s view on this is we’re really for it of course,” Volk said. “I mean it will help our business and it just makes sense to us.”

In exchange for that property, Petro is willing to give the borough seven lots across the street from the community cold storage. That includes the site of the old Union Oil or AFS tank farm. Under former owners, that site was contaminated by leaking heating oil. Conoco Phillips paid for clean up work and had contaminated soil removed. In 2012, the Alaska Department of Environmental Conservation signed off on the clean up work.

Petro’s land is assessed at over 356,000 dollars. The leased land the company wants from the borough is assessed at over 235,000. Volk he has spoken to company owner Kurt Lindsey about the swap. He said Petro is willing to take a payment from the borough to make up the difference and apply that money to pay for the installation of a mooring dolphin near the fuel dock. He thought the additional mooring structure would help his company and the municipality.

“The main option to us would really help with the dolphin because the Lindseys they care about communities,” Volk said. “They know that it would benefit us. They know it’d benefit the harbor. It would benefit the downtown businesses. It would benefit everybody because I think we could get bigger boats, with more people or more activity in here.”

Another option would be for the borough to reduce Petro’s lease payment for its other property to make up for that difference in value.
If the exchange were to happen the borough would lose annual lease and tax revenue. The Petro lease for the land the company wants brings in 28,500 dollars annually for the harbor enterprise fund. That payment would end, along with a little more than four thousand dollars of property tax revenue.
Harbor staff are supporting the exchange. They’d like to use Petro’s property across from the cold storage for a centralized maintenance and storage area. Currently, they’re working out of container vans at multiple sites around town along with the harbor office.

Harbor master Glorianne Wollen explained the need to the board. “So if the Petro doesn’t, if this doesn’t work, we think it from the staff’s point of view it’s a great location, great facility, fits all our needs,” Wollen said. “But if we’re not allowed to move forward on this we’re gonna have to do something. The situation we have currently, we can’t continue on the way we are. So if we don’t move forward on this, we’re gonna be looking at building something on our own property.”

That other option could mean building something new on the rock filled approach to the drive down down, not something that Wollen is hoping will happen. “What I like about Petro is again it’s across the street and still centrally located, not taking up valuable waterfront,” she said.

Assembly member Kurt Wohlhueter thought more fishing boat bait sheds may need to be moved off tidelands next to the boat yard Piston and Rudder if that compnay’s president Mike Luhr is looking to expand there. Wohlhueter did not think the drive down dock approach was a good spot for a harbor building.

“I think we’re going to need that space for bait sheds,” Wohlhueter said. “I don’t think we wanna put a building on that approach because we need to be looking 5-10 years down the road here you know and maybe a few years before Mike does want the rest of that property. I think it needs to be available to him.”

Board members thought the land exchange made sense and the existing building on the Petro land would make work easier for harbor staff.

“We have a building in front of us that fits your needs,” said board member Don Spigelmyre. “It does exactly what you need it for. I think for the guys that work, being a guy that had stuff spread all over the place that had to drive and pick up parts, it’s going to not only save them an incredible amount of time but it’s going to allow you to have dry storage and a work space to do everything you needed to do.”

“I agree,” said board chair Mike Bangs. “The way I look at it is we have close to a 60 million dollar infrastructure and we’re trying to maintain it out of a tool shed, it just doesn’t make sense.”

There were four board members at a meeting in late January and Bob Martin and John Murgas joined Bangs and Spigelmyre in voting to recommend going forward with the land exchange. It will be up to the borough assembly to make the final decision and agree to terms of a swap.