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Regular Ketchikan City Council meeting was called to order by Mayor Williams at 7:00 p.m., October 18, 2012, with the following members present: Sam Bergeron, Dick Coose, Kj Harris, DeAnn Karlson, Matthew Olsen, Robert Sivertsen and Marty West. The Pledge of Allegiance was given by all persons in the Chambers. Staff present were Manager Amylon, Assistant Manager Martin, Finance Director Newell, City Attorney Seaver, Fire Chief Share, Marketing, Sales and Customer Service Manager Simpson, Port and Harbors Director Corporon, Police Chief Bengaard, Public Works Director Allen, Electric Division Manager McConnell, Telecommunications Division Manager Cushing, Librarian Pearson, Water Division Systems Foreman Johnston and City Clerk Suiter.

Oath of Office – Councilmember-Elect

Clerk administered the oath of office to Councilmember-Elect Robert Sivertsen. COMMUNICATIONS Mayor Williams read a proclamation for Red Ribbon Week and presented it to Renee Schofield of Tongass Substance Screening. Ms. Schofield thanked the Council for the proclamation and invited the Council to celebrate Red Ribbon Week next week with them. She outlined events that will be occurring during the week, and said she has a lot of red ribbons for people. Mayor Williams also read a proclamation for Disability Mentoring Day and presented it to Kevin Gadsey, Director for Southeast Alaska Independent Living. Mr. Gadsey thanked the Council for the proclamation, and announced that SAIL has hired Emily Chappel as the newest team member. He read a statement that Ms. Chappel wrote up, which thanked several entities and businesses that opened doors to allow those with disabilities to job shadow. PERSONS TO BE HEARD Keith Smith, representing Ketchikan Chamber of Commerce, thanked the City for the use of the new library for its After Hours event today. He spoke to the request for funding for the Annual Holiday Festival and Tree Lighting Ceremony, and said he would be available to answer any questions. He stated they are very excited to have it at the new fire hall, feeling this location will help the festival grow. He noted the request for a contribution of $500 toward the festival. Mayor Williams asked if there were any objections to either moving the festival to the new Fire Station or to donating $500 toward the project, and none were heard. Kelly Chick, representing the Performing Arts Center, thanked the Council for allowing the process of the capital projects to continue. She related an example of clients of hers

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who participate in the community arts, and she expressed desire to keep the Council informed at all times. In response to Councilmember Harris, she said she would get information relative to prior support toward the Performing Arts Center from the Council. Kathleen Light, Ketchikan Area Arts and Humanities Council, reported the presenting season began in September and the Council should be getting the season guides tomorrow or the next day. She outlined the events that have occurred or will occur, including: 100 Plastic Boxes, Generation Wyze, Artist Development Series, the Black Crabs performance, Rockwellian Ketchikan, and Boom Ball and Square Dance. CONSENT AGENDA Mayor Williams asked if there were any objections to moving several items to the Consent Agenda, including: the award of the Yeltatzie Salmon in Iridescent Mosiac Tiles to Terry Pyles; Ordinance No. 12-1707 amending the insurance requirements for public vehicles; modification of the Front/Grant Streets bus stop; and Amendment No. 5 to the project management services for the new fire station with RISE Alaska. No objections were heard.

Approval of Minutes

Moved by Sivertsen, seconded by Bergeron approval of the minutes of the regular meeting of October 4, 2012 and special meetings of October 8, 2012. Motion passed with Harris, Coose, Sivertsen, West, Karlson, Olsen and Bergeron voting yea.

Declaring Personal Property as Surplus and Authorizing Sale of Such Property Through a Competitive Bid Process

Moved by Sivertsen, seconded by Bergeron pursuant to paragraph (b) of Section 3.12.070 of the Ketchikan Municipal Code, the City Council declare as surplus such personal property as detailed in the Telecommunications Division manager’s memorandum dated October 9, 2012 and direct staff to dispose of said personal property by means of a competitive bid process. Motion passed with Harris, Coose, Sivertsen, West, Karlson, Olsen and Bergeron voting yea.

Contract No. 12-51 – Ketchikan Public Art-Creek Street “Yeltatzie Salmon in Iridescent Mosaic Tiles,” Terry Pyles

Moved by Sivertsen, seconded by Bergeron the City Council approve Contract No. 12-51, Ketchikan Public Art-Creek Street “Yeltatzie Salmon in Iridescent Mosaic Tiles”

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Between the City of Ketchikan and Terry Pyles in the amount not to exceed $62,750; authorize funding in the amount of $62,750 from Port Department’s 2012 Ketchikan Creek Public Art Procurement Capital Account; and direct the city manager to execute the agreement on behalf of the City Council. Motion passed with Harris, Coose, Sivertsen, West, Karlson, Olsen and Bergeron voting yea.

Ordinance No. 12-1707 – Amending Insurance Requirements For Public Vehicles – First Reading

Copies of Ordinance No. 12-1707 were available for all persons present. Moved by Sivertsen, seconded by Bergeron the City Council approve in first reading Ordinance No. 12-1707 amending insurance requirements for public vehicles; and establishing an effective date. Motion passed with Harris, Coose, Sivertsen, West, Karlson, Olsen and Bergeron voting yea.

Modification of Front/Grant Streets Bus Stop

Moved by Sivertsen, seconded by Bergeron the City Council authorize the city manager to modify the Front/Grant Streets bus stop as detailed in the Public Works director’s report dated October 8, 2012. Motion passed with Harris, Coose, Sivertsen, West, Karlson, Olsen and Bergeron voting yea.

Amendment No. 5 to Contract No. 09-34, Project Management Services for Municipal Fire Station Construction, RISE Alaska LLC

Moved by Sivertsen, seconded by Bergeron the City Council authorize the city manager to enter into Amendment No. 5 to Contract No. 09-34, Project Management Services for Municipal Fire Station Construction, between the City of Ketchikan and RISE Alaska, LLC, in the amount of $15,000 for additional construction administration and warranty close out services associated with the construction of a new fire station on Lot 10-A1; approve funding from the Fire Department’s Main Street Fire Station Replacement Capital Account; and direct the city manager to execute the amendment on behalf of the City Council. Motion passed with Harris, Coose, Sivertsen, West, Karlson, Olsen and Bergeron voting yea.

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UNFINISHED BUSINESS

Ordinance No. 12-1706 – Repealing Existing Section 2.40.040 of the Ketchikan Municipal Code Entitled “Use of the Library May Be Denied”; Adding A New Section 2.40.040 Entitled “Rules of Conduct – Exclusion” – Second Reading

Copies of Ordinance No. 12-1706 were available for all persons present. Moved by Sivertsen, seconded by Olsen the City Council approve in second reading Ordinance No. 12-1706 repealing existing Section 2.40.040 of the Ketchikan Municipal Code entitled “Use of the Library May Be Denied”; and adding a new section 2.40.040 entitled “Rules of Conduct – Exclusion” to the Ketchikan Municipal Code relating to use of the Ketchikan Public Library; and establishing an effective date. Motion passed with West, Olsen, Karlson, Bergeron, Harris, Sivertsen and Coose voting yea. NEW BUSINESS

Amendment No. 2 to Contract No. 11-43 – Design of Bar Harbor Boat Launch Reconstruction, PND Engineers, Inc.

Moved by Sivertsen, seconded by Coose the City Council authorize Amendment No. 2 in the amount of $60,150 to Contract No. 11-43, Design of Bar Harbor Boat Launch Reconstruction, between the City and PND Engineers, Inc.; approve funding from the Small Boat Harbors Division’s 2012 Bar Harbor Launch Ramp Replacement and Grid Repair Capital Account; and direct the city manager to execute the amendment on behalf of the City Council. Port and Harbors Director Corporon answered questions from the Council Motion passed with Sivertsen, Bergeron, Coose, Harris, Olsen, West and Karlson voting yea.

Phase III Planning Design Concepts – Berths I and II Rehabilitation Project

Moved by Olsen, seconded by West the City Council direct staff to proceed with the wood overlay of the pedestrian plaza and the construction of a new base for “The Rock” as detailed in the Port & Harbors director’s memorandum dated October 3, 2012 regarding Phase III design concepts for the Berths I and II Replacement Project.

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Port and Harbors Director Corporon answered questions from the Council Motion passed with Coose, Bergeron, West, Harris, Sivertsen, Olsen and Karlson voting yea.

Amendment No. 10 to Contract No. 07-25, City of Ketchikan Berths I and II Rehabilitation and Master Planning Study, PND Engineers, Inc.

Moved by Sivertsen, seconded by West the City Council approve Amendment No. 10 in the amount of $52,000 to Contract No. 07-25, City of Ketchikan Berths I and II Rehabilitation and Master Planning Study, between the City and PND Engineers, Inc.; authorize funding from the Berths I and II Replacement Capital Account; and direct the city manager to execute the amendment on behalf of the City Council. Port and Harbors Director Corporon answered questions from the Council Motion passed with Karlson, Harris, Olsen, West, Bergeron, Sivertsen and Coose voting yea.

Directing Preparation of an Ordinance to Repeal the City’s Boat Tax

Moved by Sivertsen, seconded by Coose the City Council direct staff to prepare an ordinance to repeal Section 3.21.010 of the Ketchikan Municipal Code abolishing the City’s boat tax, said ordinance to be submitted to the City Council for formal consideration and review at its meeting of November 1, 2012. Finance Director Newell answered questions from the Council. Moved by West, seconded by Olsen to amend by changing the date for City Council review to its meeting of December 6, 2012. Motion to amend failed with Olsen, Harris and West voting yea; Bergeron, Sivertsen, Karlson and Coose voting nay. Motion passed with Coose, Sivertsen, Karlson, Olsen and Bergeron voting yea; Harris and West voting nay.

Award of Contract No. 12-09 – City Underground Storage Tank Removal and Site Closure, S&S General Contractors & Equipment Rental, Inc. - $141,705

Moved by Sivertsen, seconded by Bergeron the City Council accept the bid of S&S General Contractors & Equipment Rental, Inc. in the amount of $141,705 for Contract

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No. 12-09, Underground Storage Tank Removal and Site Closure; establish a ten percent contingency in the amount of $14,000, bringing the total project cost to $155,705; authorize budget transfers in the amounts of $91,545 and $14,160 respectively from Appropriated Reserves of the Wastewater Services and Hospital Sales Tax Funds to the Wastewater Division’s 2012 Underground Steel Tank Removals Capital Account; approve funding in the amount of $155,705 from the Wastewater Division’s 2012 Underground Steel Tank Removals Capital Account; and direct the city manager to execute the contract documents on behalf of the City Council. Motion failed with Sivertsen and Coose voting yea; West, Olsen, Karlson, Bergeron and Harris voting nay. Moved by Bergeron, seconded by Harris for immediate reconsideration. Motion to reconsider passed with Coose, Bergeron, West, Harris, Sivertsen and Karlson voting yea; Olsen voting nay. The motion was back on the floor. Motion passed Karlson, Harris, Olsen, West, Sivertsen and Coose voting yea; Bergeron voting nay.

Declaration of Public Emergency – Ketchikan Medical Center Penthouse Siding & Flashing Installation Project, Northern Marine & General Contracting, Inc.

Moved by Harris, seconded by West pursuant to paragraph (7) of Section 3.12.050(a) of the Ketchikan Municipal Code, the City Council declare the installation of siding and flashing at the Ketchikan Medical Center penthouse as a public emergency; award a public improvements contract to Northern Marine & General Contracting, Inc. in an amount not to exceed $68,000; establish a ten percent contingency in the amount of $6,800, bringing the total project cost to $74,800; authorize funding from the Public Health Department’s 2012 KGH Penthouse/Chimney Improvements Capital Account; and direct the city manager to execute the contract documents on behalf of the City Council. Public Works Director Allen answered questions from the Council. Motion passed with Sivertsen, Bergeron, Coose, Harris, Olsen, West and Karlson voting yea. The Council took a short break at 8:13 p.m. and reconvened at 8:18 p.m.

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Reconsideration of Council Action Regarding the 2014 Community Priority Capital Project Requests for Transmittal to the Office of the Governor

Moved by Bergeron, seconded by Sivertsen to reconsider the Council action taken at the special Council meeting of October 8, 2012 regarding the 2014 community priority capital project requests for transmittal to the Office of the Governor. Motion passed with Coose, Bergeron, Harris, Sivertsen and Karlson voting yea; West and Olsen voting nay. The motion on the table before the Council was: Moved by Olsen, seconded by Coose the City Council affirm the October 5, 2012 recommendation of the Lobbying Executive Committee to submit to the Office of the Governor a letter executed by the three mayors indicating the capital project priorities of the three communities and requesting funding for those projects.

At the October 5, 2012 meeting of the Lobbying Executive Committee, the committee adopted a motion providing for the top two priorities of each community as follows:

City of Ketchikan 1. Phase I of the Ketchikan Medical Center Addition and Alterations Project $20,000,000 2. Rehabilitation/Replacement of Off-System City Bridges 12,750,000

Ketchikan Gateway Borough: 1. Performing Arts Center 1,800,000 2. Service Area Road Construction and Repairs 4,090,150

City of Saxman: 1. Mahoney Lake Hydroelectric Project 1,000,000 2. Saxman Community Center Parking Lot 557,740

Ketchikan Shipyard 11,000,000 Several councilmembers and the mayor expressed concern at the process that took place and the end result. Motion failed with Karlson, Olsen and West voting yea; Harris, Bergeron, Sivertsen and Coose voting nay. Moved by West, seconded by Bergeron the City Council affirm the August 27, 2012 recommendation of the Lobbying Executive Committee to submit to the Office of the Governor a letter executed by the three mayors indicating the capital project priorities of the three communities and requesting funding for those projects.

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The August 27, 2012 recommended list of the Executive Lobbying Committee was:

1 Ketchikan Medical Center $20,000,0002 Mahoney Lake Hydroelectric Project $1,000,0003 Performing Arts Center $1,800,0004 Off-System City Bridges and Repairs $12,750,0005 Service Area Road Construction and Repairs $4,090,1506 Saxman Community Center Parking Lot $557,7407 Ketchikan Shipyard $11,000,0001 Ketchikan Medical Center $20,000,000

Concern about getting a list to the Governor’s Office sooner rather than later took place.

Motion failed with West voting yea; Bergeron, Sivertsen, Olsen, Karlson, Coose and Harris voting nay.

Moved by Bergeron, seconded by Olsen to reconsider the previous motion that the City Council affirm the October 5, 2012 recommendation of the Lobbying Executive Committee to submit to the Office of the Governor a letter executed by the three mayors indicating the capital project priorities of the three communities and requesting funding for those projects.

Motion to reconsider passed with Harris, Coose, Karlson, Olsen and Bergeron voting yea; Sivertsen and West voting nay.

Motion passed with West, Olsen, Bergeron, Harris, Sivertsen and Coose voting yea; Karlson voting nay.

Negotiation of Agreements for the Deployment of a 4G/LTE Wireless Network and Construction of a Micro-Wave Radio Link Between Ketchikan and Prince Rupert, British Columbia and Approving the Requisite Financing Plans Thereof

Moved by Bergeron, seconded by West the City Council authorize the KPU general manager to negotiate agreements and otherwise take such actions necessary for KPU Telecommunications to deploy a 4G/LTE wireless network and to construct a micro-wave radio link between Ketchikan and Prince Rupert, British Columbia, said agreements to be submitted to the City Council for formal consideration and approval.

Motion passed with Sivertsen, Bergeron, Coose, Olsen, West and Karlson voting yea; Harris voting nay.

Moved by Bergeron, seconded by West the City Council approve a financing plan for the 4G/LTE and Microwave Radio Link Capital Projects that authorizes loans from the Self-

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Insurance, Community Facilities Development, and Port Enterprise Funds; establishes an interest rate of four percent on the borrowed funds; and requires that the loans be paid within six years.

Finance Director Newell recommended amounts from each of the following funds:

Self-Insurance Fund $800,000 Community Facilities Development Fund $1,500,000 Port Enterprise Fund $2,700,000

In response to Councilmember Coose, Finance Director Newell said he would provide the correct amount in the Harbor Construction Fund at the next meeting.

Motion passed with Bergeron, West, Sivertsen, Olsen and Karlson voting yea; Coose and Harris voting nay.

Re-Bid of Contract No. 11-40 – UV Facility Warehouse Construction

Moved by West, seconded by Olsen the City Council direct staff to re-bid Contract No. 11-40, UV Facility Warehouse Construction, based on revised specifications for a 40’x40’ heated, sprinkled structure.

Motion failed with Olsen and West voting yea; Karlson, Harris, Bergeron, Sivertsen and Coose voting nay.

VOUCHERS

Moved by Bergeron, seconded by West for approval of vouchers to Ketchikan Daily News in the amount of $414.36.

Motion passed with West, Olsen, Karlson, Bergeron, Harris, Sivertsen and Coose voting yea.

CITY MANAGER’S REPORT

Schedule of General Government and KPU Appropriated Reserves Through the City Council Meeting of October 4, 2012

Manager Amylon provided the Council a schedule of the current balance of Appropriated Reserves of various funds of General Government and KPU through the City Council meeting of October 4, 2012.

Contract No. 12-19, Phase II of Berths I and II Rehabilitation Project – Preconstruction Meeting Minutes of September 14, 28 and October 5, 2012

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Manager Amylon copied the Council with the preconstruction meeting minutes for Contract No. 12-19, Phase II of Berths I and II Rehabilitation Project that was held on Friday, September 14, 28 and October 5, 2012.

Contract No. 11-27, Construction Manager/General Contractor Services for the Construction of a New Municipal Public Library – Minutes of Weekly Design/Construction Progress Meeting Nos. 77 and 78

Manager Amylon provided minutes for the weekly design/construction progress meeting Nos. 77 and 78 that was held in Ketchikan/Anchorage/Bellingham on October 2 and 9, 2012 for Contract No. 11-27, Construction Manager/General Contractor Services for the construction of a New Municipal Public Library.

Request for Schoenbar Road Crosswalk Installation – Rural CAP Headstart

Manager Amylon transmitted a memorandum from Public Works Director Allen which outlined a request by Rural CAP Headstart to install a crosswalk near the new library facility on Copper Ridge Lane. Manager Amylon pointed out his intent to direct Mr. Allen to proceed with the crosswalk installation unless otherwise directed by the Council.

Public Works Department Project Status Report – September 2012

Manager Amylon provided the Council with the project status report of the Public Works Department for the month of September 2012.

2013 Proposed General Government and Ketchikan Public Utilities Annual Budgets

Manager Amylon advised that the 2013 Proposed General Government and Ketchikan Public Utilities Annual Budgets will be electronically distributed to Councilmembers on Thursday, November 8, 2012.

Bawden Street Apartments

Manager Amylon reported the bids were opened today for the Bawden Street Apartments, and it is staff’s intent to bring something back to the Council at its first meeting in November to seek direction on who the Council wants to award, and that would be followed by an actual award the second meeting in November, unless the Council wants to meet earlier on and give staff direction on who it wants staff to award to. In order to consider a special meeting, staff will need a little bit of time to evaluate the bids so a meeting no earlier than a week from tonight could be held. Several councilmembers said they would not be available a week from today. Mayor Williams said he would work on a special meeting date to move it faster.

K.P.U. MANAGER’S REPORT

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Project Status Reports of the KPU Operating Divisions – September 2012

Manager Amylon provided the Council with the project status reports of the KPU operating divisions for September 2012.

Report of October 3, 2012 Power Outage

Manager Amylon copied the Council with a report from Senior Electric Systems Engineer Donato regarding the power outage of October 3, 2012.

Request for Land Exchange – Bear Valley Mini Storage

Manager Amylon reported it is the consensus of staff that the proposed land exchange as presented by Mr. Kim Wold at the Council meeting of October 4, 2012 is not in the best interests of Ketchikan Public Utilities. He noted staff believes the expansion of Bear Valley Mini Storage that Mr. Wold would like to build can be accommodated through the issuance of a revocable driveway permit. He stated his office would pursue this approach unless directed otherwise by the Council.

Request for Special Meeting of the City Council – SEAPA “Operations and Maintenance Organizational Review,” D. Hittle and Associates

Manager Amylon requested a special meeting of the Council to review and take a position on the D. Hittle and Associates report relating to SEAPA’s existing operations and maintenance contract with KPU for the Swan Lake Hydroelectric Project. He suggested a special meeting on November 8, 2012.

In response to Councilmember Bergeron, Manager Amylon informed that the current lake levels are always available from KPU’s website. Councilmember Sivertsen also said SEAPA has one available for the iPhone. Councilmember Coose requested a link be provided at the bottom of the lake levels report that would take the reader directly to the website location.

CITY CLERK’S FILE

Clerk Suiter reminded the Council to turn in their board preferences as soon as possible.

CITY ATTORNEY’S FILE

Report of Significant Activities for the Month of September 2012 – Office of the City Attorney

City Attorney Seaver provided a report of significant activities for the month of September 2012.

FUTURE AGENDA ITEMS – None

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MAYOR AND COUNCIL COMMENTS

Councilmember Bergeron said there was a biomass convention in Ketchikan about a week ago that was very informative. He related he was asked to be a presenter and he talked about the City championing the biomass technologies as a way to help alleviate our electrical load. He stated there are a lot of new technologies coming out, and he said during the presentation that while he is the biggest biomass champion in Ketchikan, not everything needs to have a biomass boiler – it needs to make sense. He continued by expressing hope that through the conservation study that KPU Advisory Board and the City Council is going through that we identify places to use biomass, particularly as district biomass heating boilers. He felt if anything was going to happen in the area of conservation, the City of Ketchikan needs to set the example.

Councilmember Karlson thanked the Police Department for bringing up the speaker that was in town to give a presentation on substance abuse and his experience. She felt it was very well done and she commended the KPD for continuing to provide this level of education for our community and for the continuation she sees through the drug busts and arrests. She asked why he didn’t speak at the local schools, and Police Chief Bengaard informed his visit was provided by grant funding and he did Ketchikan a favor by coming up for what was available. She didn’t feel it was a matter of if local families would be affected by drug abuse, but rather when. She said the more we can do to work on this issue, the better off the community will be.

Councilmember Olsen said he was at the library this evening at the Chamber After Hours session, where everyone got a really nice view and look at the space. He said it is a fantastic facility and the contractor did a great job that we will be proud of for years to come. He reported he attended the Museum construction meeting, and several comments were made pertaining to the ability to show large items such as the Goose, Johnboat and other items like that. He felt it would be wise for the Council to direct, possibly as a future agenda item, or to come up with a committee that will look at expansion of the museum and what they do, creating additional space where we can store and display large items off the main museum site.

Councilmember Sivertsen said he had an opportunity from sitting on the Pioneer Advisory Board to travel to Anchorage, Fairbanks and Palmer to look at the Pioneer Homes. He related there are baby boomers coming into the system, and the discussion centered around adding more beds to the Alaska Pioneer facilities, realizing that alone will not do it. He informed in Ketchikan there is a 100-person waitlist, and there is no way to accommodate them all. He said one of the interesting things they found out energy-wise was that the Anchorage and Palmer homes converted to LED lighting. He continued they did a test and they felt there was an error because the drop in load was so dramatic that the generators didn’t pick up the load like they normally would. He related this to City Hall, and possibly we could look at changing lights out to LED. He also thanked the Engineering Division and the contractors for the Alaska Avenue project, noting it is a beautiful job. He felt it was a good project that was managed well.

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Councilmember Harris discussed conservation, noting the lights on in City Hall.

Councilmember Coose said he also attended the biomass meeting, stating there were at least 100+ people there from all over the state. He continued by saying the mayor made some very good comments, thanking him. He said the Borough is getting very interested on the airport and probably the schools going to biomass. He said he talked to Forest Cole, who is very interested in hooking the fire station with the Discovery Center. Manager Amylon said staff has been in discussions with the Forest Service, and the ball is now in their court. Mr. Coose also suggested sometime in the next month that we have an open house visitation with the school board, the Assembly and the Council to view the biomass boiler.

Councilmember Bergeron said the convention attenders went up to tour the biomass boiler at the library. He said he has seen three of them and the library’s is the nicest.

Mayor Williams thanked staff for taking care of the trees around Third Avenue, and said he would work with the old hospital to get a special meeting. He said Centennial Parking Lot underneath was clean for a while but now it is full of trash again. He continued tomorrow there is a Cooperative Relations Committee meeting tomorrow, noting there are only two items on the agenda. He asked the Council to get their board requests in to the clerk so they could be put on the next meeting.

OTHER NEW BUSINESS – None

EXECUTIVE SESSIONS – None

ADJOURNMENT

As there was no further business, the Council adjourned at 9:15 p.m. Lew Williams III, Mayor ATTEST: Katherine M. Suiter City Clerk FYI ITEMS INCLUDED Lake Levels and System Generation Report for the Month of September 2012 Water Utilization Study Report - September 2012