MEMORANDUM

TO: Pete Sprague, Assembly President

Members, Kenai Peninsula Borough Assembly

THRU: Dale Bagley, Mayor

FROM: Colette Thompson, Borough Attorney

Max Best, Planning Director

Paul Ostrander, Land Management Officer

Marcus Mueller, Land Management Agent

DATE: June 5, 2003

SUBJECT: Ordinance 2003-26, An Ordinance extending the deadline in Ordinance 2001-16 regarding certain grazing leases

The assembly adopted Ordinance 2001-16 on June 19, 2001, which authorized the mayor to renew or extend for 27.5 years seven grazing leases in the southern area of the Kenai Peninsula. The State of Alaska originally issued these leases under a program designed to encourage grazing use of state lands. The Kenai Peninsula Borough selected the lands subject to these grazing leases several years ago pursuant to the Municipal Land Grant program.

These leases were for an initial term of 27.5 years and provided lessees with an option to apply for a renewal lease upon certain terms and conditions for an additional period of 27.5 years. The initial 27.5 years expired in July 2001, and all of the subject lessees applied for the 27.5-year renewal with the borough.

In the two years since enactment of ordinance 2001-16 the lessees have submitted development plans after working with the Soil and Water Conservation District, but those plans were not consistent with some borough code requirements and require modification. The lessees' attorney has also claimed that the renewal leases must contain the same terms as the original state leases, which would result in numerous problems. The administration researched these matters and hopes to resolve them in the near future.

Regarding the survey status of these lands, many of the leased properties may not have been surveyed. The administration is reviewing the properties to determine whether any improvements are sufficiently close to a boundary line that a partial survey may be required to ensure no encroachments exist. This process should be completed within the next few months.

An additional year is respectfully requested to enable the administration to finalize this process and renew these leases in an appropriate manner. Due in part to borough personnel shortages and changes, and legal issues, this project has taken longer to complete than originally expected. As vacant positions have now been filled, the administration has made this a priority. While it is expected that these requirements and leases will be formally completed in less than one year, a year is requested in the event that unanticipated problems arise.

Hearing on shortened time is requested as the two-year period in ordinance 2001-16 will expire July 11, 2003, and only one assembly meeting is scheduled for July 2003. The requirements in ordinance 2001-16 cannot properly be completed before July 11, 2003. If the ordinance is introduced on June 17, 2003, there will be adequate time for the Planning commission to consider it at the Planning Commission meeting of June 23, 2003. No advisory planning commissions in the affected areas have meetings scheduled during this time.