Chapter 16.12
DISPOSITION OF PUBLIC LANDS AND TIDELANDS

Sections:

16.12.010    Applicability of provisions.

16.12.012    Disposition of real property for economic development purposes.

16.12.015    Disposal of public lands for public use.

16.12.020    Commencement of proceedings.

16.12.030    Sale of tidelands.

16.12.040    Value assessment – Notice of terms.

16.12.050    Landlocked tidelands.

16.12.060    Restriction on sale of tidelands and sufficiency of proof.

16.12.070    Preference rights of upland owners and tidelands lessees.

16.12.075    Additional requirements.

16.12.080    Exchange or trade of borough real property or tidelands.

16.12.090    Effective date of resolution.

16.12.100    Repealed.

16.12.105    Over-the-counter sales.

16.12.115    Ratification of prior conveyances.

16.12.120    Construction as condition of sale – Generally.

16.12.130    Construction as condition of sale – Term during which construction must begin.

16.12.140    Construction as condition of sale – Construction completion terms.

16.12.150    Construction as condition of sale – Construction completion terms for industrial development.

16.12.160    Construction as condition of sale – Extension of construction period.

16.12.170    Construction as condition of sale – Default provision.

16.12.180    Construction as condition of sale – Inspection and report authority – Appeals.

16.12.010 Applicability of provisions.

The provisions of this chapter shall constitute the formal procedure for the lease, sale, or other disposition of real property for interest in real property or tideland owned by the borough. Nothing herein shall preclude the assembly from waiving all of the provisions of this chapter, when in the judgment of the assembly the public interest so requires, so as to dispose of public lands by lease, exchange, trade, sale, or other disposition of said public lands when the value of said property, lease, or interest is $1,000,000 or less (as determined by a qualified appraiser or the borough assessor) and is accomplished by resolution after public notice published 14 days prior to passage of the resolution. [Ord. 677 § 4, 2000; Ord. 645 § 5, 1998; Ord. 588 § 4, 1993; Ord. 429 § 4, 1982; Ord. 275 § 5, 1972; prior code § 45.20.010.]

16.12.012 Disposition of real property for economic development purposes.

A. In the exercise of the borough’s economic development powers, the assembly may determine, in its sole discretion, that it is in the best interest of the borough to dispose of borough-owned real property, including tidelands, or any interest therein, which interest has a value of $1,000,000 or less (as determined by the borough assessor or a qualified appraiser), without requests for proposals or sealed bid procedures and at less than fair market value.

B. In determining the best interests of the borough under this section, the assembly may consider any relevant factors, which may include:

1. The desirability of the economic development project;

2. The actual or potential economic benefits to the borough, its economy and other businesses within the borough;

3. The contribution of the proponent to the economic development project in terms of money, labor, innovation, expertise, experience and otherwise;

4. The business needs of the proponent of the project in terms of integration into existing facilities and operations, stability in business planning, business commitments, and marketing;

5. Actual or potential local employment due to the economic development project;

6. Actual and potential enhancement of tax and other revenues to the borough related to the project; and

7. Existing and reasonably foreseeable land use patterns and ownership.

C. Prior to disposal under subsection (A) of this section, the assembly shall hold a public hearing. The borough clerk shall publish notice of the public hearing in a newspaper of general circulation in the borough at least 14 days prior to the hearing. The notice shall include the date, time and place of the hearing, and general or legal description of the real property or interest, and the proposed disposition and its purpose.

D. Following the hearing, and with comments/recommendations from the port commission, the planning and zoning commission, and the economic development committee, the assembly may authorize disposition of the real property or interest therein by resolution.

E. Where the acquisition of the real property or any interest therein or the construction of a permanent improvement has been approved by the voters at an election, the disposition of such property, interest or improvement under this section by sale, trade or lease for a term exceeding five years shall be made only by authority of an ordinance ratified by a majority of the qualified voters of the borough who vote upon the question. For purposes of this subsection, the term of any such lease shall include the terms of all options to extend or renew the lease. The requirements of this subsection do not apply where the voter approval involved was in the form of authorizing the issuance of bonds to finance the acquisition of the real property or any interest therein or the construction of a permanent improvement. [Ord. 781 §§ 1, 2, 2006; Ord. 756 § 1, 2004.]

16.12.015 Disposal of public lands for public use.

A. When the borough assembly determines it is in the best interests of the public to dispose of real property, or any interest therein, owned by the borough, including tidelands, which interest has a value of $1,000,000 or less, to the state or U.S. government for public use, the disposal may be made without sealed bid procedures and at less than fair market value.

B. Prior to disposal under subsection (A) of this section, the assembly shall hold a public hearing. The borough clerk shall publish notice of the hearing in a newspaper of general circulation in the borough at least 10 days prior to the hearing. The notice shall include the date, time, and place of the hearing and a description of the real property, stating in full the proposed public use.

C. Following the hearing, the assembly may authorize disposal of the real property by resolution, which shall include any special terms and conditions the assembly may require for the disposal. Upon adoption of the resolution, the borough attorney shall prepare a deed or other appropriate instrument of conveyance. [Ord. 677 § 4, 2000; Ord. 645 § 5, 1998; Ord. 588 § 5, 1993; Ord. 410 § 5, 1981; prior code § 45.20.015.]

16.12.020 Commencement of proceedings.

Proceedings commencing disposition of real property, including tidelands, to other than the state or U.S. government, as provided in WMC 16.12.015, shall be initiated by the borough clerk or by the assembly or a assembly member upon motion at a meeting, or by an interested third party upon written application or request submitted to the borough clerk seven days prior to the assembly meeting. Such motion, application, or request must identify the property by general or legal description, state the interest to be disposed (sale, lease, or other) and state the reason and purpose of the proposed disposition. [Ord. 677 § 4, 2000; Ord. 410 § 6, 1981; Ord. 275 § 5, 1972; prior code § 45.20.020.]

16.12.030 Sale of tidelands.

A. The policy of outright disposal by sale of tide and submerged lands is not favored; the orderly development of the borough with due consideration toward ocean resource harvesting, municipal revenue and public recreation would indicate a strong preference toward tidelands leasing. However, when it is in the public interest, the assembly may, by resolution, authorize the sale of tracts of tide and submerged lands in the manner provided for the sale of other real property owned by the borough. Tidelands, which may be sold pursuant to this section, as that term is used herein, refers only to those tide and submerged lands conveyed by the state of Alaska to the then-City of Wrangell pursuant to AS 38.05.820.

B. All sales of tide and submerged lands shall be public sales and shall be governed by the provisions of this chapter, insofar as applicable. [Ord. 833 § 42, 2009; Ord. 677 § 4, 2000; Ord. 645 § 5, 1998; Ord. 618 § 4, 1996; Ord. 588 § 6, 1993; Ord. 410 § 7, 1981; Ord. 275 § 5, 1971; prior code § 45.20.030.]

16.12.040 Value assessment – Notice of terms.

A. When an application is filed for the sale, lease or other disposition of real property, tidelands or any interest therein, the borough clerk shall cause an appraisal of the interest to be disposed of to be made by the assessor, who shall submit a report to the assembly, which will include his estimate of the market value of the interest. The assembly shall then submit the application and, upon approval of a majority of those voting on the question, the assembly shall approve the sale on such terms and conditions as provided herein, or set by the assembly. The costs of appraisal fees, survey fees and fees necessary for the preparation of documents, and all other costs associated with the application shall be borne by the applicant.

B. Following approval by the assembly, if the subject interest has a value of $1,000,000 or less, the borough clerk shall thereafter give notice of the sale, lease or other disposition by publication of notice in a newspaper of general circulation in the borough at least 30 days before the date of the sale, lease, or other disposition, and the notice shall be 30 days before the date of the sale, lease, or other disposition, and the notice shall be posted within that time in at least three public places in the borough.

C. The notice shall contain a description of the property and the interest therein which is being disposed; the estimated value of the interest; declare that the disposition shall be effected through sealed bids, the forms for which may be obtained in advance at the borough clerk’s office at City Hall; shall specify the address to which the sealed bids shall be addressed or delivered by the bidders; state the date and hour upon which bids shall be opened in public, and that sealed bids may be submitted at any time prior to the opening; that the property may be sold, leased, or disposed to the highest responsible bidder for cash, or terms as provided in WMC 16.12.015; that the borough reserves the right to reject any and all bids.

D. Terms. Certified or cashier’s check or cash equal to 25 percent of the bid must accompany the bid. Personal checks will not be accepted. Purchasers may choose to pay balance by cash or execute an installment purchase agreement with the City and Borough of Wrangell. Term of installment purchase agreement shall not exceed 15 years. Interest rate on unpaid balance will accrue at prime plus two points at time of closing. The unpaid balance shall be evidenced by a promissory note secured by a deed of trust on the property.

E. Fund Disposition. All funds received from tidelands sales shall be deposited into the City and Borough of Wrangell’s permanent fund. [Ord. 750 § 4, 2004; Ord. 746 § 4, 2004; Ord. 692 § 4, 2000; Ord. 677 § 4, 2000; Ord. 312 § 5, 1974; prior code § 45.20.040.]

16.12.050 Landlocked tidelands.

Those portions of borough-owned tidelands which have been filled and are now landlocked with no access to navigable waters shall be treated as all other uplands owned by the borough and disposed of in the manner provided in Chapter 16.12 WMC for borough-owned real property. [Ord. 677 § 4, 2000.]

16.12.060 Restriction on sale of tidelands and sufficiency of proof.

No sale of tidelands shall occur except upon public hearing, 30 days’ notice of which shall be given by three successive weekly publications in the local newspaper, the cost of which shall be borne by the applicant. At the hearing, the applicant must clearly demonstrate the benefits of sale of the subject tidelands tract that could not be realized by the borough through leasing; a determination by the assembly adverse to the applicant may not be appealed unless clearly erroneous. An applicant for purchase of tidelands must conclusively demonstrate the outright sale of the nominated tidelands tract, as contrasted with the lease of such tract, is in the borough’s best interest. The borough reserves the right to refuse sale of any tidelands tracts, regardless of sufficiency of proof. [Ord. 677 § 4, 2000.]

16.12.070 Preference rights of upland owners and tidelands lessees.

A. Uplands owner abutting tide and submerged lands for which a sale application is submitted, whether submitted by the uplands owner or a third party, shall be entitled to a preference right in the form of the right to meet or exceed the highest bid or offer tendered by another person for the purchase of abutting tide or submerged lands. No additional notice other than that already required by this title shall be required of the applicant. Furthermore, failure to exercise this preference right at or before the time of sale shall result in the forfeiture of said preference right.

B. The lessees of an existing and current tidelands lease shall be entitled to a preference right in the form of the right to meet or exceed the highest bid or offer tendered by another person for the purchase of the tidelands leased by said lessee. The tidelands lessees’ preference shall be superior to that preference granted to uplands owners in subsection (A) of this section. No additional notice, other than that already required by this title, shall be required of the applicant. Furthermore, failure to exercise this preference at or before the time of sale shall result in the forfeiture of said preference right. [Ord. 677 § 4, 2000.]

16.12.075 Additional requirements.

The borough assembly may provide such additional and necessary requirements as they find necessary to carry out the specific and unique terms of each such sale and as may from time to time be necessary and not inconsistent with this chapter. [Ord. 677 § 4, 2000.]

16.12.080 Exchange or trade of borough real property or tidelands.

Notwithstanding any other requirement of this chapter, except the requirements provided for public notice in WMC 16.12.015, exchanges or trades of borough-owned real property or tidelands or interests therein shall be governed solely by this subsection and in compliance with the borough charter, the borough assembly may, by resolution and without public bidding, exchange any borough-owned real property or tidelands or interest therein, provided that:

A. The value of the borough-owned real property, or interest therein, and the value of the real property, or tidelands, or interest therein, to be exchanged have been determined by either an appraisal prepared by a qualified appraiser obtained by the borough within the preceding 12 months, or by review of the then current property assessment records of the borough.

B. The value of the borough-owned real property, or tidelands or interest therein, is equal to the value of the real property, tidelands or interest therein, to be exchanged; or, if the value of the borough-owned real property, tidelands or interest therein is different from the value of the real property, or tidelands or interest therein, to be exchanged, the difference is made up in money.

C. The borough assembly determines by resolution that the borough-owned property or tidelands or interest therein is no longer needed for municipal purposes and that the exchange of properties or tidelands or interests therein is in the public interest. [Ord. 677 § 4, 2000.]

16.12.090 Effective date of resolution.

A resolution providing for the disposition of property shall become effective upon adoption by the assembly. The borough attorney shall prepare a deed or other appropriate instrument of conveyance to be executed by the mayor and clerk, subject to any deed of trust securing installment payments of the purchase price and other obligations to the borough. [Ord. 750 § 4, 2004; Ord. 677 § 4, 2000; Ord. 618 § 5, 1996; Ord. 410 § 8, 1981; Ord. 312 § 5, 1974; prior code § 45.20.050.]

16.12.100 Ratification by election – Procedure.

Repealed by Ord. 800. [Ord. 746 § 5, 2004; Ord. 677 § 4, 2000; Ord. 645 § 5, 1998; Ord. 588 § 7, 1993; Ord. 410 § 9, 1981; prior code § 45.20.060.]

16.12.105 Over-the-counter sales.

A. Lots or parcels of land offered for sale pursuant to WMC 16.12.030 for which no responsive bids are received may, upon resolution of the assembly, be offered for over-the-counter sale upon such terms and conditions as provided in WMC 16.12.040(C) and (D).

B. The resolution shall specify the date and hour on which over-the-counter sales shall commence and an expiration date.

C. Such lots shall be offered by the borough clerk over the counter at City Hall on a first-come, first-served basis and be sold for the minimum bid value (appraised valuation).

D. The purchases shall be ratified by a resolution of the assembly, and conveyed as provided for in WMC 16.12.090. [Ord. 750 § 4, 2004; Ord. 677 § 4, 2000; Ord. 618 § 6, 1996; Ord. 337 § 5, 1975; prior code § 45.20.080.]

16.12.115 Ratification of prior conveyances.

Previous installment sales of borough property made before April 1, 2004, where the property was conveyed by a deed subject to a deed of trust securing payment of the purchase price are hereby ratified and approved. [Ord. 750 § 4, 2004.]

16.12.120 Construction as condition of sale – Generally.

The assembly or its agents may require the construction of certain improvements within a specified period of time as a condition to the conveyance of any borough-owned real property by sale or other disposition. Whenever the contract of sale and/or instrument of conveyance recites “construction” or “construction conditions” or similar language, or if the notice of sale pertaining or relating to the subject property recites the aforementioned terminology or similar language pertaining to construction requirements, all of the provisions of this section and WMC 16.12.090 through 16.12.130 shall be applicable thereto and become incorporated by reference in the transaction as if fully set forth. [Ord. 677 § 4, 2000; Ord. 618 § 8, 1996; Ord. 281 § 5, 1973; prior code § 45.20.070(a).]

16.12.130 Construction as condition of sale – Term during which construction must begin.

Real property sold or otherwise disposed of by the borough with the stipulation that construction shall be undertaken or otherwise subject to construction requirements or construction as a condition subsequent to vesting shall mean that construction shall occur within two years from the date of sale. The date of sale for the purposes of this section shall mean the effective date of the resolution authorizing the conveyance of the subject property, lease agreement, or other agreement evidencing the conveyance. [Ord. 677 § 4, 2000; Ord. 618 § 9, 1996; Ord. 281 § 5, 1973; prior code § 45.20.070(b).]

16.12.140 Construction as condition of sale – Construction completion terms.

A. “Construction,” within the meaning of WMC 16.12.080 through 16.12.130, shall require 80 percent completion of a residential or commercial structure. “Eighty percent completed” is intended to imply greater progress than mere substantial completion.

B. Standards for minimum acceptable completion shall include the following in compliance with WMC Title 18.

1. Earthwork site preparation;

2. Foundation completion;

3. Structural completion of the building, including all exterior walls and the completed roof;

4. Installation and connection of electrical, water and sewer utilities;

5. Installation of all plumbing, including internal fixtures;

6. Installation of all electrical wiring completed through the point of installing boxes and connections thereto from the primary power source; and

7. Installation of all insulation materials.

C. Completion shall not require installation of the following:

1. Finished flooring;

2. Dry wall, sheet rock, or other interior wall board or ceiling material;

3. Installation of internal lighting fixtures, switches, outlets and box covers;

4. Interior walls or partitions not containing plumbing or electrical wiring;

5. Paint;

6. Drain gutters; or

7. Finished landscaping. [Ord. 677 § 4, 2000; Ord. 281 § 5, 1973; prior code § 45.20.070(c).]

16.12.150 Construction as condition of sale – Construction completion terms for industrial development.

A. “Construction,” within the meaning of WMC 16.12.080 through 16.12.130, for industrial development shall require development consistent with WMC Title 20, and shall be substantially complete within two years after the date of sale.

B. Within 60 days after the date of sale, purchaser of the subject property shall present a written development plan to the planning and zoning commission for approval. At a minimum, the development plan shall include a description of the construction planned and a time schedule for its completion. The commission shall forward the plan, with its recommendations, to the borough assembly for approval within 30 days after receipt from the purchaser. If the plan is not approved by the assembly, the assembly shall prepare and deliver a written statement to the purchaser explaining their reasons for disapproving the plan. The purchaser shall be required to submit a revised plan to the assembly within 30 days. If the revised plan is not approved by the assembly, the sale shall be considered in default.

C. After approval of the purchaser’s development plan by the borough assembly, the purchaser shall have the remainder of the two-year period after date of sale to make the improvements indicated by the approved plan.

D. Notwithstanding any other provisions of this section, an enclosed building will be required as part of any development plan submitted by the purchaser for approval. The building and all other development features shall comply with WMC Titles 15 and 18. [Ord. 677 § 4, 2000; Ord. 515 § 4, 1987.]

16.12.160 Construction as condition of sale – Extension of construction period.

A. Upon the written request of the purchaser, the borough assembly may extend the time for construction completion for good cause shown by the purchaser. The purchaser shall submit written evidence of good cause to the assembly. The purchaser may request an extension on or before 30 days before the construction completion date. The assembly shall prepare a written decision within 30 days of the purchaser’s request for extension, and a copy of such decision shall be provided to the purchaser.

B. Extensions of time for construction completion of industrial development will be granted if the borough has prevented compliance by not meeting those elements of the development plan required to be performed by the borough.

C. In the event of assignment or subsequent conveyance by the initial purchaser or lessee, the original completion requirements shall remain in effect and be binding upon the subsequent grantee or lessee. [Ord. 677 § 4, 2000; Ord. 515 § 5, 1987.]

16.12.170 Construction as condition of sale – Default provision.

In the event of the acquiring party’s failure to strictly comply with the completion requirements set forth in this chapter, the following default provisions shall apply:

A. In the event there has been no foundation or site of preparation work, the contract shall terminate and the real property or interest therein shall revert to the borough. The borough may require that the defaulting party or parties execute a quitclaim deed to the borough conveying all of their interest in the subject property to the borough. The borough shall refund to the defaulting party or parties the amounts paid toward the purchase of the subject property except the greater of 25 percent of the total purchase price of $500.00, whichever is greater, which shall be retained by the borough as liquidated damages. In the event of a lease, the borough shall retain all sums paid to the date of default as liquidated damages.

B. In the event of default after completion of substantial earthwork and site preparation but before installation of a foundation, the contract shall terminate and the real property shall revert to the borough. The borough may require the defaulting party or parties to execute a quitclaim deed conveying all of their interest in the subject property to the borough. The borough shall refund 25 percent of the total purchase price to the defaulting party or parties and retain all other amounts paid to that date as liquidated damages. In the event of default under a lease, the borough shall retain all rental amounts theretofore paid the borough as liquidated damages.

C. In the event of default after the foundation is substantially complete, whether the foundation is of piling, poured concrete or other recognized and acceptable foundation material, the defaulting party shall have the option of removing the foundation and restoring the lot to its original condition within 30 days and relinquishing all of his right, title, and interest therein by quitclaim conveyance to the borough and be refunded 50 percent of the total purchase price, or to retain the real property and pay the borough liquidated damages for breach of conditions in the amount of the original lot purchase price within 30 days after default; and, in the event of failure to timely make such remittance, the real property and all improvements thereon shall revert to the borough which shall also retain all amounts theretofore paid for the purchase of said property as liquidated damages. A lessee in default shall have the option of terminating the lease and relinquishing the real property and all improvements thereon to the borough and forfeiting all rental payments theretofore paid as liquidated damages, or may retain the property and continue the lease and pay the borough the amount of $2,000 in liquidated damages within 30 days after the default. [Ord. 677 § 4, 2000; Ord. 515 § 6, 1987; Ord. 281 § 5, 1973; prior code § 45.20.070(e).]

16.12.180 Construction as condition of sale – Inspection and report authority – Appeals.

A. The borough building inspector shall have the duty of inspecting all properties subject to the construction conditions. The inspection will be made on or before the date constituting expiration of the term for construction completion, except that the purchaser may request earlier inspection. The building inspector shall inspect within 30 days of written request by the purchaser.

B. The purpose of the inspection is to determine whether or not there has been compliance with the construction requirements according to the standards contained in this chapter.

C. The building inspector shall report his findings to the planning and zoning commission. The commission shall immediately review the findings and prepare a written report of their compliance determination and submit it promptly to the borough manager who shall take whatever action is appropriate in the circumstances. The commission shall also mail or otherwise forward a copy of the report to the purchaser or lessee of the subject property.

D. An aggrieved party wishing to challenge or controvert the determination of the planning and zoning commission may appeal to the borough assembly by giving and delivering written notice of appeal to the borough manager or borough clerk within five days after receipt of notice of the commission’s determination. Thereafter, the assembly shall conduct a hearing on the appeal at a special or regular meeting of the assembly within 10 days after receipt of notice of appeal. The assembly may enter its findings at the hearing or may take the matter under advisement and thereafter collectively inspect the subject property, disregarding any work on the building occurring between their inspection and that of the planning and zoning commission, and shall enter its decision within two days after the hearing without necessity for formal reconvention at special or regular meeting. [Ord. 677 § 4, 2000; Ord. 515 § 7, 1987.]