Chapter 11.55
TIDELAND LEASES

Sections:

11.55.010    Scope.

11.55.020    Set rate leases.

11.55.030    Applications.

11.55.040    Lease terms.

11.55.010 Scope.

This chapter governs leases for tidelands and submerged lands which have been or which will hereafter be conveyed by the State of Alaska to the borough pursuant to AS 38.05.830. Leases under this chapter are governed by this chapter and are exempt from Chapters 11.40 and 11.45 KGBC. Tidelands include land that is periodically covered by tidal waters between the elevations of mean high water and mean low water. Submerged land includes land covered by tidal waters and extending seaward from the line of mean low water. This chapter shall not apply to public improvements or public utilities placed by the borough on tidelands or submerged lands. This chapter shall not apply to leases which have been assigned by the State of Alaska to the borough except that the borough assembly may apply some or all of the requirements of this chapter to the re-leasing of these assigned leases after their termination. The borough shall not grant anyone a right to occupy or use tidelands or submerged lands for a period of more than 60 days without a lease. [Ord. No. 1441A, §1, 7-16-07. Code 1974 §40.19.010.]

11.55.020 Set rate leases.

(a)    The assembly may classify certain borough-owned tidelands or submerged lands as eligible for set rate lease. Property which has been classified as eligible for set rate lease may be leased to third parties on a first-come, first-serve basis for terms of up to five years without separate assembly approval. Such leases shall be at rates which are not less than the rates approved for lease of the designated space.

(b)    Property eligible for lease under a set rate lease shall be designated by resolution.

(c)    Lease rates applicable to set rate lease properties shall be established by resolution. If property is currently under a written lease when the resolution setting out the lease rates as it pertains to the subject property is amended, such lease shall continue to be governed by the rate in the written lease until the lease comes up for renewal or adjustment by its terms. [Ord. No. 1441A, §1, 7-16-07. Code 1974 §40.19.020.]

11.55.030 Applications.

A person seeking a lease for tidelands or submerged lands shall file an application with the borough manager’s office. A nonrefundable processing fee of $100 shall be paid to the borough at the time of filing. A person seeking a lease for temporary occupation of less than 60 days shall file an application with the borough manager’s office and pay a nonrefundable processing fee of $25 that will be paid to the borough at the time of filing.

(a)    Development Plan. The borough manager shall require the applicant to submit a development plan that includes and is consistent with plans required by other agencies involved in the development process. The development plan shall include:

(1)    A description of the proposed use for the tidelands, submerged land, and adjacent uplands;

(2)    A description of the improvements that will be placed on the tidelands, submerged land, and adjacent uplands;

(3)    The dates by which construction will begin and will be completed;

(4)    The estimated cost of the improvements that will be placed on the tidelands, submerged lands, and adjacent uplands;

(5)    A description of the effects that the proposed use of the tidelands, submerged lands, and adjacent uplands will have on public streets, public facilities, public services, public utilities, traffic, and parking. The description shall include a plan for mitigating adverse effects on streets, public facilities, public services, public utilities, traffic congestion, and parking, and a plan for paying the costs thereof;

(6)    A proposed rent and security deposit if applicable; and

(7)    The names and addresses of the owners, officers, and proposed managers.

The development plan shall describe how the applicant will fulfill the terms of any permits or approvals required by the Ketchikan Gateway Borough. The applicant shall provide such additional information, including designs and specifications, as the borough manager may request. After notifying the applicant, the borough manager may, at the applicant’s additional cost, obtain such surveys, title reports, appraisals, feasibility studies, traffic studies, environmental analyses, navigational studies, public utility and facilities studies, community impact studies, and other studies as the borough manager determines to be useful in evaluating the application. The borough manager may require the applicant to amend its development plan.

(b)    Notice of Publication. The borough manager will cause a notice of tidelands lease application to be published for three consecutive weeks before final action to approve or reject the lease. If publication is in a newspaper, the publication shall be once each week, with the final publication at least one week prior to the final action on the application. The notice shall identify the applicant, the location of the proposed lease, the proposed rent, and the proposed use. The notice shall state that any other persons interested in a lease for the area should file an application with the borough manager by a date identified in the notice. The notice shall also state that anyone wishing to protest the lease must file a written protest with the borough manager not later than a date identified in the notice. Such protest shall be in writing and shall state all reasons for the protest. Failure to timely protest as required by this subsection shall constitute a waiver of any right to lease or use the location and shall waive any right to contest the awarding of the lease. The borough manager shall mail notice to the owners, as shown on the borough tax rolls, of upland property within a radius of at least 1,200 feet of the shore-side boundary of the tidelands or submerged lands to be leased. Such notice will not be sent to the applicant if the applicant is the owner of some of the upland property. No sooner than one week after the date set for receipt of competing applications or protests, the borough manager shall submit to the assembly a report and recommendation on each application timely received by the borough. No lease shall be approved by the assembly until the borough manager’s report has been submitted to the assembly. [Ord. No. 1827, §13, 4-3-17; Ord. No. 1686, §3, 12-2-13; Ord. No. 1441A, §1, 7-16-07. Code 1974 §40.19.030.]

11.55.040 Lease terms.

All leases issued under this chapter shall contain the following minimum terms and conditions:

(a)    Rent. Unless the assembly specifies that the lease is based on considerations other than value, or is being assigned to a government agency or nonprofit corporation, the annual rent shall be two-and-one-half percent of the real property value as defined in KGBC 11.40.020 of the tideland before any improvements were installed, constructed, or developed. Such rate shall be subject to adjustment during the term of the lease at intervals of not less than five years in accordance with subsection (b) of this section.

The assembly may authorize a reduction from this benchmark rate for leases issued to federal, State, or local government agencies and nonprofit organizations when the assembly finds that benefits to the public from, and the public interest served by, the use of the leased area justifies the reduction in the lease rate.

(b)    Term. The term of the lease including any renewable options shall not exceed 55 years. In determining the term, the assembly shall consider:

(1)    The desirability of the proposed use to the borough;

(2)    The proposed investment in improvements;

(3)    The durability of such improvements; and

(4)    The time needed to amortize the proposed investment.

The assembly shall be the sole judge of the weight, if any, to be given to any of the above considerations. The assembly’s conclusions shall be final. For purposes of this chapter the term of any lease shall be calculated by including all renewal periods provided by the lease. Any lease with a term exceeding five years shall allow the borough to adjust the rent based upon two-and-one-half percent of the current real property value as defined in KGBC 11.40.020 of the tideland before any improvements were installed, constructed, or developed no less frequently than every five years. The lease shall provide for early termination if the lessee violates the terms of the lease and fails to cure the violation within such time as may be provided for in the lease.

(c)    Patent Conditions. The lease shall be subject to the terms and conditions of the patent or deed from the State of Alaska, and subject to any littoral rights and any rights of the public under the Public Trust Doctrine.

(d)    Insurance and Indemnification. The lessee shall provide and maintain comprehensive general liability insurance with the borough as an also insured in an amount to be determined by the borough manager. The lessee shall indemnify, defend, and hold harmless the borough, its agents, insurers, officers, and employees from all claims, damages, fines, forfeitures, losses, injuries, or deaths arising from or related to the lease or the use of the tidelands or submerged lands. In particular, the lessee shall indemnify, defend, and hold harmless the borough, its agents, insurers, officers, and employees from any such claims, damages, losses, or injuries relating to navigational rights, littoral rights, or rights to access or use tidelands or submerged lands.

(e)    No Warranties of Title or Condition. The lease shall state that the borough makes no warranties or representations as to its title or as to the suitability or condition of the leased premises for its intended use or any other use.

(f)    Development Plan. The lease shall restrict the use of the tidelands and submerged lands to those uses described in the development plan and shall obligate the lessee to fulfill its obligations under the development plan in a timely manner. Changes in the development plan must include a complete development plan as prescribed in KGBC 11.55.030(a), approved by the borough manager or designee, and must be consistent with the current zoning of the upland zoning district.

(g)    Removal or Reversion of Improvements Upon Termination. The lease shall provide that within a negotiated period of time from the date the lease terminates all improvements, fill, or other alterations to the tidelands and submerged lands will be removed in a legally approved manner by the lessee at lessee’s cost. At the termination of the lease the tidelands and submerged lands will be restored to their condition prior to the lease. Alternatively, the lessee, with the concurrence of the borough, may provide for the improvements to revert to and become the sole property of the borough at no cost to the borough.

(h)    Lessee to Obtain All Other Permits and Approvals. The lease shall require the lessee to obtain at its expense all other permits and approvals required by law. The borough manager may require that the lessee obtain all such permits and approvals prior to the effective date of the tidelands or submerged lands lease and may set a deadline for obtaining such permits and approvals.

(i)    Assignment and Subleases. The rights of lessees may not be assigned unless the assignee agrees to all terms and conditions of the lease. No lessee may sublease any tidelands or submerged lands without the approval of the borough manager. Subleases shall be in writing and shall be subject to all terms and conditions of the tidelands lease. Assignment of existing leases issued by the State of Alaska prior to transfer shall be subject to approval of the assembly according to the terms of the existing lease regarding assignment or transfer of those leases. An assignment of security interest in a tideland lease for the purpose of financing improvements to the tidelands is subject to approval of the borough manager, but is not subject to assembly approval.

(j)    Payment of Tax. The payment of property tax shall be as a leasehold tax. Lessee shall pay all such taxes subject to such rights of appeal as are provided by law.

(k)    Other Terms and Conditions. The lease shall contain such other terms and conditions as the borough manager may determine. The terms and conditions described in this section do not prohibit the assembly or the manager from imposing greater restrictions or obligations on any lessee.

(l)    Upland Property Owner Preference. Upland property owners shall be granted a preference for leasing submerged lands adjacent to their property for any private development of the tidelands.

The assembly will approve or reject the negotiated lease. No rights to new leases or new use of tidelands or submerged lands may arise until the assembly approves a final written lease. Nothing in this chapter requires the assembly to accept any lease. [Ord. No. 1729, §1, 7-21-14; Ord. No. 1686, §4, 12-2-13; Ord. No. 1441A, §1, 7-16-07. Code 1974 §40.19.040.]