Although the entire park is just over 71 acres, there are less than 10 acres remaining in the so-called "core area."

Although the entire park is just over 71 acres, there are less than 10 acres remaining in the so-called “core area.”

There will be no bulk water shipments from Sitka this summer. The company that owns the rights to market Sitka’s Blue Lake water in bulk had said it would ship its first load in July. But now it will likely ask to extend its deadline.

Meanwhile, Sitka is fielding inquiries from companies interested in bottling Blue Lake water. But the city is running into an unexpected problem: there’s not enough land to accommodate new players at the Gary Paxton Industrial Park.

After years in which the city struggled to attract businesses to the site of its former pulp mill, suddenly it’s running out of room. Much of that land is locked up in businesses that have yet to deliver the promised revenue and jobs.

Now the park is looking to expand.

Note: The Sitka Assembly will vote Tuesday (8-11-15) on whether to grant conceptual approval to the plan to expand the Gary Paxton Industrial Park. The plan would have to go through the Planning Commission before any final decision is made.

When Sitka took over the site of its old pulp mill fifteen years ago, the city set up the Gary Paxton Industrial Park — formerly the Sawmill Cove Industrial Park — with a specific mission: to “maximize its economic benefit to the community through creation of meaningful jobs.”

And for years, the park had trouble finding many takers. Here’s Grant Miller, the chair of the park’s board:

“It’s not that long ago that we weren’t able to do anything out there.”

But now, suddenly, there’s not enough land to go around.

In just the last year, the city has fielded a string of proposals, entering into agreements with Silver Bay Seafood, the fish-processor; the locally-owned Monarch Tannery; Alaska & Pacific Packing, which plans to fabricate seafood processing equipment; and a water bottling start-up, iWater.

About an acre is leased to NSRAA, the Northern Southeast Regional Aquaculture Association. Another three acres are tied up in the defunct True Alaska Bottling plant, which has stood empty for years.
Then there’s the park’s perimeter, which includes the Fortress of the Bear and the city’s scrap yard; the rest of the park is too steep to be developed easily.

That leaves less than ten acres of prime real estate, with too many suitors. Silver Bay has proposed buying yet more land — this time for a marine services center. Alaska Bulk Water is eyeing those same plots. And then there’s the city itself, which has state funding to build a multipurpose dock at the park.

Now park director Garry White says he’s had interest from two separate groups who want to bottle Sitka’s water and market it in China. One potential investor visited for two weeks in July, White said.

“He’s dead serious on acquiring ten acres to put up a bottling plant. But we don’t have ten acres.”

So White proposed a solution: Why not expand the park? Specifically, he suggested that the board ask the city to transfer about twenty acres of land along Sawmill Creek Road, southeast of the current park.
The suggestion was met with enthusiasm by board member Charles Horan:

“We should put this in Gary’s bag of land to offer when folks come kicking tires.”

The board voted unanimously to request the additional land.

White says the recent surge in interest is the city’s efforts paying off.

“So we’ve been marketing for 15 years. It shows that when you put money towards marketing, things come to fruition at some point.”

It also shows how hard it is. White estimates there are about forty full-time, year-round jobs at the park, mostly at Silver Bay, Fortress of the Bear, NSRAA. That’s down from over 400 during the pulp mill days. (White estimates another 375 seasonal jobs in fish processing and tourism.) But most of the projects at the park haven’t delivered any jobs yet. Some are too new: The sale to Monarch Tannery was approved this spring but hasn’t yet closed. Alaska & Pacific Packing is just setting up.

And others are simply gambles. Alaska Bulk Water is asking for its fifth extension as it tries to build a business-model — exporting bulk water — for which there isn’t much precedent. I Water must bottle half a million gallons of water by December 2016 to hang onto its contract, but so far it hasn’t broken ground. Meanwhile, the bottling plant on the park’s west end has stood empty for years, a constant reminder of business plans that sound good but don’t pan out.

Board member Dan Jones asked if some of the recent interest might be another mirage.

“You know, they think they want ten acres, but would they really buy it? To me, it’s a really good question. Is there really a demand there?”

It’s a sensitive question because the park operates under its own rules when it disposes of public land. Anywhere else in the city, a sale over $500,000 requires voter approval. Sales at the park, on the other hand, require just one vote by the assembly – that’s means major land sales can spend less time at the assembly table than the lease for an espresso stand at the airport.
But White says he’s confident that businesses will come through.

“I feel the development’s coming. I really do.”

And when it does, he says, there had better be somewhere for it to land.