The Assembly sold Lot #1306 to Sitka’s Community Land Trust in 2015 for a proposed cottage neighborhood. (Map courtesy of CBS)

After a tense debate and a close 4-3 vote, the Assembly denied a request from the Sitka Community Land Trust (SCLT) for financial assistance to clean up contaminated soil. The pollution was uncovered after breaking ground on an affordable housing project, which aims to build seven cottage homes on land held in trust. With their vote, the SCLT will have to look elsewhere for money.

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The former industrial lot was polluted by the city and the state over decades of use. While digging trenches this June, the Sitka Community Land Trust found a degree of pollution they weren’t aware of when buying the land from the city two years ago.

In 2006, citizens voted to dedicate the site to an affordable housing project (Informational Ord 2006-32 minutes and election results).

Last month, they brought the issue before the Assembly, requesting $47,000 from the Southeast Economic Development Fund to cover half the cost of cleaning up and building around the contaminated soil.  Assembly was torn about what to do with the budget ordinance (Motion and SCLT Agreement): who is responsible for those chemicals now and who should assume the cost of their removal?

In the end, the majority told the Sitka Community Land Trust to take care of the problem themselves. That included Richard Wein, Steven Eisenbeisz, Aaron Bean, and Matthew Hunter.

Both Wein and Bean mentioned how, in purchasing the land for $1 , the Land Trust did agree to cover any future soil remediation work. Wein wanted to uphold that contractual agreement to the letter and said doing otherwise would create a bad precedent. “If prior agreements can be breached, then the value of what this agreement tonight does to future promises…I’m not sure. You can’t keep making agreement after agreement, and breach it and breach it,” he said.

In 2014, the Assembly approved sale of Parcel 1306 on Halibut Point Road for $1. The SCLT assumed the risk of any further testing of soil and the majority of the Assembly wanted to uphold that agreement. (Excerpt from Ordinance No. 2015-56)

Assembly member Steven Eisenbeisz thought it best to pass the added cost on to home buyers. “I’m more in favor of the land trust dealing with their own issues on this and slightly increasing the price of the houses,” he said, arguing that the price of homes would not raise significantly – about $7000 on average.

Back of the envelope calculations by Wein estimated this would raise monthly mortgage payments by $30 to a 30 year period and $49 for a 15 year period. Keep in mind: with home prices unlisted, it’s tough to pin these numbers down. But the hypothetical figure was a touch point for several Assembly members during the debate.

“I would argue that $30 or $49 a month for a lot of people is quite a bit of money,” said Kevin Knox, on the opposing side.

Knox felt that tacking on any cost – even in the double digits – would undermine the goals of the affordable housing project. He further argued the city should take care of pollution it created. At the last Assembly meeting, representatives of the Sitka Community Land Trust said the Alaska Department of Environmental Conservation does not recognize waivers of environmental responsibility.

Given these factors, Knox, Ben Miyasato and Bob Potrzuski voted for the measure. With an even split, Mayor Matthew Hunter broke the tie.

“I keep coming back to $30 a month and I know that is a very, very huge amount of money for a lot people, as evidenced by the amount of information we get utility bills go up that much. However … I don’t like this, but I think I’m probably going to be the fourth no vote tonight on this one. That based on precedence this is going to set and the fact that this project can still get done, even without the city money. And this is not fun,” Hunter said.

Hunter stated earlier in the meeting that he hopes the land trust model is a success for Sitka, inspiring other communities with a shortage of affordable housing.

Land trust chair Randy Hughey inspects the oily sheen in a trench at the site of the Halibut Point Cottages. He hopes to find a way to mitigate the contamination without passing on the costs to future buyers “who weren’t even born when this happened.” (KCAW photo/Robert Woolsey)

While the Assembly may be opting out, the Sitka Community Land Trust is all in. They’re in the process of installing helical pilings to avoid digging deeper into petroleum deposits underground and shipping 120 cubic yards of contaminated soil to Juneau.

The cost of all this work is $88,000, nearly half of which will be paid for through the sale of a parking lot to a local vet clinic.

As for the other half of the tab the Assembly won’t pick up? Executive Director Mim McConnell says it must be paid sooner, rather than later. One option the board could consider when it meets on October 16th is selling some of its land.

“Especially the parts that we can’t build on. We’re backed up against a steep hill.  There’s land there. We would probably approach those neighbors and ask if they’re interested in buying the piece that fronts their property,” McConnell said.

What McConnell doesn’t want to see is – contrary to the Assembly’s thinking – is homeowners absorbing this cost. “That’s not what we’re about. I think somehow this needs to be dealt with in a way that doesn’t make life more difficult for the home buyer,” she said.

Board President Randy Hughey agrees. Both Hughey and McConnell were out of town at the time of the Assembly meeting and not able to testify before the Assembly. But over the phone with KCAW, Hughey was firm in saying that affordable housing was a chronic problem and that local government should play a bigger role.

“For 20 years, we’ve seen the demographics of the town change to an aging population, declining school population, and it’s my belief that affordability in housing is one of the critical factors in that change in demographics,” Hughey said. “We can fix that, but it’s going to take some sacrifice. It’s going to take more than just free land into a land trust to solve the problem.”

Be that as it may, the majority of the Assembly drew a line in the soil on the issue of contamination and voted to support the project with vocal praise, but not with cash.

You can find more coverage of the Sitka Community Land Trust here and of the Sitka Assembly here.