The Sitka Assembly is moving forward with plans to lease a large parcel of city-owned property to Shee Atiká Incorporated to develop a tourist destination about seven miles from downtown.
Shee Atiká Inc. was the only respondent to the city’s “request for proposals” seeking bids on 17 acres near the end of Halibut Point Road.
Sitka’s urban Native corporation says it plans to partner with a new concession “Adventure Sitka” led by Halibut Point Marine’s Chris McGraw to develop a tourist attraction on the property. Shee Atiká’s initial offer was $50,000 a year to lease the land, and $4 dollars per visitor in revenue sharing for the city when negotiations began in May.
City Planning Director Amy Ainslie told the Assembly that both sides had to haggle up.
“The RFP proposed an original lease rate of $50,000. We countered with $70,000,” she said. “Shee Atiká and its partners countered at $60,000. So that’s sort of our last offer that we received was an annual lease rate of $60,000.”
When it’s complete, Shee Atiká’s development, tentatively called the “Harbor Point Cruise Development Project” will include kayak and canoe tours, zip lines, and cultural demonstrations around gardening practices and traditional foods.
Shee Atiká CEO Karl Potts said the project would help the city handle the influx of cruise ship passengers predicted for next summer.
“A year from now, we’re hoping that we will have about 400,000 or so people stepping off their boats and onto the shores of Sitka. The year after that, and the year after that more and more. A rising tide is going to lift all boats,” he said. “In Sitka, this is a good project, certainly for us financially or it wouldn’t be involved. It’s good for the city.”
When it came time for the assembly to deliberate, most voiced support for the lease arrangement. Assembly Member Rebecca Himschoot explained her support.
“And from everything I’m hearing from Planning and people on the ground, it’s not a property that could easily be used for housing,” she said. “And if it could be used for housing, it would be extremely high end housing. So for that reason, I would like to see something done with this land. So I’m a yes vote tonight.”
But Assembly Member Thor Christianson hesitated when he saw that the visitor fees would increase by 10 percent after 10 years. He said he wanted to see more regular rate adjustments figured into the lease.
“The one deal breaker for me is that lack of escalation on the passenger fee of the $4,” he said. “We don’t know what’s going to happen with inflation. 10% may be reasonable, it may not be.
After some discussion, a motion was made to direct city staff to develop a lease based on the negotiated terms outlined by the Planning Director. That passed 4-1 with member Thor Christianson the lone holdout.
The lease will come back before the assembly for final approval at a future meeting.