By SHANNON HAUGLAND
Sentinel Staff Writer
The Assembly moved a step closer to selling the former Sitka Community Hospital properties Tuesday night, voting 6-1 to adopt an ordinance on first reading accepting the SEARHC offer of $8.25 million for the property.
The text of the ordinance states that second reading will take place on Oct. 12, after the results of an advisory ballot in the Oct. 5 city election are known.
The city-owned parcels being sold are at 209 Moller Drive, 302 Gavan Street and 202 and 204 Brady Street.
Voting in favor of the ordinance were Thor Christianson, Kevin Mosher, Crystal Duncan, Kevin Knox, Rebecca Himschoot and Mayor Steven Eisenbeisz. Valorie Nelson voted against.
Before casting his vote in favor, Mosher said, “Sitka is still asset rich and cash poor. We have a lot of needs, there are many things we have to do. People have come to expect certain things and keep costs low... This is an attempt to raise revenues, to not raise taxes and keep the quality of life. I look forward to the public vote.”
Crystal Duncan, left, chats with fellow Assembly member Rebecca Himschoot during a meeting break after the Assembly renewed a mask mandate Tuesday night at Harrigan Centennial Hall. Masks are required in indoor public spaces through September. (Sentinel Photo by James Poulson)
SEARHC plans a $38 million investment in the properties, including renovations to Sitka Community Hospital, adding parking, removing the Mountainside clinic and building a three-story, 28-unit apartment complex with housing available to SEARHC employees as well as the general public.
In other business at Tuesday’s meeting the Assembly extended the COVID mitigation face mask mandate for one month, requiring nose and mouth covering to be worn in certain indoor public spaces.
Also at the meeting the Assembly approved the sale of another tract of the old city shops land to the Sitka Community Land Trust, and final reading of an ordinance to lease property at 4951 Halibut Point Road to Shee Atika Inc. for a recreation and cultural attraction for tourists. (See story, this page.)
SEARHC Offer
The decision to move the hospital sale ordinance on for second reading followed a one-hour closed door discussion by the Assembly.
SEARHC approached the city about a year ago about purchasing the property, and was the only entity responding to the city’s request for proposals issued in the spring.
The Native-owned health consortium submitted a 40-plus page illustrated document in response to the RFP, not only offering the appraised price of $8.25 million, but outlining planned on-site improvements that will total $38 million, including the purchase price.
“I have no problem approving it on first reading,” Christianson said. He said the relevant piece of information at this time is the price being offered by SEARHC.
Nelson said she could not vote in favor, “as much as I’d like to vote yes.” She said she’s felt for the past two years that the community hasn’t been well served from the start by selling the hospital business to SEARHC and she has similar feelings about this offer.
This project is separate from other SEARHC projects in the works, including the replacement of the Mt. Edgecumbe Medical Center currently under way, and which SEARHC says will cost $200 million.
From the public, Richard Wein said the best use for the former SCH property is for SEARHC to continue providing needed services there, but the better move for the city would be a lease, not a sale. He said a number of questions about the benefits of the sale to Sitka remain unanswered.
Nancy Yaw Davis said she did not have a enough time to review the plans in the few days since they were made public, but believes the $8.25 million offer was too low for such a large piece of property.
Maegan Bosak, director of property and lands for SEARHC, said the benefits to Sitka from the sale include construction jobs, an improved facility and property, adding to the housing stock for young professionals and families, and more full-time equivalent positions in healthcare.
Responding to a question from Himschoot, Administrator John Leach said the city and SEARHC employed the same out-of-town professional for their separate appraisals.
Leach clarified today that the city hired Julie Deneen of Lafayette, Colorado, for the appraisal in March this year. In June SEARHC ended up hiring the same company.
“In my conversations with Julie, I reiterated with her that our appraisal is confidential except for the intended user, which is CBS (City and Borough of Sitka), but we didn’t have an exclusivity agreement with her so there was nothing preventing SEARHC from hiring the same appraiser,” Leach said.
City Finance Director Melissa Haley, who was on the evaluation team for the proposals, said today the city hired the appraiser to assure that the city had a minimum sale price that could be used in the evaluation of any offers that came in from the RFP. The appraisal represents the expert’s calculation of the fair market value for the land and buildings in their existing condition.
If the city accepts the SEARHC offer, the amount of the sale, minus the costs, would be deposited into the city’s permanent fund. A deposit of $8.25 million would increase the balance of the Pfund by 35 percent, Haley said. Earnings from the fund’s investments added $1.2 million to the city’s general fund last year, Haley said. She gave an estimate that the “net impact on disbursements, when looking at the three-year average we use” would be over $300,000 per year in additional income for the city.
Face Covering Mandate
After hearing comments from the public – six-to-one against the ordinance – the Assembly voted to extend the city face covering mandate to September 28, or sooner if the city’s COVID risk level drops from “high” to “moderate.”
Sitka’s risk level has been “high” consistently since July. “High” is currently defined as more than one case per day, based on a two-week rolling average,
The vote in favor of extending the mandate was 5-2, with Eisenbeisz and Nelson opposed. Five votes were needed to pass since it was extension of an emergency ordinance.
The emergency ordinance has been in effect since July 29 when it was passed at an emergency meeting. At that time the 14-day rolling average was about 20 per day. Today the average is 7.29 positive tests per day.
Face masks are required for those age 2 and above in “certain indoor settings,” with a $50 fine for violation. The “indoor settings” include grocery stores and pharmacies, buses and taxis and eating and drinking establishments, except while eating or drinking. There are exceptions for those who have trouble breathing, children under 2, those who are deaf and hard of hearing and those for whom the mask would impair communication.
The police department has not issued any citations and there has been only one recorded complaint to police about a resident refusing to wear a mask in a store, police spokeswoman Serena Wild said today.
Six from the public spoke in opposition, and one spoke in favor. The one in favor said she was there on another agenda item but felt compelled to address some of the previous comments.
Those who spoke against were passionate in making their cases against the mandate and covered a range of topics. For some, it was about specific points of the ordinance. Others called into question the efficacy of masks as a tool to prevent the spread of COVID, opposed the masking of children as young as 2, and criticized some of the public health strategies of fighting the virus.
Some Assembly members spoke in favor of the mask mandate extension.
“Masks aren’t perfect, nothing is, but it’s one of the things we can do,” Christianson said. “It’s not particularly onerous: whenever you’re inside around other people, wear a mask. ... It’s one more layer of Swiss cheese.”
Nelson spoke against the mandate, saying she believes it will create more problems than it will solve.
Mosher said he is trying to listen to the health experts, including the state chief medical officer, Dr. Anne Zink, who has spoken in favor of masks and vaccines as tools to help prevent the spread of COVID. He said he saw the mandate as a compromise, and suggested the Assembly look at a higher age than 2 years old for the mask requirement.
Duncan reviewed some of the statistics for COVID in the community and across the state, including some hospitals in Anchorage nearing capacity for ICU beds
“I support (the ordinance) because I think it’s having a positive impact,” she said.
In other business, the Assembly:
– appointed Catherine Mohn to the Health Needs and Human Services Commission.
– approved retail marijuana store license renewal application for AKO Farms at 1210 Beardslee Way.
– approved on first reading an ordinance to authorize the transfer/sale of a portion of City and Borough of Sitka’s “Old City Shops” property located at 1410 and 1414 Halibut Point Road to the Sitka Community Land Trust for an affordable housing project. (Story in Thursday’s Sentinel.)
