As seen in this promotional image from the Gary Paxton Industrial Park, the old pulp mill utility dock is visible just behind and to the right of the park’s new multi-purpose dock. The GPIP board has one caveat for any possible bidders on the utility dock: To make the new multipurpose dock serviceable for Panamax ships, a forward mooring bollard may have to be installed near — or possibly on — the old utility dock. (GPIP image)
The utility dock at Sitka’s industrial park is going up for sale.
The board of directors of the Gary Paxton Industrial Park on Tuesday (12-18-18) voted to solicit proposals for the purchase of the dock, which dates to the mid-20th Century.
By putting the dock out to bid, the park hopes to avoid controversy surrounding a similar transaction ten years ago that cast shade over the founding of one of the state’s largest seafood processors.
The decision to put the dock for sale under competitive bid was prompted by an offer last month from Hanson Maritime, Inc., who proposed buying the dock in exchange for the cost of repairs — a deal reminiscent of the 2008 transaction that saw the former pulp dock and warehouse go to the then newly-organized Silver Bay Seafoods.
Municipal attorney Brian Hanson — no relation — tried to unravel some of the history behind the 2008 deal with Silver Bay for the current board — even consulting with his predecessor Theresa Hillhouse — but he didn’t have a solid answer.
“I’m giving you this background because I’m trying to put together why this wasn’t competitively bid back then in 2008,” said Hanson. “Because frankly, neither in the resolution, or in the recitals to the purchase contract were there any references to the charter or the code. Or excepting from the charter or the code. There were references to the purposes of the then-Sawmill Cove Industrial Park — now GPIP — to this language about ‘economic development and job creation,’ but there were no references to excepting this from competitive bidding. And I was curious about that: Why would they just completely ignore that? And I frankly didn’t find an answer to that.”
Hanson alluded to the possibility that Silver Bay was one of several tenants of the pulp warehouse and dock at the time, all of whom were given the option to purchase — and that might have satisfied the requirement of the charter that municipal property be sold by competitive bid.
Board member Dan Jones had a different perspective: he thought the arrangement with Silver Bay — which involved credits for expenses the processor incurred repairing the pulp dock — was due to the unique nature of the property, which made it otherwise unsaleable.
Silver Bay eventually got the dock and warehouse, and went on to become a major player in the Alaska Seafood Industry, but the transaction prompted a citizen initiative and embroiled the city in a protracted legal battle that found its way to the Alaska Supreme Court.
The lack of competitive bidding for the Silver Bay dock and some other park properties created problems that Jones hoped to not repeat.
“If we can’t explain why we did it before,” said Jones, “we’re going to open up the question of ‘Can those be challenged?’ Some of those sales were challenged.”
So the board formally voted down the offer by Hanson Maritime, and instead approved a request for proposals drafted by park director Garry White, who argued that the scoring of bids should favor the park’s mission.
“The main thing is to create jobs, right?” said White. “So I put down qualifications, 1-25 points. Conceptual plan — what is this going to do, how is this going to help the waterfront, is it going to fit into the overall strategic plan of the park, is it going to create jobs? Is it going to bring in more revenue and job creation and help the community? And that’s 1-35 points. So you’ve got 60 points tied up in ‘Can this person do this and what does their plan look like?’”
That’s 60 points out of 100. White proposed scoring price at only 15 points because he felt the priorities lay in the mission and not “can we get a whole bunch of money.”
The board agreed to the strategy, on the understanding that there may be no other proposals except the one from Hanson Maritime. Company principal Lee Hanson was in the audience for the meeting. He told board members, “I’m good with it.”
The deadline to submit proposals for the purchase of the utility dock at Gary Paxton Industrial Park was set at January 17, with the hope of reviewing offers in February and March, and finalizing a sale by the end of the fiscal year in June.
The park board’s vote to issue a request for proposals is a recommendation to the Sitka Assembly, which has final authority over the disposal of property at the industrial park.
