The Seward Phoenix Log - News of the Eastern Kenai Peninsula since 1966

By Wolfgang Kurtz
LOG Editor 

It's crunch time for Jesse Lee Home

 

Leon Youngblood | The Seward Phoenix LOG

The vacant main residence building on the grounds of the former Jesse Lee Home has a commanding view of Resurrection Bay through broken out windows. Recent work stabilized the roof, structure and foundation for protection against further deterioration in the hopes that a complete restoration is near.

According to advocates for the restoration of Seward's long-abandoned Jesse Lee Home building and the establishment of a boarding school there, the City of Seward must sell the property or face the prospect of demolishing the derelict structure.

Friends of the Jesse Lee Home, including board members and staff working for the charter of the Balto School, recently concluded a series of meetings with city administrators by appearing before city council in a work session and at the May 27 council meeting. The central focus of FLJH was the argument for transfer of the city-owned land and buildings to the nonprofit.

University of Alaska professor Paul Ongtooguk, chair of the Balto School academic advisory board, also addressed the focus of the new school, saying that a school that focussed on developing Native leadership skills and qualities would be a welcome shift away from eyeing rural Alaskan populations as a labor pool to funnel through vocational programs.

Laura Hensley, education director for the Balto School, said that the Balto School boasted support from the Kenai Peninsula School District and proferred a letter of support from KPBSD Superintendent Steve Atwater saying as much. According to Hensley the evolving Balto School has worked closely with the district and the Alaska Department of Education in developing a curiculum that will meet requirements and pass standards for the upcoming charter school application by the organization.

Consultant Steven Hamilton introduced a new economic impact study for both construction and operations of the proposed school. The construction phase of the project estimated 127 jobs split between Anchorage and Seward, with 78 workers in the Kenai Peninsula Borough. Overall the study pegged the total amount of economic activity at $21.2 million with $9.9 million in the area.

With a projected 2018 start-up date and an initial enrollment of 75 students, the study claims that 21 local jobs will be created with $2.9 million in related economic activity. However, Hamilton said this was a preliminary view of the possible economic benefit from the project based on the current state of planning and incorporated numerous assumptions.

Citing funding concerns for the project, and dim prospects for the historic building otherwise, project manager and FLJH Executive Director Kirsten Vesel argued for the transfer of the property as soon as possible. The nonprofit claims to have $12 million banked toward the restoration of the former orphanage and school which was shuttered in 1964 after the earthquake that year. However, the FLJH project budget outlines $18.5 million in costs toward making the building functional, leaving a $6.5 million shortfall.

With current state grants at risk of lapsing and the remaining balance not likely to be funded due to spiralling state finances, FLJH has been exploring alternative methods of bridging the gap. However, as Vesel explained, the most attractive prospect is a low interest loan that will require the transfer of the property.

Vesel also outlined the demolition and disposal costs that the city would face if it retained the property. She stated that if a transfer could be negotiated for the stated figure of $2, FLJH has funds at the ready to pay for site cleanup, hazardous material removal and utilities improvements, which would enhance the city's position in the unlikely event that the property reverted to city.

Seward Assistant City Manager Ron Long gave a nod toward that possible advantage and said that the estimates Vesel cited including $216,000 for hazmat abatement, $105,000 for site preparation and $100,000 for demolition were likely to be as good as any. However, he noted that city administration is weighing the benefits of the possible transaction against cost recovery in the case where the property reverts to the city again.

Long said that city administration would look favorably on a plan contingent on specific improvements that would first address liabilities and then proceed to site improvements that would be of value in the event of reversion. As one of the potential improvements, Vesel cited a figure of $316,000 for utilities upgrades in the FLJH list of tasks that could get underway this summer using funds that the organization has on hand.

However, Vesel also alluded to exposure that the city faces from grant funds already spent on consultants and stabilizing the building's foundation and roof. Apparently, $1 million has already been spent to those ends under a grant and associated covenant, thereby encumbering the property. That risk was downplayed by Long, who explained that good-faith efforts toward the project by the city would defuse any such risk.

This was picked up on by Councilor Iris Darling, who questioned whether further spending could become the city's liability. Councilor Christy Terry also questioned how the transfer would be justified according to the requirement of proof that the taxpayer's interest be served. She said that any progress on an agreement would require an aggressive timeline with enforceable milestones.

As Vesel emphasized, if the project is to include the renovation and use of the former Jesse Lee Home campus the city must make a decision to transfer the property before funding is withdrawn. Although the Balto School has been developed with the possibility in mind that dedicated grounds and building may not be made available, there is a question of whether the momemtum behind the curriculum initiative is captive to the Jesse Lee Home property.

This uncertainty was highlighted when Vesel concluded by seeming to say that without the property transfer, the entire project may falter. With state grants and possible financing dependent on the transfer of the property, the clock is running out on efforts to give the Balto School a home of its own.

 

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