The borough assembly has approved a $2.296 million contract to construct gravel streets and install buried utility lines at the Alder Top Village (Keishangita.’aan) subdivision near Shoemaker Bay, almost $400,000 more than the engineers estimate of $1.9 million.
The contract with Petersburg-based Rock-N-Road Construction, which was the only bidder on the job, will push total development costs for the 20 residential lots to about $4.1 million, more than double what the borough hopes to recover from the land sale.
The borough will put the lots up for online auction, looking to boost its revenues.
In addition to approving the work contract at its May 13 meeting, the assembly amended the borough’s plans for the auction, extending the bidding period another month. Bidding will start July 1 and close Oct. 31, instead of the original date of Sept. 30.
The intent is to allow potential bidders access to the lots closer to the projected substantial completion date of Oct. 30 for the road work and utilities.
The assembly votes were 6-1, with Jim DeBord the lone no vote.
Starting prices for the lots are set at the appraised value of the parcels, generally about half an acre each. New appraisals presented to the assembly on May 13 set the values at between $49,800 and $70,100, depending on the lot size and location on the property. That’s an increase of between $3,400 and $5,900 per lot from the previous appraisal in 2023.
The borough will offer financing for buyers who cannot or do not want to pay in cash — terms to be determined later — in hopes of attracting first-time homeowners.
Much of the money for the development of the former federally run Native boarding school land — which Wrangell took ownership of in 1996 — is coming from the borough’s land development fund, which will receive the proceeds of the land sales.
“We’re kind of spending money we haven’t even collected yet,” said DeBord, who voted against approval of the additional draw on borough funds and the Rock-N-Road contract.
He was disappointed that the borough received only one bid for the work.
DeBord explained his reluctance to take more from the land development fund by reminding assembly members he has long hoped that the borough would use some of the reserves in the account to pay for playground improvements around town.
A $300,000 federal grant will help pay for the subdivision project, along with possible contributions from the electric utility fund and water and sewage utility fund. Both accounts will receive additional revenues as the lots are developed and start paying for utilities.
The borough will also receive property taxes as the parcels are transferred to private ownership.
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