MEMORANDUM 07-11

TO: Mayor Hornaday and Homer City Council

FROM: Walt Wrede

DATE: January 19, 2007

SUBJECT: Back-Up Information / Ordinance 07-03 / University Land

This memorandum provides some background information regarding Ordinance 07-03. Ordinance 07-03 was introduced at the last meeting on January 8. The ordinance authorizes the City to accept title to approximately 275 acres (two parcels) of land presently owned by the University of Alaska. The land is located immediately to the North of the Borough baler facility and the DOT/PF maintenance shop on the Sterling Highway. The land contains a significant portion of the Baycrest Ski Trail system which has historically been maintained by the Kachemak Nordic Ski Club. Diamond Creek runs through the middle of this property and it contains a mix of high value wetlands, forest, and important wildlife habitat. Recreation, primarily skiing, has been the primary human use.

The Kachemak Heritage Land Trust (KHLT) has secured a grant from the Forest Legacy Program to purchase this property and the University has indicated that it is willing to sell it for fair market value. KHLT has completed its due diligence tasks including obtaining an appraisal and Phase I Environmental Assessment. I have reviewed these documents. The grant from the Forest Legacy Program comes with some strings attached. One is that the land can only be used for conservation, recreation and forest enhancement programs. The other important stipulation is that the title must be held by a municipality. For a variety of reasons, the City of Homer is the logical and most appropriate choice.

There has been a series of discussions between the City, KHLT, and the Nordic Ski Club about how this might work. The basic idea is this. Once KHLT secures the rest of the money it needs (approximately $200,000 by July 1), it will purchase the property from the University. The title will be transferred to DNR, then to KHLT, and then to the City. The idea is that the City will simply own the land and the Kachemak Nordic Ski Club will continue to maintain the trails as they always have. The City and the Ski Club would enter into a memorandum of agreement that addressed the roles and responsibilities of each party.

The property would not be managed for recreation at all in the summer since the trails are built as winter trails and traverse many areas that are wet and boggy. If summer trails are desired at some point in the future, the City could partner with the Soil and Water Conservation District or other appropriate entity to develop and maintain the trails. The Ski Club understands that at this point in time, it should not expect any funding or operational support from the City.

There was little or no discussion by the Council about this ordinance at the last meeting when it was introduced. So, I have tried to anticipate the types of questions and concerns that might come up. Following is a brief discussion of the issues that I believe are most important.

Liabilit^y Issues

Municipalities have limited statutory immunity for recreational activities under State law but those Iimitations are very significant. For example:

• AS 9.65.290 (a) states " A person who participates in a sports or recreational activity [which includes skiing, snowboarding, snow sliding, and others] assumes the inherent risks in that.... activity and is legally responsible for all injuries or death to the person or other persons and for all damage to property that results from the inherent risks in that... activity."

NOTE: This section does not apply to a civil action based on the negligence of a provider if the negligence was the proximate cause of the loss, so the provider remains liable for negligence (AS 65.290 (c)). This is the same liability the City current has for negligence in park maintenance, street maintenance, etc. The City can reduce this risk further by requiring the Nordic Ski Club to carry sufficient insurance with the City as an additional insured and holding the City harmless, by requiring the proper signage at trail heads, and by having skiers sign waivers.

The City also has limited statutory immunity for injuries that occur on unimproved land. For example:

• "An owner of unimproved land is not liable in tort, except for an act or omission that constitutes gross negligence or reckless or intentional misconduct , for damages for the injury to or death of a person who enters onto or remains on the unimproved portion of land if (1) the injury or death resulted from a natural condition of the unimproved portion of the land or the person entered onto the land for recreation: and (2) the person had no responsibility to compensate the owner for the person's use or occupancy of the land." (AS 9.65.200(a). "In this section, `unimproved land' includes land that contains a (1) trail...". (AS 9.65.200(c).

NOTE: It is debatable whether this statute would apply to the Baycrest land that is purposely maintained as a cross country ski trail. However, the statute may apply if a skier or other person wanders off of the groomed and maintained ski trails. It may also apply in the summer because no summer trails or other facilities exist. The land will remain in its natural state.

Insurance Issues:

The Kachemak Nordic Ski Club already carries Commercial General Liability Insurance in the amount of One Million Dollars and the Policy includes additional insurance for special events like " Ski to Sea". The Ski Club has indicated that it is willing to add the City of Homer as an additional insured. We believe this policy is sufficient and is consistent with what we would have recommended. It is the same policy required by the Borough (much of the ski trail system is on Borough land). This insurance policy has been reviewed by the City's insurance carrier (AML/ JIA). AML/JIA reported that this policy is a good one and provides sufficient protection for the City as long as the City is named as an additional insured. Further, AML/JIA reported that the City's existing umbrella policy would protect it further and it can be extended to the ski trails and this land at no additional cost.

Elements of the Memorandum of Understanding

If KHLT is successful in acquiring this land and the City becomes the owner, it is anticipated that the City would enter into a Memorandum of Understanding with the Kachemak Nordic Ski Club. This MOU must still be drafted and would have to be approved by both the Council and the Ski Club Board of Directors before it would be enacted. The basic elements of the MOU would include:

The City Agrees to:

• Accept ownership of the land

• Comply with the deed restrictions that stipulate that the land must be used only

for recreation, conservation, and forest enhancement projects. • Classify the land as either park land or open space/recreation.

• Allow the Nordic Ski Club to continue its ski trail maintenance program.

The Kachemak Nordic Ski Club Agrees to:

• Maintain Nordic ski trails is a reasonably safe condition considering all
circumstances and comply with all relevant statutes in that regard.

• Submit, on an annual basis, a trails plan and current strategic plan

• Obtain approval from the City in advance for all major proposed improvements on the land such as bridges, culvert installation, permanent signs, parking areas, structures, development of new trails, etc.

• Comply with AS 5.45.060 regarding signage. This includes signs warning skiers of inherent risks and their own liability.

• Maintain a Commercial General Liability Insurance Policy in the amount of $1 Million dollars with additional insurance for special events as appropriate. The City shall be named as an additional insured.

• Hold the City Harmless and indemnify the City for any personal injury, death, or other loss arising from use of the property for skiing activities.

• Require participants to sign an assumption of risk and waiver of all claims that releases both the Ski Club and the City. This would apply to participants in special events, ski club members, and volunteers.

RECOMMENDATION: In my view, the long-term benefits to the community (recreation, open space, habitat and watershed protection) of securing this land and preventing it from being sold on the open market far outweigh the risks that would be assumed by the City. I believe this is an important opportunity that the Council should jump on. This is a gift to future generations of Homer residents. Recommend approval of Ordinance 07-03.