A request for a fire hydrant has underscored a need for a clear policy Soldotna city administrators can follow when considering requests from area property owners that the city extend their utility services.

The request considered by city administration and the council during a work session on June 23 came from Alaska Christian College, which is asking the city to extend its water main so the college can put a fire hydrant outside a gymnasium slated for construction.

ACC President Dr. Keith Hamilton, who spoke on behalf of the college, said the gym would be an asset for all of the central peninsula community and that the college wants to enter into a service agreement similar to what Soldotna has executed over the last 20 years or so.

The college is located near Kenai Peninsula College, in an area between Poppy Ridge Road and Kalifornsky Beach Road. Soldotna’s water system ends about 800 feet from where ACC’s new gymnasium would be built.

There are about 23 properties outside of Soldotna city limits that are connected to Soldotna’s water and/or sewer, most of which are along Funny River Road between the Sterling Highway and the Soldotna Airport, Soldotna City Manager Stephanie Queen said Monday. Those properties have individual service agreements with the city, which establish rates and other terms of service, and formalize the property owner’s consent to annexation of the property into the City of Soldotna.

Such requests, city administrators say, are becoming more common in recent years but individual service agreements, which Queen said are meant to be one-off, may warrant a clear process administrators can work from when requests come in.

“It’s the type of project that we’re likely to encounter from more properties and more developers than just this singular request,” Queen said.

Soldotna Public Works Director Kyle Kornelis, who also attended the work session, agreed that the city would benefit from having a formal policy for handling requests because of increasing frequency in recent years.

“I think that it would be wise to take a hard look at it and to look at potential code updates and policy changes and have some instruction for what an applicant or an entity would do to apply for this,” Kornelis said during last week’s work session.

Decisions regarding extension of city services outside city limits are particularly difficult, Queen said, because they are unplanned.

“We have a 20-year master plan for our utility system that anticipates growth and expansion, but we don’t plan for extensions outside the city,” Queen said. “So we’re coming to each of these conversations really ill-prepared to assess whether this particular expansion is in our best interest.”

Soldotna Vice Mayor Lisa Parker asked if there was an alternative to having the college sign an individual service agreement, adding that some entities who signed such agreements with the city are now protesting annexation, which is part of the agreement.

“Right now, the people that signed the agreement 20 years ago are some of the people who protested and said, ‘We don’t want to be part of the city,’ even though they signed an agreement saying they would be,” Parker said.

Queen said an alternative to entering into an agreement would be to annex the parcel requesting the services, which has been done in Soldotna with city-adjacent properties at the owner’s request. That alternative, however, would give final say to the Local Boundary Commission.

Council Member Linda Farnsworth-Hutchings echoed the concerns raised by Parker.

“This last Local Boundary Commission has not been favorable to the City of Soldotna at all,” Farnsworth-Hutchings said. “I just foresee us going through all these steps and having it fail again.”

Hamilton said that while ACC has specifically requested to enter into an agreement with Soldotna that is similar to what they’ve done historically, the college’s ultimate priority is getting access to the city’s water supply. If the city consented to offering them an agreement, Hamilton said the college would not attempt to protest annexation later.

“We’ll stick by our word,” Hamilton said.

While property owners located outside city limits pay utility fees, they do not pay the same taxes that property owners inside city limits pay.

Utility fees go directly to Soldotna’s Utility Fund as revenue to support its operations, regardless of whether the ratepayer is inside or outside of city limits, Queen said. That fund is subsidized in part by the resources from the city’s General Fund, including departments which are primarily funded by property and sales tax collected within city limits.

“It’s just an example of something we will want to evaluate further, to ensure the rates we charge are appropriate, and provide for equity among utility customers and the general public,” Queen said via email.

When asked why the college was interested in remaining in the borough instead of being annexed into Soldotna, Hamilton cited a good working relationship with borough administration, lower sales tax in the borough than in Soldotna and different building codes between the two municipalities.

Queen said Friday that, moving forward, city administration will do additional research to bring more than one option for a policy review for the city council to consider.

“Updating our formal policy will be beneficial, as it will provide clarity for property owners who desire City services, while ensuring our staff can respond in a consistent and timely manner,” Queen said via email. “And it will reaffirm that we’re applying municipal resources in accordance with the Council’s priorities, and goals.”

The council’s full work session can be viewed on Soldotna’s website at soldotna.org/streaming.

Reach reporter Ashlyn O’Hara at ashlyn.ohara@peninsulaclarion.com.