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Commission backs clearing title cloud on Kenai parcel, forwards ordinance to assembly
Summary
The planning commission voted Jan. 27 to forward an ordinance authorizing the borough to resolve a decades-old title issue on a Kenai property that originated with an erroneous 1970 tax statement and subsequent foreclosure and sale.
On Jan. 27, 2025, the Kenai Peninsula Borough Planning Commission voted to forward ordinance 2025-2 to the borough assembly recommending action to resolve title matters on a parcel in Kenai that was affected by an erroneous tax statement issued in 1970.
Aaron Hughes, land management officer, summarized the history: a 1970 tax statement was issued in error on property that belonged to the U.S. Department of the Interior; the Department of the Interior did not pay the assessed taxes, the borough foreclosed through court action and received a tax deed in 1972, and the borough then sold the property at a tax-foreclosure sale in 1977. According to Hughes, the erroneous recording of the 1977 tax-foreclosure deed created a cloud on title that the borough and state have worked for decades to resolve.
Hughes said the State of Alaska ultimately selected the parcel from the Department of Interior and obtained a patent to the property. The state is prepared to grant a patent to the borough contingent upon the borough being willing to convey the property to the current owner by merging title and clearing the title cloud. If the assembly authorizes the action, the borough intends to issue a quitclaim deed to the current property owner, identified in the staff report as Mary Stroman.
Commissioners asked why a tax deed had been generated on property in the federal estate. Hughes and other staff explained the process: delinquent taxes prompt a court foreclosure action, and upon judgment the borough requests a clerk’s deed. Staff acknowledged the error in this older case and said current practice includes requesting title reports and routing acquisitions through legal, finance and land management review to catch such problems in the future.
A commissioner asked whether staff had searched for other properties with similar issues. Hughes said most borough properties are acquired through municipal selections and that staff will review properties before a patent is conveyed to prevent recurrence. The commission made no substantive changes and unanimously forwarded the ordinance to the assembly.
The forward sends the matter to the assembly, which must act to resolve the patent and allow the borough to convey title to the current owner.
