On Monday, the City Council struck down a motion to reconsider a failed Breeze Inn lease transfer from current owner Juris Mindenbergs to Elliott Jackson, owner of the Van Gilder Hotel, the Marina Motel, and seven local restaurants. The motion was initially introduced by Council Member Mike Calhoon after the Council failed the original resolution unanimously on Jan. 9 amid an outpouring of community opposition, largely based on Jackson’s reputation for employee mistreatment and code noncompliance. Calhoon stated a need to base the decision on facts rather than hearsay as his grounds for reconsideration.
“After the meeting on Jan. 9, I did not feel that we had received all the information that we needed to make the best-informed decision that we could make,” said Calhoon. “I felt that, based on some of the information that we’ve had tonight, that that was what was missing, and I did not want us to make this decision just based on emotion. I wanted it to actually be made on concrete information, and I did not feel that we had that at that meeting.”
Before the motion was introduced, the council heard from 12 people speaking in favor of the lease transfer, including seller Susan Mindenbergs and Jackson himself, both of whom had been absent from the Jan. 9 meeting.
“I thought Resolution 2023-001 would be a simple administrative process like most reassignments usually are,” Jackson said. “It is my intention to keep the Breeze open year-round… My goal is to make Seward Hospitality Group employee-owned. That’s my exit out is to actually sell stock back to my employees and have them run it and have them keep growing it… I’m a true Alaskan who has worked hard to achieve the American dream. I got ahead in life by working my ass off and personal sacrifice. I did not inherit the g**damn thing—excuse my language. I continue to invest in myself to become a better person, and we also invest in this community to make it a better place to live.”
“The perspective that you did not hear at the Jan. 9 meeting was that of the business owners,” Mindenbergs said, “and now you have heard from the business owners, and they are collectively saying to you, ‘Don’t do this. This is a bad precedent. This is going to scare potential buyers from obtaining city leases.’ This is not good for the city of Seward. This is not in the best interest of the city. At the Jan. 9 meeting – and I watched the video too – you were hearing heartfelt concerns from employees, and I understand that. But you didn’t hear any facts. What you heard were rumors and innuendos and speculation, because it’s scary to have things change, but things change all the time. In contrast to the rumors and innuendos, when you asked your own staff what was going on, they said, ‘Mr. Jackson’s in compliance. He’s cooperating with us for codes.’”
Ultimately the reconsideration lacked the necessary three-fourths majority – five votes for a seven-member council – to pass, and the motion failed by a 4-3 margin, with Council Members Randy Wells and Mike Calhoon voting in favor, along with Vice Mayor John Osenga and Mayor Sue McClure. Council Members Bob Barnwell, Kevin Finch, and Liz Demoss voted against. Wells told the Journal on Tuesday that his vote in favor was cast only as a means of entering his concerns over Jackson’s past compliance record.
“I wanted the public to know that this was not a popularity contest, as implied,” he said. “This was not a picking on somebody, as implied, or backdoor deals or any of that. I wanted to bring it all out so that the business owners who were nervous – we’ve got a lot of business owners who were nervous, who have city-leased properties – they said we were going to be setting a precedent and devaluing these properties. In my opinion, that’s not the case. We want the properties to be the highest value possible, and you have to maintain them.”
Because of the motion’s failure, Wells would not have an opportunity to share his concerns until the close of the meeting, after a visibly angered Jackson took the podium for citizen comments.
“This is bulls***t,” Jackson said in his address to Council. “I should’ve been heard. You did not hear me… I should be able to do business – I should be able to buy business – I should be able to sell business to whoever the hell I want to. Same thing with all these other business owners. I’m supposed to read something here from my lawyer, but I’m probably too pissed off to do it. I mean, I feel so frickin’ miserable for Juris right now. It’s unbelievable. He worked his ass off. He should have the right to sell to whoever he wants, and you guys just screwed businesses across the board here.”
Toward the end of his address, during which he apologized for his use of profanity, Jackson made reference to possible legal action.
“Maybe I should take my money off the road and basically reinvest somewhere else,” he went on, “and you guys have one less entrepreneur in this town at that point, and that’s bad. You guys are losing business owners, and this unfortunately I think is going to cost us a lot. This is what’s coming. I grew up fighting. Literally. On the ice, off the ice. This cost me a lot, but guess what – I’m successful, and I will fight. And I’m going to fight, so basically, be prepared for that, because you guys made one hell of a mistake.”
In his closing comments, Council Member Randy Wells surprised the Council with a laydown outlining several pages of Jackson’s past code violations across all his businesses.
“Nobody on Council had seen that packet until last night at the end of the meeting, when I passed it out,” Wells told the Journal. “The issue is the ongoing violations and the refusal to bring the places up to actual code. It’s like the same violations over and over and over again, and it just sets a precedent.”
Noteworthy in the laydown were a number of ongoing fire and safety inspection failures that persisted for years without action taken to correct them. Among the inspection documents, memos from fire safety officials detailed the ongoing nature of many of the violations. Regarding the Van Gilder hotel, one letter from Assistant City Manager Stephen Sowell to City Attorney Sam Severin was dated Sep. 20, 2021.
“Mr. Jackson came in this morning at about 8:30am to speak with us regarding the issues described in the letter that was sent in August,” Sowell wrote. “In summary, he was hoping the City would accept the windows in Van Guilder being replaced in a staged fashion over the coming years as opposed to all at once prior to opening next year. We responded that until the windows (and all of the other items on the list described) were completed, no business license would be issued. His response was that if that is the case, he will not open the Van Gilder. I will leave out the colorful language and other rhetoric. Just wanted to be sure to pass along this information for reference. While the City remains hopeful that the life safety issues are addressed, it does not appear that compliance will be forthcoming.”
Another memo from Fire Chief Clinton Crites to the city clerk’s office was dated Feb. 24 of last year.
“On 8/13/2020 I wrote a letter to community development and CC' d Mr. Jackson (email and certified letter) approving his business license so he could obtain COVID CARES money for each hotel location in hopes that money could be used to correct deficiencies,” wrote Chief Crites. “In that letter I advised no occupancy shall be allowed in the Van Gilder until conditions were deemed safe by the Fire Department. In 2021 Mr. Jackson had customers staying in the Van Gilder without correction to violations. Additionally, rooms above the Sea Salt were being used as overflow for the Van Gilder and is in violation of his CUP.”
In an overview of the documents, Wells pointed out that several code and safety violations went unaddressed for a number of years, only being corrected in instances when liquor license renewals were at stake.
“The city' s historical data relating to all code and permit dealings with Mr. Jackson and the entities he represents show additional precedents,” he said. “From ongoing fire and safety failings, for not maintaining fire extinguishers, fire suppression systems, restaurant hood ventilation, emergency exits, proper emergency lighting, and not following building code permit requirements. Even the basic code of maintaining the snow and ice on sidewalks around these locations hasn't been done consistently if done at all. These issues are not at just one or even two locations, but each location.”
“It’s all public record,” Wells told the Journal on Tuesday. “If somebody wants to find out this same data on any other business in town, including my own, they just have to call and request a public record. The reason why I did it this way is because a lot of people felt after the Jan. 9 meeting that this was a popularity contest and a bunch of hearsay, and I wanted to prove that that wasn’t the case with my vote.”
For the full text of Wells’s 30-page laydown, including a list of code violations, see this article on our website, www.SewardJournal.com.