‘We need to get Telephone Hill off our plate’: Mayor proposes dividing neighborhood into three lots

One lot envisions 20-30 units of housing, other two lots would be sold as-is in competitive bid; mayor says idea is for city to do no further work or spend additional funds

A map shows a proposal by Mayor Beth Weldon to divide the Telephone Hill neighborhood into three lots, replacing a previous plan to redevelop the entire area with high-density housing. (City and Borough of Juneau)

By Mark Sabbatini

Juneau Independent

This is a developing story.

A major shift in the future of Telephone Hill is being proposed by Mayor Beth Weldon, following months of protests and a lawsuit about plans to demolish the neighborhood and build four mid-rise apartments with up to 155 total units.

"We have come to a time when I believe we are spending too much time on Telephone Hill," she wrote in a memo scheduled to be presented to the Juneau Assembly’s Committee of the Whole on Monday night. "Budget and flood season are upon us, and we need to get Telephone Hill off our plate."

She is proposing the area be divided into three lots, with one used for 20-30 units of housing, and the other two sold as-is without a specific intent for their future. The second and third lots could be bought separately or together.

The Committee of the Whole meeting is scheduled at 6 p.m. Monday at City Hall. Because the meeting is a work session, public testimony is generally not allowed.

Weldon stated ongoing objections from residents influenced her proposal.

"The testimony that I am hearing more and more is to just not spend anymore money period on the project," she wrote. "These arguments are swaying me."

Plans to redevelop Telephone Hill have been in the works for decades, first by the state beginning in the 1980s and then by the city when it acquired the property in 2022. Residents living in the homes have been renting them for many years knowing about those plans.

The intent of city leaders was to demolish the 13 existing residences — which include Juneau’s oldest house — and build high-density housing to help address the city’s housing shortage. A further consideration was the planned homeporting of a U.S. Coast Guard icebreaker in the downtown area during the coming years, which means 190 crew members and their families will need housing.

Weldon’s memo states putting 20 to 30 homes on one of the three lots in her proposal could help address that need.

The Assembly last June approved a plan calling for the eviction of the residents on Oct. 1 and demolition of the homes during the following months, approving $5.5 million for the first phase of site preparation. Weldon, in her memo, states only about $600,000 has been spent to date, since, among other things, the bidding process for the demolition process is still ongoing.

However, she also noted proceeding with the project as planned will cost the city extensive additional money. City leaders have estimated the full cost of site prep, including demolition and building a new road, will be up to $9 million.

A shakeup in the plans for Telephone Hill occurred during an Assembly meeting on Monday when Nano Brooks, elected last fall with the help of people who wanted to preserve the neighborhood, proposed reopening debate "to discuss actions that could affect Telephone Hill development or the timeline" at a future Committee of the Whole meeting. The Assembly approved the motion 6-2.

Weldon was among those supporting the motion, stating she had a plan she wanted to present to members, but she declined to discuss details at the time. In her memo, she offers a two-step plan:

• Allocate one lot at the top of the hill, where a parking lot and one large house is, to be developed as a multifamily dwelling with 20-30 units.

• Offer the other two lots in a sealed-bid auction.

Such a plan would keep the city from putting more time and funding into Telephone Hill, but also might not result in much gain, according to Weldon.

"Talking to local contractors, we would likely not be able to make much money from these lots as the cost of building is so high," she wrote. "The advantage of this is that we wouldn’t be spending anymore money."

Also, Weldon noted, such an option means "the homeowners may go in together and buy the lots. We at least are no longer landlords and the lots with houses on them are now on the tax roll."

• Contact Mark Sabbatini at editor@juneauindependent.com or (907) 957-2306.