00                             HOUSE BILL NO. 89                                                                          
01 "An Act authorizing the commissioner of natural resources to offer bedload material for                                 
02 disposal for flood control purposes in exchange for a percentage of the profit from the                                 
03 sale of that material."                                                                                                 
04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
05    * Section 1. AS 38.05.872 is amended by adding new subsections to read:                                            
06            (b)  The commissioner may offer for disposal bedload material within an                                      
07       approved flood control project under the terms established in (c) of this section after                           
08       making a finding that                                                                                             
09                 (1)  removal of the bedload gravel will offset future costs to the state                                
10       that are attributable to flood damage;                                                                            
11                 (2)  the sale of the bedload gravel under (b) - (d) of this section at a cost                           
12       that may be below fair market value is in the best interests of the state; and                                    
13                 (3)  removal of the bedload gravel will enhance the effectiveness of the                                
14       flood control project in preventing a flood or minimizing flood damage.                                           

01            (c)  A person acquiring bedload material under a disposal authorized by the                                  
02       commissioner under this section shall pay to the department a royalty of not less than                            
03       12.5 percent of pretax profit calculated by subtracting from the value of the bedload                             
04       material the actual direct costs of extricating, loading, and transporting the material to                        
05       market, if applicable. The commissioner may adopt regulations that identify the                                   
06       method and means for determining the value of the bedload material and the costs that                             
07       may be deducted for the purpose of calculating the amount to be paid to the state. In                             
08       this subsection, "value" means the sales price of the material in a bona fide arm's-                              
09       length transaction between unaffiliated parties or the sales price of the material had the                        
10       material been sold in a bona fide arm's-length transaction between unaffiliated parties.                          
11            (d)  In this section, "bedload material" means gravel, rock, and other material                              
12       located below the plane of the ordinary high water mark or the mean high water mark                               
13       of a river, lake, stream, or other coastal water.                                                                 
14    * Sec. 2. The uncodified law of the State of Alaska is amended by adding a new section to                          
15 read:                                                                                                                   
16       REVISOR'S INSTRUCTION. The revisor of statutes shall change the heading of                                        
17 AS 38.05.872 from "Disposition of state land for flood control projects" to "Disposition of                             
18 state land and material for flood control projects."