Legislature(1993 - 1994)
1994-05-09 House Journal
Full Journal pdf1994-05-09 House Journal Page 4260 SB 217 The following was read the second time: CS FOR SENATE BILL NO. 217(FIN) am "An Act relating to the University of Alaska and university land, authorizing the University of Alaska to select additional state public domain land, and defining net income from the University of Alaska's endowment trust fund as `university receipts' subject to prior legislative appropriation; and providing for an effective date." with the: Journal Page CRA RPT HCS(CRA) 3DP 3NR 4218 -PREVIOUS SENATE FISCAL NOTE (DNR) 3/16 4219 -2 PREVIOUS SENATE Fiscal notes (UA, F&G) 3/10/94 4219 -PREVIOUS SENATE ZERO FN (REV) 3/10/94 4219 FIN REFERRAL WAIVED 4234 Representative Phillips moved and asked unanimous consent that the following committee substitute be adopted in lieu of the original bill: HOUSE CS FOR CS FOR SENATE BILL NO. 217(CRA) (same title) There being no objection, it was so ordered. 1994-05-09 House Journal Page 4261 SB 217 Amendment No. 1 was offered by Representative Finkelstein: Page 10, after line 15, insert a new subsection to read: "(c) The public shall have access to lands conveyed under this section for subsistence, recreation, hunting, and fishing activities." Representative Finkelstein moved and asked unanimous consent that Amendment No. 1 be adopted. Representative Sitton objected. The question being: "Shall Amendment No. 1 be adopted?" The roll was taken with the following result: HCS CSSB 217(CRA) Second Reading Amendment No. 1 YEAS: 15 NAYS: 25 EXCUSED: 0 ABSENT: 0 Yeas: Brown, Bunde, Davidson, Finkelstein, Grussendorf, Hoffman, MacLean, Martin, Menard, Moses, Navarre, Nicholia, Nordlund, Ulmer, Willis Nays: Barnes, Brice, Carney, Davies, B.Davis, G.Davis, Foster, Green, Hanley, Hudson, James, Kott, Larson, Mackie, Mulder, Olberg, Parnell, Phillips, Porter, Sanders, Sitton, Therriault, Toohey, Vezey, Williams And so, Amendment No. 1 was not adopted. 1994-05-09 House Journal Page 4262 SB 217 Amendment No. 2 was offered by Representative Finkelstein. Page 2, line 17: Delete "a significant and substantial portfolio of income producing" Insert "the surface estate of state" Page 4, line 10, after "the conveyance of" Insert "the surface estate to" Page 4, line 31: Delete "Notwithstanding AS 38.05.125(a)," Insert "AS 38.05.125(a) applies to" Page 5, after "this" on line 2, through line 7: Delete all material. Insert "section." Representative Finkelstein moved and asked unanimous consent that Amendment No. 2 be adopted. Representative Brice objected. The question being: "Shall Amendment No. 2 be adopted?" The roll was taken with the following result: HCS CSSB 217(CRA) Second Reading Amendment No. 2 YEAS: 11 NAYS: 29 EXCUSED: 0 ABSENT: 0 1994-05-09 House Journal Page 4263 SB 217 Yeas: Brown, Finkelstein, Grussendorf, Hoffman, Larson, MacLean, Moses, Navarre, Nicholia, Nordlund, Willis Nays: Barnes, Brice, Bunde, Carney, Davidson, Davies, B.Davis, G.Davis, Foster, Green, Hanley, Hudson, James, Kott, Mackie, Martin, Menard, Mulder, Olberg, Parnell, Phillips, Porter, Sanders, Sitton, Therriault, Toohey, Ulmer, Vezey, Williams And so, Amendment No. 2 was not adopted. Amendment No. 3 was offered by Representative Navarre: Page 4, line 10: Delete "500,000" Insert "250,000" Representative Navarre moved and asked unanimous consent that Amendment No. 3 be adopted. Objection was heard. The question being: "Shall Amendment No. 3 be adopted?" The roll was taken with the following result: HCS CSSB 217(CRA) Second Reading Amendment No. 3 YEAS: 22 NAYS: 17 EXCUSED: 0 ABSENT: 1 Yeas: Brown, Davidson, G.Davis, Finkelstein, Foster, Green, Grussendorf, Hanley, Hoffman, Kott, Larson, Mackie, MacLean, Martin, Menard, Mulder, Navarre, Nicholia, Nordlund, Parnell, Porter, Ulmer 1994-05-09 House Journal Page 4264 SB 217 Nays: Barnes, Brice, Bunde, Carney, Davies, B.Davis, Hudson, James, Olberg, Phillips, Sanders, Sitton, Therriault, Toohey, Vezey, Williams, Willis Absent: Moses And so, Amendment No. 3 was adopted. Amendment No. 4 was offered by Representative Finkelstein: Page 1, line 7 - page 13, line 28: Delete all material and insert: "* Section 1. AS14.40 is amended by adding a new section to read: Sec. 14.40.365. UNIVERSITY LAND FROM STATEHOOD ACT LAND SELECTION CONVEYANCES. (a) The University of Alaska may select and obtain an equitable interest in and is entitled to receive the income derived from the management of 250,000 acres of land conveyed to the state under Sec. 6(b) of the Alaska Statehood Act (P.L. 85-508, 72 Stat. 339) that, on the date of its selection by the university, (1) has not been conveyed by the state; (2) has not been reserved by law from the public domain; (3) is not land (A) included in a five-year proposed oil and gas leasing program under AS38.05.180(b); or (B) leased under, or for which a lease application is pending under, AS38.05.180(d); (4) is not subject to a possessory interest or encumbrance other than (A) a lease that is not an oil or gas lease; (B) a timber contract; (C) a mining claim; (D) a sale of materials under AS38.05.110- 38.05.120; 1994-05-09 House Journal Page 4265 SB 217 (E) a land use permit or right-of-way issued by the Department of Natural Resources under AS38.05; (5) is not necessary to carry out the purpose of an interagency land management agreement; or (6) is not subject to conveyance under a land exchange or land settlement agreement. (b) Notwithstanding AS38.05.125(a), the transfer of the equitable interest in land from the Department of Natural Resources to the Board of Regents of the University of Alaska under this section includes (1) the interest of the state in the coal, ores, minerals, fissionable materials, geothermal resources, and fossils that may be in or on the land; and (2) the interest of the state in the oil and gas that may be in or on the land, but only as to land that is selected by the University of Alaska under this section on and after the date that is the fifth anniversary of the effective date of this section. (c) When the University of Alaska selects an equitable interest in the land to which it is entitled under this section, unless the commissioner of natural resources determines under (e) of this section that the equitable interest in the land should not be conveyed, the commissioner of natural resources shall impose on the land selected an equitable interest in the land. (d) When a selection has been made by the University of Alaska under (c) of this section, the land selected is closed to entry until a conveyance of the equitable interest is made or the selection has been rejected by the commissioner of natural resources. (e) The commissioner of natural resources may not convey the equitable interest to any land selection made by the University of Alaska under this section if the commissioner determines that the proposed selection (1) includes land for which, at the time of its selection under this section, (A) a municipality has made a selection under AS29.65, unless the land selection is, at a later date, rejected by the commissioner of natural resources or relinquished by the municipality; or (B) the commissioner reasonably believes may be selected by a municipality under AS29.65.030, but the 1994-05-09 House Journal Page 4266 SB 217 commissioner may not withhold under this subparagraph the conveyance of title to land selected by the University of Alaska for more than three years after the date of the municipality's incorporation; (2) is not in the best interests of the state; in making a determination under this paragraph as to whether a selection by the University of Alaska is in the best interests of the state, the commissioner shall consider (A) the interest of the general public in retention of the equitable interest in the land in state ownership, including the interest in maintaining and protecting customary and traditional uses of the resources of the land; (B) ensuring an appropriate diversity in the character of interests in land held by the state and by the University of Alaska; (C) the public benefits achieved by conveyance of the equitable interest in the land to the University of Alaska; (D) the probable potential for the development of the land and its resources and the probable income to the University of Alaska from the conveyance of the equitable interest in the land; (E) benefits to the University of Alaska from the conveyance of the equitable interest in the land to it; and (F) the efficiency of the management of the land resulting from the conveyance of the equitable interest in the land. (f) If the Board of Regents of the University of Alaska disagrees with a decision of the commissioner of natural resources not to convey the equitable interest to the University of Alaska land selected by it under this section, the Board of Regents and the commissioner of natural resources shall submit the matter to the governor, who shall make the decision. The decision of the governor is final. (g) The Department of Natural Resources shall manage the land to which equitable interest has been conveyed to the University of Alaska under this section. When the Department of Natural Resources manages the land for which equitable interest has been conveyed to the University of Alaska, the department shall 1994-05-09 House Journal Page 4267 SB 217 (1) consult with the Board of Regents before adopting or amending regulations relating to the land's management; (2) provide notice to, and consult with, the Board of Regents regarding all proposed actions subject to public notice under AS38.05.945 before giving that public notice; (3) annually provide the Board of Regents with a report including (A) a description of all land management activities undertaken under this section during the prior year; and (B) an accounting of all income and proceeds generated from the land; (4) obtain the approval of the Board of Regents before exchanging or disposing of the land. (h) When the equitable interest is conveyed to the University of Alaska under this section, the University of Alaska takes the equitable interest in the land subject to any possessory interest held by another person on the effective date of the conveyance. Except as provided in AS14.40.368(1), the Department of Natural Resources shall manage the land selected by the University of Alaska under this section, but the University of Alaska is entitled to receive the consideration due under that interest for the duration of the interest. (i) In conveying the equitable interest to the University of Alaska under this section, the commissioner of natural resources shall give public notice under AS38.05.945(b) and (c) and provide for access under AS38.05.127, but other provisions of AS38.04 and AS38.05 do not apply. (j) The equitable interest in the land that is transferred or conveyed to the University of Alaska under this section (1) is subject to (A) section 6(i) of the Alaska Statehood Act (P.L. 85-508, 72 Stat. 339); (B) art. IX of the state constitution; (C) AS19.10.010; and (D) the rights of the state under former 43 U.S.C. 932 (sec. 8, Act of July26, 1866, 14 Stat. 253); (2) excludes any interest transferred to the state by quit claim deed dated June30, 1959, under authority of the Alaska Omnibus Act, P.L. 86-70, 73 Stat. 141; 1994-05-09 House Journal Page 4268 SB 217 (3) based on a land selection filed by the University of Alaska on or after the effective date of this section and until the day before the day that is the fifth anniversary of the effective date of this section is subject to reservation by the state in perpetuity of all oil and gas that may be in or on the land, together with the right to explore the land for oil and gas and to remove from the land all oil and gas located in and on it. (k) The University of Alaska shall bear all costs of selection, platting, surveying, and conveyance of equitable interest in the land that it selects under this section and, subject to appropriation, shall reimburse the Department of Natural Resources for the reasonable costs incurred by that department relating to that selection, platting, surveying, and conveyance. As to an equitable interest in land due the University of Alaska under (c) of this section because it has not been disapproved under (e) of this section, (1) if the land has been surveyed, the boundaries of the land must conform to the public land subdivisions established by the approved survey; (2) if the land is unsurveyed, the commissioner shall survey the exterior boundaries of the land without interior subdivision, and shall use the exterior boundary survey in conveying the equitable interest. (l) For equitable interests in land due the University of Alaska under (c) of this section that is unsurveyed, pending the survey of exterior boundaries and issuance of conveyance, the commissioner of natural resources shall prepare and provide to the University of Alaska a document of interim conveyance for the interest in the land that is to be conveyed. (m) The University of Alaska may not make a selection of an equitable interest in land under this section after December31, 2009. (n) The state retains legal title to land for which equitable interest is conveyed to the University of Alaska under this section. * Sec. 2. AS14.40.365(e) is repealed and reenacted to read: (e) The commissioner of natural resources may not convey the equitable interest to any land selection made by the University of Alaska under this section if the commissioner determines that the proposed selection 1994-05-09 House Journal Page 4269 SB 217 (1) includes land for which, at the time of its selection under this section, (A) a municipality has made a selection under AS29.65, unless the land selection is, at a later date, rejected by the commissioner of natural resources or relinquished by the municipality; or (B) the commissioner reasonably believes the land may be selected by a municipality under AS29.65.030, but the commissioner may not withhold under this subparagraph the conveyance of title to land selected by the university longer than three years after the date of the municipality's incorporation; (2) includes land that, at the time of its selection under this section, (A) is subject to an oil and gas exploration license; or (B) the commissioner reasonably believes will be made part of, an oil and gas exploration license issued under AS38.05.131 - 38.05.134; the commissioner may not refuse to convey title to land to the University of Alaska under this subparagraph for more than three years after its first selection by the University of Alaska; (3) is not in the best interests of the state; in making a determination under this paragraph as to whether a selection by the University of Alaska is in the best interests of the state, the commissioner shall consider (A) the interest of the general public in retention of the equitable interest in the land in state ownership; (B) ensuring an appropriate diversity in the character of interests in land held by the state and by the University of Alaska; (C) the public benefits achieved by conveyance of the equitable interest in the land to the University of Alaska; (D) the probable potential for the development of the land and its resources and the probable income to the University of Alaska from the conveyance of the equitable interest in the land; (E) benefits to the University of Alaska from the conveyance of the equitable interest in the land to it; and 1994-05-09 House Journal Page 4270 SB 217 (F) the efficiency of the management of the land resulting from the conveyance of the equitable interest in the land. * Sec. 3. AS14.40 is amended by adding new sections to read: Sec. 14.40.368. MANAGEMENT AND DISPOSITION OF INCOME FROM EXISTING ENCUMBRANCES. For the land selected by, and for which an equitable interest is conveyed to, the University of Alaska under AS14.40.365 that is subject to a lease, contract, claim, sale, permit, or right-of-way identified in AS14.40.365(a)(4) (1) the state is entitled to receive the income obtained from the lease, contract, claim, sale, permit, or right-of-way for the duration of the term of the lease, contract, claim, sale, permit, or right-of-way, and during any renewal of it that is authorized by the lease, contract, claim, sale, permit, or right-of-way, or by law; (2) the responsibility for the management of the land by the Department of Natural Resources for the benefit of the University of Alaska commences upon conclusion of the term of the lease, contract, claim, sale, permit, or right-of-way, and any renewal authorized by the lease, contract, claim, sale, permit, or right-of-way, by law. Sec. 14.40.369. CUSTOMARY AND TRADITIONAL USES TO BE CONTINUED. When the state has conveyed the equitable interest in the land selected by the University of Alaska under AS 14.40.365 the land shall be managed in a manner that permits customary and traditional uses of the resources of that land to the maximum extent practicable. * Sec. 4. AS14.40.400(a) is amended to read: (a) The Department of Revenue shall establish a separate endowment trust fund in which all net income derived from the sale or lease of the land granted under the Act of Congress approved January21, 1929, and the land selected by, and to which the equitable title is conveyed to, the University of Alaska under AS14.40.365, and in which all monetary gifts, bequests, or endowments made to the University of Alaska for the purpose of the fund, shall be held in trust. * Sec. 5. AS14.40.400(e) is amended to read: (e) Subject to legislative appropriation, the [THE] Department of Administration shall disburse the net income from the trust fund upon vouchers approved by the president and 1994-05-09 House Journal Page 4271 SB 217 treasurer of the University of Alaska specifying the purpose for which the money is to be used and showing it is to be used in conformity with this section. * Sec. 6. AS14.40.491 is amended to read: Sec. 14.40.491. DEFINITION OF UNIVERSITY RECEIPTS. In AS14.40.120 - 14.40.491, "university receipts" includes (1) student fees, including tuition; (2) receipts from university auxiliary services; (3) recovery of indirect costs of university activities; (4) the net income of the trust fund established in AS14.40.400 and receipts from sales and rentals of university property; (5) federal receipts; (6) gifts, grants, and contracts; and (7) receipts from sales, rentals, and the provision of services of educational activities. * Sec. 7. AS29.45.030(a) is amended to read: (a) The following property is exempt from general taxation: (1) municipal property, including property held by a public corporation of a municipality, or state property, except that (A) a private leasehold, contract, or other interest in the property is taxable to the extent of the interest; (B) notwithstanding any other provision of law, property acquired by an agency, corporation, or other entity of the state through foreclosure or deed in lieu of foreclosure and retained as an investment of a state entity is taxable; this subparagraph does not apply to federal land granted to the University of Alaska under AS14.40.380 or 14.40.390, or to other land granted to the university by the state to replace land that had been granted under AS14.40.380 or 14.40.390, or to the equitable interest in the land conveyed by the state to the University of Alaska under AS14.40.365; (C) an ownership interest of a municipality in real property located outside the municipality acquired after December 31, 1990, is taxable by another municipality; however, a borough may not tax an interest in real property located in the borough and owned by a city in that borough; (2) household furniture and personal effects of members of a household; 1994-05-09 House Journal Page 4272 SB 217 (3) property used exclusively for nonprofit religious, charitable, cemetery, hospital, or educational purposes; (4) property of a nonbusiness organization composed entirely of persons with 90 days or more of active service in the armed forces of the United States whose conditions of service and separation were other than dishonorable, or the property of an auxiliary of that organization; (5) money on deposit; (6) the real property of certain residents of the state to the extent and subject to the conditions provided in (e) of this section; (7) real property or an interest in real property that is exempt from taxation under 43 U.S.C. 1620(d), as amended; (8) property of a political subdivision, agency, corporation, or other entity of the United States to the extent required by federal law; except that a private leasehold, contract, or other interest in the property is taxable to the extent of that interest; (9) natural resources in place including coal, ore bodies, mineral deposits, and other proven and unproven deposits of valuable materials laid down by natural processes, unharvested aquatic plants and animals, and timber. * Sec. 8. APPLICABILITY OF UNIVERSITY SELECTION RIGHTS UNDER AS14.40.365 TO LAND. In addition to the land in which, under AS14.40.365(e), the commissioner of natural resources may not convey an equitable interest to the University of Alaska, the commissioner of natural resources may not convey equitable interest in land that, at the time of its selection by the university, (1) is subject to designation for conveyance or conveyance to the Alaska Mental Health Trust Authority under sec. 54, ch. 66, SLA 1991; (2) is land that the commissioner of natural resources reasonably believes should be designated for conveyance or conveyed to the Alaska Mental Health Trust Authority under sec. 55, ch. 66, SLA 1991, as compensation to that trust for original mental health trust land not available for return to the corpus of the trust; or (3) is land described in sec. 56, ch. 66, SLA 1991, as listed in "Lands Hypothecated to the Mental Health Trust, May 1991" located in the office of the director of the division of lands, 1994-05-09 House Journal Page 4273 SB 217 Department of Natural Resources, in Anchorage, Alaska, that has been hypothecated to secure reconstitution of the mental health trust; however, as the reconstitution of the mental health trust is accomplished and the hypothecated land is released on a pro rata basis, the University of Alaska may select the land and the commissioner may convey an equitable interest in it. * Sec. 9. LEGISLATIVE INTENT. It is the intent of the legislature that, if sec.8 of this Act has not taken effect on or before the effective date of secs.1 and 3 - 7 of this Act, the commissioner of natural resources reject, as inconsistent with the best interests of the state, selections of land by the University of Alaska under AS14.40.365, added by sec. 1 of this Act, of land described in sec.8 of this Act. * Sec. 10. Section 2 of this Act takes effect on the effective date of a version of House Bill 199 or Senate Bill 150 of the Eighteenth Alaska State Legislature authorizing oil and gas exploration licensing on state land that is passed by the Eighteenth Alaska State Legislature. * Sec. 11. Section 8 of this Act takes effect on the effective date of ch. 66, SLA 1991." Representative Finkelstein moved and asked unanimous consent that Amendment No. 4 be adopted. Representative Phillips objected. The question being: "Shall Amendment No. 4 be adopted?" The roll was taken with the following result: HCS CSSB 217(CRA) am H Second Reading Amendment No. 4 YEAS: 7 NAYS: 33 EXCUSED: 0 ABSENT: 0 Yeas: Brown, Carney, Finkelstein, Grussendorf, Hoffman, Navarre, Nicholia 1994-05-09 House Journal Page 4274 SB 217 Nays: Barnes, Brice, Bunde, Davidson, Davies, B.Davis, G.Davis, Foster, Green, Hanley, Hudson, James, Kott, Larson, Mackie, MacLean, Martin, Menard, Moses, Mulder, Nordlund, Olberg, Parnell, Phillips, Porter, Sanders, Sitton, Therriault, Toohey, Ulmer, Vezey, Williams, Willis Navarre changed from "Nay" to "Yea". Nicholia changed from "Nay" to "Yea". Barnes changed from "Yea" to "Nay". And so, Amendment No. 4 was not adopted. Representative Phillips moved and asked unanimous consent that HCS CSSB 217(CRA) am H be considered engrossed, advanced to third reading and placed on final passage. Representative Navarre objected. The Speaker stated that HCS CSSB 217(CRA) am H will be in third reading on the next legislative day's calendar. Representative Navarre objected. The Speaker ruled that HCS CSSB 217(CRA) am H will be in third reading on the next legislative day's calendar. Representative Navarre appealed the ruling of the Chair and withdrew the appeal.