1996-10-16                     Senate Journal                      Page 4375
SB 162                                                                       
Message of May 30 was received, stating:                                       
                                                                               
Dear President Pearce:                                                         
                                                                               
Under the authority of art. II, sec. 15 of the Alaska Constitution, I          
have vetoed the following bill:                                                
                                                                               
                                                                               

1996-10-16                     Senate Journal                      Page 4376
SB 162                                                                       
CS FOR SENATE BILL NO. 162(FIN)                                               
"An Act relating to land used for agricultural                                
purposes and to state land classified for agricultural                         
purposes or subject to the restriction of use for                              
agricultural purposes only; and annulling certain                              
program regulations of the Department of Natural                               
Resources that are inconsistent with the amendments                            
made by this Act"                                                              
                                                                               
This bill would dramatically change the way in which the state                 
conveys and protects its interests in agricultural development on state        
lands.  In my view, the changes made by the bill are not                       
improvements in state law to help ensure that Alaska has a viable              
agricultural industry now and in the future.                                   
                                                                               
Under the bill, a current owner of an agricultural interest in state           
land could receive title in fee simple subject to a covenant by                
complying with certain requirements specified in the bill.  The bill           
though does not require the purchaser to pay any additional                    
compensation to the state for the extra interests in the land.  We             
need to consider carefully whether this is an appropriate use of state         
resources.                                                                     
                                                                               
While I am sympathetic to claims by some farmers that their                    
financing options are restricted by the current land interests, I am           
convinced that the state's best interests are not best served by this          
bill.  Under current law, the state is able to ensure the retention of         
land for agricultural purposes by its right to terminate a purchasers          
interest in the land if the land is used for non-agricultural purposes.        
This bill would remove that possibility.                                       
                                                                               
Under the bill, the state would assume the substantial burden of               
proving non-compliance with the restrictive covenant on the land and           
would be limited to costly and possibly ineffective means of                   
preventing a purchaser from using the land for non-agricultural                
purposes.  The specific remedies available to the state are unclear            
under the bill.                                                                
                                                                               
                                                                               

1996-10-16                     Senate Journal                      Page 4377
SB 162                                                                       
I am aware that other states have experienced the problems that this           
bill would likely create.  Some other states and the federal                   
government are now buying back development rights in land held by              
farmers that was purchased under government programs.  It would                
be against the State of Alaskas interest to put itself in such a               
position.                                                                      
                                                                               
I support finding ways to help farmers finance legitimate, productive          
agricultural endeavors.  This bill, however, opens the door to                 
problems and costs that do not serve the public interest.  In the long         
run this bill likely will hurt the agricultural industry and therefore         
those very people that the legislature intended it to help.                    
                                                                               
						Sincerely,                                                               
						/s/                                                                      
						Tony Knowles                                                             
						Governor                                                                 
                                                                               
Governor's veto overriden on June 6 (page 4323).