Legislature(1993 - 1994)
05/05/1994 01:30 PM House FIN
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* first hearing in first committee of referral
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SB 310 An Act relating to the management and sale of state timber; relating to the classification of state land that would preclude harvesting of timber or would designate harvesting of timber as an incompatible use; relating to the administration of forest land, proposals for state forest, and the determination of sustained yield; and providing for an effective date. SB 310 was placed into Subcommittee with Representative Therriault as Chair and with members Representatives MacLean, Grussendorf, Foster, Brown and Parnell. SENATE BILL 310 "An Act relating to the management and sale of state timber; relating to the classification of state land that would preclude harvesting of timber or would designate harvesting of timber as an incompatible use; relating to the administration of forest land, proposals for state forest, and the determination of sustained yield; and providing for an effective date." Co-Chair Larson placed SB 310 into Subcommittee with Representative Therriault as Chair and with members Representatives MacLean and Grussendorf. KATE TROLL, UNITED FISHERMEN OF ALASKA (UFA), JUNEAU, testified in opposition to SB 310 which would go beyond establishing the Forest Management Agreements into making substantial modifications to the State Forest Practices Act. The bill would reduce the intent to manage state and municipal forest for multiple use and would weaken the forest planning and review process, while altering the requirement for reforestation on private land. She emphasized that the changes would be substantial to the State Forest Practices Act. Furthermore, the practices would come at a time when the Board of Forestry, a Board established to resolve issues relevant to the forest resources in the State, has 4 acknowledged that the State Forest Practices Act is working well and through a consensus negotiation states that the product does not need to be altered. Ms. Troll strongly recommended deleting all sections of SB 310 which alter the Forest Practices Act pointing out that UFA was a key player in the two years of negotiations that led to the State Forest Practices Act. She advised an additional concern of UFA was the application of the "sustained yield", Section #4, which calls for the continuation and expansion of business. She pointed out that "sustained yield" has been defined in statute as "continuity of harvest over annual periods". The proposed legislation would redefine "sustained yield", to be not just "continuity", but also "expansion of business". KATYA KIRSCH, EXECUTIVE ASSISTANT, ALASKA ENVIRONMENTAL LOBBY, JUNEAU, testified in opposition to SB 310 explaining that the forest management agreements will benefit corporations more than the State. She emphasized that the State should reconsider loosing money to subsidize removal of forest lands. SB 310 mandates long-term contracts for up to 20 years, with a renewal option for another 20 years. Long-term contracts, also called Forest Management Agreements (FMA's) will make timber harvest the priority on state forest lands, elevating timber over fisheries, wildlife, subsistence, tourism and recreation values. Ms. Kirsch added that long-term timber contracts are likely to have a negative impact on Alaska's economy and natural resources: 1. Long-term contracts are unhealthy for Alaska's pocket book. 2. Long-term contracts lock out future knowledge. 3. Timber-supply problems in order to fulfill long- term contracts will occur. 4. Long-term contracts and mills may endanger Alaskan communities economically and environmentally. 5. Industry should not manage state lands. Ms. Kirsch enumerated a number of alternatives to long-term contracts. 1. Maintain current timber sale length of three to five years which would allow DNR to update contracts as social values, economic situations, and biological information change. 5 2. This would allow reasonable certainty that interested purchasers will have a steady supply of timber to bid on at fair market value, without locking up resources for 20 years and without locking out other interested timber purchasers. 3. Encourage locally owned, value-added forest industries. REX BLAZER, REPRESENTING SELF, FAIRBANKS, spoke in opposition to SB 310 which allows the state forestry officials to sign long term contracts with timber companies. He pointed out that long term contracts have been proven unsustainable everywhere they are practiced. Mr. Blazer emphasized that the proposed legislation will weaken the Forest Practices Act due to: 1. No requirement for bonding. 2. No local hire guarantees. 3. No guarantee for value added. 4. No provision for biannual review. 5. No provision for requirements for operator paying cost of building. RON WOLF, CHIEF FORESTER, KLUCKWAN FOREST PRODUCTS, spoke in support of SB 310 which would amend Title #38 and #41 creating the establishment of Forest Management Agreements (FMA). He added that SB 310 will allow the Department of Natural Resources (DNR) to respond to forest health problems by allowing for limited emergency timber sales and the halting of serious epidemics before they become unmanageable. Mr. Wolf mentioned that main benefit of the legislation would be a reliable supply of wood for the industry to make capital investments. Mr. Wolf advised that the legislation would allow an entrance into Forest Management Agreements allowing for careful management of State forest lands and would bring positive returns to the state treasury by managing timber resources. Representative Grussendorf advised that he had received a memo from Board members from Mr. Wolf's corporation who recommended that there be no changes in the Forest Practices Act. Mr. Wolf responded that the amendments to Title #41 6 are largely clerical and the effect would not change the reforestation obligation to a landowner, although it would remove a confusing reference to sustained yield. (Tape Change, HFC 94-159, Side 2). AUDREY MAGOEN, REPRESENTING SELF, FAIRBANKS, spoke in opposition to the proposed legislation and provided the Committee with a set of "Flow Charts" which she drew in order to illustrate procedures between a regular commercial timber sale (as mandated by Alaska law) and the sale of timber through a Forest Management Agreement (FMA) as proposed by SB 310. [Copy on file]. Ms. Magoen elaborated on the significant points of the handouts, the operational forced inventory plan, the Forest Management Plan, pointing out that the volunteer timber sales would occur before the first opportunity for the public to voice their opinion. She emphasized the necessity for operational ground rules and management. She did not feel the proposed legislation would allow the public to know what is happening since they would not be given the opportunity to witness the ground rules and provide input. BARBARA KELLY, REPRESENTING SELF, JUNEAU, spoke against multi-national corporations having control over large areas of forest for a twenty year period. She requested that the bill be held until further deliberation and consensus is reached. If the bill is not held in Committee, Ms. Kelly recommended consideration of amendments such as: 1. A provision to place a limit on the allowable cut placed into FMA'; 2. Provisions making the contractor responsible for all the costs to the State related to administering and enforcing the FMA; 3. Requiring a cost benefit analysis be provided on the long term timber contracts to see if benefits do exist; 4. A requirement for full funding of DNR and Department of Fish and Game in order that they adequately monitor the FMA's; 5. Allowance for adjustments to be made to harvest plans to reflect inventories conducted; 6. Suggested amendments implemented in the House Resources Committee which would make the sale of the timber for fair market value which would be 7 adjusted annually by the Commissioner; and 7. Limit the amount of timber in the FMA's. CHRIS GATES, DIRECTOR, DIVISION OF ECONOMIC DEVELOPMENT, DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT, testified that the Constitution of the State of Alaska compels the proper and responsible development of our renewable forests. Additionally, the Legislature and the current State administration have seen fit to take concrete actions to encourage the creation of new jobs and economic activity in the State. Mr. Gates recommended that the Committee adopt SB 310 for the following reasons: 1. The legislation provides better management of the set of resources found in the State forests; 2. Provides better management of the forest products industry; 3. Provides a better chance to encourage outside investment in value-added timber processing in Alaska; 4. Provides a better chance to reduce whole log exports from Alaska; 5. Better chance to provide more effective management of spruce bark beetle infested forests; 6. Better chance to allow Alaskans to take advantage of increased demand for forest products in the Pacific Rim; and 7. Allows the State to set aside secure, long term house log, firewood, harvest or other small scale harvest areas to allow the capitalization of value added processing facilities. TOBY WHEELER, REPRESENTING SELF, JUNEAU, testified in opposition to the legislation pointing out the amount of controversy surrounding the bill. He thought that a better bill could be constructed with "more time" which could address the twenty year contracts. Mr. Wheeler urged Committee members to consider creating a Task Force to further consider the legislation. MCKIE CAMPBELL, DEPUTY COMMISSIONER, DEPARTMENT OF FISH AND GAME, reiterated the Administration's support of the legislation. Deputy Commissioner Campbell spoke to the 8 fiscal obligation of the Department of Fish and Game. Mr Campbell reported that in preparation of the fiscal note, the Department analyzed FMA's in North America. The fiscal note would include salaries for one biologist, one fish- technician and a clerk typist per FMA. The House Resources Committee has added amendments which would create greater fiscal concern. (Tape Change, HFC 94-160, Side 1). Representative Grussendorf commented on the amount of authority and responsibility placed on the Commissioner of the Department of Natural Resources. He felt there should be greater scrutiny of the contents of the contract. Mr. McKie replied that from a fish and wildlife perspective, the Department would prefer greater involvement in the process. Representative Brown questioned the zero fiscal note provided by the Department of Natural Resources. Co-Chair Larson noted that the Subcommittee would be expanded to include Representative Therriault as Chair and with members Representatives Brown, Grussendorf, Foster, Parnell and MacLean. SB 310 was HELD in Committee for further consideration.
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