Legislature(2017 - 2018)GRUENBERG 120
04/09/2018 01:00 PM House JUDICIARY
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| Audio | Topic |
|---|---|
| Start | |
| SB202 | |
| HB336 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 202 | TELECONFERENCED | |
| + | HB 336 | TELECONFERENCED | |
| + | TELECONFERENCED |
SB 202-NATIVE CORP. LIABILITY FOR CONTAMINATION
2:12:47 PM
CHAIR CLAMAN announced that the first order of business would be
HOUSE CS FOR SENATE BILL NO. 202(JUD), "An Act relating to the
liability of a Native corporation for the release or threatened
release of hazardous substances present on certain lands."
CHAIR CLAMAN reminded the committee that it previously heard HB
67 [companion bill to SB 202] and his plan is to pass SB 202 out
of committee today.
2:13:42 PM
CHAIR CLAMAN moved to adopt Amendment 1, labeled 30-LS1422\A.4,
which read as follows:
Page 1, line 6:
Delete "and (n)"
Delete "exception set out in (i)"
Insert "exceptions [EXCEPTION] set out in (i) and
(n)"
Page 2, line 27, through page 3, line 1:
Delete all material and insert:
"(n) A Native corporation that acquired land
under 43 U.S.C. 1601 et seq. (Alaska Native Claims
Settlement Act) is not liable under this section for a
release or threatened release of a hazardous substance
on the land unless the Native corporation, by an act
or omission, caused or contributed to the release or
threatened release of the hazardous substance."
REPRESENTATIVE STUTES objected for purposes of discussion.
2:14:06 PM
MARIDON BOARIO, Staff, Senator Lyman Hoffman, Alaska State
Legislature, explained that Amendment 1 creates an exception to
strict liability under AS 46.03.822. Under this amendment, she
advised, strict liability does not apply to Native Corporations
for any release or threatened release of a hazardous substance
on land granted under the Alaska Native Claims Settlement Act
(ANCSA) unless the Native Corporation, by an act or omission,
caused or contributed to the release or threatened release. The
amendment also removes the burden of proof from the Native
Corporation, and she added that Senator Hoffman fully supports
Amendment 1.
2:14:51 PM
CHAIR CLAMAN surmised that the intention of Amendment 1 is that
the Senate bill will track the language passed on a recent
federal law within an appropriations bill (Indisc.).
MS. BOARIO responded that Chair Claman was correct because when
this bill was introduced there was pending federal legislation,
which has since passed. When that law was passed, she advised,
it came to light that possibly Alaska's statute was not tracking
as closely as it should have, and this language makes state law
compatible with the federal law.
2:15:52 PM
REPRESENTATIVE EASTMAN offered a scenario of someone finding a
hazardous substance on another person's property and surmised
that under this amendment, if someone goes to that property and
finds "something, in order for them to be liable, we have to
prove that they were to blame for the substance."
MS. BOARIO answered that the burden of proof is on the person
who caused the contamination.
2:16:53 PM
REPRESENTATIVE EASTMAN asked whether the burden of proof is on
the Native Corporation to prove that it did not cause the
problem, or must someone, possibly the government, prove that
they did cause the contamination.
MS. BOARIO replied that Representative Eastman was correct.
2:17:14 PM
REPRESENTATIVE EASTMAN surmised that that scenario would be
different for the Native Corporation than it is for everyone
else because in other property situations the burden of proof
would be on the person to prove that they did not contaminate
the property.
MS. BOARIO deferred to Chair Claman, and said that this is a
specific situation for Alaska Native Corporations on transferred
land.
2:18:10 PM
REPRESENTATIVE KOPP commented that it appears Amendment 1 simply
makes clear that the Native Corporation owned lands were not
conveyed liability in the Alaska Native Settlement Act. In
other words, he explained, as SB 202 currently reads, the onus
is on the Native Corporation to prove it is not liable.
Wherein, under this amendment the Native Corporations are
basically moved to a neutral position, and the assumption is
that the Native Corporations were not conveyed any liability
when lands were conveyed to the Native Corporations.
MS. BOARIO replied that Representative Kopp was correct.
2:19:01 PM
REPRESENTATIVE STUTES withdrew her objection. There being no
objection, Amendment 1 was adopted.
2:19:16 PM
REPRESENTATIVE LEDOUX moved to adopt Amendment 2, labeled 30-
LS1422\A/1, which read as follows:
Page 1, line 1:
Delete "Native corporation"
Insert "person"
Page 2, line 24, through page 3, line 2:
Delete all material and insert:
"* Sec. 2. AS 46.03.822(d) is amended to read:
(d) To establish that a person had no reason to
know that the hazardous substance was disposed of on,
in, or at the facility, as provided in (c)(1) and (l)
of this section, or to establish that a person had no
reason to know that the hazardous substance was
present on the land at the time the ownership of the
land was transferred to the person, as provided in (n)
of this section, the person must have undertaken, at
the time of voluntary acquisition, all reasonable
inquiries into the previous ownership and uses of the
property consistent with good commercial or customary
practice in an effort to minimize liability. For
purposes of this subsection a court shall take into
account all relevant facts, including
(1) any specialized knowledge or experience
the person has;
(2) the relationship of the purchase price
to the value of the property if it were
uncontaminated;
(3) commonly known or reasonably
ascertainable information about the property;
(4) the obviousness of the presence or
likely presence of contamination at the property; and
(5) the ability to detect contamination by
appropriate inspection.
* Sec. 3. AS 46.03.822 is amended by adding a new
subsection to read:
(n) In an action to recover damages or costs, a
person otherwise liable under this section for a
release or threatened release of a hazardous substance
on the person's land is relieved from liability under
this section if the person proves that the
(1) person did not know and had no reason
to know that the hazardous substance was present on
the land at the time the ownership of the land was
transferred to the person; and
(2) hazardous substance was present on the
land at the time the ownership of the land was
transferred to the person."
REPRESENTATIVE STUTES objected for purposes of discussion.
2:19:27 PM
REPRESENTATIVE LEDOUX commented that "this is a very good bill,"
except it brings out a problem in Alaska's laws in general.
There is the problem that someone could be a good faith
purchaser or grantee of a property and end up getting stuck on a
strict liability standard for a hazard on the property. She
opined that that situation is not fair, which has been pointed
out in the context of Native Corporations. Amendment 2, she
explained, basically "changes our law, period, so that no good
faith person ends up to be liable." She acknowledged that this
is a huge change in Alaska law and she does not want to impede
this bill because it will help the Native Corporations with its
contaminated lands. Representative LeDoux advised that
Amendment 2 was drafted to shed light on this existing problem
in the Department of Environmental Conservation (DEC) and
environmental law wherein a future legislature may possibly
change this law for everyone. She advised that she withdraws
Amendment 2.
2:21:18 PM
REPRESENTATIVE EASTMAN moved to adopt Amendment 3, labeled 30-
LS1422\A.2, which read as follows:
Page 2, line 29, following the first occurrence of
"the":
Insert "(1)"
Page 2, line 31:
Delete "and the"
Insert ";
(2)"
Page 3, line 1, following "granted":
Insert "; and
(3) Native corporation did not have control
of the land at the time the hazardous substance was
disposed of or placed on the land"
REPRESENTATIVE KREISS-TOMKINS objected.
2:21:24 PM
REPRESENTATIVE EASTMAN referred to [SB 202, Sec. 3. AS
46.03.822, page 3, line 1], and explained that Amendment 3 adds
the language after the word "granted." as follows:
(3) Native corporation did not have control
of the land at the time the hazardous substance was
disposed of or placed on the land.
REPRESENTATIVE EASTMAN explained that the language clarifies
that a Native Corporation managed its land prior to the granting
of land, and if the corporation is already responsible for the
land "and there's things being done to it," this would not
inadvertently absolve those responsible parties of their
responsibility to make certain the hazardous substances were
appropriately disposed.
2:22:12 PM
CHAIR CLAMAN asked the sponsor of the bill, in light of the
passage of Amendment 1, whether the sponsor supports Amendment
3.
MS. BOARIO opined that Senator Hoffman would not support
Amendment 3.
2:22:49 PM
CHAIR CLAMAN noted that [within the committee packet] are
letters from Daniel Cheyette, Vice President for Lands and
Natural Resources, Bristol Bay Native Corporation; and Jaeleen
Kookesh, Vice President, General Counsel & Corporate Secretary.
He referred to the last sentence of paragraph 3, of the 4/9/18
letter from the Sealaska Corporation which read as follows
[original punctuation provided]:
Representative Eastman's amendment would be moot if
your amendment is adopted by the Committee and the
legislature.
CHAIR CLAMAN asked Representative Eastman whether the passage of
Amendment 1 moots his motion to adopt Amendment 3.
2:23:33 PM
[CHAIR CLAMAN and Representative Eastman discussed receipt of
the letter and its content.]
CHAIR CLAMAN again asked whether Representative Eastman had an
argument that the passage of Amendment 1 did not moot his motion
for the adoption of Amendment 3.
REPRESENTATIVE EASTMAN commented that it is hard for him to
understand why Amendment 3 is now moot.
2:24:20 PM
CHAIR CLAMAN directed Representative Eastman's attention to the
4/9/18 letter from the Bristol Bay Native Corporation [contained
within the committee packet] and asked that he read paragraph 4
as it explains why Amendment 3 is moot. He requested that
Representative Eastman offer a basis within which Chair Claman
should not rule Amendment 3 out-of-order.
REPRESENTATIVE EASTMAN opined that "this actually gets to the
substance" of the matter and Amendment 3 is important to
discuss.
2:24:59 PM
CHAIR CLAMAN ruled Amendment 3 out-of-order because he agreed
with the analysis provided by the Sealaska Corporation that the
adoption of Amendment 1 takes out the burdens "that you are
actually talking about."
CHAIR CLAMAN advised that even though the committee passed
Amendment 1, it raised a fiscal note issue that John Halverson
of the Department of Environmental Conservation would address.
2:25:44 PM
JOHN HALVERSON, Environmental Program Manager, Contaminated
Sites Program, Department of Environmental Conservation (DEC),
advised that there would likely be a need for a fiscal note with
Amendment 1.
CHAIR CLAMAN requested more clarity as to whether it would be an
increased fiscal note and whether there was a fiscal note
previously.
MR. HALVERSON responded that there was a zero fiscal note
previously and with Amendment 1 there would likely be an
increase in state costs because the burden of proof will have to
fall to the state.
2:26:41 PM
REPRESENTATIVE KOPP asked whether the burden is normally with
the state when it comes to DEC litigated claims on land
transfers that move from the state to private ownership, or is
the burden of proof normally with the person to whom the land
was transferred to, and whether there is a standard that applies
here.
MR. HALVERSON responded that normally it would be through the
parties to the transaction rather than to the state.
2:27:31 PM
REPRESENTATIVE KOPP said (Indisc.) transaction happened to be
the state and the person to whom the land was conveyed to, he
asked whether it would be the state's job to prove the
liability.
MR. HALVERSON answered that the burden would be on the party who
previously owned the property. This case deals with properties
that were under federal ownership and conveyed to the
corporations.
2:28:17 PM
REPRESENTATIVE KREISS-TOMKINS noted that many of these
conveyances are from the federal government to the Native
Corporations under the Alaska Native Claims Settlement Act
(ANCSA), and asked where the State of Alaska and DEC fit into
that equation, and why DEC would have any obligation if this is
a transaction between two parties that are not the State of
Alaska.
MR. HALVERSON opined that if there is a disagreement between the
current landowner and the federal government over responsibility
for contamination on the land, the state would typically look to
those parties to sort it out and it would provide oversight on
any necessary cleanup. Under adopted Amendment 1, the state may
incur some additional expenses in trying to research the history
on when contamination occurred and whether the Native
Corporation had caused or contributed to existing problems at
the site.
CHAIR CLAMAN added that one of the key concepts to recognize in
SB 202, page 1, lines 9-11, read as follows:
damages, for the costs of response, containment,
removal, or remedial action incurred by the state, a
municipality, or a village, and for the additional
costs of a function or service, including
administrative expenses for the incremental costs of
providing the
CHAIR CLAMAN advised the if there is contamination, typically
the state or municipality engages costs and then looks to the
landowner for reimbursement. The above provision essentially
says that if there is an effort by the state to try to recoup
those costs, it would have to be able to show that the Native
Corporation had caused the contamination.
2:30:26 PM
REPRESENTATIVE KOPP stated that this comes down to a fundamental
due process issue because Native Corporations are a corporation,
but they are also Alaskans and have been given land under ANSCA.
Without this amendment, they would be required to wage legal war
with the federal government, who has limitless resources. He
opined that this puts the Native Corporations on a more equal
footing wherein they are not presumed guilty until they prove
otherwise. He said that it introduces a due process protection,
which is "very important."
2:31:11 PM
CHAIR CLAMAN pointed out that no motion had been introduced to
change the committee's action on Amendment 1, and moved on to
committee discussion.
2:31:17 PM
REPRESENTATIVE EASTMAN noted that Amendment 2 was not discussed
because its sponsor withdrew the amendment. He commented that
the sponsors of this bill make a strong point that liability
ought not be placed where it does not belong, and Amendment 2
makes that same point. He said that he looks forward to being
able to support that amendment or other language at the first
opportunity.
2:32:16 PM
REPRESENTATIVE STUTES commented that she is happy to see SB 202
because her district contains some contaminated areas that have
absolutely crippled the Native Corporation from developing the
areas. She opined that possibly with SB 202, it will allow the
Native Corporations some recourse to move forward because in her
area as well, as many other rural areas, housing is a huge
problem and the Native Corporations are unable to develop their
lands for housing due to these types of issues.
2:32:56 PM
CHAIR CLAMAN commented that he is particularly pleased with
Amendment 1 because it puts state law and federal law on the
same path, which is a positive step. Thereby, he advised, the
Native Corporations would not have to look at two different
rules for two different jurisdictions as they move forward.
2:33:18 PM
REPRESENTATIVE KREISS-TOMKINS REPRESENTATIVE moved to report SB
202, labeled 30-LS1422\A, as amended, out of committee with
individual recommendations and the accompanying fiscal notes.
There being no objection, SB 202(JUD) passed out of the House
Judiciary Standing Committee.