Legislature(2001 - 2002)
04/23/2001 01:15 PM RES
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HB 244-RIGHT-OF-WAY TO DENALI BOR. FOR RR/UTIL. CO-CHAIR MASEK announced that the next order of business would be HOUSE BILL NO. 244, "An Act relating to a grant of state land to the Denali Borough for a railroad and utility corridor and a railroad development project; repealing provisions relating to a grant of a right-of-way of land for a railroad and utility corridor to the Alaska Industrial Development and Export Authority; and providing for an effective date." Number 0857 REPRESENTATIVE JEANETTE JAMES, Alaska State Legislature, testified as the sponsor of HB 244. This legislation, HB 244, would "undo" the authority Alaska Industrial Development and Export Authority (AIDEA) has to bond to identify a corridor for rail in the north access to Denali National Park. She pointed out that the committee packet includes maps, which illustrate this 90,000 acre piece of property that is next to Denali Park. This property is state land and is also known as "Wolf Township." Representative James explained that "we" are attempting to gain other access into the park because the current access is insufficient, at capacity, and in need of improvement. Therefore, a second entrance to the park would be valuable. However, she stressed that she doesn't favor a road due to all the problems a road would create [in a park setting]. This proposal merely provides an opportunity for rail access to only the state lands, which is about 40 miles from Healy. Although there may be some interest in going farther, it would require federal intervention and much work. Furthermore, the group interested in putting in this 40 miles of rail indicates that this is an opportunity to be a "paying proposition." REPRESENTATIVE JAMES explained that HB 244 would identify a swath from the 90,000 acre piece of land and give it to the Denali Borough so that the borough could identify and survey a route through the middle. The borough would have until 2006 to identify and survey that route, after which the borough would only own the route, which would be up to 3,500 acres. The reality is that the corridor would require merely 1,500 acres. Representative James acknowledged that some are concerned with the location of the corridor. Furthermore, the Department of Natural Resources (DNR) would prefer authorizing the borough to identify the corridor and return to DNR in order to ensure that there are no existing uses, which would result in conflicts. Once DNR approved the corridor, then the surveying could be done, after which DNR could transfer the land to the Denali Borough. Representative James clarified, "That is the amendment that we're going to be working on to try to get a CS up to Finance, but because we're on an extended timeframe here, we'd like to move the bill out as it is today." REPRESENTATIVE JAMES, in response to the concern regarding why 40,000 acres is necessary for this, pointed out that the route would have to traverse the lay of the land and proceed such that animal and habitat conflicts are avoided. Therefore, a wide area is necessary. She then turned to the concern regarding the possibility that the land is given to the Denali Borough, but no railroad is built. Therefore, it was decided that this [the corridor land] will be part of the borough's land selection. Representative James informed the committee that the Denali Borough Assembly is in support of this proposition, HB 244. She noted that she would be in the area this summer working to ensure that this corridor would not intrude on state park land. Number 0382 REPRESENTATIVE JAMES informed the committee that U.S. Senator Murkowski got $1.32 million appropriated by the federal government to work on this issue. There was a park survey [by the Park Service] who did support the northern access. The state needs a match of $330 million, which she believes will be included in this year's capital budget. Therefore, there will be money to perform the environmental assessment and the environmental impact study (EIS). Representative James said, "I think the protection for the listening to the voices of the folks is in there in the process and what we really need to do is get it on the table and authorize somebody to go forward with it and that's what this bill is intended to do." The committee substitute (CS) has already been ordered, but wasn't available in time for this meeting. Number 0270 JOSEPH FIELDS, President, Kantishna Holdings, Inc., testified via teleconference in support of HB 244. He said that HB 244 provides an expedited methodology to establish a right-of-way in order to create something that has been endorsed by all the boroughs and cities of the Railbelt. He recalled that the legislature has passed two resolutions in support of this and there was the AIDEA bill of 1998, which is essentially HB 244 save the change from AIDEA to the Denali Borough. Furthermore, HB 244 does relieve the bonding authorization from AIDEA and eliminates the transfer to AIDEA, which would be beneficial to AIDEA. Mr. Fields informed the committee that there has been federal movement [with] a new secretary reviewing the access as found by the 1994 Denali task force. That task force, the national public board that advises the National Parks Service, called for a new access route to Wonder Lake. Therefore, Mr. Fields was confident that with the passage of HB 244, the work of identifying the specific right-of-way can begin. He noted that the right-of-way will not take up the entire yellow section, but will only take up something the size of the Parks Highway and end up as a 300 foot right-of-way. He echoed Representative James' earlier comments regarding the intention to avoid habitat and features that are difficult for railroads. Mr. Fields announced that Stampede Road is not really appropriate for this. He hoped that the committee would move HB 244 forward so that the details could be worked out at the next hearing, which [will produce] a good bill that will produce about $.25 billion worth of private investment in the state as well as possibly 900 jobs over the years. He concluded by saying, "This is a rare opportunity for public-private relationship to flourish and go forward. I hope you will move it quickly." TAPE 01-41, SIDE A [Please note that approximately three minutes of Mr. Braun's testimony was not recorded and thus was obtained from the written testimony he read the committee.] Number 0001 DAVID BRAUN, testifying via teleconference, read the following testimony: [I am opposed to House Bill 244. Public and private land developers are trying to appropriate state land in Denali Borough. They want to make the Wolf Townships an extension of Denali National Park's transportation system, and develop it for their own financial gain. On Thursday, April 19 [the] House Transportation Committee quickly passed HB 244 out of committee without providing for any public comment or public hearing. The history of this bill is interesting. A working draft of the bill distributed at the Denali Borough Assembly meeting April 7th said, "The Denali Borough shall identify and survey a railroad and utility corridor ... from near the community of Healy to the eastern boundary of Denali National Park and Preserve." It also said, "The borough may retain not more than 3,500 acres of the land granted to the borough under this section." This land would be in addition to the borough entitlement and is worth many millions of dollars.] And I don't believe the citizens of Alaska will ever be adequately compensated for the loss of this public land. A legislative staffer noted that having the Denali Borough do the survey for a private enterprise put the borough in the role of developer. The bill was then changed so that Kantishna Holdings, Incorporated, would identify and survey the railway, but the Denali Borough would still get 3,500 acres to develop whether the railroad was built or not. In my opinion, this bill is an attempt to give valuable public land to Denali Borough to sell, lease, or otherwise develop. The ultimate use of any land conveyed to the borough is completely unpredictable. The borough assembly has been unwilling to regulate land use as charged by the legislature. Contrary to what some supporters of HB 244 say the question is not whether development should occur but where it should be. There are tens of thousands of acres east of Panguingue Subdivision open to borough land selection. Leaving the Wolf Townships as they are encourages development that is independent of Denali National Park and Preserve. People of the state, I don't believe, wanted the Park Service to be given to Wolf Townships and I don't believe they want ... the Wolf Townships, in any way, connected to the park. Alaskans and tourists use this as an alternative to the congestion and bureaucracy of the park. It's worth noting that now travelers from all over the globe are purposely coming exclusively to the Wolf Townships as a result of Jon Krakaur's book Into the Wild, the story of Chris McCandless's death. It is shortsighted and absolutely impossible to try to funnel all our visitors through Denali National Park. We can learn from the mistakes made outside parks in the Lower 48. Keeping Wolf Townships as they are is good for economic development. Also, I have to question the motives of those who are hostile to the National Park Service that would have the park encroach on our public land. I also think that Kantishna Holdings, Incorporated, should reveal the names of all those who will benefit financially from this venture. ... I must state again that there are no restrictions on land the Denali Borough might sell or lease (indisc.). Number 0303 NANCY BALE, President, Denali Citizens Council, testified via teleconference. Ms. Bale specified that she is testifying on behalf of herself and the Denali Citizens Council, a local oversight group in the Denali area. She informed the committee that she has lived and worked in Denali National Park since 1971. Furthermore, she has mushed and skied the Stampede area. Ms. Bale pointed out that lands north of the Wolf Townships were given to Denali National Park as part of the 1980 Alaska National Interest Lands Conservation Act (ANILCA) settlement. The purpose of all the northern additions was to provide wildlife habitat, specifically for the Denali caribou herd. The Stampede Trail is located on the open tundra that gently slopes downward to some rolling hills. From her personal contact with the Stampede Trail, she informed the committee that there are many wetlands along the route as well as some major streams and a small river. This area has already been regarded as important as wildlife habitat by the state lands planning process. She quoted the Tanana Basin Area Plan as saying, "State land in this unit is to be retained in public ownership for multiple-use management. The emphasis is on management of recreation and maintaining fish and wildlife habitat." MS. BALE related her belief that the importance of this land necessitates any change in land management to go through the already existing public process. Furthermore, the Wolf Townships area is not identified as an area from which the borough could select entitlements. Therefore, an amendment to the Tanana Basin Area Plan would be required before it could be deeded. However, HB 244 "shortstops" that process. Additionally, whenever the state conveys land from state ownership to another entity a best interest finding is generally required, which is not included in this bill. Therefore, the public process in determining the fate of this land is somewhat sidestepped by HB 244. MS. BALE then turned to the issue of due diligence. She informed the committee that Kantishna Holdings, Inc., has already had a chance for a right-of-way through the 1998 AIDEA bill. However, Kantishna Holdings, Inc., has failed to show AIDEA due diligence in the many intervening years. Thus she wasn't sure that Kantishna Holdings, Inc., could show due diligence to develop a cost effective railway in this area. MS. BALE recalled Representative James' remark that she prefers a railway because it's more environmentally friendly. However, Ms. Bale pondered whether the 3,500 acres, if not developed by rail because of the lack of due diligence would end up having a road through them. She informed the committee that SB 3 nominates some funds to study other rail or road [possibilities], which creates conflict. Although Ms. Bale agreed with Representative James that a road in this area would not be appropriate, she didn't believe that a rail would be cost effective or a "good for Alaskans" way to promote tourism. There are dozens of alternatives to this that will be discussed during a panel discussion by the Denali Citizens Council in early June. Ms. Bale indicated that the committee should have her full written testimony. LINDA PAGANELLI testified via teleconference. She informed the committee that although she is a member of the Northern Alaska Environmental Center as the Denali Watch Coordinator, she is testifying on her own behalf. She noted that the committee should have her written testimony, which she read as follows: I am a long time resident of the Denali Borough living on the Stampede Trail in the Panguingue Creek Subdivision. This coming summer will mark my 20th season driving a bus on the Denali National Park road for the park's concessionaire. While I do support efforts to assess possible solutions to park access issues, I do not support the North Access solution as put forth in HB 244 based on the following. Determinations made by the Alaska State Department of Natural Resources, the National Park service, and the United States Congress are unanimous in their findings that the area in question, the Wolf Townships, serves as an important habitat for wildlife, particularly for park caribou and wolf populations. These lands should remain in public ownership for the purposes of maintaining wilderness recreation opportunities for local, regional, and statewide users and protecting fish and wildlife habitat. In 1986 the Denali Subsistence Resource Commission conveyed, to the Secretary of the Interior, their strong opposition to any construction of new roads or railroads in Denali National Park and Preserve. The commission has reiterated their opposition to development of roads a number of times. Any activity that impairs the overall health of an ecosystem, natural processes or resource availability has the potential to adversely impact the customary and traditional activities practiced by subsistence users. The Wolf Townships, retained in state ownership, will continue to serve to protect the natural ranges of large park mammals from incompatible development and will thus, better ensure the continuance of the subsistence lifestyle. I am concerned with the stipulation contained in this bill that grants over 45,000 acres of prime public land to the Denali Borough. I am in agreement with the Department of Natural Resources, "that a more efficient and equally effective approach would be for the borough and Kantishna Holdings, Inc., to identify the corridor first, then DNR transfer the land, or Kantishna Holdings, Inc., simply apply for a ROW from DNR." I am also in agreement with their assessment that this deal should not come down to a "give away" to a private developer and that the citizens of the state receive adequate compensation for granting private exclusive use of thousands of acres of state land. This bill grants sole rights of project development to one company, Kantishna Holdings, Inc., without the opportunity for a competitive bid process. On this basis, the bill may be unconstitutional. Although I am far from being a constitutional law expert, I request that the committee deliberate the following questions: What's the legislative purpose behind granting Kantishna Holdings, Inc., a sweetheart deal and a legislatively mandated seat at the planning table? Where's the state's common interest in bestowing this deal on Kantishna Holdings, Inc.? An unreasonable fix date for the transfer of lands from the state to the borough fails to encourage or even allow public input on the consideration of whether or not these lands should transfer. Impacts to homeowners, sport and subsistence hunters, local guiding businesses, and other local, regional, and statewide users will consequently be ignored. Transfer to the municipality should not be approved until the recommended changes to the Tanana Basin Area Plan have been publicly reviewed through the amendment and reclassification processes as defined by the appropriate Alaska statutes. The Denali Borough government boasts a "do nothing" policy towards guiding growth and development in the borough. It's shortsighted approach towards planning ... Number 1174 JOAN FRANKEVICH, Regional Staff, Alaska Regional Office, National Park Conservation Association (NPCA), testified via teleconference and explained that NPCA is a national nonprofit group dedicated to protecting the National Park System. Of NPCA's over 450,000 members over 1,000 live in Alaska. Ms. Frankevich stated that NPCA has opposed the north Denali route since it was first proposed. Furthermore, NPCA opposes HB 244 for the following reasons. There is little benefit or purpose of this railroad to park visitors. Having worked in the park for five summers, Ms. Frankevich is very familiar with the area, visitors, travel patterns, and with the needs of the visitors. She noted that she is also familiar with the northern area where the railroad would be placed. Ms. Frankevich said, "For Denali visitors, the primary attraction is wildlife viewing." Besides Katamai National Park and McNeil State Park, Denali is the easiest and most predictable location to view grizzly bears as well as a variety of other wildlife. She informed the committee that wildlife in the park is seen mainly in the middle third of the park road, which is roughly from Igloo Canyon to Eielson Visitors Center. The entrance area and the Wonder Lake area are forested and thus it is more difficult to view wildlife here. The northern route is similar and thus the chance for wildlife viewing from the railroad would be fairly minimal. Additionally, the north route scenery isn't as dramatic as along the park road. The proposed site of the railroad on the north side, the low range blocks views of the high peaks and the glaciers of the Alaska Range. Furthermore, the [northern] area has never been glaciated and thus none of the dramatic broad glaciated valleys and views like those on the park road. On the proposed route there are occasional views of Mt. McKinley at high points and once Wonder Lake is reached the scenery is spectacular, which may make the ride worth it. She pointed out that Mt. McKinley is the highest peak in North America and as such it generates its own weather. Therefore, even when clear elsewhere, the mountain is often shrouded in clouds. She noted that she worked at Eielson Visitors Center, which tracks the visibility of the mountain as is done every year. In general, the mountain is visible 30 percent of the time. MS. FRANKEVICH stated that compared to the park road, the north rail route offers poor wildlife viewing, less spectacular scenery, and infrequent views of Mt. McKinley similar to the park road. Therefore, [NPCA] doesn't see this proposed rail route being a benefit for park visitors nor in demand by park visitors. Furthermore, there is a misperception that large numbers of potential visitors are turned away from riding the park buses every year. This is incorrect. After speaking with National Park Service staff today, Ms. Frankevich was informed that in 2000 there were over 363,000 visitors to Denali with a bus ridership composing about 76 percent of that total. About 2,000 people were turned away from the [buses], which amounts to less than 1 percent of the total visitors. The other visitors, such as climbers to Mt. McKinley, Ruth Glacier landings, etcetera, account for the rest of the numbers. This misperception is probably due to the presence of visitation counters on the highway prior to 1996. Those counters counted everyone on the park's highway and thus it was interpreted that only a small percentage were able to ride the bus. However, that is inaccurate. Furthermore, the current bus system has a high level of satisfaction as supported by a 1998 survey by the University of Idaho in which 88 percent of the visitors rated the bus system as good or excellent and that wildlife observations were the greatest single factor in contributing to visitor satisfaction. MS. FRANKEVICH concluded by saying that this project makes little sense to her. "A railroad that starts just 17 miles north of the park road is very expensive and ends in the same place - where demand is low, where they won't see a bear, and over 50 percent of the riders won't see Mt. McKinley - seems to serve little purpose," she said. Moreover, she echoed prior concerns regarding giving this land to the Denali Borough, which is a young borough with no road powers. The borough has done virtually no land planning, which it abhors. Therefore, the borough seems a highly unlikely choice to receive a state right- of-way. Number 1500 REPRESENTATIVE CHENAULT recalled Ms. Bale's testimony regarding the Denali Borough's lack of road powers and her belief that it shouldn't have the land. He asked if Ms. Bale would favor transferring state land to the hands of a local community. MS. BALE answered that the way the state has agreed to manage this land per the Tanana Basin Area Plan has addressed the general purposes for wildlife management and the general needs for subsistence use of the locals. Therefore, she favored the retention of ownership in the state's hands. CO-CHAIR MASEK closed the public testimony and inquired as to the will of the committee. Number 1595 REPRESENTATIVE McGUIRE moved to report HB 244 out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, HB 244 was reported from the House Resources Standing Committee.