Legislature(2021 - 2022)BARNES 124

04/30/2021 01:00 PM RESOURCES

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Heard & Held
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
Moved CSHB 98(RES) Out of Committee
           HB 120-STATE LAND SALES AND LEASES; RIVERS                                                                       
                 [Contains discussion of SB 97]                                                                                 
1:30:27 PM                                                                                                                    
CHAIR PATKOTAK announced  that the final order  of business would                                                               
be HOUSE BILL  NO. 120, "An Act relating to  state land; relating                                                               
to  the  authority  of  the Department  of  Education  and  Early                                                               
Development to dispose  of state land; relating  to the authority                                                               
of  the Department  of Transportation  and  Public Facilities  to                                                               
dispose  of  state  land;  relating   to  the  authority  of  the                                                               
Department  of   Natural  Resources  over  certain   state  land;                                                               
relating to the state land  disposal income fund; relating to the                                                               
leasing  and  sale  of state  land  for  commercial  development;                                                               
repealing  establishment  of  recreation  rivers  and  recreation                                                               
river corridors; and providing for an effective date."                                                                          
1:31:01 PM                                                                                                                    
The committee took a brief at-ease at 1:31 p.m.                                                                                 
1:31:45 PM                                                                                                                    
REPRESENTATIVE  RAUSCHER moved  to adopt  the proposed  committee                                                               
substitute  (CS)  for  HB   120,  Version  32-GH1634\B,  Radford,                                                               
4/23/21 ("Version B"), as the working document.                                                                                 
1:31:59 PM                                                                                                                    
CHAIR  PATKOTAK objected  for purposes  of  discussion and  noted                                                               
that this is a conforming change  to match the companion bill, SB
97.   He  then removed  his objection.   There  being no  further                                                               
objection, Version B was before the committee.                                                                                  
1:32:23 PM                                                                                                                    
MARTY  PARSONS,  Director, Division  of  Mining  Land and  Water,                                                               
Department  of Natural  Resources (DNR),  presented a  PowerPoint                                                               
[hard copy included in the committee  packet] on HB 120, which he                                                               
explained is  an attempt by  the Dunleavy Administration  to "get                                                               
Alaska lands into  Alaskans' hands."  He said that  Version B has                                                               
removed  from the  original bill  version some  of the  issues he                                                               
characterized  as   "controversial."    He  presented   slide  2,                                                               
"Authority to DEED  and DOT&PF," which read  as follows [original                                                               
punctuation provided]:                                                                                                          
     Authority to DOT&PF and DEED to Dispose of State Land                                                                    
         Provides authority to ease disposal of excess                                                                          
                   buildings around the state                                                                                   
     ? The bill amends current  statutes to allow DOT&PF and                                                                    
     DEED to acquire and  transfer excess buildings and land                                                                    
     that  is  no longer  needed  for  the purposes  of  the                                                                    
     original acquisition                                                                                                       
     ? This will streamline the disposal process and reduce                                                                     
     multi-agency efforts                                                                                                       
MR. PARSONS  explained that Title  38, under which  DNR operates,                                                               
currently  allows  the  Department  of  Transportation  &  Public                                                               
Facilities  (DOT&PF) and  the Department  of Education  and Early                                                               
Development (DEED) to dispose of  lands previously procured for a                                                               
specific purpose  directly instead of  conveying them to  DNR; he                                                               
stressed that  this would only be  for lands conveyed to  DEED or                                                               
DOT&PF for a specific purpose.   The provisions for land disposal                                                               
exist under  the statutes  governing DNR,  he explained,  but not                                                               
under the statutes governing DEED  or DOT&PF.  He reiterated that                                                               
Version B of HB 120 would simply "harmonize" the statutes.                                                                      
1:34:55 PM                                                                                                                    
CHAIR  PATKOTAK  asked Mr.  Parsons  to  discuss the  changes  in                                                               
Version B.                                                                                                                      
MR. PARSONS explained that the  original language of HB 120 would                                                               
have  repealed  the  statutes   establishing  the  Susitna  Basin                                                               
Recreation  Rivers Management  Plan, adopted  in the  late 1980s.                                                               
The language, he  said, became a controversial  issue with groups                                                               
using that area.  He said  that Version B also clarified portions                                                               
of Section 14.                                                                                                                  
1:36:37 PM                                                                                                                    
REPRESENTATIVE   HANNAN   expressed    her   understanding   that                                                               
properties held by DEED are finite  and asked about the number of                                                               
buildings and  parcels of raw  land.   She said that,  since DEED                                                               
properties are in communities, she  would prefer to allow a local                                                               
government  or school  district  the right  of  first refusal  in                                                               
purchasing the property.                                                                                                        
MR. PARSONS  replied that Representative Hannan's  assumption was                                                               
correct; DNR has  identified five properties deeded  to DEED with                                                               
locations  in Fort  Yukon,  Wales, Shishmaref,  and  Teller.   He                                                               
noted that the  properties in Sitka for the  Mt. Edgecumbe school                                                               
have  already  been  disposed.   He  clarified  that  DEED  would                                                               
determine how best to dispose of the remaining properties.                                                                      
REPRESENTATIVE HANNAN  asked whether all five  properties include                                                               
MR.  PARSONS replied  that  he  believes they  do,  but he  would                                                               
1:39:36 PM                                                                                                                    
REPRESENTATIVE  FIELDS  asked  whether there  are  larger  DOT&PF                                                               
parcels,  and  if  so,  their  locations.    He  noted  that  the                                                               
provisions  in Sections  5, 6,  and 8-11  would affect  DNR lands                                                               
such as the  Hatcher Pass area, and  said he would like  to see a                                                               
map  of land  affected by  the provisions  under HB  120 and  how                                                               
current uses could be impacted.                                                                                                 
CHAIR PATKOTAK expressed  that it would be  helpful to understand                                                               
any statewide effects under the  proposed legislation, as well as                                                               
getting detailed information on any areas of special interest.                                                                  
REPRESENTATIVE FIELDS  asked Mr.  Parsons to explain  the thought                                                               
process  regarding  the  location  of  parcels  for  disposal  in                                                               
relation to lands used for recreation.                                                                                          
MR.   PARSONS  asked   Representative  Fields   whether  he   was                                                               
referencing DOT&PF or general state lands.                                                                                      
REPRESENTATIVE FIELDS replied, "More broadly."                                                                                  
MR. PARSONS stressed  that the lands identified  for disposal are                                                               
DOT&PF  [or DEED]  lands  that were  acquired  only for  specific                                                               
purposes.  He said that if  DOT&PF had done a prescriptive action                                                               
to  take over  a  certain parcel,  and then  found  there was  no                                                               
longer an identified  purpose for that parcel,  DOT&PF would have                                                               
the  opportunity  to  dispose  of  the  parcel  through  its  own                                                               
statutes  instead  of conveying  it  to  DNR for  processing  and                                                               
disposal.  He clarified that HB 120 would remove the "red tape."                                                                
REPRESENTATIVE FIELDS  noted that  he may have  misunderstood the                                                               
intent of the  bill and expressed his  understanding that Hatcher                                                               
Pass wouldn't be affected under HB 120.                                                                                         
MR. PARSONS said, "That is correct."                                                                                            
1:44:30 PM                                                                                                                    
REPRESENTATIVE RAUSCHER  asked whether concerns such  as asbestos                                                               
remediation   were  considered   in  identifying   buildings  for                                                               
MR.  PARSONS reiterated  his earlier  explanation of  HB 120  and                                                               
stressed  that  only  five  parcels   have  been  identified  for                                                               
disposal.   He said  that DEED  may be able  to provide  a larger                                                               
list of buildings, but those would  not be part of the provisions                                                               
under HB 120.                                                                                                                   
1:46:46 PM                                                                                                                    
MR.  PARSONS  continued  his presentation  with  slide  3,  "Land                                                               
Disposal  Income Fund  (LDIF)," which  read as  follows [original                                                               
punctuation provided]:                                                                                                          
          Increase Land Disposal Income Fund (LDIF)Cap                                                                        
     Increase spending authority from the LDIF for project                                                                      
     The cap  on the LDIF  is proposed to be  increased from                                                                    
     $5M  to  $12M to  provide  additional  capital for  the                                                                    
     department to  develop and dispose  of state  lands and                                                                    
     to offset  inflation since the fund  was established in                                                                    
          ? The $5M cap has not been adjusted in 20 years                                                                       
          ? Personnel  and Development costs  have increased                                                                    
          significantly,  reducing  the  available  "working                                                                    
          ? This  will result in more  acreage available for                                                                    
          sale and  construction of access                                                                                      
          ? This is not an  increase in appropriation simply                                                                    
          an adjustment to the funding cap                                                                                      
1:48:42 PM                                                                                                                    
REPRESENTATIVE HANNAN  asked, "The land disposal  income fund has                                                               
been considered a 'sweepable fund,' correct?"                                                                                   
MR. PARSONS replied, "That is correct."                                                                                         
REPRESENTATIVE HANNAN  noted that she understands  the reason for                                                               
increasing  the fund  and  asked whether  it  has generally  held                                                               
enough to fund the land disposal program.                                                                                       
MR. PARSONS responded that land  sales currently produce a little                                                               
over $5  million annually.   He  explained that  several projects                                                               
have  been  deferred  because  DNR  currently  doesn't  have  the                                                               
ability  to build  infrastructure  and comply  with the  planning                                                               
authorities of local municipalities,  which would be necessary to                                                               
bring  higher  value  land  into   the  market.    He  said  that                                                               
increasing  the fund  cap would  allow DNR  to fund  larger, more                                                               
expensive projects.                                                                                                             
1:50:40 PM                                                                                                                    
CHAIR PATKOTAK asked  how much excess the fund has  held for each                                                               
of the past five fiscal years.                                                                                                  
MR. PARSONS replied  that he would get that  information, as well                                                               
as provide  a list of  projects deferred  due to the  low funding                                                               
1:51:16 PM                                                                                                                    
REPRESENTATIVE  SCHRAGE  asked  whether the  working  capital  is                                                               
funded through the land sales or an appropriation.                                                                              
MR. PARSONS responded that the fund is not an appropriation.                                                                    
REPRESENTATIVE  SCHRAGE  asked  about   the  public  process  for                                                               
deciding to develop a piece of property with the intent to sell.                                                                
MR. PARSONS  replied that  DNR has developed  a process  by which                                                               
factors such  as infrastructure  needs and cost,  comparable land                                                               
sales,  appraisal,  and design  are  considered.   If  the  cost-                                                               
benefit  analysis   for  developing  the  land   is  positive,  a                                                               
preliminary decision  is distributed  to the  public, as  well as                                                               
state  and  local agencies  and  tribal  governments, for  input.                                                               
After the  public process, he  explained, the plan is  amended, a                                                               
final decision is made, and work begins.                                                                                        
REPRESENTATIVE  SCHRAGE   asked  whether  DNR  would   require  a                                                               
specific  rate  of  return  on   a  project  in  order  to  begin                                                               
MR. PARSONS replied that if  the expected fair market value could                                                               
recoup the cost of development,  the project would most likely go                                                               
1:55:48 PM                                                                                                                    
CHAIR PATKOTAK asked to see the policy for the public process.                                                                  
1:56:04 PM                                                                                                                    
REPRESENTATIVE  HOPKINS asked  whether  the  process Mr.  Parsons                                                               
described  was used  to develop  and sell  the agricultural  land                                                               
outside of Nenana.                                                                                                              
MR. PARSONS  replied that the  Nenana land underwent  a different                                                               
process  and indicated  that [Division  of Agriculture]  Director                                                               
Dave Schade would have more information.                                                                                        
1:56:50 PM                                                                                                                    
REPRESENTATIVE SCHRAGE  noted that  adjusting the $5  million cap                                                               
for inflation would  add only $2.5 million.  He  asked, "Is there                                                               
that substantial of a backlog  of properties that need investment                                                               
to  bring them  to sale?   Why  do you  need the  additional $4.5                                                               
MR. PARSONS  reiterated his explanation  that DNR is  also trying                                                               
to ensure the  ability to undergo future projects.   He said that                                                               
projects often have road  construction requirements stipulated by                                                               
the municipalities  or boroughs  which could include  ingress and                                                               
egress for emergencies, emergency  equipment for evacuation, two-                                                               
lane  roads, and  electrical infrastructure;  the  costs of  such                                                               
infrastructure requirements can be "rather high."                                                                               
1:59:48 PM                                                                                                                    
MR.  PARSONS resumed  the PowerPoint  presentation with  slide 4,                                                               
"Commercial  Use," which  read as  follows [original  punctuation                                                               
                   Commercial Use Land Sales                                                                                  
       This new statute governing the leasing and sale of                                                                       
           state lands deemed suitable for commercial                                                                           
     development, within Qualified Opportunity Zones or in                                                                      
         state determined commercial development areas                                                                          
     ? Land can be nominated by the public                                                                                      
     ? Leasing option to complete requirements for sale and                                                                     
     allow immediate commercial activity                                                                                        
     ? After conclusion of the lease requirements for sale                                                                      
     will occur                                                                                                                 
      ? Individuals have requested a program to allow for                                                                       
     such sales                                                                                                                 
         ? The number of acres identified for proposed                                                                          
       development will be significant and the number of                                                                        
     acres conveyed will depend on the proposals received                                                                       
MR. PARSONS  explained that this idea  was borne by the  need for                                                               
small  entrepreneurs  to  have  land   on  which  to  base  their                                                               
operations  without having  to go  through a  competitive bidding                                                               
process.   He  said that  DNR  would work  with a  business on  a                                                               
development  plan  and enter  into  a  lease,  with the  goal  of                                                               
selling the land  to the business as it grows.   He stressed that                                                               
this  program  would  be  for   commercial  use  only,  with  the                                                               
intention   of  diversifying   the  economy,   rather  than   for                                                               
recreational use.                                                                                                               
2:02:42 PM                                                                                                                    
REPRESENTATIVE HANNAN asked for more information on the process.                                                                
MR.  PARSONS described  two ways  in which  the proposed  program                                                               
could operate.  In the first  scenario, he said, a business could                                                               
identify a parcel of land,  approach DNR with a development idea,                                                               
lease the land from  DNR at fair market value, and  at the end of                                                               
the lease,  if the business has  developed and the land  is being                                                               
used as planned, the lease could be  converted to a sale.  In the                                                               
second scenario,  he said, DNR  could identify lands  and solicit                                                               
ideas  for their  commercial use;  if multiple  businesses wanted                                                               
the same land,  options would be evaluated for  highest return to                                                               
the state.                                                                                                                      
2:05:04 PM                                                                                                                    
REPRESENTATIVE RAUSCHER asked who pays for the land appraisal.                                                                  
MR.  PARSONS replied  that the  individual or  business would  be                                                               
responsible for the survey and appraisal.                                                                                       
2:05:55 PM                                                                                                                    
CHAIR PATKOTAK  stated his understanding that  the business would                                                               
be  responsible for  the survey  and appraisal  costs when  going                                                               
through the commercial nomination process.                                                                                      
MR. PARSONS replied, "That is correct."                                                                                         
CHAIR PATKOTAK asked,  "So in the other process,  the state might                                                               
carry  the bill  on the  appraisal  when it  goes to  competitive                                                               
MR. PARSONS explained that if the  state offered a parcel of land                                                               
and  multiple businesses  could  make  use of  the  land with  no                                                               
overlap, each would be responsible  for the appraisal cost of its                                                               
own acreage.  If multiple  organizations wanted the same acreage,                                                               
then the land  would go to the highest bidder,  who then would be                                                               
responsible  for the  survey and  appraisal.   If  DNR offered  a                                                               
discrete  parcel, then  the survey  and appraisal  would be  done                                                               
before the land was made available.                                                                                             
2:07:17 PM                                                                                                                    
REPRESENTATIVE  RAUSCHER asked  whether these  parameters are  in                                                               
the proposed legislation.                                                                                                       
MR. PARSONS said that it's  his recollection that the language is                                                               
in HB 120.                                                                                                                      
CHAIR PATKOTAK noted that this issue would need clarification.                                                                  
2:07:47 PM                                                                                                                    
REPRESENTATIVE HOPKINS  asked how the state  would determine that                                                               
an appraisal is accurate.                                                                                                       
MR.  PARSONS responded  that DNR  would  provide instructions  on                                                               
what the appraisal would need to include.                                                                                       
REPRESENTATIVE  HOPKINS   asked  how  DNR  would   know  that  an                                                               
appraisal is legitimate.                                                                                                        
MR. PARSONS  responded that the  in-house appraisal staff  at DNR                                                               
reviews  all   of  the  appraisals  to   ensure  the  development                                                               
standards are met.                                                                                                              
CHAIR  PATKOTAK stated  his belief  that Representative  Hopkins'                                                               
question was intended to clarify  checks and balances to ensure a                                                               
fair assessment.                                                                                                                
2:09:35 PM                                                                                                                    
REPRESENTATIVE SCHRAGE  asked to what  extent the state  would be                                                               
covering costs that should be  paid by the developer, and whether                                                               
the costs  could include building  a road to access  the property                                                               
or putting in infrastructure which would benefit the developer.                                                                 
MR. PARSONS  replied that it depends  on the program.   Under the                                                               
land  disposal  program,  if  the  state  is  selling  individual                                                               
parcels in  a subdivision, then  in order  for the state  to meet                                                               
the requirements  of borough planning  boards, the state,  as the                                                               
developer,    would   commonly    be   required    to   establish                                                               
infrastructure  such  as  roads,  subdividing  the  parcels,  and                                                               
bringing in  electricity.  When  an individual lot  is purchased,                                                               
the  buyer would  be  responsible for  things  like clearing  the                                                               
lots, building  driveways, and  running water  and power.   Under                                                               
the  commercial use  program,  however, he  said  that the  state                                                               
doesn't guarantee any type of constructive access.                                                                              
REPRESENTATIVE SCHRAGE asked whether  a property would go through                                                               
a competitive  bidding process after  having been nominated  by a                                                               
private individual.                                                                                                             
MR. PARSONS said  that under the commercial use  program a person                                                               
or  business  could  identify  a  property  for  commercial  use,                                                               
provide DNR with a development  plan, enter into a lease, develop                                                               
the  land with  state  monitoring, and  have  the opportunity  to                                                               
convert  the   lease  to  a   sale  without  going   through  the                                                               
competitive bidding process.                                                                                                    
2:13:14 PM                                                                                                                    
CHAIR PATKOTAK asked  whether it would be possible  to bypass the                                                               
lease and buy the land directly.                                                                                                
MR. PARSONS  said that  under this  program, they  would go  to a                                                               
lease first and then the sale.   He explained that DNR would want                                                               
to ensure that the property  isn't being used for speculation; as                                                               
the  intention  of  the  commercial  use  program  is  to  expand                                                               
economic diversity,  leasing allows  the state  to make  sure the                                                               
land is used in accordance with that intention.                                                                                 
CHAIR  PATKOTAK  asked whether  there's  a  minimum lease  length                                                               
before the opportunity to purchase.                                                                                             
MR.  PARSONS  said that  while  there  is  no limitation  in  the                                                               
proposed legislation, regulations could be implemented.                                                                         
2:15:03 PM                                                                                                                    
REPRESENTATIVE  RAUSCHER asked  whether  the state  could deny  a                                                               
proposal based on the appraised value.                                                                                          
MR. PARSONS explained  that an appraisal determines  the value of                                                               
the land.                                                                                                                       
REPRESENTATIVE  RAUSCHER asked,  "Wouldn't you  want to  get your                                                               
use accepted  before you put  all the  money into the  survey and                                                               
the estimate  of the land  instead of having  it all at  once, so                                                               
that the state  now, actually, gets a free estimate  if they turn                                                               
down your usage?"                                                                                                               
MR. PARSONS replied  that someone who was nominating  a parcel of                                                               
land  would have  a reasonable  expectation  that their  proposal                                                               
would  be accepted.   He  said, "I  wouldn't assume  that someone                                                               
would go out, survey, and have  a land appraised and then come to                                                               
the state,  and that would be  the first time they  start talking                                                               
about what  they want to  do."   He further explained  that there                                                               
would have been conversations as  part of due diligence regarding                                                               
areas  such as  land  classifications or  use  restrictions.   He                                                               
said, "I'm envisioning  quite a dialogue prior to  getting to the                                                               
point where  an individual would  go out and survey  and appraise                                                               
the land."                                                                                                                      
2:18:12 PM                                                                                                                    
REPRESENTATIVE  HOPKINS  read  from   slide  4  of  Mr.  Parson's                                                               
presentation,  "The  number  of  acres  identified  for  proposed                                                               
development will be significant and  the number of acres conveyed                                                               
will  depend  on   the  proposals  received"  and   asked  for  a                                                               
definition of  "significant."   He then  asked whether  there are                                                               
any types  of lands currently  designated as  "opportunity zones"                                                               
or otherwise unavailable for the commercial use program.                                                                        
MR.  PARSONS  responded  that  lands  set  aside  as  legislative                                                               
designated areas (LDAs) wouldn't  be available, and that possible                                                               
uses  of  land already  being  used  for things  like  subsurface                                                               
exploration would have to be  carefully considered.  He said that                                                               
if a  parcel of land is  not classified for disposal  there would                                                               
need to be a reclassification.                                                                                                  
REPRESENTATIVE   HOPKINS   asked    whether   the   process   for                                                               
reclassifying the land is legislative or administrative.                                                                        
MR. PARSONS  answered that it's  administrative and  goes through                                                               
public process.                                                                                                                 
2:21:10 PM                                                                                                                    
REPRESENTATIVE MCKAY  stated his assumption that  the parcels are                                                               
checked for archaeological remnants and ancient graveyards.                                                                     
MR. PARSONS replied that checking  for historical significance is                                                               
always part of the process before any state land conveyances.                                                                   
2:22:14 PM                                                                                                                    
REPRESENTATIVE  HANNAN  said  that   shellfish  farms  have  been                                                               
operated for 30 years, and  when they were first established, the                                                               
general consensus  was that  commercial enterprises  shouldn't be                                                               
able  to hold  long-term leases  to beachfront  land.   She asked                                                               
whether a current leaseholder of  developed land would be able to                                                               
convert their lease to a sale.                                                                                                  
MR.  PARSONS clarified  that the  commercial use  program is  for                                                               
uplands only,  and that  the state  is prohibited  from conveying                                                               
tidelands  or  submerged  lands  to   any  entity  other  than  a                                                               
municipality.   He  said that  if  someone already  had a  lease,                                                               
another entity couldn't take that away from them.                                                                               
REPRESENTATIVE  HANNAN   said  that  she  understands   that  the                                                               
shellfish  themselves are  on the  tidelands but  that commercial                                                               
shellfish  farms  have uplands  permits  for  things like  onsite                                                               
living  quarters.    She asked  whether  a  commercial  shellfish                                                               
farmer  would be  able  to purchase  the  upland currently  under                                                               
MR. PARSONS explained that justification  of commercial use, such                                                               
as processing or transportation, would need to be provided.                                                                     
2:26:26 PM                                                                                                                    
REPRESENTATIVE SCHRAGE asked whether a  lease converted to a sale                                                               
could then be resold for non-commercial use.                                                                                    
MR.  PARSONS replied  that once  the land  was conveyed  from the                                                               
state there would  no longer be a stipulation on  the parcel that                                                               
restricted it for commercial use.                                                                                               
CHAIR  PATKOTAK asked  whether  existing  leases, when  expiring,                                                               
could be transferred to sales.                                                                                                  
MR.  PARSONS  responded that  upon  expiration,  a current  lease                                                               
could  be  converted  into  a  lease  under  the  commercial  use                                                               
program, and the land could  subsequently be purchased at the end                                                               
of that lease.                                                                                                                  
CHAIR PATKOTAK  asked Mr.  Parsons to  clarify whether  a current                                                               
leaseholder would  have to  wait until  expiration of  the lease,                                                               
then enter  into a  new lease under  the commercial  use program,                                                               
and only  then at the  end of that lease  have the option  to buy                                                               
the  land.   He  said  that  a  leaseholder  may have  been  more                                                               
conservative than an owner in developing the land.                                                                              
MR.  PARSONS  responded  that  the   state  could  terminate  the                                                               
existing lease  and enter into  a new lease under  the commercial                                                               
use  program,   so  that   the  entrepreneurial   activities  are                                                               
protected.  He  stressed that it's not the intent  of the program                                                               
to  effectively  kick  someone  off  of  the  land  they've  been                                                               
developing, and that DNR would  work to convert an existing lease                                                               
to  a   commercial  use  program   lease  given   an  appropriate                                                               
development plan.                                                                                                               
2:30:32 PM                                                                                                                    
DAVID SCHADE,  Director, Division  of Agriculture,  Department of                                                               
Natural  Resources,  began his  portion  of  the PowerPoint  with                                                               
slide  5, "Agriculture  Lands," which  read as  follows [original                                                               
punctuation provided]:                                                                                                          
      Reduced Restrictions to Agricultural Land Disposals                                                                     
        Statutes are modified to reduce restrictions on                                                                         
             agricultural land to private ownership                                                                             
     ? Reduces parcel size from a minimum of 40 acres to 20                                                                     
     acres when subdividing                                                                                                     
      ? Increases the number of parcels from a maximum of                                                                       
     four parcels to eight parcels when subdividing                                                                             
       ? Allows for land use and improvements, including                                                                        
          those that do not limit the primary use for                                                                           
     agricultural purposes                                                                                                      
MR. SCHADE  explained that  HB 120  would allow  both use  of and                                                               
improvements  on agriculture  covenanted land  to include  modern                                                               
revenue-generating activities  that don't  impede on  its primary                                                               
use as an  agriculture operation; for example, he  said, a farmer                                                               
could  open a  bed and  breakfast or  put in  a cell  tower.   He                                                               
explained that  the reading of  the statute by the  Department of                                                               
Law  (DOL) has  determined  that not  only  are those  activities                                                               
currently disallowed, but farming  operations are also limited in                                                               
how large  tracts of land  may be parceled, limiting  the acreage                                                               
to four parcels with  a minimum of 40 acres each.   Under HB 120,                                                               
he said, large operations would  be allowed to have eight parcels                                                               
of 20  acres or more,  and parcels of  between five and  20 acres                                                               
would  be allowed  to establish  ancillary activities  such as  a                                                               
tractor  dealership, allowing  for infrastructure  opportunities.                                                               
He characterized  the proposed legislation as  attempting to make                                                               
agricultural   lands   more    user-friendly   while   increasing                                                               
agricultural use.                                                                                                               
2:34:22 PM                                                                                                                    
REPRESENTATIVE  HANNAN asked  whether the  statute would  require                                                               
agriculture  activities be  ongoing  while operating  non-farming                                                               
MR.   SCHADE  explained   that  agricultural   covenants  require                                                               
agriculture activities  to continue.  Because  of the limitations                                                               
on other activities, he said,  it's been difficult to enforce the                                                               
covenants.   He said that the  first step is to  clarify what the                                                               
allowable  uses would  be, then  take on  a more  active role  in                                                               
covenant enforcement.                                                                                                           
REPRESENTATIVE HANNAN asked how an allowable use is determined.                                                                 
MR. SCHADE  replied, "You're asking the  million dollar question,                                                               
it's  the one  we struggle  with:  What level  of agriculture  is                                                               
agriculture?"   He  said that  one  of the  reasons for  allowing                                                               
ancillary  uses   on  the   smaller  parcels   is  to   keep  the                                                               
traditional,  larger farming  enterprises on  the large  parcels.                                                               
He expressed strong support for  the 20-acre minimum to allow for                                                               
crop rotation  in traditional  agriculture.  He  said that  if HB
120 passes,  it would  be incumbent on  DNR to  write regulations                                                               
clarifying the metrics of ancillary and non-farm uses.                                                                          
2:38:31 PM                                                                                                                    
MR. PARSONS  resumed the PowerPoint with  slide 6, "Development,"                                                               
which read as follows [original punctuation provided]:                                                                          
        Road Development and Minimum Lot Size Standards                                                                       
          The bill clarifies statutes relating to the                                                                           
      development of roads and minimum lot size standards                                                                       
        ? Provides statute language to ensure State land                                                                        
       disposals are held to the same platting and zoning                                                                       
      requirements as all municipal projects for both lot                                                                       
                  size and constructed access                                                                                   
MR.  PARSONS   explained  that  this  section   of  the  proposed                                                               
legislation is  intended to  allow the  state to  be held  to the                                                               
same  standards  as a  private  developer  when developing  lands                                                               
within   the   boundaries   of    the   organized   boroughs   of                                                               
municipalities.   If  a private  developer was  allowed to  build                                                               
roads to  a collector  standard, he said,  the state  couldn't be                                                               
required to  build roads  to the  more costly  arterial standard,                                                               
with  wider  shoulders and  different  drainage  structures.   He                                                               
noted that this agreement was reached with the cooperation of                                                                   
the Alaska Municipal League.                                                                                                    
2:40:49 PM                                                                                                                    
REPRESENTATIVE HANNAN asked for the location of that language in                                                                
the bill.                                                                                                                       
MR. PARSONS replied that it is in Section 2, on page 3, lines                                                                   
17-29.  Section 2 read as follows:                                                                                              
     Sec. 2. AS 19.30.080 is amended to read:                                                                                 
          Sec.   19.30.080.   Construction   standards   and                                                                  
     maintenance.  An  access   road  constructed  under  AS                                                                  
     19.30.060  - 19.30.100  shall be  of low  standard, not                                                                    
     necessarily suitable for all  weather use. The state is                                                                    
     not  under  obligation  to   maintain  an  access  road                                                                    
     constructed  under  AS  19.30.060 -  19.30.100.  If  an                                                                    
     access road is constructed  outside a municipality that                                                                    
     has zoning  ordinances, the right-of-way width  for the                                                                    
     road shall be  determined by the division  of lands and                                                                    
     the   Department    of   Transportation    and   Public                                                                    
     Facilities.  If an  access road  under  AS 19.30.060  -                                                                
     19.30.100  is constructed  within the  boundaries of  a                                                                
     municipality that has zoning ordinances, the right-of-                                                                     
     way width  for the road  shall be consistent  with, but                                                            
     not in excess of,  a municipal road project's right-of-                                                                
     way [CONFORM  TO THE SUBDIVISION CONTROL  ORDINANCES OF                                                                
     THE MUNICIPALITY]. Contracts for  the work on an access                                                                    
     road  are  governed  by  AS  36.30  (State  Procurement                                                                    
2:41:26 PM                                                                                                                    
MR. PARSONS presented slide 7, "Additional Sales and                                                                            
Authorities," which read as follows [original punctuation                                                                       
                  Additional Sale Authorities                                                                                 
     Provides for ease of Land Sales purchase contracts and                                                                     
     ?    Modifies   auction    requirements   for    easier                                                                    
     administration of land offerings                                                                                           
          o Allows  for more modern sale  options, including                                                                    
     online auctions                                                                                                            
     ? Increases max contract term to 30 years                                                                                  
          o Currently capped at 20 years                                                                                        
         o Allows for longer financing of higher value                                                                          
      ? Language referencing "foreclosure" is modified to                                                                       
     "termination" to align with the current administrative                                                                     
MR.  PARSONS  explained that  slide  7  highlighted the  "cleanup                                                               
language" in the proposed legislation.                                                                                          
2:43:42 PM                                                                                                                    
REPRESENTATIVE SCHRAGE  asked whether  there would  be a  way for                                                               
residents without Internet access to participate in an auction.                                                                 
MR. PARSONS  responded that  at this  time DNR is  not set  up to                                                               
conduct online-only  auctions; the current  system is to  have an                                                               
auction,  with any  lands unsold  moved to  an "over-the-counter"                                                               
sale.   He said that  it's those lands that  could be put  up for                                                               
online auction.                                                                                                                 
CHAIR PATKOTAK noted that it would  be preferable to have a paper                                                               
system remain available.                                                                                                        
REPRESENTATIVE  SCHRAGE asked  whether HB  120 could  potentially                                                               
allow a system of online-only auctions.                                                                                         
MR. PARSONS replied, "I believe that would be a possibility."                                                                   
2:45:33 PM                                                                                                                    
CHAIR PATKOTAK announced that HB 120 was held over.                                                                             

Document Name Date/Time Subjects
HB 135 Support University of Michigan Center for Sustainable Systems 4.27.2021.pdf HRES 4/30/2021 1:00:00 PM
HB 135
HB 135 Example Geothermal Facilities 4.27.2021.pdf HRES 4/30/2021 1:00:00 PM
HB 135
HB 120 DNR Presentation to HRES 4.30.2021.pdf HRES 4/30/2021 1:00:00 PM
HB 120
HB 120 Draft HRES CS 4.30.2021.pdf HRES 4/30/2021 1:00:00 PM
HB 120
HB 120 Sectional Analysis to HRES CS 4.30.2021.pdf HRES 4/30/2021 1:00:00 PM
HB 120