01/13/2004 08:00 AM House STA

HB 319-REMOTE REC.CABIN SITE SALES/LOTTERY SALE                                                                               
                                                                                                                                
CHAIR WEYHRAUCH  announced that  the next  order of  business was                                                               
HOUSE BILL  NO. 319, "An  Act relating  to the disposal  of state                                                               
land by lottery; and relating  to the disposal, including sale or                                                               
lease, of remote recreational cabin sites."                                                                                     
                                                                                                                                
9:36 a.m.                                                                                                                       
                                                                                                                                
JIM  POUND,  Staff  to Representative  Hugh  Fate,  Alaska  State                                                               
Legislature, presented  HB 319 on behalf  of Representative Fate,                                                               
sponsor.   He told the committee  that HB 319 is  partly a result                                                               
of the Alaska  Constitution, Article VIII, Section  1, which read                                                               
as follows:                                                                                                                     
                                                                                                                                
     SECTION 1.   Statement of Policy.  It is  the policy of                                                                    
     the State to  encourage the settlement of  its land and                                                                    
     the  development  of  its   resources  by  making  them                                                                    
     available for  maximum use  consistent with  the public                                                                    
     interest.                                                                                                                  
                                                                                                                                
MR.  POUND  noted  that  the  State of  Alaska  has  held  on  to                                                               
approximately  90 acres.   He  said that  HB 319  relates to  the                                                               
American dream  of owning a  piece of  property.  The  land being                                                               
held  by the  state is  essentially nonproductive  and is  exempt                                                               
from local taxation.   He opined that that land  is only an asset                                                               
when it is passed on to the private sector.                                                                                     
                                                                                                                                
MR.  POUND  said this  remote  recreational  cabin site  bill  is                                                               
designed  to make  it easier  for individuals  to find  a perfect                                                               
location  for a  weekend escape,  or a  hunting or  fishing trip,                                                               
hopefully near  their own homes.   It means that  local residents                                                               
will be  building structures in parts  of the state where  no one                                                               
currently lives.                                                                                                                
                                                                                                                                
MR. POUND noted  that a trickle down effect  would occur, because                                                               
building  materials, fuel,  and  remote  transportation would  be                                                               
purchased.  He  also noted that organized boroughs  would then be                                                               
allowed to  have property tax  bases they currently do  not have.                                                               
Mr.  Pound concluded  by saying  that  owning land  in Alaska  is                                                               
economic in basis, because land is  forever - it is not something                                                               
that has to do with a "boom or bust."                                                                                           
                                                                                                                                
9:40 a.m.                                                                                                                       
                                                                                                                                
REPRESENTATIVE SEATON referred  to page 3, line 5,  which read as                                                               
follows:                                                                                                                        
                                                                                                                                
      Sales under this section may be at public or private                                                                  
     sale.                                                                                                                  
                                                                                                                                
REPRESENTATIVE SEATON  said that  he would like  some explanation                                                               
whether this  language refers  to private  sales that  only occur                                                               
after [land]  has gone  out to  a public sale  and is  a leftover                                                               
parcel,  or  whether  it  could  refer  to  sales  that  are  not                                                               
competitively  available   to  all  Alaskans.     [Regarding  the                                                               
language] he added,  "I'm hoping there'll be a  little cleanup in                                                               
there."                                                                                                                         
                                                                                                                                
MR.  POUND  offered his  understanding  that,  under the  current                                                               
policy, a  person can walk  in after  the open process  is closed                                                               
and say,  "Okay, I want  that little  plot of land  right there,"                                                               
and that can be negotiated  privately, "without it going back out                                                               
to public."                                                                                                                     
                                                                                                                                
REPRESENTATIVE  SEATON recommended  that  the  word "private"  be                                                           
clarified to  mean a private sale  after it has been  offered for                                                               
public sale.                                                                                                                    
                                                                                                                                
9:44 a.m.                                                                                                                       
                                                                                                                                
REPRESENTATIVE  GRUENBERG  turned  to  [page  2,  line  3]  where                                                               
"38.05.600" shows  as new text added  to HB 319.   He offered his                                                           
understanding  that  the State  of  Alaska  retained the  mineral                                                               
rights to virtually  everything.  He asked, "Now  on these remote                                                               
parcel sales, do they pass the mineral rights away?"                                                                            
                                                                                                                                
MR.  POUND answered  no.    He indicated  that  [that portion  of                                                               
statute] was added [to the language  in the bill] to clarify that                                                               
there would not be a different set of rules.                                                                                    
                                                                                                                                
9:46 a.m.                                                                                                                       
                                                                                                                                
CHAIR WEYHRAUCH asked  Mr. Pound to explain  his previous comment                                                               
regarding  land only  being an  asset  when it's  in the  private                                                               
sector.   He remarked  that the University  [of Alaska]  has land                                                               
that is not in the  private sector, which is certainly considered                                                               
an asset.                                                                                                                       
                                                                                                                                
MR. POUND  noted that the land  that makes up the  university and                                                               
the railroad is  exempt from local taxation;  therefore, there is                                                               
no tax  base.  He stated  his belief in local  taxation, and said                                                               
that, regarding possession of an  appraised value, one finds more                                                               
of an  appraisal in a  private sector  piece of property  than in                                                               
government owned [property].                                                                                                    
                                                                                                                                
[HB 319 was heard and held.]