Legislature(2011 - 2012)SENATE FINANCE 532

04/13/2011 09:00 AM FINANCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ SB 95 FRANK PALMER FERRY TERMINAL TELECONFERENCED
Moved SB 95 Out of Committee
+ SB 108 SPC. STEPHEN "MAX" CAVANAUGH OVERPASS TELECONFERENCED
Moved SB 108 Out of Committee
+ HB 105 SOUTHEAST STATE FOREST TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
HOUSE BILL NO. 105                                                                                                            
                                                                                                                                
     "An Act relating to the Southeast State Forest; and                                                                        
     providing for an effective date."                                                                                          
                                                                                                                                
9:13:36 AM                                                                                                                    
                                                                                                                                
RICK ROGERS, FOREST RESOURCE PROGRAM MANAGER, DIVISION OF                                                                       
FORESTRY, DEPARTMENT OF NATURAL RESOURCES, read from a                                                                          
prepared statement (copy on file):                                                                                              
                                                                                                                                
                                                                                                                                
     Background and Purpose                                                                                                     
                                                                                                                                
                                                                                                                                
     I am  pleased to speak  in support of HB105.  This bill                                                                    
     is  part of  the state's  effort to  ensure that  local                                                                    
     timber  processing  continues  to  be a  piece  of  the                                                                    
     economy in Southeast Alaska. The  majority of timber in                                                                    
     SSE is on  federal land, but federal  timber sales have                                                                    
     declined  drastically. Local  mills now  depend heavily                                                                    
     on  state timber  for  survival.  Demand for  Southeast                                                                    
     timber  for wood  energy  is  also increasing,  further                                                                    
     raising  the importance  of securing  a timber  base in                                                                    
     this region.                                                                                                               
                                                                                                                                
                                                                                                                                
     Pursuant to  SCSHB 162(RES), the 25,291  acre Southeast                                                                    
     State  Forest  was established  in  June  2010. HB  105                                                                    
     would add an additional 23,181  acres of state lands to                                                                    
     the Southeast  State Forest from state  lands currently                                                                    
     available for timber harvest.  The Division of Forestry                                                                    
     would  then  be able  to  manage  the combined  acreage                                                                    
     (48,4 72  acres) for a  long-term supply of  timber and                                                                    
     retain  these lands  in  state  ownership for  multiple                                                                    
     uses.  These  forest  lands  will   be  managed  as  an                                                                    
     integrated  unit  and  according   to  a  state  forest                                                                    
     management  plan that  will be  developed via  a public                                                                    
     process  within the  next two  years.  While the  lands                                                                    
     were  previously available  for  timber harvest  before                                                                    
     the  State Forest  was  established,  the State  Forest                                                                    
     designation ensures these  productive forest lands will                                                                    
     remain in  state ownership and  contribute to  the long                                                                    
     term  viability   of  the   timber  based   economy  in                                                                    
     Southeast.                                                                                                                 
                                                                                                                                
                                                                                                                                
     In 2009, the previous  forest inventory was updated for                                                                    
     all  general use  lands managed  by  the Department  of                                                                    
     Natural Resources  (DNR) with forest  management intent                                                                    
     language  per   the  regions  Area  Plans.   This  data                                                                    
     provides the required  supporting information on timber                                                                    
     volume,   acreage  and   allowable  harvest   for  this                                                                    
     request.  The allowable  harvest  from  these lands  is                                                                    
     approximately 8.3  million board feet. The  DNR manages                                                                    
     over  159,000 acres  of uplands  in Southern  Southeast                                                                    
     Alaska. Timber  management is allowed  on approximately                                                                    
     one  third of  this  land; the  State actively  manages                                                                    
     this timber  base to supply  wood to  local processors.                                                                    
     The remaining  land is  designated primarily  for other                                                                    
     uses   including   land    sales,   recreation,   water                                                                    
     resources,  and fish  and  wildlife habitat,  including                                                                    
     over  65,073 acres  of  legislatively designated  state                                                                    
     marine parks  and critical habitat areas.  Adding lands                                                                    
     to the State  Forest will ensure that  the State's most                                                                    
     suitable  lands   in  Southeast  remain   available  to                                                                    
     contribute  to   timber  supply  through   the  State's                                                                    
     ongoing timber  sale program. Much  of the  State owned                                                                    
     timber land in Southeast  Alaska was inherited from the                                                                    
     U.S. Forest Service and is comprised of young, second-                                                                     
     growth  stands.  Actively-managed second-growth  stands                                                                    
     provide  more   timber  volume  per  acre   on  shorter                                                                    
     rotations and  can result in improved  deer browse than                                                                    
     unmanaged  stands. We  can  increase  timber yield  and                                                                    
     associated timber  supply from  state land  by thinning                                                                    
     these stands.  Thinning is  a long-term  investment and                                                                    
     is  only justified  if  the land  will  continue to  be                                                                    
     available for forest management.                                                                                           
                                                                                                                                
     Timber  sales  from  these  lands  will  be a  mix  of                                                                     
     domestic  and export  and  will be  based  on economic                                                                     
     conditions and  locations. As established  by the 1984                                                                     
     Supreme   Court   Case   of   South   Central   Timber                                                                     
     Development,  Inc  vs.  Esther Wunnicke,  Commissioner                                                                     
     DNR, the state may  not restrict round log exports due                                                                     
     to  the  interpretation  of  the  interstate  commerce                                                                     
     clause.  In  spite  of  these  legal  constraints  the                                                                     
     Division  has  done   a  good  job  encouraging  local                                                                     
     manufacturing  of   logs  from   State  timber  sales.                                                                     
     Approximately 87% of the  timber sold from state lands                                                                     
     in southern Southeast over the past six years has been                                                                     
     processed by Alaska manufacturers.                                                                                         
     The proposed  additions to the  Southeast State Forest                                                                     
     include 23 parcels (see  chart in the briefing paper).                                                                     
     Approximately 21 percent of  these lands are from five                                                                     
     parcels  that  had  previously  been reserved  pending                                                                     
     legislative transfer to the University of Alaska. That                                                                     
     legislation did not pass freeing these lands for long-                                                                     
     term  forest  management  in  the  State  Forest.  The                                                                     
     legislation includes  general use  lands on  Prince of                                                                     
     Wales,  Tuxekan,  Gravina,  Kosciusko,  Revillagigedo,                                                                     
     Wrangell,  Suemez,  Mitkof,  Kuiu,  Dall, and  Zarembo                                                                     
     Islands.  Six of  these parcels  are adjacent  or near                                                                     
     existing State Forest parcels.                                                                                             
                                                                                                                                
                                                                                                                                
     The Division  of Forestry worked  with the  Division of                                                                    
     Mining,  Land,  and  Water (DML&  W)  to  identify  and                                                                    
     exclude lands  that are priorities  for the  state land                                                                    
     disposal  program. A  consultation  was also  initiated                                                                    
     with the University of Alaska  Statewide Office of Land                                                                    
     Management  and  University  senior  officials.  A  key                                                                    
     difference  between a  state forest  designation and  a                                                                    
     transfer of  lands as proposed by  previous legislation                                                                    
     is the  continued long-term  public ownership  of these                                                                    
     lands  as  opposed  to   other  development  uses.  The                                                                    
     Division also  consulted with the Alaska  Department of                                                                    
     Fish and  Game to  ensure there was  internal alignment                                                                    
     on the list of proposed  parcels, and there is. Several                                                                    
     other parcels  were considered as part  of our internal                                                                    
     due diligence  process, but  because of  known concerns                                                                    
     and  or   potential  for  high  controversy   were  not                                                                    
     included.    Fish habitat  and  water  quality are  key                                                                    
     components of  the Forest  Resources and  Practices Act                                                                    
     (FRPA)  which have  a series  of regulations  that will                                                                    
     apply to  management of  these parcels.  Stream buffers                                                                    
     have  a  no   cut  100  foot  minimum   width  on  both                                                                    
     anadromous and  high value  resident fish  streams. The                                                                    
     next 100  to 300  foot zone  may allow  timber harvest,                                                                    
     but  the  activity  must be  consistent  for  both  the                                                                    
     maintenance  of important  fish  and wildlife  habitat.                                                                    
     Area Plans also  provide for coastal buffers  of 300 to                                                                    
     500 feet  with additional recommendations  for specific                                                                    
     parcels.   During  the   development   of  the   forest                                                                    
     management plan, a key consideration  for the Neets Bay                                                                    
     parcel  will be  the maintenance  of water  quality and                                                                    
     quantity for  the fish hatchery  operation at  the head                                                                    
     of  the   bay.  Dialog  with  the   Southern  Southeast                                                                    
     Regional  Aquaculture  Association (SSRAA)  is  ongoing                                                                    
     concerning this legislation.                                                                                               
                                                                                                                                
     The Southeast State Forest would be managed as part                                                                        
     of the State Forest System under AS 41.17.200-.230.                                                                        
     Subsection (a) of Sec. 41.17.200 reads in part:                                                                            
                                                                                                                                
                                                                                                                                
     "The  primary purpose  in  the  establishment of  state                                                                    
     forests  is timber  management  that  provides for  the                                                                    
     production,  utilization, and  replenishment of  timber                                                                    
     resources  while  allowing  other  beneficial  uses  of                                                                    
     public land and resources ".                                                                                               
                                                                                                                                
                                                                                                                                
     In  addition to  timber management,  State Forests  are                                                                    
     open for multiple uses,  including wildlife habitat and                                                                    
     harvest,    mineral   exploration    and   development,                                                                    
     transportation,  recreation and  tourism. State  Forest                                                                    
     lands would  be managed consistent with  the management                                                                    
     intent  under the  current Prince  of Wales  Island and                                                                    
     Central  Southeast area  plans.  Changes to  management                                                                    
     intent  would  require  public and  interagency  review                                                                    
     through  adoption of  a  State  Forest Management  Plan                                                                    
     under AS 41.17.230.                                                                                                        
                                                                                                                                
     9:19:43 AM                                                                                                               
                                                                                                                                
     Mr. Rogers continued with his testimony:                                                                                   
                                                                                                                                
     Municipal Entitlements                                                                                                     
                                                                                                                                
     One of  the other demands  on state  land in SSE  is to                                                                    
     fulfill  land entitlements  for new  municipalities. To                                                                    
     avoid conflicts with  the Wrangell Borough entitlement,                                                                    
     the Southeast State Forest bill  specifies that the new                                                                    
     Wrangell Borough  may select  State Forest  land within                                                                    
     the  borough boundary.  The  Wrangell borough  boundary                                                                    
     encompasses three parcels in  the existing state forest                                                                    
     (Crittenden Creek  and Bradfield Canal East  and West),                                                                    
     and  four parcels  in the  proposed additions  (Eastern                                                                    
     Passage,  Pat Creek,  Pat Creek  uplands and  Earl West                                                                    
     Cove).                                                                                                                     
                                                                                                                                
     If  additional municipalities  are incorporated  before                                                                    
     June 30, 2019, lands  that were vacant, unappropriated,                                                                    
     unreserved  land  before  establishment  of  the  State                                                                    
     Forest would be included in the calculation of the                                                                         
     municipal entitlement acreage, but may not be                                                                              
     selected.                                                                                                                  
                                                                                                                                
     9:23:13 AM                                                                                                               
                                                                                                                                
     Mr. Rogers continued:                                                                                                      
                                                                                                                                
     Outreach                                                                                                                   
                                                                                                                                
     DNR  has briefed  many statewide  groups and  entities                                                                     
     across   Southeast   Alaska   about   this   proposal,                                                                     
     including the Board of Forestry, SE  Conference, local                                                                     
     governments, and  the diverse groups participating  in                                                                     
     the  Tongass  Futures  Roundtable.  These  discussions                                                                     
     will continue and to date we have received  letters in                                                                     
     support from the following organizations:                                                                                  
                                                                                                                                
                                                                                                                                
     •    the City of Coffman Cove,                                                                                             
     •    the Resource Development Council,                                                                                     
     •    the Alaska Forest Association,                                                                                        
     •    The Alaska Chapter of the Society of American                                                                         
     Foresters                                                                                                                  
     •    Southeast Conference                                                                                                  
     •    Wrangell resident and forestry consultant, George                                                                     
     Woodbury                                                                                                                   
     •    The Juneau Chamber of Commerce                                                                                        
     •    The Alaska Board of Forestry                                                                                          
                                                                                                                                
Senator  Thomas asked  about the  role of  federal lands  in                                                                    
Southeast  in  relation  to  state  and  timber  corporation                                                                    
lands.                                                                                                                          
                                                                                                                                
Mr.  Rogers  referred  to a  pie  chart:  "Southeast  Alaska                                                                    
Public Land Summary"  (copy on file). He  replied that total                                                                    
public  lands comprised  about 21  million acres,  including                                                                    
the north end  of the Tongass National Forest  at Yakutat to                                                                    
Southern  Southeast  Alaska.  He stated  that  the  "Tongass                                                                    
Timber  Scheduled"  section  of the  chart  totaled  144,000                                                                    
acres; the  Haines State Forest  was 286,000 acres;  and the                                                                    
existing Southeast State Forest was about 25,000 acres.                                                                         
                                                                                                                                
Co-Chair Stedman added that for  all practical purposes most                                                                    
of the  public land  in Southeast was  owned by  the federal                                                                    
government.                                                                                                                     
Senator Olson  wondered whether there was  opposition to the                                                                    
proposed forest.                                                                                                                
                                                                                                                                
Mr.  Rogers  referred  to testimony  from  Southeast  Alaska                                                                    
Conservation Council  (SEACC) in opposition to  the bill. He                                                                    
recalled   that  there   had  been   individuals  from   the                                                                    
communities who had voiced opposition.                                                                                          
                                                                                                                                
9:28:47 AM                                                                                                                    
                                                                                                                                
Senator Olson queried the opposition's viewpoint.                                                                               
                                                                                                                                
Mr.  Rogers  replied  that  some  felt  the  wood  would  be                                                                    
exported, and not  support the mills in  Alaska. He reported                                                                    
that  over the  prior six  years, 87  percent of  the timber                                                                    
sales went  to local  mills. He also  stated that  there was                                                                    
some   concern  about   balancing  forest   management  with                                                                    
fisheries, wildlife, and cultural  resources. He pointed out                                                                    
that the standards and requirements  of the Forest Resources                                                                    
and Practices  Act and the additional  planning requirements                                                                    
set forth in the bill would address many of the concerns.                                                                       
                                                                                                                                
Senator  Olson  wondered  whether   there  were  letters  of                                                                    
support from communities close to the proposed forest.                                                                          
                                                                                                                                
Mr. Rogers replied that there  was no official position from                                                                    
other   individual  communities.   He   remarked  that   the                                                                    
Southeast  Conference   membership  included  many   of  the                                                                    
surrounding municipalities.                                                                                                     
                                                                                                                                
Co-Chair Stedman  mentioned timber  mills in  Southeast, and                                                                    
wondered how many mills would be affected.                                                                                      
                                                                                                                                
Mr.  Rogers  replied  that  there   very  few  timber  mills                                                                    
remained  in Southeast  Alaska.  He stated  that the  Viking                                                                    
Lumber Mill,  near Craig, had  relied on federal  timber and                                                                    
were  experiencing significant  difficulty  in wood  supply.                                                                    
The mill had begun to rely  on state timber sales to stay in                                                                    
business. He noted that the  annual requirement for the mill                                                                    
was  20  million  board  feet per  year,  but  annual  board                                                                    
footage from state  lands was only 8 million.  He opined the                                                                    
limitations concerning how the  land base could be utilized,                                                                    
but  if  it was  properly  managed  there could  be  further                                                                    
support  of the  timber  industry. He  mentioned that  there                                                                    
were enhancements in the bill  directed at the other smaller                                                                    
timber mills.                                                                                                                   
                                                                                                                                
Co-Chair  Stedman explained  that  the  mill was  relatively                                                                    
small, as was the state forest,  because most of the land in                                                                    
Southeast was federally owned.                                                                                                  
                                                                                                                                
Co-Chair Stedman  referred to  a zero  fiscal note  from the                                                                    
Department of Natural Resources.                                                                                                
                                                                                                                                
9:35:04 AM                                                                                                                    
                                                                                                                                
CHIP THOMA,  JUNEAU, explained that the  proposed lands were                                                                    
originally intended for  community development. He expressed                                                                    
concern that  the lands  would eventually  be clear  cut. He                                                                    
declared  that Rowan  Bay and  Hook  Arm were  inappropriate                                                                    
locations  for timber  cutting, because  the areas  had been                                                                    
cut in  the few years  prior. He  stressed that most  of the                                                                    
Native  Corporation  land was  located  on  Prince of  Wales                                                                    
Island.                                                                                                                         
                                                                                                                                
Co-Chair Hoffman  noted that there was  a projected decrease                                                                    
in population in Southeast  Alaska, so community development                                                                    
would  be impossible.  He wondered  how the  lands could  be                                                                    
intended  for  community   expansion  when  the  surrounding                                                                    
communities were decreasing.                                                                                                    
                                                                                                                                
Mr. Thoma  replied that  the lands  should be  designated to                                                                    
the  communities'  intentions,  rather than  combining  them                                                                    
with the State Forest and designating them for logging.                                                                         
                                                                                                                                
9:38:26 AM                                                                                                                    
                                                                                                                                
Co-Chair Stedman  referred to the 2010  Trend Magazine (copy                                                                    
on file),  and looked  at population forecasts  mentioned by                                                                    
Co-Chair Hoffman.  He stated that  the Southeast  region was                                                                    
negative 14  percent, Prince of Wales  Island would decrease                                                                    
by  34  percent,  Wrangell/Petersburg  would  decrease  34.6                                                                    
percent, Juneau would decrease 1.5  percent, and Sitka would                                                                    
decrease 7  percent. He stressed  that there  were different                                                                    
mechanisms  that   the  legislature   used  to   respond  to                                                                    
population growth and decline.                                                                                                  
                                                                                                                                
Senator Egan  wondered whether there would  be clear-cutting                                                                    
of the acreage.                                                                                                                 
                                                                                                                                
Mr. Rogers  replied that  most of the  lands were  in second                                                                    
growth,  and hoped  to  foster the  land.  He stressed  that                                                                    
clear-cutting  was the  primary  means  of managing  timber,                                                                    
with a regeneration applied to  the stripped land. He stated                                                                    
that there would  be some pre- commercial  thinning but that                                                                    
the land was public and stricter mandates would be applied.                                                                     
                                                                                                                                
Senator  Olson  queried  plans  for  reclamation  after  the                                                                    
commercial cutting.                                                                                                             
                                                                                                                                
Mr. Rogers  stated that the  Forest Resources  and Practices                                                                    
Act had  a mandatory  re-forestation requirement.  He stated                                                                    
that  Southeast Alaska  had a  requirement to  have stocking                                                                    
standards  applied within  5 years  of cutting.  He stressed                                                                    
that there was heavy natural  seeding in Southeast, and that                                                                    
it was  rare to  invest in planting  trees in  Southeast. He                                                                    
stated   that  the   act  had   high   standards  for   road                                                                    
maintenance,  with  emphasis  on   water  quality  and  fish                                                                    
passage.                                                                                                                        
                                                                                                                                
HB  105  was  HEARD  and   HELD  in  Committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
9:45:24 AM                                                                                                                    
RECESSED                                                                                                                        
                                                                                                                                

Document Name Date/Time Subjects
NEW SB 95 DOT Fiscal Note 041211.pdf SFIN 4/13/2011 9:00:00 AM
SB 95
HB 105 SE Land Summary 2.22.2011.pdf HFIN 3/22/2011 1:30:00 PM
SFIN 4/13/2011 9:00:00 AM
HB 105
SB 95 - Emails of Support.pdf SFIN 4/13/2011 9:00:00 AM
SB 95
SB 95 - Frank Palmer Obituary.pdf SFIN 4/13/2011 9:00:00 AM
SB 95
SB 95 - Letters of Support.pdf SFIN 4/13/2011 9:00:00 AM
SB 95
SB 95 - Sponsor Statement.pdf SFIN 4/13/2011 9:00:00 AM
SB 95
SB 108 SPONSOR STATEMENT.pdf SFIN 4/13/2011 9:00:00 AM
SB 108
SB 108 Support Documents - Congressman Young (Cavanaugh) 030811.pdf SFIN 4/13/2011 9:00:00 AM
SB 108
SB 108 Support Letter to governor from Cavanaugh 033010.PDF SFIN 4/13/2011 9:00:00 AM
SB 108
HB 105 AFA Letter of Support 1.12.2011.pdf SFIN 4/13/2011 9:00:00 AM
SFIN 4/14/2011 9:00:00 AM
HB 105
HB 105 BOF Support Letter 4-1-11.pdf SFIN 4/13/2011 9:00:00 AM
SFIN 4/14/2011 9:00:00 AM
HB 105
HB 105 Coffman Cove Letter of Support.pdf SFIN 4/13/2011 9:00:00 AM
SFIN 4/14/2011 9:00:00 AM
HB 105
HB 105 JCB Letter of Support.pdf SFIN 4/13/2011 9:00:00 AM
SFIN 4/14/2011 9:00:00 AM
HB 105
HB 105 Land Ownership and Mill Status.pdf SFIN 4/13/2011 9:00:00 AM
SFIN 4/14/2011 9:00:00 AM
HB 105
HB 105 Parcel Maps 12.20.2010.pdf SFIN 4/13/2011 9:00:00 AM
SFIN 4/14/2011 9:00:00 AM
HB 105
HB 105 RDC Letter of Support.pdf SFIN 4/13/2011 9:00:00 AM
SFIN 4/14/2011 9:00:00 AM
HB 105
HB 105 SAF Letter of Support.pdf SFIN 4/13/2011 9:00:00 AM
SFIN 4/14/2011 9:00:00 AM
HB 105
HB 105 Value Added 3.30.2011.pdf SFIN 4/13/2011 9:00:00 AM
SFIN 4/14/2011 9:00:00 AM
HB 105
HB 105 Vicinity Map.pdf SFIN 4/13/2011 9:00:00 AM
SFIN 4/14/2011 9:00:00 AM
HB 105
HB 24 SCS FIN Version D.pdf SFIN 4/13/2011 9:00:00 AM
HB 24
HB 24 SFIN FN for DCCED.pdf SFIN 4/13/2011 9:00:00 AM
HB 24
HB 119 HarborTransfers.pdf SFIN 4/13/2011 9:00:00 AM
SFIN 4/15/2011 9:00:00 AM
HB 119
HB 119 SCS FIN Version E.pdf SFIN 4/13/2011 9:00:00 AM
SFIN 4/15/2011 9:00:00 AM
HB 119
HB 126 SCS FIN Version E.pdf SFIN 4/13/2011 9:00:00 AM
SFIN 4/15/2011 9:00:00 AM
HB 126
HB 126 SFIN for DPS.pdf SFIN 4/13/2011 9:00:00 AM
SFIN 4/15/2011 9:00:00 AM
HB 126
HB 119 AHFC Letter 020811.pdf SFIN 4/13/2011 9:00:00 AM
SFIN 4/15/2011 9:00:00 AM
HB 119
SB 119 Critical Habitat map.pdf SFIN 4/13/2011 9:00:00 AM
SB 119
HB 119 Buccanerr Energy Letter.pdf SFIN 4/13/2011 9:00:00 AM
SFIN 4/15/2011 9:00:00 AM
HB 119