05/04/2004 03:55 PM Senate RES

   CSHB 319(FIN) am-REC.CABIN SITES/LOTTERY SALE/RTS. RESERV                                                                
                                                                                                                                
CHAIR  SCOTT  OGAN  announced  CSHB   319(FIN)am  to  be  up  for                                                               
consideration.                                                                                                                  
                                                                                                                                
REPRESENTATIVE HUGH FATE,  sponsor of HB 319,  said he'd reviewed                                                               
only some of the amendments.                                                                                                    
                                                                                                                                
4:10 - 4:12 - at ease                                                                                                           
                                                                                                                                
MR.  BOB LOEFFLER,  Director, Division  Mining,  Land and  Water,                                                               
Department of Natural  Resources (DNR), said he is  very proud of                                                               
the division's  remote recreation  program, which  is continually                                                               
being  improved. The  technical amendments  are just  workability                                                               
sections so his goal can be accomplished.                                                                                       
                                                                                                                                
He informed the  committee that surveys are  currently taking his                                                               
department roughly two years from  the time a lease is initiated.                                                               
Individual  parcels usually  take  longer than  the batches.  The                                                               
Mat-Su  Borough   has  a  10-month   backlog  and   the  proposed                                                               
legislation would  probably put  individuals to  the end  of that                                                               
line; Fairbanks  North Star Borough's situation  is similar. This                                                               
brings  about his  concern that  this program  might eliminate  a                                                               
portion of the department's current  program to do surveys in the                                                               
proposed  24   months.  Secondly,   he  was  concerned   that  an                                                               
individual would  go through the  process and not be  finished in                                                               
the  24-month  timeframe  and  the   department  would  lose  its                                                               
authorization to  convey the  surveyed land  to them.  To protect                                                               
individual  Alaskans, he  proposed Amendment  1 that  says survey                                                               
and  appraisal  shall be  completed  within  24 months  of  lease                                                               
issuance  unless   an  extension  is  deemed   necessary  by  the                                                               
commissioner.  This directs  him very  clearly to  accomplish the                                                               
sponsor's intent, but doesn't penalize  an individual if it can't                                                               
be done.                                                                                                                        
                                                                                                                                
MR. LOEFFLER said that Amendment  2 prohibits the department from                                                               
selling land with high mineral  potential by standards adopted by                                                               
the  department in  regulations (page  4, section  (g). Requiring                                                               
standards to  be put  into regulations  would eliminate  his FY05                                                               
sale.  However,  he  can  accomplish   the  sponsor's  intent  by                                                               
adopting standards, but not putting them into regulations.                                                                      
                                                                                                                                
MR. POUND refined  the amendment saying he would  delete only "in                                                               
regulations".                                                                                                                   
                                                                                                                                
MR.  LOEFFLER  said  that  would be  fine.  The  third  technical                                                               
amendment deletes subsection (g). He  explained that at least two                                                               
boroughs require  either absolutely or approximately  10 acres as                                                               
the  minimum parcel  size,  but the  bill sets  10  acres as  the                                                               
maximum parcel size.  Given his experience with  people going out                                                               
on the  ground and  trying to  figure out  the area  along curved                                                               
streams  and  lakes, he  didn't  think  most  of them  would  get                                                               
particularly close.  It would be  odd to send people  out knowing                                                               
they would be unsuccessful in  the Mat-Su and Kodiak boroughs. He                                                               
thought  the  sponsor's  intent  could  be  accomplished  by  the                                                               
technical change.                                                                                                               
                                                                                                                                
MR. POUND replied that it was acceptable.                                                                                       
                                                                                                                                
SENATOR WAGONER said  he liked line 31 in section  (g) that deals                                                               
with lake  and river frontage  so one  person couldn't go  in and                                                               
develop one-acre lots clear around a lake.                                                                                      
                                                                                                                                
MR.  LOEFFLER  agreed   with  him  in  general   and  said  those                                                               
requirements are  typically in all  his division's  remote sales.                                                               
He  said the  third  part of  (g) says  parcels  sold under  this                                                               
section are  subject to 16 USC  31, the famous no  more clause in                                                               
ANILCA. While he  is supportive of the clause,  it binds Congress                                                               
to not do certain things and it's  an odd thing to have to put in                                                               
everybody's patent.                                                                                                             
                                                                                                                                
CHAIR OGAN summarized that there  was agreement by the sponsor on                                                               
all the technical  changes except for Amendment 1. He  went on to                                                               
the policy amendment that would revise (f).                                                                                     
                                                                                                                                
MR.  LOEFFLER explained  that  the policy  problem  he wanted  to                                                               
solve  in  (f) is  that  Alaska  land needs  to  be  open to  all                                                               
Alaskans. Just  because one person nominates  a particularly good                                                               
parcel doesn't mean he is the  only one who should be entitled to                                                               
it  as he  is currently.  However, it  has been  the department's                                                               
experience that  people don't  bid when  someone has  nominated a                                                               
parcel and has the right of  first refusal. His solution has been                                                               
to offer enough land so that there are enough choices.                                                                          
                                                                                                                                
SENATOR WAGONER  said he has been  involved in a couple  right of                                                               
first refusal purchases and that  people do bid competitively for                                                               
them.                                                                                                                           
                                                                                                                                
MR. LOEFFLER  responded that the  department offers  auctions for                                                               
surveyed  parcels  without  the   right  of  first  refusal,  but                                                               
auctions are  spirited nevertheless.  The publications  for those                                                               
parcels are much more elaborate  than mere classifieds. HB 319 is                                                               
an opportunity  to stake  land, but  the department  doesn't know                                                               
exactly what  is included in  the offers because the  land hasn't                                                               
been surveyed yet. The problems are operational.                                                                                
                                                                                                                                
SENATOR WAGONER  said that a  lot of  people in Alaska  will know                                                               
better than  other people immediately  where the prime  pieces of                                                               
property are.                                                                                                                   
                                                                                                                                
     I  believe what  the  chairman of  this committee  said                                                                    
     that we're  going to  create a mini  land rush  and the                                                                    
     best parcels  in those areas  are going to be  taken up                                                                    
     by  the people  that know  those areas  best.... But  I                                                                    
     think it's  our responsibility  to make sure  the state                                                                    
     gets  the largest  amount of  profit out  of this  land                                                                    
     that we can....                                                                                                            
                                                                                                                                
CHAIR OGAN  suggested adding "after  a best interest  finding" on                                                               
line 3 of the policy amendment.                                                                                                 
                                                                                                                                
MR. LOEFFLER  said that a  best interest finding is  required for                                                               
the department  to sell all land,  but it's not required  on land                                                               
that isn't being sold.                                                                                                          
                                                                                                                                
4:40 - 4:48 - at ease                                                                                                           
                                                                                                                                
SENATOR DYSON arrived at 4:53.                                                                                                  
                                                                                                                                
CHAIR OGAN said he would hold HB 319 for further work.