Legislature(2013 - 2014)BUTROVICH 205
02/12/2013 09:00 AM Senate STATE AFFAIRS
| Audio | Topic |
|---|---|
| Start | |
| SB1 | |
| SB2 | |
| SB4 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 1 | TELECONFERENCED | |
| *+ | SB 2 | TELECONFERENCED | |
| *+ | SB 4 | TELECONFERENCED | |
SB 1-ALASKA MINING DAY
9:03:16 AM
CHAIR DYSON announced that the bills before the committee were
SB 1, SB 2, and SB 4. He stated his preference to move the bills
out of committee.
9:03:30 AM
SENATOR CATHY GIESSEL, sponsor of SB 1, stated that the bill
would establish May 10 as Alaska Mining Day. She said that date
was chosen because on May 10, 1872, the General Mining Act of
the United States was adopted. She highlighted supporting
documents in members' packets. She noted that a lot of the
infrastructure in Alaska was built by the mining industry. The
most recent example is the Lake Dorothy Hydroelectric Dam near
Juneau, which was needed because of the Greens Creek Mine.
SENATOR GIESSEL pointed out that Alaska has a significant amount
of rare earth elements, such as those found in Bokan Mountain.
She spoke of an education program called Alaska Resource
Education that provides schools with information about mined
elements used for technology equipment.
9:06:53 AM
CHAIR DYSON asked if other mining states have done something
similar.
SENATOR GIESSEL did not know.
9:07:24 AM
ED FOGELS, Deputy Commissioner, Department of Natural Resources,
testified in support of SB 1. He related that mining has paid a
critical role in Alaska's history and economy. He shared
statistics about the benefits of mining to Alaska. Mining has
provided over 4,000 highly skilled jobs, each that average
$100,000 per year. He talked about the tax benefits from the Red
Dog and Donlin Mines.
He said that a large part of his job is to ensure that the seven
operating mines are in environmental compliance. He described
efforts to strengthen the mining sector, such as the Strategic
and Critical Minerals Initiative. He spoke of new opportunities
in mining. He thought it wise to remind Alaskans of the
importance of mining by having an Alaska Mining Day.
9:09:58 AM
CHAIR DYSON suggested there was more mining activity in the last
ten years, than in the past. He stated that some of the mines
are world class. He asked if most mines are financed with
Canadian money.
MR. FOGELS agreed with that analysis. He said that mining has
increased rapidly over the last 20 years. He recalled that 25
years ago Greens Creek and Red Dog were just starting up and the
only other mine in the state was Usibelli coal mine. He said
there are currently seven active mines and two more large mines
in the permitting process. He agreed that a considerable amount
of investment money is Canadian, but said some mines are
financed by American dollars, such as Pogo and Kensington.
CHAIR DYSON asked how mines are taxed.
MR. FOGELS listed the number of ways the state taxes mines: a 3
percent royalty on profits, a 9 percent corporate income tax,
and a 7 percent mining license tax. The royalty would only apply
if the mine is on state land. He pointed out that there are
localized benefits from the mines in the form of jobs and
property taxes.
CHAIR DYSON asked if those are taxes on profits.
MR. FOGELS said yes.
9:12:40 AM
DEANTHA CROCKETT, Executive Director, Alaska Miners Association
(AMA), provided the background of AMA and its members. She
provided data about the economic benefits the state receives
from AMA. She testified in support of SB 1.
SENATOR GIESSEL requested that Ms. Crockett review the economic
benefits of mining to the Native Corporations.
MS. CROCKETT described the economic benefits to the Nenana
Corporation from the Red Dog Mine. The Red Dog Mine is the only
taxpayer in the Northwest Artic Borough. She said that 60
percent of the jobs at the Red Dog Mine are Nenana Corporation
shareholders and 90 percent of the jobs at Donlin will be
shareholders.
CHAIR DYSON shared a view that the Red Dog project was well
done. He mentioned Teck Cominco mine-related benefits, such as
training, low fuel rates, the clinic, the airport, and barge
transportation, all which help the locals, as well.
MS. CROCKETT added that the mine has been very instrumental in
helping with evacuating villagers during major storms.
9:17:02 AM
MICHAEL SATRE, Executive Director, Council of Alaska Producers,
related that he represents large-producing metal mines. He
stated full support for SB 1. He wished to recognize the
individuals who contributed to the mine industry. He recognized
David Stone as being a premier supporter of mining.
9:18:56 AM
SENATOR COGHILL moved to report SB 1, labeled LS-0001\U, from
committee with individual recommendations and attached zero
fiscal note. There being no objection, SB 1 was reported from
the Senate State Affairs Standing Committee.
SENATOR GIESSEL noted there was a zero fiscal note.