Legislature(2007 - 2008)CAPITOL 106
05/01/2007 05:15 PM House ECONOMIC DEV., TRADE, AND TOURISM
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| Start | |
| Presentation by Nana Regional Corporation Inc. | |
| SB97 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| + | SB 97 | TELECONFERENCED | |
ALASKA STATE LEGISLATURE
HOUSE SPECIAL COMMITTEE ON ECONOMIC DEVELOPMENT, INTERNATIONAL
TRADE AND TOURISM
May 1, 2007
5:42 p.m.
MEMBERS PRESENT
Representative Mark Neuman, Chair
Representative Carl Gatto
Representative Kyle Johansen
Representative Vic Kohring
Representative Bob Lynn
Representative Andrea Doll
Representative Mike Doogan
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
PRESENTATION BY NANA REGIONAL CORPORATION INC.
- HEARD
FOR SENATE BILL NO. 97(JUD)
"An Act relating to identification seals for certain articles
created or crafted in the state by Alaska Native persons;
relating to the Alaska State Council on the Arts; and making
certain identification seal violations unfair trade practices."
- HEARD AND HELD
PREVIOUS COMMITTEE ACTION
BILL: SB 97
SHORT TITLE: ALASKA NATIVE ART IDENTIFICATION SEALS
SPONSOR(s): SENATOR(s) STEVENS
02/26/07 (S) READ THE FIRST TIME - REFERRALS
02/26/07 (S) L&C, FIN
03/08/07 (S) L&C AT 1:30 PM BELTZ 211
03/08/07 (S) Heard & Held
03/08/07 (S) MINUTE(L&C)
03/13/07 (S) L&C AT 1:30 PM BELTZ 211
03/13/07 (S) Moved SB 97 Out of Committee
03/13/07 (S) MINUTE(L&C)
03/14/07 (S) L&C RPT 4DP
03/14/07 (S) DP: ELLIS, BUNDE, DAVIS, STEVENS
03/21/07 (S) FIN RPT 7DP
03/21/07 (S) DP: HOFFMAN, STEDMAN, ELTON, THOMAS,
DYSON, HUGGINS, OLSON
03/21/07 (S) FIN AT 9:00 AM SENATE FINANCE 532
03/21/07 (S) Moved SB 97 Out of Committee
03/21/07 (S) MINUTE(FIN)
03/26/07 (S) JUD REFERRAL ADDED
04/02/07 (S) JUD AT 1:30 PM BELTZ 211
04/02/07 (S) Moved CSSB 97(JUD) Out of Committee
04/02/07 (S) MINUTE(JUD)
04/04/07 (S) JUD RPT CS 1DP 4NR SAME TITLE
04/04/07 (S) DP: FRENCH
04/04/07 (S) NR: MCGUIRE, HUGGINS, WIELECHOWSKI,
THERRIAULT
04/11/07 (S) TRANSMITTED TO (H)
04/11/07 (S) VERSION: CSSB 97(JUD)
04/13/07 (H) READ THE FIRST TIME - REFERRALS
04/13/07 (H) EDT, HES, JUD
05/01/07 (H) EDT AT 5:15 PM CAPITOL 106
WITNESS REGISTER
WALTER SAMPSON, Vice President
Land and Natural Resources
NANA Regional Corporation, Inc.
Kotzebue, Alaska
POSITION STATEMENT: Provided the presentation on NANA Regional
Corporation Inc., and testified during the hearing on CSSB
97(JUD).
REPRESENTATIVE REGGIE JOULE, Member
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Testified during the presentation by NANA
Regional Corporation, and answered a question during the hearing
on CSSB 97(JUD).
TIM LAMKIN, Staff
to Senator Gary Stevens
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented CSSB 97(JUD) on behalf of Senator
Stevens, sponsor.
BENJAMIN BROWN, Attorney at Law;
Vice Chair
Alaska State Council on the Arts (ASCA)
Douglas, Alaska
POSITION STATEMENT: Testified during the hearing on CSSB 97.
L. SAUNDERS MCNEILL, Director
Community and Native Arts Program
Alaska State Council on the Arts (ASCA)
Anchorage, Alaska
POSITION STATEMENT: Testified during the hearing on CSSB 97.
ACTION NARRATIVE
CHAIR MARK NEUMAN called the House Special Committee on Economic
Development, International Trade and Tourism meeting to order at
5:42:00 PM. Representatives Gatto, Doll, Doogan, Kohring, and
Neuman were present at the call to order. Representatives Lynn
and Johansen arrived as the meeting was in progress.
^PRESENTATION BY NANA REGIONAL CORPORATION INC.
5:42:12 PM
CHAIR NEUMAN announced that the first order of business would be
a presentation by Walter Sampson of NANA.
5:43:20 PM
WALTER SAMPSON, Vice President, Land and Natural Resources, NANA
Regional Corporation (NANA), presented a brief history of NANA
after the passage of the Alaska National Interest Lands
Conservation Act (ANILCA) in December, 1971. He informed the
committee that the 11 villages of the NANA region directed that
the management of their selected land was to be based on a
subsistence use pattern; therefore, no development was planned
within this region. Mr. Sampson explained that the tribes are
strong governing bodies in the rural villages of this region.
Eventually, ten of the villages decided to adopt first class or
second class city government status and, thereby, sources of
revenue and services were established. The city governments
provided water, sewer, electricity, and other services. Mr.
Sampson said that when services began to be cut back, due to the
reduction of state funds to municipalities, the villages and
NANA shareholders began to search for other sources of revenue.
5:51:44 PM
MR. SAMPSON relayed that the NANA board of directors was
instructed to look for a business opportunity. At the same
time, NANA was finalizing its land selection and began to
research land north of Kotzebue. The rocks in this area were
stained by minerals which indicated a potential for successful
resource development. The NANA board of directors hired a
geologist and reviewed documents from the U.S. Department of the
Interior Geological Survey. After choosing a site, NANA applied
for 77,000 acres of land that eventually became the Red Dog
Mine. Mr. Sampson stressed that NANA proceeded with development
plans only after receiving the support of all of the village
residents. During a period of fourteen years plans were
developed and a road easement was acquired.
5:54:33 PM
REPRESENTATIVE GATTO asked about the stain on the land.
5:54:45 PM
MR. SAMPSON explained that the land was stained by rocks, and
the mine was named after the geologist's red dog. In 1980, NANA
began a search for a business partner with experience in mining.
Teck Cominco Ltd. (Teck Cominco), was chosen for the partnership
due to its prior arctic experience. He pointed out that the
villagers began a transformation from a rural and subsistence
lifestyle to one that also incorporates the operations of the
mining industry.
5:59:09 PM
CHAIR NEUMAN asked Mr. Sampson to speak of the balance between
subsistence and development.
5:59:31 PM
MR. SAMPSON relayed that the agreement with Teck Cominco
included provisions to protect the land around the mine, the
road system, and the port facility. In addition, a subsistence
committee comprised of elders from Kivalina and Noatak was
created. The subsistence committee meets quarterly and notifies
NANA of any potential environmental problems. NANA and Teck
Cominco also work closely with federal and state agencies to
monitor wildlife and water quality in the region.
6:05:49 PM
MR. SAMPSON described the mine's economic impact to the region
by noting that NANA and Teck Cominco have formed an employment
committee that seeks to bring shareholders into supervisory,
technical, professional, and managerial positions at the Red Dog
Mine. Through the process of education and training
opportunities, students from all of the villages tour the mine
and job-shadow employees.
6:06:01 PM
REPRESENTATIVE GATTO asked whether students from the Kivalina
school district participate in the training opportunities.
6:06:44 PM
MR. SAMPSON said yes. He then continued to say that the job-
shadow, career awareness, pre-apprentice mill wrights, and on-
the-job training programs are available for interested youth
from all of the villages. In addition, the Red Dog Mine employs
six trainers for students, and NANA provides post secondary
scholarships in the amount of $250 million per year. Higher
degrees in engineering are especially encouraged.
6:10:28 PM
MR. SAMPSON called the committee's attention to NANA's efforts
to maximize shareholder employment at the mine. The percentage
of shareholder employment has ranged from 5l percent in 1996, to
58 percent in 2005, and one of the goals for the next ten years
is to increase that percentage. He said that the Red Dog Mine
is a drug and alcohol free operation. Mr. Sampson informed the
committee that the total work force at the mine is 464 workers,
and total annual wages paid are $42 million. He said that wages
paid by the mine from 1982 and through 2006, totaled $475
million. Almost 70 percent of the mine's employees live in
Anchorage due to the lower cost of living and a shortage of
housing and other employment opportunities in the villages.
6:17:15 PM
CHAIR NEUMAN asked whether villagers are concerned about the
number of young adults who are moving to bigger cities.
6:17:48 PM
MR. SAMPSON opined that the majority will return to their
communities.
6:18:30 PM
REPRESENTATIVE DOOGAN asked whether there were Native employees
at the mine, who are not listed as shareholders because they
were born after December, 1971.
6:19:08 PM
MR. SAMPSON explained that NANA is one of two Native
corporations that have enrolled children born after December 18,
1971; however, stock held by the afterborn is not transferable.
6:20:19 PM
MR. SAMPSON pointed out that NANA received Teck Cominco royalty
payments from 1982 through 2005, that totaled $126 million.
Seventy percent of the royalty payment is shared with other
regional corporations as mandated by ANILCA. The Northwest
Arctic Borough was created in 1986 from the region surrounding
the mine in order to support education and improve employment
opportunities for the residents. As a borough, Northwest
Borough is empowered to collect from the Red Dog Mine payment in
lieu of taxes (PILT). Teck Cominco has paid PILT in the amount
of $56 million from 1990 though 2005, and residents of the
borough are not obligated to pay taxes. The present Northwest
Arctic Borough budget is $6 million and is sufficient to bond
$100 million for the construction of seven new schools.
6:25:13 PM
MR. SAMPSON stated that the cost of living and transportation
costs have risen for the Northwest Artic Borough residents, and
residents hope for state assistance in the future. Presently 85
percent of the borough's budget is dedicated to education.
During construction of the mine, financing was needed for the
port facility. The Alaska Industrial Development and Export
Authority (AIDEA) invested $265 million in construction of the
port site. Teck Cominco has repaid $288 million toward the
balance, interest, and excess tonnage charges for the road
system. Mr. Sampson said that the Northwest Arctic Borough is
investigating, with AIDEA, the possibility of purchasing the
port site as a source of additional revenue. He said that
purchase of the port site will provide income and employment for
the region, and that the Northwest Artic Borough would
appreciate the committee member's support of this project.
6:32:27 PM
CHAIR NEUMAN observed that AIDEA should be invited to present a
report to the committee.
6:32:56 PM
MR. SAMPSON continued to note that the future of the port is
contingent on AIDEA, and the Department of Transportation (DOT),
completing the environmental impact study of the deep water
port. If approved, the port will be dredged three miles to
allow the ships to load at the conveyor and eliminate the need
for barges.
6:35:00 PM
CHAIR NEUMAN asked whether storage is provided at the port site.
6:35:17 PM
MR. SAMPSON answered that, north of the port, there are tanks
for fuel storage. There is also a storage facility for the that
has the capacity to hold nine months of concentrate from the
mine. Also, storage is provided for the mine supplies and
equipment. The Red Dog Mine burns 33,000 gallons of fuel per
day for operations and mine owners are considering a partnership
with NANA to explore for natural gas.
6:37:41 PM
MR. SAMPSON turned the committee's attention to the subject of
the Sulanich Arts Center. He said that the Northwest Arctic
Borough is interested in supporting Native arts and crafts and
its offices purchase art work or display artwork to sell on
consignment. The borough and Chukchi College received a
$395,000 grant to build an arts center in Kotzebue. The
renovated facility for artists is scheduled to open in June,
2007, with additional funding from the Rasmussen Foundation.
6:41:37 PM
CHAIR NEUMAN recalled that the land is a resource for
subsistence and a source of income.
6:42:42 PM
MR. SAMPSON stated that the future of the region depends on
development of the resources north of the Red Dog Mine, and of
the coal deposits in the Artic slope. In the Ambler mining
district, transportation issues are vital; particularly the need
for a railroad, or road, from the west to the port facility.
6:43:40 PM
REPRESENTATIVE REGGIE JOULE, Alaska State Legislature, added
that the deep water port project must keep moving forward. He
noted that there is an important need to eliminate the
lightering of mine products by barges, and to bring other
customers in to use the port. Development in the north is
challenging, he said, but can protect the environment and
continue the subsistence livelihood for residents.
6:46:08 PM
CHAIR NEUMAN asked for advice for Northern Dynasty Mines Inc.,
regarding the development of the Pebble Mine.
6:46:22 PM
MR. SAMPSON replied that development must include consultation
with affected residents and interested environmental groups.
Communities must be asked to partner with the mine developers
for mutual benefits.
6:48:15 PM
REPRESENTATIVE DOLL asked about the estimated production life of
the mine and the location of its markets.
6:48:33 PM
MR. SAMPSON answered that the mine will be in production for 35
to 40 years. Its markets include, but are not limited to,
China, Japan, and Korea. Transportation of over a million tons
of ore is provided by a variety of shippers.
SB 97-ALASKA NATIVE ART IDENTIFICATION SEALS
6:49:50 PM
CHAIR NEUMAN announced that the next order of business would be
CS FOR SENATE BILL NO. 97(JUD), "An Act relating to
identification seals for certain articles created or crafted in
the state by Alaska Native persons; relating to the Alaska State
Council on the Arts; and making certain identification seal
violations unfair trade practices."
6:50:31 PM
TIM LAMKIN, staff to Senator Gary Stevens, Alaska State
Legislature, presented the sponsor statement for SB 97 on behalf
of Senator Stevens, sponsor, and the Alaska State Council on the
Arts (ASCA). Mr. Lamkin informed the committee that the Silver
Hand seals are a marketing tool that is used to represent that
an article of art has been authentically made in Alaska by an
Alaska Native. Originally begun in the 1930s, at the beginning
of the worldwide interest in Native art, the emblem has often
become a victim of fraud. He said that SB 97 is a measure to
modernize the statute, strengthen the program, and protect the
artists.
6:53:52 PM
CHAIR NEUMAN asked whether SB 97 will change the bloodline
requirements to quality for a permit to use Silver Hand seals.
6:54:20 PM
MR. LAMKIN responded that SB 97 will strike references to blood
quantum and bring the qualifications for permit holders equal to
those at the federal level.
BENJAMIN BROWN, attorney at law, and vice chair of the Alaska
State Council of the Arts, informed the committee that the bill
was the result of work by an ASCA task force that consisted of
Alaska Native artists. He assured the committee that the bill
was unanimously supported by the council. The task force
studied the existing statute and made housekeeping changes that
are not controversial.
6:56:09 PM
CHAIR NEUMAN noted that on page 4, line 13, there is a new state
residency requirement.
6:56:55 PM
MR. BROWN indicated that an artist can retain residency by
stating his/her intent to return to the state permanently.
6:57:23 PM
REPRESENTATIVE GATTO asked for the source of the steel used to
craft an ulu.
6:57:43 PM
MR. BROWN responded that SB 97 allows for use of imported
materials.
6:58:19 PM
MR. LAMKIN added that this bill will also put more emphasis on
the artist and his/her creation, rather than the materials used.
6:58:32 PM
WALTER SAMPSON, Vice President, Land and Natural Resources, NANA
Regional Corporation, Inc., opined that this bill will narrow
the statewide issue regarding Native status down to a tribal
issue. Blood quantum, he advised, is a divisive issue, as is
the residency requirement.
7:00:36 PM
MR. LAMKIN clarified that an out of state Native artist would
not be prevented from the sale of his/her art, but he/she would
not qualify to use the Silver Hand seal.
7:01:32 PM
CHAIR NEUMAN stated that the committee will probably hold SB 97
due to the negative comments he has received.
7:02:02 PM
L. SAUNDERS MCNEILL, Director, Community and Native Arts
Program, Alaska State Council on the Arts (ASCA), informed the
committee that the use of the Silver Hand seal is limited to
state residents due to the lack of ASCA jurisdiction outside of
state boundaries. She noted that ASCA maintains partnerships
for enforcement of the Silver Hand program with the attorney
general's office, the Federal Trade Commission, and the Indian
Arts and Crafts Board; however, enforcement must be within state
boundaries.
7:03:12 PM
CHAIR NEUMAN asked whether there are circumstances under which a
non-resident artist could use the seal.
7:03:39 PM
MS. MCNEILL said that the intent of the program has always been
to designate Native art that is produced in the state.
Exceptions are made for artists stationed in the military
outside of the state.
7:04:24 PM
REPRESENTATIVE LYNN asked whether the Silver Hand seal differs
from the "Made in Alaska" bear symbol.
7:04:55 PM
MR. LAMKIN answered that the Made in Alaska tag is used for
manufactured, mass-produced goods, although artists sometimes
use both symbols. He explained that the Made in Alaska symbol
is owned by the Department of Commerce, Community, & Economic
Development (DCCED).
7:05:50 PM
REPRESENTATIVE DOOGAN confirmed that there is no enforcement to
prevent misuse of the Silver Hand seal outside of Alaska.
7:06:37 PM
MS. MCNEILL affirmed that nationwide, regulation of Native arts
is a problem. She noted that the ASCA is tasked to administer
the Silver Hand program and not to determine who qualifies.
Tribes designate individuals as members, and the ASCA would
simply require a permit holder to prove the artist's
registration in a tribe.
7:08:17 PM
REPRESENTATIVE DOLL remarked:
I just need to have something clarified. ... On page
5, [line 3], where you said, original, meaning new,
unique, not a reproduction, or without the use of a
mechanized duplication instruments. ... Were you
mentioning, Mr. Brown, that, for example, we could
import the steel that's already fashioned, and then
the wood would be already there, and you just have to
put it together. Is that the idea?
7:09:03 PM
MR. BROWN said no. He relayed that he was trying to explain the
diversity of media and materials that are used in the creation
of art. The program does not try to micro manage the
determination of handicraft versus art, and the bill seeks to
streamline the statute that refers to artwork. Mr. Brown added
that the changes in the bill were to identify Alaska Native
artists and their work that is being sold in Alaska.
7:10:04 PM
CHAIR NEUMAN opined that there is some confusion about the
Silver Hand seal program.
7:10:24 PM
REPRESENTATIVE DOOGAN observed that an original painting would
qualify for a Silver Hand seal, but the resulting prints would
not.
7:11:02 PM
MS. MCNEILL explained that there are different types of printing
processes and the intent of the legislation is to issues permits
to print artists that maintain a direct relationship with their
artwork. When an artist is the printmaker, the art work will
qualify for a Silver Hand seal. However, multiple reproductions
of original art may not. She expressed her hope that the
changes in statute will make the program more inclusive for all
Alaska Native artists.
7:12:37 PM
REPRESENTATIVE GATTO stated that "Alaska Grown" has been
patented to protect its use.
7:13:26 PM
MS. MCNEILL responded that the Silver Hand seal is a registered
trademark in Alaska, and ASCA is in the process of obtaining a
federal trademark for the seal.
7:14:34 PM
CHAIR NEUMAN stated the committee's intent to garner, from
artisans, additional testimony on SB 97.
ADJOURNMENT
There being no further business before the committee, the House
Special Committee on Economic Development, International Trade
and Tourism meeting was adjourned at 7:15 p.m.
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