Legislature(1993 - 1994)
03/01/1994 01:36 PM House FIN
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE FINANCE COMMITTEE
March 1, 1994
1:36 p.m.
TAPE HFC 94-43, Side 1, #000 - end.
TAPE HFC 94-43, Side 2, #000 - end.
TAPE HFC 94-44, Side 1, #000 - 572.
CALL TO ORDER
Co-Chair Larson called the House Finance Committee to order
at 1:36 p.m.
PRESENT
Co-Chair Larson Representative Hoffman
Vice-Chair Hanley Representative Martin
Representative Brown Representative Parnell
Representative Foster Representative Therriault
Representative Grussendorf Representative Navarre
Co-Chair MacLean not present for the meeting.
ALSO PRESENT
Avrum Gross, Attorney, Juneau; Florian Sever, Sitka; Don
Muller, Sitka; Chip Thoma, Juneau; Paula Terrel, President,
Thane Homeowners Association; Chuck Auchberger, Juneau
Chamber of Commerce; Mary Nardale, Attorney, Alaska Pulp
Association; Vern Culp, Sitka; Authur Hackett, Sitka;
Florian Sever, Sitka; Rollo Pool, Sitka; Robert Ellis,
Sitka; Don Muller, Sitka; Valorie Nelson, Sitka; Ernestine
Griffin, Sitka Chamber of Commerce; Denton Pearson, Sitka;
Matt Donohue, Sitka.
SUMMARY INFORMATION
HB 394 "An Act relating to limited partnerships; and
providing for an effective date."
HB 394 was WAIVED from Committee.
SB 178 "An Act relating to civil nuisance actions; and
providing for an effective date."
HCSSB 178 (FIN) was HELD in Committee for further
discussion.
CAMBRIDGE ENERGY RESEARCH ASSOCIATES, INC. CONTRACT
SENATE BILL NO. 178
"An Act relating to civil nuisance actions; and
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providing for an effective date."
AVRUM GROSS, ATTORNEY, JUNEAU emphasized that he was not
representing any client or lobbying group. He spoke in
opposition of HCS CSSB 178 (FIN). He asserted that HCS CSSB
178 (FIN) is not about nuisance lawsuits. He maintained
that the legislation is about a suit to abet a private
nuisance. He explained that "private nuisance" is defined
as "the unreasonable interference of the property rights of
another." The nuisance pertains to an interference through
air, water, noise or odor that makes it impossible to
operate the property or maintain an existing business.
Mr. Gross alleged that there has never been a defense that
the person who is creating the nuisance, which destroys
another person's property value, is not violating the law
because they have a permit to perform the activity which is
creating the nuisance. He observed that laws and permits
pertain to public rights. He demonstrated that the criteria
for permits issued by the state is whether or not the public
value is harmed or the holder is violating their public
obligations.
Mr. Gross referred to page 2, lines 7- 10, HCS CSSB 178
(FIN). He argued that subsection (c) places private
property rights in the public arena. He queried to whom
subsection (c), "a result that was unknown or not reasonably
foreseeable at the time of the authorization," pertains. He
underscored that the activity creating a nuisance outside of
the public domain would be unforeseen since the state does
not measure the affect of the permitted activity on adjacent
private property.
Mr. Gross alleged that the legislation authorizes private
people to take other peoples property for their benefit. He
maintained that if a business is immunized through the
permitting process and their activities destroy the value of
the adjacent property the state would be liable for the
damages incurred. He stressed that the legislation would
allow private parties to take other peoples property through
a state permit that has to do with public rights not with
the other person's property.
Mr. Gross suggested that an opinion be solicited from the
Attorney General on the issue of state liability. He
suggested that the legislation would lengthen the permitting
process.
Mr. Gross summarized that the legislation is a private
property rights bill. He maintained that the legislation
was introduced to assist a large corporation that can
protect its own interests.
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Representative Therriault observed that a person that claims
damages from a public regulated activity must demonstrate
that their damages are greater than that experienced by the
general public. Mr. Gross clarified that Representative
Therriault's remarks pertain to public nuisances. Public
nuisances affect the general public. Private nuisances are
linked to private property. He emphasized that an
unreasonable interference with the use of the property must
be demonstrated. He emphasized that it is difficult to
prove a private nuisance exists. He maintained that
nuisance laws are the citizens only protection against
activities that take place around them.
Representative Therriault clarified that noise disturbances
are not covered by HCS CSSB 178 (FIN).
Representative Navarre suggested that passage of the
legislation will require the state to consider the effects
of the activity being permitted on adjoining private
property.
Mr. Gross suggested that he could provide the Committee with
language to clarify the intent of the Subcommittee regarding
subsection (c).
VERN CULP, SITKA testified via the teleconference network
from Sitka. He spoke in opposition to HCS CSSB 178 (FIN).
He maintained that the legislation would diminish his right
as a citizen for protection against harm.
AUTHOR HACKETT, SITKA testified via the teleconference
network. He spoke in support of HCS CSSB 178 (FIN). He
maintained that nuisance lawsuits cost millions of dollars
to businesses and municipalities. He asserted that Alaskan
industry is hampered by increasing state and federal
regulations. He maintained that regulations are impeding
the ability of Alaskan businesses to compete in foreign
markets.
FLORIAN SEVER, SITKA testified via the teleconference
network. He spoke in opposition to HCS CSSB 178 (FIN). He
maintained that HCS CSSB 178 (FIN) strips from the public
their right to protect themselves from habitual polluters
and lax regulators.
ROLLO POOL, ALASKA PULP CORPORATION (APC), SITKA testified
via the teleconference network. He urged the Committee to
pass HCS CSSB 178 (FIN) without delay. He stressed that HCS
CSSB 178 (FIN) is supportive of Alaskan businesses. He
stated that HCS CSSB 178 (FIN) gives businesses that operate
within the limits of their permits a small reward. He
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observed that polluters that exceed their permit amount will
be open to litigation. He maintained that the retroactive
clause is fair. (Mr. Pool's written testimony is on file
with the House Finance Committee)
Representative Navarre noted that the state could face
additional liability if the retroactive clause is adopted.
He questioned if permits issued in the last year should be
cancelled and reissued based on a new finding by the state,
that considers unknown or unreasonable events at the time
the permits are issued, in regards to private property
rights. Mr. Pool acknowledged that permits could be
reopened. Representative Navarre reiterated that additional
burden to consider effects on neighboring private property
could further delay the permitting process.
ROBERT ELLIS, SITKA testified via the teleconference
network. He spoke in opposition to HCS CSSB 178 (FIN). He
emphasized that the legislation takes away the rights of
private citizens. He maintained that the legislation
confuses frivolous lawsuits with serious lawsuits. He
maintained that constitutional rights are being legislated
away to protect a Japanese company.
DON MULLER, SITKA testified via the teleconference network.
He expressed strong opposition to HCS CSSB 178 (FIN).
(Tape Change, HFC 94-43, Side 2)
VALORIE NELSON, SITKA testified via the teleconference
network. She spoke in strong opposition to HCS CSSB 178
(FIN). She referred to a letter she sent to Representative
Grussendorf, dated April 23, 1993 (copy on file). In the
letter she outline her difficulties with the expansion of a
nonconforming rock quarry located near her property.
Discussion pursued in regards to the letter sent by Ms.
Nelson. She asserted that HCS CSSB 178 (FIN) would take
away property owner's rights to protect their property.
ERNESTINE GRIFFIN, SITKA CHAMBER OF COMMERCE testified via
the teleconference network in support of HCS CSSB 178 (FIN).
She stressed that companies that operate within the
boundaries of major permits should have immunity from
persecution.
MATT DONOHUE, SITKA testified via the teleconference network
in opposition to HCS CSSB 178 (FIN). He emphasized the role
of the judicial branch in balancing the executive branch.
He stressed that the state of Alaska's Constitution
guarantees due process. He asserted that the legislation
challenges due process.
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CHIP THOMA, JUNEAU testified in opposition to HCS CSSB 178
(FIN). He maintained that HCS CSSB 178 (FIN) contradicts
Article I, section 18 of the Alaska Constitution. He noted
that section 18 states that "property shall not be taken or
damaged for public use without just compensation." He
reiterated that nuisance cases are rare. He emphasized that
the Superior Court has determined that the case has merit.
PAULA TERREL, THANE HOMEOWNER'S ASSOCIATION testified in
opposition to HCS CSSB 178 (FIN). She gave examples of how
property owners in Juneau could be affected by HCS CSSB 178
(FIN). She referred to the proposed reopening of the Alaska
Juneau Mine. She asserted that property owners need to have
a recourse for the effects of permitted activities that
cause damages to property values.
CHUCK AUCHBERGER, DIRECTOR, JUNEAU CHAMBER OF COMMERCE
testified in support of HCS CSSB 178 (FIN). He noted that
the permitting process is extensive. He maintained that the
rights of property owners trying to develop economic
activities should also be protected. He emphasized the
investment of business activities.
MARY NARDALE, ATTORNEY, ALASKA PULP CORPORATION testified in
support of HCS CSSB 178 (FIN). She contended that HCS CSSB
178 (FIN) is narrowly crafted. She stated that only
activities which are specifically permitted are exempt from
private nuisance actions. She maintained that liability
would not shift to the state. She observed that most
permits contain clauses which allow the state to revoke or
modify them if the permitted activity causes problems beyond
the property line, of the property on which the activity is
being pursued. Regulations are designed to limit the impact
beyond the property line. She did not think that the
legislation would expand the permitting process.
Ms. Nardale referred to the provisions on page 2, line 7.
She asserted that "unknown or foreseeable" refers to anyone.
She maintained that the regulatory environment is designed
to protect individuals from unreasonable and substantial
interference with their property rights.
Representative Brown referred to subsection (c). She
suggested that not every possible impact will be dealt with
expressly as part of the record. She questioned if it is
the agencies obligation to demonstrate that there is no
interference with private property rights. She asked if
something was not expressly dealt with, how it will be
demonstrated that the result is known or foreseeable. Ms.
Nardale replied that the "reasonable man" test would apply.
She noted that the legislation is specific.
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Representative Brown clarified that some permits are issued
without public notice.
Ms. Nardale and Representative Brown debated whether all or
one of the provisions of subsection (b) on page 2, lines 1 -
6 would need to be present. Ms. Nardale asserted that all
of the first three categories under (b) would have to be
met. She maintained that the "or" pertains to AS 46.40, or
a court order or judgement. Representative Brown
interpreted (b) to require that only one of the first three
requirements on lines 2 - 4 needs to apply. Discussion
pursued regarding the issuance of general permits.
DENTON PEARSON, ATTORNEY, SITKA testified via the
teleconference network in support of HCS CSSB 178 (FIN). He
asserted that the primary issue raised by HCS CSSB 178 (FIN)
is the uniform application of laws relating to the
regulation of emissions and discharges as a result of
commercial or municipal activities. He asked if it is good
policy to invite the contradictory results which are the
product of court intervention. He maintained that
regulators are specialists while courts are generalists.
(Mr. Pearson's written remarks are on file with the House
Finance Committee.)
(Tape Change, HFC 94-44, Side 1)
Representative Brown stated that while she has confidence in
the state's regulatory agencies the permit process cannot
fully anticipate all the problems all the time. Mr. Pearson
insisted that activities clearly permitted are the ones that
will be shielded from further litigation. Representative
Brown observed that problems can arise because activities
are not expressly barred.
Representative Parnell asked what avenues are available to
stop activities that are immune through nuisance
legislation. Ms. Nardale noted that abetment or damages
could be sought under citizen suit provisions. Citizen suit
provisions could force a regulatory agency to take action
against the activity if unreasonable interference is found.
She pointed out that damages resulting from a citizen suit
would go to the state.
In response to a question by Representative Martin, Ms.
Nardale stated that the purpose of the permitting process is
to prevent pollution and unreasonable interference with
property and to bring to the attention of the authorities
problems with the potential impact of the activity. She
pointed out that in the permitting process there is an
opportunity to discern if the adjoining uses of property
will be so impaired as to destroy the economic value of the
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property. At that point, the state can institute a
condemnation action to take the property by eminent domain
and allow full compensation to property owners.
Ms. Nardale referred to subsection (c). She maintained that
subsection (c) provides a safety net.
Representative Martin and Ms. Nardale discussed a case
involving zoning in North Carolina. They continued to
discuss zoning issues.
CAMBRIDGE ENERGY RESEARCH ASSOCIATES, INC. CONTRACT
Co-Chair Larson noted that renewal of the contract with the
House and Senate Finance Committees and the Cambridge Energy
Research Associates was before the Committee for approval
(Attachment 1).
Representative Navarre questioned if information provided
the Legislature by the Cambridge Energy Research Associates
contract is redundant to information provided by the state's
revenue economist.
Co-Chair Larson noted that the periodic updates are useful.
He suggested a second opinion may be beneficial.
Representative Martin OBJECTED to the contract renewal. A
roll call vote was taken on the motion to renewal the
contract with the Cambridge Energy Research Associates.
IN FAVOR: Hanley, Hoffman, Parnell, Foster, Grussendorf,
Larson
OPPOSED: Martin, Navarre, Therriault, Brown
Co-Chair MacLean was not present for the vote.
The MOTION PASSED (6-4).
SENATE BILL NO. 178
"An Act relating to civil nuisance actions; and
providing for an effective date."
Co-Chair Larson reflected the Committee's desire to have the
Attorney General address the question of constitutionality
in regards to HCS CSSB 178 (FIN).
Representative Brown provided members with AMENDMENT 1 (copy
on file). She explained that the amendment would make HCS
CSSB 178 (FIN) more fair to private property owners by
ensuring that they have knowledge of actions that are to
take place. The amendment would require written
notification to adjacent land owners 60 days prior to permit
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issuance.
HCSSB 178 (FIN) was HELD in Committee for further
discussion.
HOUSE BILL NO. 394
"An Act relating to limited partnerships; and providing
for an effective date."
Co-Chair Larson noted that HB 394 would be WAIVED from
Committee.
ADJOURNMENT
The meeting adjourned at 3:36 p.m.
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