Legislature(1997 - 1998)

02/12/1997 01:45 PM House FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
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                     HOUSE FINANCE COMMITTEE                                   
                        FEBRUARY 12, 1997                                      
                            1:45 P.M.                                          
                                                                               
  TAPE HFC 97 - 23, Side 1, #000 - end.                                        
  TAPE HFC 97 - 23, Side 2, #000 - end.                                        
  TAPE HFC 97 - 24, Side 1, #000 - end.                                        
  TAPE HFC 97 - 24, Side 2, #000 - end.                                        
  TAPE HFC 97 - 25, Side 1, #000 - #360.                                       
                                                                               
  CALL TO ORDER                                                                
                                                                               
  Co-Chair  Mark  Hanley called  the  House  Finance Committee                 
  meeting to order at 1:45 P.M.                                                
                                                                               
  PRESENT                                                                      
                                                                               
  Co-Chair Hanley               Representative Kelly                           
  Co-Chair Therriault           Representative Kohring                         
  Representative Davies         Representative Martin                          
  Representative Davis          Representative Mulder                          
  Representative Grussendorf                                                   
                                                                               
  Representative  Moses  and  Representative  Foster were  not                 
  present for the meeting.                                                     
                                                                               
  ALSO PRESENT                                                                 
                                                                               
  Representative   Albert   Kookesh;    Representative   Irene                 
  Nicholia; Representative Ramona Barnes;  Representative Bill                 
  Williams; Dan Spencer, Budget Analyst, Office of  Management                 
  and Budget, Office of the  Governor; Bruce Botelho, Attorney                 
  General, Department of  Law; Ted  Popely, Counsel, Senate  &                 
  House Majority; John Hope, Tribal  Member, Juneau; Katherine                 
  Miyascoto,  President,  Douglas   Camp  #3,  Juneau;  Selina                 
  Everson,  Past  President, Alaska  Native  Sisterhood (ANS),                 
  Juneau; Al  Ketzler  Sr.,  (Testified  via  teleconference),                 
  Chief Administrator Officer,  Tanana Chiefs Council; Loretta                 
  Bullard, (Testified via teleconference),  President, Kawerak                 
  Inc.,  Kawerak; Joan  Dangeli, Alaska's First  Nation Native                 
  Rights  Alliance, Juneau;  Delores  Cadiente, Self,  Juneau;                 
  Caleb Pungowiyi, (Testified  via teleconference),  Executive                 
  Director,   Knowles   Commission,  Kawerak;   Lloyd  Miller,                 
  (Testified  via  teleconference), Attorney,  Tribal Citizen;                 
  Zach Brink,  (Testified via  teleconference), AVCP,  Bethel;                 
  Luke  Sampson,  (Testified  via  teleconference),  Kotzebue;                 
  Representative  Don  Long,  (Testified via  teleconference),                 
  Inuit  Community  of  Arctic  Slope, Barrow;  Paul  Swetzof,                 
  (Testified via teleconference), Aleut Tribal Council; Alfred                 
  McKinley,  Alaska Native  Brotherhood  (ANB), Juneau;  Diane                 
  Wirth, Self, Juneau; John Martin, Teinna Gey Tlingit Nation,                 
                                                                               
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  Juneau;   Burt   Prist,   (Testified  via   teleconference),                 
  Kotzebue;  April  Ferguson, (Testified  via teleconference),                 
  Nome; John Borbridge, Lobbyist, 1st President Sealaska Corp,                 
  Juneau; Sharon Lee, Self, Juneau.                                            
                                                                               
  SUMMARY                                                                      
                                                                               
  CSSB 74(FIN)   An Act  extending  lapse  dates  for  certain                 
                 prior     year     appropriations;     making                 
                 supplemental,     capital,     and    special                 
                 appropriations;   and   providing    for   an                 
                 effective date.                                               
                                                                               
                 CSSB 74(FIN)  was reported  out of  Committee                 
                 with a "do pass" recommendation.                              
                                                                               
  HB 113         An Act  extending  lapse  dates  for  certain                 
                 prior     year     appropriations;     making                 
                 supplemental,     capital,     and    special                 
                 appropriations;   and   providing    for   an                 
                 effective date.                                               
                                                                               
                 HB  113  was HELD  in  Committee for  a later                 
                 hearing.                                                      
  SENATE BILL 74                                                               
                                                                               
       "An Act extending  lapse dates  for certain prior  year                 
       appropriations;  making   supplemental,  capital,   and                 
       special appropriations; and  providing for an effective                 
       date."                                                                  
                                                                               
  BRUCE BOTELHO, ATTORNEY GENERAL, DEPARTMENT OF LAW, provided                 
  the Committee  an  overview  of  the  proposed  legislation,                 
  speaking  in  favor of  it's  passage.   He  noted  that the                 
  legislation would provide funding for  the Department of Law                 
  to  advocate  the State's  legal  position on  the sovereign                 
  powers of Native tribal governments in Alaska addressing the                 
  Venetie issue.  Attorney General  Botelho suggested that the                 
  Venetie  decision would  raise  questions  about the  proper                 
  interpretation of the  1971 Alaska Native  Claims Settlement                 
  Act (ANCSA) in providing a  basis that Indian country exists                 
  in  the  State.    A  circuit   court  decision  requires  a                 
  realignment of inter-government relations throughout Alaska.                 
                                                                               
                                                                               
  He continued, a subject as important as the issues raised in                 
  the Venetie case  should be  taken to the  Supreme Court  so                 
  that  it will  be  the  final  arbitrator of  what  Congress                 
  intended  when it  passed ANCSA  in 1971.   Attorney General                 
  Botelho noted that  in order  for the Department  of Law  to                 
  adequately cover the case, the  entire $500 thousand dollars                 
                                                                               
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  appropriation  would   be  necessary.    The  Department  is                 
  requesting  the entire amount  in one  appropriation, rather                 
  than an increment to  cover only the initial expenses.   The                 
  Legislature will have adjourned before the Supreme Court has                 
  made their  final decision.   The allocation will  cover all                 
  anticipated costs for both FY97 and FY98.                                    
                                                                               
  Attorney  General  Botelho  elaborated,  the  Supreme  Court                 
  receives   petitions  for  7.5   thousand  cases  per  year,                 
  although, only hears between 80 and  90 of them.  He  added,                 
  this is a matter of great  importance to all Alaskans and as                 
  it will address a fundamental  examination of Indian law  in                 
  the United States.  He believed that this case  could be one                 
  that  the  Supreme  Court  would  take,  given  the  overall                 
  ramifications to the State.                                                  
                                                                               
  Attorney General  Botelho continued, additional  concern has                 
  been  voiced  as to  why the  Department  of Law  would seek                 
  additional funding,  knowing that an appropriation  had been                 
  allocated  for statehood  defense.  Statehood  defense money                 
  was never allocated to the Venetie case.  That case has been                 
  supported by the  General Fund  budget, while the  statehood                 
  defense money has been directed  to other significant cases.                 
                                                                               
                                                                               
  JOHN HOPE, PAST PRESIDENT  OF TLINGIT-HAIDA CENTRAL COUNCIL,                 
  BOARD OF DIRECTORS  - SEALASKA, JUNEAU, spoke  in opposition                 
  to  the  proposed legislation.    He noted  that  the Indian                 
  Health  Service  (IHS)  had  appropriated  to  Alaska,  $3.1                 
  million   dollars;  the  Bureau   of  Indian  Affairs  (BIA)                 
  appropriated $92 million dollars;  and SEARCH received $35.7                 
  million  dollars.    He noted  that  there  is  at least  an                 
  additional $100 million  dollars spent in Alaska  for Indian                 
  housing.      Mr.  Hope   stressed   that  Alaska   receives                 
  approximately $500  million dollars  a year  because of  the                 
  tribe  status.     The  Federal  government  has   no  legal                 
  obligation   to   distribute  funding   to   Natives;  their                 
  obligation is to fund tribes.                                                
                                                                               
  Mr.  Hope  reiterated  that  if  the  State  of  Alaska  was                 
  successful in this case,  there would be no obligation  from                 
  the federal government  to make  annual appropriations.   He                 
  voiced fear, that  within a few  years, U.S. Congress  would                 
  note Alaska's action and realize that they have no financial                 
  obligation to the Natives of the State.                                      
                                                                               
  KATHERINE  MIYASCOTO, PRESIDENT,  DOUGLAS  CAMP #3,  JUNEAU,                 
  spoke in opposition to SB 74.  She stated that the amount of                 
  money  being  appropriated belongs  to  both Native  and non                 
  Native  people of  Alaska and  that she opposed  her portion                 
  being  spent  on negotiations  against  Native people.   Ms.                 
  Miyascoto  suggested  that  the appropriation  be  used  for                 
                                                                               
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  education and other interests that cover the entire State.                   
                                                                               
  SELINA  EVERSON, PAST  PRESIDENT,  ALASKA NATIVE  SISTERHOOD                 
  (ANS),  JUNEAU,  testified  in  opposition  to  the proposed                 
  legislation,  agreeing   that  concerns  of   education  and                 
  subsistence should be funded at greater levels.                              
                                                                               
  AL  KETZLER  SR.,  (TESTIFIED  VIA  TELECONFERENCE),   CHIEF                 
  ADMINISTRATOR  OFFICER,  TANANA  CHIEFS   CONFERENCE,  spoke                 
  against SB  74 as  currently written.   He  stated that  the                 
  Tanana  Chiefs  Conference  specifically  opposes  the  $500                 
  thousand dollars  appropriated to the  Legislative Operating                 
  Budget.  He reminded Members of the case presented two years                 
  ago, State versus  Babbitt legislation that went  before the                 
  Circuit  Court.   That case  challenged the  ability of  the                 
  State   Legislature  seeking  to   represent  the  State  in                 
  litigation.  Any attempt of the Legislature to represent the                 
  State, in State Court, is a violation of the Constitution in                 
  doctrine and separation of powers.                                           
                                                                               
  Mr. Ketzler believed that inclusion of Section  (b) would be                 
  "unwisely used" to  determine policy  grounds.  He  stressed                 
  that   political   legislative  intervention,   divides  the                 
  elements  and creates  racial overtones.   The  relationship                 
  between  a  tribal state  and  the federal  government  is a                 
  political relationship.  Intervention  by the Legislature on                 
  this  bill brings  unwarranted and vindictive  actions which                 
  will be counter productive.  Mr. Ketzler urged the Committee                 
  to  strike the  appropriation to  the  Legislative Operating                 
  Budget.                                                                      
                                                                               
  LORETTA BULLARD, (TESTIFIED VIA  TELECONFERENCE), PRESIDENT,                 
  KAWERAK, INC.,  KAWERAK, voiced  opposition to  SB 74.   She                 
  asked why  the appropriation  was on  a "fast"  track.   Ms.                 
  Bullard reiterated previous concerns that  the Supreme Court                 
  will only hear a small number  of cases brought before them;                 
  thus, questioned the  $1 million dollar appropriation  for a                 
  1% chance of being successful.                                               
                                                                               
  Ms.  Bullard  questioned  how   the  Legislative  leadership                 
  proposed   to  use   the  $500  thousand   dollar  suggested                 
  appropriation.   She pointed out  that Senator Al  Adams had                 
  proposed an  amendment that  would grant  the $500  thousand                 
  dollar appropriation if the Supreme Court agreed to hear the                 
  case.   She stated that her agency supported that amendment.                 
                                                                               
                                                                               
  Ms. Bullard continued, State funding for social services has                 
  been  cut  for the  past  four  years.   Because  of limited                 
  funding, Village Public Safety Officers (VPSO's) have "their                 
  lives on the line" for $11.71/hour.  With welfare reform and                 
  the  infrastructure  changing  throughout   the  State,  Ms.                 
                                                                               
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  Bullard surmised that  there are more appropriate  places to                 
  put the money.                                                               
                                                                               
  JOAN  DANGELI,   ALASKA'S  FIRST   NATIONAL  NATIVE   RIGHTS                 
  ALLIANCE,   JUNEAU,  voiced   concern   with  the   proposed                 
  legislation,  reiterating that  Native  Alaskan's tax  money                 
  would be used to fight against  themselves.  She stated that                 
  the bill was "aggressive" and the issues confusing.                          
                                                                               
  DELORES CADIENTE,  SELF, JUNEAU, testified in  opposition to                 
  SB 74.  She requested that  Members of the Finance Committee                 
  consider a better spending plan for the proposed allocation.                 
  Ms.  Cadiente  suggested  addressing  health, education  and                 
  social issues in the light of welfare reform.                                
                                                                               
  She continued, a national study rating schools in the United                 
  States for quality  of teaching, fair distribution  of money                 
  and student  achievement  rated Alaska  very  low.   The  $1                 
  million  dollars  could be  used  more meaningfully  than to                 
  fight tribal  governments and  their inherent  rights.   Ms.                 
  Cadiente  questioned  why   tribal  governments  should  not                 
  receive the same rights that municipal governments do.                       
                                                                               
  CALEB  PUNGOWIYI,  EXECUTIVE  DIRECTOR, KNOWLES  COMMISSION,                 
  KAWERAK, spoke in  opposition to  the $500 thousand  dollars                 
  being appropriated  to the  Legislature for  the purpose  of                 
  supporting the State's  interest on  the issue of  sovereign                 
  powers of the  Native tribal governments.  He concurred that                 
  there were more appropriate places to spend that allocation.                 
                                                                               
                                                                               
  LLOYD  MILLER,  (TESTIFIED  VIA  TELECONFERENCE),  ATTORNEY,                 
  TRIBAL CITIZEN, voiced strong opposition to the legislation.                 
  He  asserted  that $1  million dollars  was a  very generous                 
  amount  allocated  for outside  consultation  for  a Supreme                 
  Court case.  Mr. Miller stressed that once again, the public                 
  has been kept in the dark as to how the funds would be used.                 
                                                                               
                                                                               
  He commented  that the  $500 thousand  dollar portion  which                 
  would be used to support the Legislature, would be ten times                 
  more  than  necessary; the  Legislature, independent  of the                 
  Executive  Branch,     has  no  constitutional  standing  to                 
  participate  in  the case.   Mr.  Miller  added that  the $1                 
  million dollar  appropriation is an "outrageous"  expense to                 
  make when the  Legislature is seeking  to cut the budget  by                 
  such proposed large amounts.  He  suggested that the bulk of                 
  the appropriation would be much  better used to establish  a                 
  thoughtful  process  for   working  out  a  State   plan  of                 
  cooperation.                                                                 
                                                                               
  LUKE SAMPSON, (TESTIFIED VIA  TELECONFERENCE), BETHEL, spoke                 
                                                                               
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  on behalf of  Mayor Chuck Green, North Slope Arctic Borough,                 
  in opposition to SB 74.  He suggested that money be spent on                 
  water  and  sewer   concerns  which   exist  in  the   rural                 
  communities.                                                                 
                                                                               
  He pointed out that the legislation  would be harmful to the                 
  State.  Mr.  Sampson noted that  when village areas  receive                 
  1/10th of  the  amount  requested  to bring  jobs  to  those                 
  places, they are required to  have feasibility and marketing                 
  studies  as  a portion  of the  business  plan.   Using that                 
  request standard, this legislation would not pass.                           
                                                                               
  DON   LONG,   (TESTIFIED    VIA   TELECONFERENCE),    FORMER                 
  REPRESENTATIVE -STATE OF ALASKA, PRESIDENT, INUIT  COMMUNITY                 
  OF THE ARCTIC  SLOPE, BARROW, spoke in  strong opposition to                 
  the proposed legislation.   He suggested  that a $1  million                 
  dollar  allocation  should be  used  to cover  problems that                 
  exist in the  village areas.   He pointed  out his  concerns                 
  with the depleted municipal aide and revenue sharing.                        
                                                                               
  (Tape Change, HFC 97-23, Side 2).                                            
                                                                               
  PAUL SWETZOF,  (TESTIFIED VIA TELECONFERENCE),  ALEUT TRIBAL                 
  GOVERNMENT, AFN  BOARD OF  DIRECTORS, ALEUT  VILLAGES, noted                 
  that  every  village  which  he  represents opposes  to  the                 
  appropriation.   He  stated  that this  was  the modern  day                 
  equivalent of a "war chest" against  the Indian people.  Mr.                 
  Swetzof suggested the  money be  used to set  up a  dialogue                 
  with tribal  governments working cooperatively.  He stressed                 
  that the legislation takes a stance against Native people.                   
                                                                               
  ALFRED  MCKINLEY, SR.,  EXECUTIVE  COMMITTEE MEMBER,  ALASKA                 
  NATIVE BROTHERHOOD (ANB), JUNEAU, spoke in opposition to the                 
  proposed  legislation.    He  pointed  out  that  the  money                 
  appropriated by the Legislature to the rural communities was                 
  matched  with  federal dollars.    Each  year,  close to  $1                 
  billion dollars are appropriated. He  thought that the State                 
  would  not continue  funding that  amount without  receiving                 
  federal incentive.                                                           
                                                                               
  Mr.  McKinley   questioned  why   the  language   "sovereign                 
  immunity"  was  being  included  in  the  legislation.    He                 
  concluded that SB 74 would not  be in the best interest  for                 
  all Alaskans.                                                                
                                                                               
  DIANE  WIRTH,  SELF,  JUNEAU,  spoke  against  the  proposed                 
  legislation.   She suggested  that a  sense of  equality and                 
  cooperative living should  be encouraged.  Ms.  Wirth warned                 
  that the people from Venetie had begun a drain of money, and                 
  now other  Native groups are implicated.  She suggested that                 
  the proposed action could create 250 individual governments.                 
  Those concerns had  been addressed in  1972 with the  Alaska                 
                                                                               
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  Native Claims Settlement Act (ANCSA).                                        
                                                                               
  JOHN MARTIN,  TEINNA GEY  TLINGIT NATION,  JUNEAU, spoke  in                 
  opposition to SB 74.  The Tribal  Council is not in favor of                 
  the  appropriation.     He  suggested  that  if   the  State                 
  government would like  to spend the money  on Indian issues,                 
  they  should  designate  funds  for   health  and  education                 
  concerns in the rural communities.                                           
                                                                               
  BURT PRIST, (TESTIFIED VIA  TELECONFERENCE), KOTZEBUE, spoke                 
  in opposition to SB 74 and concurred with statements made by                 
  those testifying against SB 74.   Mr. Prist reiterated  that                 
  the State has a 1% chance of being heard on  the issue.  The                 
  legislation contains racial overtones.                                       
                                                                               
  Mr.   Prist  explained  that   Alaska  villages   see  self-                 
  determination  and   self-governing  as   a  necessary   and                 
  fundamental  step in  gaining  control over  the devastation                 
  caused by alcohol in the Indian communities.  He added, most                 
  Native   villages   disagree   with   the   Venetie   Tribal                 
  Government's intent, noting  that village tribal sovereignty                 
  is   inherent   and   that   tribal   government   has   the                 
  responsibility to deal with Native social  issues, although,                 
  over the years have been undermined by State policies.                       
                                                                               
  APRIL FERGUSON, (TESTIFIED VIA TELECONFERENCE), NOME,  spoke                 
  against SB 74.  She stated that the legislation was fiscally                 
  irresponsible.  She  mentioned the  challenges faced by  the                 
  State in addressing  welfare reform  and questioned how  the                 
  State could justify not allocating the $100 thousand dollars                 
  to Alaska Legal  Services.   The justification for  pursuing                 
  the course of  action would  be an "all  out declaration  of                 
  war"  on the  Native community  throughout the  State.   She                 
  recommended that the money  should be used on  educating the                 
  public in how to work with Native communities.                               
                                                                               
  Ms.  Ferguson asked how the  Legislature intended to use the                 
  $500 thousand dollars  and demanded that the  Legislature be                 
  held accountable for those expenditures.                                     
                                                                               
  JOHN BORBRIDGE, PAST LOBBYIST, 1ST PRESIDENT OF THE SEALASKA                 
  CORPORATION, JUNEAU, emphasized  that Natives want to  focus                 
  on  their  land  rights  because   the  State  selection  of                 
  entitlement is  seen as a  "danger" of those  lands claimed.                 
  Selection of lands should not proceed  and the corpus of the                 
  controversy  should  be  preserved  until  Congress  has the                 
  opportunity to work it's will.                                               
                                                                               
  He continued, to date,  Alaska had been seen as the one area                 
  in which  there is no  conquest.   As a consequence  of that                 
  realization, the worth  of the settlement was  raised as the                 
  values would determine how much in general would be received                 
                                                                               
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  for compensation and lands.                                                  
                                                                               
  The settlement  act contains no provision  that specifically                 
  states the intention  by Congress to  due away with and  not                 
  recognize Indian tribes.   Mr. Borbridge continued,  at this                 
  time, tribal  status is  being addressed  and he  asked that                 
  there  be  more communication  with  the  tribal communities                 
  regarding tribal responsibilities.                                           
                                                                               
  Representative G.  Davies asked  what powers,  Mr. Borbridge                 
  would anticipate a "tribe" to have.  Mr. Borbridge responded                 
  that a tribe  has inherent certain  powers and spoke to  the                 
  additional powers in the signing of Indian country.   Absent                 
  the defining of Indian  country, there exists the powers  of                 
  the tribes over the membership to administer benefits.  With                 
  the presence of the Indian country, they would then have the                 
  increased opportunity  to address  the status  of the  lands                 
  where  there  would   be  a   finding  of  Indian   country.                 
  Presently, these are not identified.  Given that definition,                 
  there would be an exercise of greater powers.  He was unsure                 
  of the powers that would result in  addressing the resources                 
  of the land.                                                                 
                                                                               
  SHARON  LEE,  SELF,  JUNEAU,   spoke  against  the  proposed                 
  legislation and  applauded the words  shared among  previous                 
  testimony regarding this concern.                                            
                                                                               
  (Tape Change, HFC-24, Side 1).                                               
                                                                               
  REPRESENTATIVE   RAMONA   BARNES   commented   on   previous                 
  testimonies requesting that the allocation represented in SB
  74 be distributed  for "additional  services" in the  State.                 
  She reminded the Committee members that $500 million dollars                 
  had been paid to establish the regional Native Corporations.                 
  Representative   Barnes   referenced   Alaska  Constitution,                 
  Article #10.  The purpose of the article was to provide  for                 
  maximum local self government and  to prevent duplication of                 
  tax levying jurisdictions.   The article clearly establishes                 
  how the local  governments are identified.   The Legislature                 
  identified those governing bodies.   She emphasized that the                 
  body  was appropriated on a constitutional provision back-up                 
  by law in Title #29.                                                         
                                                                               
  Attorney  General Botelho  replied  that the  constitutional                 
  framers devoted substantial energy to looking at the type of                 
  government structure  which  should  be in  Alaska.    As  a                 
  consequence, Article #10  came into being.   It demonstrated                 
  municipal  government existing in either two forms, boroughs                 
  or cities.   Individuals  in  those   communities should  be                 
  empowered  to  have  as much  control  over  their  lives as                 
  possible.    That  is  the  resulting  structure  which  the                 
  Legislature "flushed out"  in adopting Title #29.   Attorney                 
                                                                               
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  General Botelho  reiterated that  the State Legislature  has                 
  continued  to  fulfill  it's  obligation  to  support  local                 
  funding.                                                                     
                                                                               
  Representative  Barnes spoke  to the  State's obligation  to                 
  uphold  any challenges  to the Constitution  or legislation.                 
  She questioned if  the rural areas were  sovereign entities,                 
  would the State  then be precluded  by law from giving  them                 
  additional State funds.                                                      
                                                                               
  Attorney General Botelho suggested that question needs  time                 
  and  care  to  explain, because  it  brings  forth questions                 
  regarding the terms  of tribal status.   This concern  needs                 
  more dialogue  and education.   He  added, we  unfortunately                 
  tend to  look at  tribes as  a racial entity  rather than  a                 
  political  entity.    What is  not  clear,  is  the type  of                 
  relationship that  the State would  wish to pursue  with the                 
  sovereign entities.  He suggested that a written response to                 
  Representative  Barnes'  query  would  be more  appropriate.                 
  Representative   Barnes   requested   additional   attention                 
  regarding  the Alaska  National Interest  Lands Conservation                 
  Act (ANILCA) recognition.                                                    
                                                                               
  Attorney  General Botelho  pointed  out that  Representative                 
  Barnes  had  raised  issues  that  would be  informative  to                 
  everyone regarding the question of tribal status.   He noted                 
  that  there has  been an  evolution  in the  State regarding                 
  tribal status.   The  State Supreme  Court has rejected  the                 
  concept of tribes in  Alaska, which formed a basis  that the                 
  State had  inappropriately  responded in  not  pursuing  the                 
  Babbitt appeal.                                                              
                                                                               
  Attorney  General   Botelho  continued,  many   things  have                 
  occurred  which  change the  status of  what existed  in the                 
  past.  Under our Constitutional system, we look  to Congress                 
  to be the  authority.  In  1993, the Department of  Interior                 
  issued  the  list  of federally  recognized  tribes  for all                 
  purposes.  As  a consequence of  the failure to include  the                 
  Central  Council,  the  issue went  to  Congress.   Congress                 
  endorsed the list  the Department  of Interior had  created.                 
  They  then  added  the  Central  Council  to  that  list  of                 
  recognized tribes.                                                           
                                                                               
  The second issue of the Venetie case revolves around whether                 
  there exists a land  base which would allow those  tribes to                 
  exercise powers and activities within the boundaries of that                 
  tribe.  The courts have three criteria in recognizing Indian                 
  country in the United States:                                                
                                                                               
       1.   A result of a reservation;                                         
       2.   Allotment, which does exists in Alaska;                            
       3.   Whether   the   State  has   a   dependent  Indian                 
                                                                               
                                9                                              
                                                                               
                                                                               
            community.                                                         
                                                                               
  For there to be a dependent  Indian community, there must be                 
  land  which  has  been  set  aside  for  Indians  under  the                 
  superintendents of the  federal government.  He  stated that                 
  the question  at hand is  whether ANCSA contributes  to that                 
  land base and could it be used.                                              
  Attorney General Botelho continued, the  State of Alaska set                 
  aside twelve reserves for Alaska Natives.   The land was not                 
  established  as  villages, but  rather  corporations ordered                 
  under State  law, not federal law.   That land was  given in                 
  fee.  The  initial act provides  for two square miles  which                 
  was to be  reserved for municipal  governments and if  there                 
  was not a municipal government, that land was to be taken by                 
  the State in trust for local state chartered government.  He                 
  reiterated,  it  is important  to recognize  that this  is a                 
  clear legal issue, where reasonable people can differ.   The                 
  fundamental question is  what Congress intended in  the 1971                 
  Act.    If  the decision  is  upheld,  and  there is  Indian                 
  country, the  State will  be looking  for a  redefinition of                 
  that relationship.                                                           
                                                                               
  Co-Chair Hanley interjected that if the State wins the case,                 
  it  is  important  to understand  that  federal  money would                 
  continue to "flow" into  Indian communities.  At  this time,                 
  Indian  country  is  not  recognized  in Alaska.    Attorney                 
  General  Botelho pointed out that if Indian country is found                 
  to  exist, there will be  additional federal monies that the                 
  tribes can access.                                                           
                                                                               
  Co-Chair Hanley reiterated  that the legislation was  not an                 
  attempt to  take away money  that is currently  flowing into                 
  the communities.   He pointed  out that Judge  Holland ruled                 
  that there was not Indian country in  Alaska.  A 9th Circuit                 
  Court,  three judge  panel  has ruled  that there  is Indian                 
  country, although,  he advised  that one of  the judges  did                 
  have  a  dissenting  opinion.     Because  there  have  been                 
  different  opinions  regarding  the  case,  he felt  it  was                 
  appropriate that a final hearing be made  to determine which                 
  direction the State will go.                                                 
                                                                               
  Attorney General Botelho responded to comments regarding the                 
  possibility  of  the Supreme  Court hearing  the case.   The                 
  Court does accept 80 to 90  cases per year.  It takes  those                 
  cases  which have  a significant  impact  on politics.   The                 
  Court has taken  a great interest  in any Indian law  cases,                 
  provides more of a possibility that  the case will be heard.                 
  He commented that the issue is creating  division within the                 
  State, and  the public would like finality  from the highest                 
  court in the land.  Absent  the intent, the Department would                 
  feel  they  had  not  done   their  duty  to  protect  State                 
  sovereignty.    He reiterated  that  it would  be  worth the                 
                                                                               
                               10                                              
                                                                               
                                                                               
  expenditure of public funds.                                                 
                                                                               
  Attorney General Botelho agreed that the legislation is on a                 
  "fast track".   The deadline for  filing the petition is  in                 
  early April, 1997.  Immediately  following, those who oppose                 
  must  file  a   document  noting   their  concerns;  it   is                 
  appropriate that this  is treated as a  supplemental request                 
  and placed on a high priority.                                               
                                                                               
  Representative  J.  Davies  noted his  concern  that  Alaska                 
  Natives  are  left  with  the feeling  that  the  State  has                 
  declared "war".  He  asked how can the State  could increase                 
  dialogue  for a  more  comfortable  course  of action.    He                 
  inquired if public  funds could be  used to argue the  other                 
  side of  the brief.   Attorney General Botelho  advised that                 
  would be a legislative call to determine if it could satisfy                 
  a legislative purpose.   Adding that conceptually,  it could                 
  be done.                                                                     
                                                                               
  Co-Chair Hanley commented that it would not be good business                 
  for the Legislature to appropriate  money in order that  the                 
  other party could sue the State.  He acknowledged that there                 
  have been suits by municipalities against the State.                         
                                                                               
  Attorney  General   Botelho  rebutted  that   the  court  is                 
  structured in a  way so  that good advocacy  takes place  on                 
  both sides, and that  the truth will prevail or at least the                 
  issues will  be more  sharply presented  to the  Court.   He                 
  summarized that everyone  has an interest that  this concern                 
  be resolved.                                                                 
                                                                               
  Representative Grussendorf  inquired how  the Department  of                 
  Law would  use the $500  thousand dollar request.   Attorney                 
  General Botelho outlined how  the funds would be used.   The                 
  first  stage  would  be  the   petition,  the  work  product                 
  enlisting the petition  outside support.   The second  phase                 
  would  be   the  actual   hearing  on   the  merits.     The                 
  appropriation  would   include  funds  for   more  extensive                 
  research and hiring  of an  Indian law expert.   There  will                 
  also  be  funding for  a delegation  to  meet with  the U.S.                 
  Alaskan Congressmen and the Justice of Interior.                             
                                                                               
  REPRESENTATIVE  BILL WILLIAMS  agreed that  everyone  in the                 
  State would appreciate a sense of finality on the issue.  He                 
  asked how the  case could affect selection of  village lands                 
  in the out-skirt areas surrounding the villages.                             
                                                                               
  Attorney General  Botelho acknowledged that  until precedent                 
  is established, it is clear that the 9th Circuit Court would                 
  be dealing specifically with  the Venetie case.  He  advised                 
  that  Venetie  is a  specific  case,  opting out  of  ANCSA,                 
  accepting  the  land  and  then  the  corporation  basically                 
                                                                               
                               11                                              
                                                                               
                                                                               
  dissolving itself in favor of a regional government.                         
                                                                               
  (Tape Change, HFC 97-24, Side 2).                                            
                                                                               
  Attorney  General  Botelho  continued,  addressing  the  act                 
  distinguished   between   urban  corporations   and  village                 
  corporations.  It is  difficult to state with  precision how                 
  far reaching the opinion will be.                                            
                                                                               
  Representative  Williams  questioned  how  people living  on                 
  lands that belong  to the State or  federal government would                 
  be  addressed.   He  understood that  it  was the  intent of                 
  Congress that those lands would go  to the villages in order                 
  that they  have a  land base.    Co-Chair Hanley  clarified,                 
  there  are  recognized  tribes  which  have  certain  status                 
  throughout the State.   An additional term would  expand the                 
  ability and rights of those tribes and how they manage their                 
  lands.  He added, there exists  a difference between  tribal                 
  status  and  Indian country;  he  stressed that  through the                 
  court case  all the monies  currently being received  by the                 
  Native Alaskans would continue.                                              
                                                                               
  Attorney  General  Botelho  noted  that   ANCSA  was  not  a                 
  termination  to  tribes.    Subsequent  events  have  caused                 
  Congress to  acknowledge the federal  recognition of tribes.                 
  ANCSA was intended to  be a bold experiment in  developing a                 
  relationship  between  the  federal government  and  tribes,                 
  doing away with a trusteeship.                                               
                                                                               
  REPRESENTATIVE  IRENE NICHOLIA  referenced Section  #1(a) of                 
  the proposed legislation, and asked how many firms would  be                 
  hired  under the  appropriation.   Attorney  General Botelho                 
  responded  that  one   law  firm  would  be   hired  out  of                 
  Washington, D.C., under  the leadership of Mr.  John Rogers.                 
  He stipulated that  it was the  intent of the Department  to                 
  hire an Indian law  expert who could  write a brief, at  the                 
  State's expense, on behalf of the other party.                               
                                                                               
  Representative Nicholia  asked if  Hogan &  Hartson was  the                 
  firm involved.   Attorney  General Botelho  replied Hogan  &                 
  Hartson was the law firm in which John Rogers was a partner.                 
  Representative  Nicholia  asked   for  copies  of  all   the                 
  documents  used  in  determining that  selection.   Attorney                 
  General Botelho spoke to the selection process, stating that                 
  Hogan & Hartson was a firm which had extensive Supreme Court                 
  experience.   He  continued, a  list was  prepared  of seven                 
  individual firms which had the necessary credentials and was                 
  then narrowed  to three.  Each  of those were  asked if they                 
  had an interest in representing the State.  Of the two firms                 
  which did, the State choose Hogan & Hartson.                                 
                                                                               
  Representative  Nicholia asked  if  any  lobbyists would  be                 
                                                                               
                               12                                              
                                                                               
                                                                               
  hired  by  the State  for  this purpose.    Attorney General                 
  Botelho stated that it was not  the intent of the Department                 
  of  Law  or  the  Executive Branch  to  hire  any lobbyists.                 
  Representative Nicholia queried if such would be a violation                 
  of the State Constitutional separation  of powers doctrine.                  
                                                                               
                                                                               
  Attorney General Botelho noted  that the original  statement                 
  made by Mr.  Ketzler was in  reference to the Babbitt  case.                 
  He made the decision to drop the 9th Circuit Court, at which                 
  point the  Legislature intervened  and made  the attempt  to                 
  carry the appeal  in the name of  the State of Alaska.   The                 
  9th Circuit Court  expounded that it would  be inappropriate                 
  for the Legislature to do so.  The Alaska Supreme Court  has                 
  acknowledged  that  there   may  be   cases  in  which   the                 
  Legislature may sue the Executive  Branch.  Attorney General                 
  Botelho's  judgement  was that  on  balance, there  is legal                 
  authority  for  the Legislature  to  expend monies  on legal                 
  services and to participate, although, it is not a clear-cut                 
  question.                                                                    
                                                                               
  Co-Chair Hanley  explained that the State Constitution would                 
  not prohibit the  State Legislature  from spending money  on                 
  the  case.     Attorney  General  Botelho  added   that  the                 
  characterization  of  the  Babbitt  Case  was  an  issue  of                 
  standing and not of State law.                                               
                                                                               
  In response to  Representative J.  Davies, Attorney  General                 
  Botelho noted that one third  of the Department's allocation                 
  would be spent in phase #1.   Representative J. Davies noted                 
  that  as of the end  of January, 1997,  there was about $500                 
  thousand unencumbered dollars remaining in the Department of                 
  Law's  fiscal  appropriation.     Attorney  General  Botelho                 
  responded  that  those   funds  were  for   legal  services,                 
  allocated internally by the Legislature  and not for funding                 
  the proposed case.  He stressed it would be an inappropriate                 
  use of funds.                                                                
                                                                               
  Co-Chair Hanley  asked if  the Department  would proceed  in                 
  doing the research  before the Supreme  Court had made  it's                 
  decision  whether they  would be  willing to hear  the case.                 
  Attorney  General  Botelho  stated that  there  would  be no                 
  hiatus of activity; there  will be a slowing down  until the                 
  Supreme  Court decides,  although,  there research  concerns                 
  regarding ANCSA  would continued.   Co-Chair  Hanley agreed,                 
  referencing  a  prior  discussion   with  Senator  Murkowski                 
  regarding other  existing cases  affecting Native  rights in                 
  the future.                                                                  
                                                                               
  Representative Nicholia  requested that  the Legislature  be                 
  briefed regularly  regarding  the case.    Attorney  General                 
  Botelho agreed to do so.                                                     
                                                                               
                               13                                              
                                                                               
                                                                               
  Representative J. Davies requested an overview of the tribal                 
  powers and rights  at this time and how  those that would be                 
  changed,  if  Indian  country  were  to be  granted  status.                 
  Attorney  General  Botelho  offered  to  provide  a  written                 
  overview with that information to Committee members.                         
                                                                               
  Representative Grussendorf  MOVED  to  adopt  Amendment  #1.                 
  [Attachment   #1].      Representative    Mulder   OBJECTED.                 
  Representative   Grussendorf   asked  what   the  Leadership                 
  expected  to  achieve  with the  funds  appropriated  to the                 
  Legislature.                                                                 
                                                                               
  TED POPELY, COUNSEL,  SENATE &  HOUSE MAJORITY, stated  that                 
  the Leadership  had consulted  with various  experts in  the                 
  area of concern, concluding that there is a significant role                 
  which the Legislature could play in  getting the case to the                 
  Supreme Court.   Representative Martin pointed out  that the                 
  Attorney  General  would  represent  the  Governor  and  the                 
  Executive Branch.   The Legislature does not  have their own                 
  legal council.                                                               
                                                                               
  Representative  J.  Davies  asked  specifics  regarding  the                 
  intended  use of  the  $500 thousand  dollars.   Mr.  Popely                 
  replied that there was no breakdown of how those funds would                 
  be spent.   He  added that  it would be  an ongoing  effort,                 
  although,  a broad plan does exist.   There will be a second                 
  stage and should  the Supreme Court  not hear the case  next                 
  fall,  a portion of  the funds would not  be needed to cover                 
  the expenditures.    He added  that there  has been  ongoing                 
  discussion regarding the educational effort drawn from those                 
  funds. Fund spending will be broken into three stages.                       
                                                                               
  Representative Nicholia  asked if  Mr. Popely  would be  the                 
  only  lawyer hired to address the  Leadership position.  Mr.                 
  Popely  stated that there  would be other  lawyers hired for                 
  drafting the briefs.   He did not know if  non-lawyers would                 
  be involved.                                                                 
                                                                               
  A roll call vote was taken on the MOTION.                                    
                                                                               
       IN FAVOR:      J. Davies, Grussendorf                                   
       OPPOSED:       Kelly,  Kohring,   Martin,  Mulder,   G.                 
                      Davis, Hanley, Therriault                                
                                                                               
  Representatives Foster and  Moses were  not present for  the                 
  vote.                                                                        
                                                                               
  The MOTION FAILED (2-7).                                                     
                                                                               
  Representative  Grussendorf  MOVED  to adopt  Amendment  #2.                 
  [Attachment #2].  Representative Mulder OBJECTED.                            
                                                                               
                               14                                              
                                                                               
                                                                               
  Representative Grussendorf  stated that the  amendment would                 
  create a new Section  #2, to address  the lapse date if  the                 
  Supreme Court denies the case.  Representative Mulder argued                 
  that if  the case  was not  heard by  the Supreme Court,  it                 
  could be handed down to a  lower court and that adopting the                 
  proposed amendment would tie their hands.  He suggested that                 
  current language would allow flexibility.                                    
                                                                               
  A roll call vote was taken on the MOTION.                                    
                                                                               
       IN FAVOR:      J. Davies, Grussendorf                                   
       OPPOSED:       Kohring,  Martin,   Mulder,  G.   Davis,                 
                      Kelly, Therriault, Hanley                                
                                                                               
  Representatives Foster and  Moses were  not present for  the                 
  vote.                                                                        
                                                                               
  The MOTION FAILED (2-7).                                                     
                                                                               
  Representative  J.  Davies  MOVED  to  adopt  Amendment  #3.                 
  [Attachment   #3].       Representative   Kelly    OBJECTED.                 
  Representative Davies  explained  that  Amendment  #3  would                 
  tighten up the purpose for  which the appropriation would be                 
  made, and then to  require a report  on how the monies  were                 
  expended.                                                                    
                                                                               
  (Tape Change, HFC 97-25, Side 1).                                            
                                                                               
  Representative Mulder commented that he was  not comfortable                 
  with  the language  of the amendment  as it  would eliminate                 
  necessary  flexibility.   He  added, the  Legislature always                 
  requests accounting  statistics from the Department  of Law.                 
  Representative J.  Davies  pointed  out  that  the  language                 
  includes both  federal  and  State  courts and  he  felt  it                 
  provided flexibility.                                                        
                                                                               
  A roll call vote was taken on the MOTION.                                    
                                                                               
       IN FAVOR:      J. Davies, Grussendorf                                   
       OPPOSED:       Martin,   Mulder,   G.   Davis,   Kelly,                 
  Kohring,                 Hanley, Therriault                                  
                                                                               
  Representatives Foster and  Moses were  not present for  the                 
  vote.                                                                        
                                                                               
  The MOTION FAILED (2-7).                                                     
                                                                               
  Representative  J.  Davies  MOVED  to  adopt  Amendment  #4.                 
  [Attachment   #4].      Representative    Mulder   OBJECTED.                 
  Representative J.  Davies  stated that  Amendment  #4  would                 
  apply to Section  (c).  The  amendment would make a  certain                 
                                                                               
                               15                                              
                                                                               
                                                                               
  portion of the appropriation contingent on the Supreme Court                 
  accepting the case.                                                          
                                                                               
  Co-Chair Hanley  asked what  would  happen if  they did  not                 
  review  the  case, but  instead sent  it  back to  the Ninth                 
  Circuit Court of Appeal's.   Representative J. Davies agreed                 
  and MOVED a  "friendly" amendment, $100 thousand  dollars be                 
  appropriated  in  case  it  was  remanded.    There  was  NO                 
  OBJECTION to the conceptual amendment.                                       
                                                                               
  Representative Mulder  voiced support of  the $500  thousand                 
  dollar   appropriation  from   the  General   Fund  to   the                 
  Legislative Operating Budget,  noting that it  indicated bi-                 
  partisan support for the activity.                                           
                                                                               
  A  roll  call vote  was taken  on  the amended  Amendment #4                 
  MOTION.                                                                      
                                                                               
       IN FAVOR:      J. Davies, Grussendorf                                   
       OPPOSED:       Mulder,   G.   Davis,   Kelly,  Kohring,                 
  Martin,                  Therriault, Hanley                                  
                                                                               
  Representatives Foster and  Moses were  not present for  the                 
  vote.                                                                        
                                                                               
  The MOTION FAILED (2-7).                                                     
                                                                               
  Representative Mulder MOVED  to report  CSSB 74(FIN) out  of                 
  Committee with individual  recommendations.   Representative                 
  J. Davies OBJECTED.                                                          
                                                                               
  Representative G.  Davis noted  for the  record his  concern                 
  with the lack  of information provided on  a detailed budget                 
  plan for the  appropriation.  He requested  more information                 
  on those numbers.  Co-Chair  Hanley guaranteed an accounting                 
  of the funds appropriated.                                                   
                                                                               
  Representative J.  Davies spoke  to his  objection regarding                 
  the legislation.  He recommended  that the legislation needs                 
  further discussion to  address some essential concerns.   He                 
  objected that  there are no  details or plans  regarding the                 
  proposed expenses.  Representative Davies believed that as a                 
  result from the  poorly thought  out concept,  it created  a                 
  divisive  impact amongst Alaskan  people, leaving the Native                 
  Alaskans in an angry and fearful position.                                   
                                                                               
  Representative  Grussendorf   noted  his  support   for  the                 
  appropriation to  the Department  of  Law, although,  voiced                 
  dissent with the appropriation to  the Legislative Operating                 
  Budget.  He stressed that this "piggy-back" has caused a lot                 
  of concern throughout the State.                                             
                                                                               
                                                                               
                               16                                              
                                                                               
                                                                               
  A roll call  vote was taken on  the MOTION to move  the bill                 
  from Committee.                                                              
                                                                               
       IN FAVOR:      Mulder,   G.   Davis,   Kelly,  Kohring,                 
                      Martin, Hanley, Therriault                               
       OPPOSED:       J. Davies, Grussendorf                                   
                                                                               
  Representatives Foster and  Moses were  not present for  the                 
  vote.                                                                        
                                                                               
  The MOTION PASSED (7-2).                                                     
                                                                               
  CSSB 74 (FIN) was reported out of Committee with a "do pass"                 
  recommendation.                                                              
  ADJOURNMENT                                                                  
                                                                               
  The meeting adjourned at 4:50 P.M.                                           
                                                                               
                                                                               
                               17                                              

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