Legislature(2011 - 2012)HOUSE FINANCE 519

04/11/2011 01:30 PM House FINANCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ SB 90 BOARD OF PUBLIC ACCOUNTANCY SECRETARY TELECONFERENCED
Moved Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
+= HB 106 COASTAL MANAGEMENT PROGRAM TELECONFERENCED
Heard & Held
<Bill Held Over from 8:30 Meeting>
+ SB 1 BD OF ED./EARLY DEVELOPMENT ANNUAL REPORT TELECONFERENCED
Moved Out of Committee
<Bill Held Over from 8:30 Meeting>
                  HOUSE FINANCE COMMITTEE                                                                                       
                      April 11, 2011                                                                                            
                         1:34 p.m.                                                                                              
                                                                                                                                
                                                                                                                                
1:34:45 PM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Stoltze called the  House Finance Committee meeting                                                                    
to order at 1:34 p.m.                                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Bill Stoltze, Co-Chair                                                                                           
Representative Bill Thomas Jr., Co-Chair                                                                                        
Representative Anna Fairclough, Vice-Chair                                                                                      
Representative Mia Costello                                                                                                     
Representative Mike Doogan                                                                                                      
Representative Bryce Edgmon                                                                                                     
Representative Les Gara                                                                                                         
Representative David Guttenberg                                                                                                 
Representative Reggie Joule                                                                                                     
Representative Mark Neuman                                                                                                      
Representative Tammie Wilson                                                                                                    
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
None                                                                                                                            
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Representative  Mike Hawker;  Representative Kyle  Johanson;                                                                    
Representative  Charisse  Millet; Thomas  Obermeyer,  Staff,                                                                    
Senator   Bettye   Davis,   Sponsor;   Les   Morse,   Deputy                                                                    
Commissioner,  Department of  Education and  Early Childhood                                                                    
Development;  Dana Owen,  Staff, Senate  Labor and  Commerce                                                                    
Committee;  Representative   Eric  Feige,   Co-Chair,  House                                                                    
Resources  Committee;  Representative   Bob  Herron;  Joseph                                                                    
Balash,   Deputy   Commissioner,   Department   of   Natural                                                                    
Resources.                                                                                                                      
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Lindsay Wolter, Department of Law, Anchorage.                                                                                   
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
HB 106    COASTAL MANAGEMENT PROGRAM                                                                                            
                                                                                                                                
          HB 106 was HEARD and HELD in committee for                                                                            
          further consideration.                                                                                                
                                                                                                                                
SB 1      BD OF ED. /EARLY DEVELOPMENT ANNUAL REPORT                                                                            
                                                                                                                                
          CSSB 1(EDC) was REPORTED out of Committee with a                                                                      
          "do pass" recommendation and with attached                                                                            
          previously published fiscal note: FN1, EED.                                                                           
                                                                                                                                
SB 90     BOARD OF PUBLIC ACCOUNTANCY SECRETARY                                                                                 
                                                                                                                                
          SB 90 was REPORTED out of Committee with a "do                                                                        
          pass" recommendation and with attached previously                                                                     
          published fiscal note: FN1, CED.                                                                                      
                                                                                                                                
CS FOR SENATE BILL NO. 1(EDC)                                                                                                 
                                                                                                                                
     "An Act requiring the state Board of Education and                                                                         
     Early Development to provide an annual report to the                                                                       
     legislature."                                                                                                              
                                                                                                                                
1:34:54 PM                                                                                                                    
                                                                                                                                
THOMAS  OBERMEYER,  STAFF,  SENATOR BETTYE  DAVIS,  SPONSOR,                                                                    
summarized  the legislation.  The bill  stipulated that  the                                                                    
Alaska State Board of Education  present an annual report to                                                                    
the legislature no  later than the 30th day  of each regular                                                                    
session.  The   report  was   typically  presented   to  the                                                                    
legislature towards the later part of session.                                                                                  
                                                                                                                                
1:36:20 PM                                                                                                                    
                                                                                                                                
LES MORSE, DEPUTY COMMISSIONER,  DEPARTMENT OF EDUCATION AND                                                                    
EARLY CHILDHOOD  DEVELOPMENT, offered  that upon  passage of                                                                    
SB  1 the  department would  work with  the board  to ensure                                                                    
that the report was delivered to the legislature.                                                                               
                                                                                                                                
Co-Chair Stoltze OPENED and CLOSED public testimony.                                                                            
                                                                                                                                
Vice-chair  Fairclough MOVED  to report  CSSB 1(EDC)  out of                                                                    
Committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal  note. There being NO  OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
CSSB 1(EDC) was  REPORTED out of Committee with  a "do pass"                                                                    
recommendation  and   with  attached   previously  published                                                                    
fiscal note: FN1, EED.                                                                                                          
                                                                                                                                
1:37:54 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
1:38:59 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
SENATE BILL NO. 90                                                                                                            
                                                                                                                                
     "An Act classifying and setting a monthly salary for                                                                       
     the executive secretary of the Board of Public                                                                             
     Accountancy."                                                                                                              
                                                                                                                                
1:38:59 PM                                                                                                                    
                                                                                                                                
DANA  OWEN,  STAFF,  SENATE LABOR  AND  COMMERCE  COMMITTEE,                                                                    
explained  the  legislation.  He reported  that  the  Alaska                                                                    
Board  of  Public  Accountancy was  authorized  to  hire  an                                                                    
Executive   Secretary  position   at  a   range  23   salary                                                                    
established  in   HB  315  ("An   Act  relating   to  public                                                                    
accounting;  and providing  for an  effective date")  during                                                                    
the 26th  legislative session. Subsequently,  the Department                                                                    
of Administration  (DOA) classified the position  at a lower                                                                    
range based upon a position  classification study. The board                                                                    
was unable  to hire the position  at a range 23.  He offered                                                                    
that the Senate Labor  and Commerce Committee introduced the                                                                    
legislation to re-establish the  range 23 salary in statute,                                                                    
according to the intent of HB 315.                                                                                              
                                                                                                                                
Co-Chair Stoltze OPENED and CLOSED public testimony.                                                                            
                                                                                                                                
Vice-chair  Fairclough   MOVED  to  report  SB   90  out  of                                                                    
Committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal  note. There being NO  OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
SB  90  was REPORTED  out  of  Committee  with a  "do  pass"                                                                    
recommendation  and   with  attached   previously  published                                                                    
fiscal note: FN1, CED.                                                                                                          
                                                                                                                                
1:41:20 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
1:49:23 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
HOUSE BILL NO. 106                                                                                                            
                                                                                                                                
     "An Act  extending the termination  date of  the Alaska                                                                    
     coastal   management  program   and  relating   to  the                                                                    
     extension; relating to the review  of activities of the                                                                    
     Alaska  coastal management  program;  providing for  an                                                                    
     effective date  by amending the effective  date of sec.                                                                    
     22, ch.  31, SLA 2005;  and providing for  an effective                                                                    
     date."                                                                                                                     
                                                                                                                                
1:49:28 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   ERIC  FEIGE,   CO-CHAIR,  HOUSE   RESOURCES                                                                    
COMMITTEE, provided a sectional analysis.                                                                                       
                                                                                                                                
     Section 1.   Extends the  date that the  Alaska coastal                                                                    
     management program  "is subject to termination"  to the                                                                    
     first regular legislative  session convening in January                                                                    
     2017.                                                                                                                      
                                                                                                                                
     Section  2.    Establishes the  Alaska  Coastal  Policy                                                                    
     Board (board).                                                                                                             
                                                                                                                                
Representative  Feige  explained   the  composition  of  the                                                                    
Alaska Coastal  Policy Board. He  delineated that  the board                                                                    
consisted  of  nine  members:   five  public  members;  four                                                                    
commissioners  from  the  Department  of  Natural  Resources                                                                    
(DNR),  Department of  Fish and  Game  (DFG), Department  of                                                                    
Environmental  Conservation  (DEC),  and the  Department  of                                                                    
Transportation  and   Public  Facilities  (DOT).   A  deputy                                                                    
commissioner  may  act  in place  of  the  commissioner.  He                                                                    
furthered  that  the  governor   would  choose  four  public                                                                    
members from different coastal regions  from a list provided                                                                    
by  the region.  The fifth  member, chosen  by the  governor                                                                    
must reside in the coastal zone.                                                                                                
                                                                                                                                
1:52:05 PM                                                                                                                    
                                                                                                                                
Representative Feige continued with the sectional analysis.                                                                     
                                                                                                                                
     Section  3.     Requires  the  Department   of  Natural                                                                    
     Resources  (department)  to  prepare an  annual  report                                                                    
     summarizing  the  department's  efforts  to  draft  and                                                                    
     adopt regulations  under AS  46.39 and  AS 46.40.   The                                                                    
    report must be posted on the department's website.                                                                          
                                                                                                                                
     Section 4.   Provides  that the department  may consult                                                                    
     and cooperate with the board.                                                                                              
                                                                                                                                
     Section 5.   Provides how, and to  whom, the department                                                                    
     must  provide   certain  information.     Requires  the                                                                    
     department to annually solicit issues for discussion by                                                                    
     the board,  summarize the  board's discussion  of these                                                                    
     issues,   and,   based   on   the   discussions,   make                                                                    
     recommendations to the commissioner of the department.                                                                     
                                                                                                                                
Representative  Feige  clarified  that DNR's  "duty  was  to                                                                    
provide   planning   and   consistency   review   data   and                                                                    
information of  the governing body  of the  coastal resource                                                                    
district  or service  area." He  reported that  the flow  of                                                                    
information  from the  department to  the coastal  districts                                                                    
was  lacking. The  coastal districts  were left  out of  the                                                                    
information stream.                                                                                                             
                                                                                                                                
     Section 6.   Mandates that, if  the department provides                                                                    
     funds to  a coastal  resource district or  service area                                                                    
     (district)  and the  department provides  a restriction                                                                    
     on  how the  funds may  be  used by  the district,  the                                                                    
     department  must specify  the law  that authorizes  the                                                                    
     restriction.                                                                                                               
                                                                                                                                
Representative   Feige   explained   that   Alaska   Coastal                                                                    
Management  Program (ACMP)  funding  originated through  the                                                                    
federal  government  to  DNR as  pass  through  grants.  The                                                                    
department  was responsible  for monitoring  that the  money                                                                    
was  spent   according  to   the  federal   guidelines.  The                                                                    
restrictions  included lobbying  and authoring  legislation.                                                                    
The  coastal districts  received the  money as  pass through                                                                    
grants   via   DCCED.   Some   of   the   money   had   been                                                                    
inappropriately  used  for  consultants. The  Department  of                                                                    
Commerce,   Community  and   Economic  Development   (DCCED)                                                                    
reacted  by disallowing  use of  the funds  for any  type of                                                                    
consultant.  The  Resources   Committee  determined  that  a                                                                    
blanket  restriction for  consulting was  excessive and  was                                                                    
not the intent of the funding restrictions.                                                                                     
                                                                                                                                
1:56:21 PM                                                                                                                    
                                                                                                                                
Representative Feige continued with the sectional analysis.                                                                     
                                                                                                                                
                                                                                                                                
     Section  7.    Provides  that  changes  to  a  district                                                                    
     coastal management  plan (plan)  may not  conflict with                                                                    
     statewide standards adopted by the department.                                                                             
                                                                                                                                
     Section 8.  Provides that  a plan may not conflict with                                                                    
     statewide standards adopted  by the department. Changes                                                                    
     what a  plan must include and  changes the requirements                                                                    
     for enforceable policies contained in a plan.                                                                              
                                                                                                                                
     Section  9.   Changes "the  use of  areas of  the coast                                                                    
     that  merit special  attention" to  "special management                                                                    
     areas,"  in  a  statutory   section  that  directs  the                                                                    
     department to adopt  regulations establishing statewide                                                                    
     standards  and district  plan criteria  for the  Alaska                                                                    
     Coastal  Management Program.    (The  bill repeals  the                                                                    
     definition  of "area  which  merits special  attention"                                                                    
     (bill sec.  20) and  provides a definition  of "special                                                                    
     management area" (bill sec. 18)).                                                                                          
                                                                                                                                
Representative Feige  detailed that  Section 9  retained the                                                                    
DEC "carve-out." The  section "was a sticking  point for the                                                                    
governor." The  governor strongly  favored the  "carve out."                                                                    
The exemption  of DEC permitting  from the  ACMP consistency                                                                    
review process  allowed the review  to stay on  schedule. He                                                                    
informed the committee that  a consistency determination was                                                                    
a pre-requisite for a DEC permit.                                                                                               
                                                                                                                                
     Section 10.   Changes  the process by  which a  plan is                                                                    
     reviewed and approved.  Removes language that requires,                                                                    
     for the department to approve  a plan, the plan to meet                                                                    
     statewide standards and district  plan criteria and not                                                                    
     arbitrarily  or unreasonably  restrict or  exclude uses                                                                    
     of  state  concern.    The plan  must  still  meet  the                                                                    
     provisions  of   AS  46.40  (note  that   AS  46.40.030                                                                    
     requires a plan to meet  district plan criteria and not                                                                    
     conflict  with  statewide   standards  adopted  by  the                                                                    
     department).  Provides  that  if the  department  finds                                                                    
     that a  plan is not  approvable, or is  approvable only                                                                    
     in part,  the department shall  submit the plan  to the                                                                    
     board for review and recommendations.   After the board                                                                    
     has reviewed the plan  and submitted recommendations to                                                                    
     the  department, the  department shall  enter findings,                                                                    
     and may,  by order, require  that a plan be  amended or                                                                    
     that a district take other appropriate action.                                                                             
                                                                                                                                
Representative Feige underscored that DNR made the final                                                                        
decision to approve a plan in total or in part.                                                                                 
                                                                                                                                
     Section 11.   Establishes a  process by which  a person                                                                    
     affected by  a decision  of the department  relating to                                                                    
     the  review and  approval  of a  plan  may request  the                                                                    
     commissioner  of  the   department  to  reconsider  the                                                                    
     decision.                                                                                                                  
                                                                                                                                
     Section  12.    Changes   the  criteria  by  which  the                                                                    
     department  will   evaluate  a  plan  submitted   by  a                                                                    
     district for approval.                                                                                                     
                                                                                                                                
2:00:06 PM                                                                                                                    
                                                                                                                                
Representative Feige read Page 10, lines 5-14 and lines 18-                                                                     
21 (Section 12) from the legislation:                                                                                           
                                                                                                                                
     the  department   shall  approve  a   district  coastal                                                                    
     management plan  submitted for  review and  approval if                                                                    
     the                                                                                                                        
           (1) district coastal management plan                                                                                 
               (A)  meets the  requirements of  this chapter                                                                    
               and the   district  plan criteria  adopted by                                                                    
               the department;     and                                                                                          
               (B)  does  not  conflict with  the  statewide                                                                    
               standards      adopted by the department; and                                                                    
          (2) enforceable policies of the district coastal                                                                      
               management plan                                                                                                  
               (A) do not duplicate, restate, incorporate by                                                                    
                    reference, rephrase, or otherwise modify                                                                    
               or adopt  state   or   federal  statutes   or                                                                    
               regulations;                                                                                                     
                                                                                                                                
     (b)  The enforceable  policies  in  a district  coastal                                                                    
          management plan submitted for review under this                                                                       
          section   may    establish   new    standards   or                                                                    
          requirements that are within the authority of a                                                                       
          state or federal agency unless the state or                                                                           
          federal agency specifically objects.                                                                                  
                                                                                                                                
He summarized  that an  enforceable policy  cannot duplicate                                                                    
an   existing   statute.   The   legislation   removed   the                                                                    
requirement that the enforceable  policy only applied within                                                                    
a designated  area. He  noted that  a contentious  issue for                                                                    
coastal  districts   was  to  define  a   "designated  area"                                                                    
specifically in regards to subsistence.                                                                                         
                                                                                                                                
     Section  13.   Requires  that the  department must,  in                                                                    
     regulations  adopted  by  the  department,  (1)  permit                                                                    
     certain persons to participate in a consistency review,                                                                    
     (2) provide  certain persons materials relating  to the                                                                    
     consistency  review,  (3)   make  notices  relating  to                                                                    
     proposed projects for which a consistency determination                                                                    
     is sought  available through the  department's internet                                                                    
     website.                                                                                                                   
                                                                                                                                
Representative Feige added that Section 13 ensured that                                                                         
information was thoroughly disseminated.                                                                                        
                                                                                                                                
     Section   14.     Relabels   "subsequent  reviews"   as                                                                    
     "elevations."   Provides  that elevations  may only  be                                                                    
     conducted by  the commissioners  of the  departments of                                                                    
     environmental  conservation,   natural  resources,  and                                                                    
     fish   and  game,   or   certain   deputies  of   these                                                                    
     commissioners. Provides how an elevation is completed.                                                                     
                                                                                                                                
Representative Feige explained  that a contested consistency                                                                    
review   was   termed   an  "elevation."   Previously,   the                                                                    
commissioner  of DNR  was responsible  for adjudicating  the                                                                    
dispute; coastal districts felt that process was unfair.                                                                        
                                                                                                                                
2:04:11 PM                                                                                                                    
                                                                                                                                
Representative Feige continued his sectional presentation.                                                                      
                                                                                                                                
     Section 15. Changes  "subsequent review" to "elevation"                                                                    
     to conform the section with changes in terminology made                                                                    
     in sec. 14 of the bill.                                                                                                    
                                                                                                                                
Representative Feige remarked that Section 14 suspended the                                                                     
90 day limit while the consistency review was under                                                                             
elevation. The elevation period was limited to 45 days.                                                                         
                                                                                                                                
     Section 16.  Adds  the commissioners of the departments                                                                    
     of environmental  conservation, natural  resources, and                                                                    
     fish   and  game,   or   certain   deputies  of   these                                                                    
     commissioners,  to  the  list   of  entities  that  are                                                                    
     "reviewing   entit[ies]"  for   the  purposes   of  the                                                                    
     consistency  review   and  determination   process  for                                                                    
     certain projects.                                                                                                          
                                                                                                                                
     Section 17.   Changes  language in a  statutory section                                                                    
     relating  to  the  approval  of   plans  in  a  coastal                                                                    
     resource  service area,  requires that  a new  material                                                                    
     submitted by  a city or  village may not  conflict with                                                                    
     statewide standards  adopted by the department.   Under                                                                    
     current  law, new  material submitted  by a  village or                                                                    
     city must "meet[ ] the statewide standards."                                                                               
                                                                                                                                
     Section  18.   Establishes definitions  for "elevation"                                                                    
     and "special management area."                                                                                             
                                                                                                                                
     Section  19.   Repeals the  statutory section  creating                                                                    
     the board.  (The repeal  is contingent on the repeal of                                                                    
     the entire  coastal management  program (see  bill sec.                                                                    
     25)).                                                                                                                      
                                                                                                                                
Representative Feige commented that Section 19 provided a                                                                       
sunset for the board.                                                                                                           
                                                                                                                                
     Section  20.   Repeals  the definition  of "area  which                                                                    
     merits special attention."                                                                                                 
                                                                                                                                
Representative Feige remarked that the repealed definition                                                                      
was replaced with "special management areas."                                                                                   
                                                                                                                                
     Section 21.  Provides, in  uncodified law, how and when                                                                    
     the initial  members of the  board shall  be appointed.                                                                    
     Provides  that   board  reviews  of   coastal  resource                                                                    
     management  plans (see  bill sec.  10) will  be delayed                                                                    
     until all members have been appointed.                                                                                     
                                                                                                                                
     Section 22.  Provides, if  the bill does not become law                                                                    
     before July  1, 2011, that  when the bill  becomes law,                                                                    
     the bill's provisions will be  retroactive in effect to                                                                    
     July 1,  2011, and  the provisions that  constitute the                                                                    
     Alaska  Coastal  Management   Program  that  have  been                                                                    
     repealed will be revived.                                                                                                  
                                                                                                                                
     Section 23.   Provides that the  provision establishing                                                                    
     the board (see bill sec.  2) will be repealed (see bill                                                                    
     sec. 19)  if the provisions that  constitute the Alaska                                                                    
     Coastal  Management Program  are  repealed through  the                                                                    
    operation of secs. 1 - 13 and 18, ch. 31, SLA 2005)                                                                         
                                                                                                                                
     Section 24.   Changes  the date (from  July 1,  2011 to                                                                    
     July  1, 2017)  in uncodified  law that  the provisions                                                                    
     that constitute  the Alaska Coastal  Management Program                                                                    
     will be  repealed under secs.  1 -  13 and 18,  ch. 31,                                                                    
     SLA 2005.                                                                                                                  
                                                                                                                                
     Section 25.  Provides an effective date for sec. 19 of                                                                     
     the bill.                                                                                                                  
                                                                                                                                
     Section 26.  Provides, except as provided in sec. 25,                                                                      
     an immediate effective date for the bill.                                                                                  
                                                                                                                                
2:06:33 PM                                                                                                                    
                                                                                                                                
Co-Chair  Thomas   wondered  whether   the  administration's                                                                    
concerns  with  the  Resources   Committee  version  of  the                                                                    
legislation  were  under  discussion.  Representative  Feige                                                                    
reported  that   the  governor's   staff  and   the  coastal                                                                    
districts  were  engaged  in an  "active"  conversation.  He                                                                    
believed that the differences  in the program's organization                                                                    
were not  substantial. The  administration and  industry had                                                                    
followed the Resources Committee process.                                                                                       
                                                                                                                                
Representative  Neuman  cited  Section  18  page  14,  which                                                                    
defined  a  "special  management  area." He  wondered  if  a                                                                    
special   management  area   could  require   a  subsistence                                                                    
priority.   Representative   Feige    commented   that   the                                                                    
definition  of a  special management  area in  the bill  was                                                                    
broad. He  thought that the  governor wanted  the definition                                                                    
narrowed.                                                                                                                       
                                                                                                                                
REPRESENTATIVE BOB HERRON, referred  to the comments made by                                                                    
the  attorney general  about the  label "special  management                                                                    
area." He relayed that the  attorney general sought to avoid                                                                    
any unintended  consequences and wanted assurances  that the                                                                    
label  would  change  and  conform  to  language  under  the                                                                    
Department  of  Law  (DOL).  He  opined  that  the  attorney                                                                    
general  was not  worried about  subsistence  by itself.  He                                                                    
answered that  if the definition of  special management area                                                                    
"fit  within  the policy  it  could  cover subsistence."  He                                                                    
believed the section that dealt  with "designated areas" was                                                                    
extremely important.  The coastal district had  to designate                                                                    
a subsistence area  even if subsistence use in  the area was                                                                    
not  established at  the time.  The situation  precluded the                                                                    
district  from commenting  on subsistence  use in  areas not                                                                    
designated  as  subsistence  on  any  ACMP  project  in  the                                                                    
future.                                                                                                                         
                                                                                                                                
2:11:20 PM                                                                                                                    
                                                                                                                                
Representative  Herron argued  that  removal of  "designated                                                                    
areas"  from  ACMP  was  the most  important  piece  of  the                                                                    
legislation.                                                                                                                    
                                                                                                                                
Representative Feige  interjected that at the  same time the                                                                    
standards defining an enforceable policy were tightened up.                                                                     
                                                                                                                                
Representative  Neuman restated  concerns  about opening  up                                                                    
the ability  to designate areas for  a subsistence priority.                                                                    
He  referred  to  the  language in  the  bill  that  defined                                                                    
special  management areas  as  "areas  of unique  historical                                                                    
significance,   cultural   value,  essential   habitat,   or                                                                    
recreational value  or opportunity." He asked  if the intent                                                                    
of  the  legislation  was  to  open  up  subsistence  areas.                                                                    
Representative  Feige stated  that the  legislation was  not                                                                    
intended to  set aside specific priority  subsistence areas.                                                                    
The removal of the  designated areas allowed the enforceable                                                                    
policy to apply to the  entire coastal district. He reminded                                                                    
the  committee that  enforceable  policies cannot  supersede                                                                    
state  or  federal  government  authority.  The  removal  of                                                                    
designated  areas  was  a compromise  to  allow  enforceable                                                                    
policies  pertaining  to  subsistence to  apply  across  the                                                                    
entire  district.  Otherwise,  it   was  difficult  for  the                                                                    
districts to define subsistence areas.                                                                                          
                                                                                                                                
2:15:34 PM                                                                                                                    
                                                                                                                                
Representative  Neuman announced  that he  had asked  for an                                                                    
opinion from  the attorney general on  the subsistence issue                                                                    
and how it related to access.                                                                                                   
                                                                                                                                
Representative Guttenberg  pointed out  three places  in the                                                                    
bill   with  the   language  "not   in  conflict"   or  "not                                                                    
inconsistent" with statewide standards.  He queried how that                                                                    
conflicted with  developing local enforceable  policies that                                                                    
must  conform to  statewide criteria.  Representative Herron                                                                    
was not sure. He thought  that the bill accomplished that by                                                                    
the  deletion on  section 7,  Page 6,  line 6  of "statewide                                                                    
standards"  and including  "changes to."  Recent discussions                                                                    
with the  attorney general suggested different  changes were                                                                    
necessary. He  suggested that new language  could be crafted                                                                    
into a new CS.                                                                                                                  
                                                                                                                                
Vice-chair  Fairclough  pointed  to  Section  2  related  to                                                                    
composition of  the board. She  asked whether  the drafter's                                                                    
intent was  to include  industry on  the statewide  seat for                                                                    
public board members. Representative  Feige answered that it                                                                    
was not the  specific intent but the language  left open the                                                                    
possibility for an industry seat on the board.                                                                                  
                                                                                                                                
Vice-chair  Fairclough queried  compromises made  to coastal                                                                    
communities  and the  interaction  of decisions  of a  board                                                                    
with limited representation in  juxtaposition with access by                                                                    
leaseholders  to coastal  resources.  She  thought that  all                                                                    
Native  Corporations benefited  from  coastal resources  and                                                                    
had  rights under  ANCSA  [Alaska  Native Claims  Settlement                                                                    
Act] to access them. She  wondered how to achieve meaningful                                                                    
evaluation  to  ensure  the resources  benefited  all  state                                                                    
interests and not just coastal communities.                                                                                     
                                                                                                                                
2:19:52 PM                                                                                                                    
                                                                                                                                
Representative Feige  repeated that the board  was appointed                                                                    
by  the governor  and was  also  comprised of  commissioners                                                                    
that worked in the  interest of the governor. Representative                                                                    
Herron asked  for clarification of the  question. Vice-chair                                                                    
Fairclough stated  that she was  speaking to  the underlying                                                                    
interests  of  all  Alaskans  and  all  Native  Corporations                                                                    
interests  outside of  coastal  communities.  She wanted  to                                                                    
mitigate  negative  environment  actions inside  of  coastal                                                                    
communities, but  the rest  of the state  also had  a vested                                                                    
interest in  resources located there. She  asserted that the                                                                    
public  sector  could  outvote  the  administration  on  the                                                                    
board, which she had not seen on other boards.                                                                                  
                                                                                                                                
2:22:23 PM                                                                                                                    
                                                                                                                                
Representative  Feige  reminded  her  that  the  board  made                                                                    
recommendations  and was  not  involved  in the  consistency                                                                    
review process.  He discussed the  ACMP process.  He likened                                                                    
the  ACMP process  to  having  a "front  side"  and a  "back                                                                    
side."  The  "front  side" characterized  the  role  of  the                                                                    
coastal  districts  and  the board.  The  coastal  districts                                                                    
created   plans   and   established   rules   for   resource                                                                    
development.  The "back  side" represented  the role  of the                                                                    
state.  The state's  interests were  represented during  the                                                                    
consistency  and elevated  review  processes. Disputes  were                                                                    
adjudicated  by   the  commissioners  who   represented  the                                                                    
state's interest.                                                                                                               
                                                                                                                                
Representative Herron reiterated that  all nine members were                                                                    
the  governor's  appointees.  He  reported  that  after  the                                                                    
Resources   Committee  version   was  completed   discussion                                                                    
continued with  the administration about the  composition of                                                                    
the fifth  board member; industry  was chosen  by consensus.                                                                    
He claimed  that the  board's role was  to "help"  develop a                                                                    
coastal plan  without involvement in the  review process. He                                                                    
noted that his constituents  wanted an additional role, such                                                                    
as reviewing  the regulations. He  identified that  the goal                                                                    
of CS HB 106 (RES) was  to strengthen the role of the policy                                                                    
board  which  was balanced  by  not  having veto  power.  He                                                                    
viewed the board as a  team player. He supported the board's                                                                    
involvement in the regulatory review process.                                                                                   
                                                                                                                                
Representative  Edgmon  understood  that  the  policy  board                                                                    
acted  in an  advisory capacity.  The binding  authority was                                                                    
held  by   DNR.  He  believed   DNR  held   the  significant                                                                    
authoritative  role and  that the  policy  board was  purely                                                                    
advisory.                                                                                                                       
                                                                                                                                
2:26:55 PM                                                                                                                    
                                                                                                                                
Representative  Feige agreed.  He reiterated  his two  sided                                                                    
analogy: one  side that represented the  coastal communities                                                                    
establishing  plans  and  rules  and, the  other  side  that                                                                    
embodied  the  state's  role  in   the  review  process.  He                                                                    
referred  to past  frustrations by  the coastal  communities                                                                    
due  to   lack  of  participation.  He   believed  the  ACMP                                                                    
structure kept the process "predictable."                                                                                       
                                                                                                                                
Representative  Edgmon  asked   what  the  coastal  district                                                                    
boundaries  were. Representative  Herron  answered that  the                                                                    
boundaries were  related to the  tides. He  exemplified that                                                                    
Bethel  was  in  its  own coastal  district.  The  districts                                                                    
formed a  "ribbon" along the  coast. He emphasized  that the                                                                    
districts did not reach inland.                                                                                                 
                                                                                                                                
2:30:09 PM                                                                                                                    
                                                                                                                                
Representative  Costello  directed  attention  to  Page  10,                                                                    
lines 18 - 21. She read the language:                                                                                           
                                                                                                                                
      (b)  The enforceable  policies in  a district  coastal                                                                    
          management plan submitted for review under this                                                                       
          section   may    establish   new    standards   or                                                                    
          requirements that are within the authority of a                                                                       
          state or federal agency unless the state or                                                                           
          federal agency specifically objects.                                                                                  
                                                                                                                                
Representative  Costello   interpreted  that   the  language                                                                    
granted enforceable  policies the  weight of law  unless the                                                                    
state or  federal government objected. She  asked what would                                                                    
happen if  the enforceable  policy became  law and  a future                                                                    
legislature  wanted to  change the  law. She  discerned that                                                                    
legislative  authority  was being  granted  to  the ACMP  to                                                                    
write  laws. Representative  Herron  believed that  creating                                                                    
enforceable  policies  was  the  reason  for  the  ACMP.  He                                                                    
reasoned that an enforceable policy  could be revised if any                                                                    
future objection arose.                                                                                                         
                                                                                                                                
Representative  Costello   commented  that  the   state  was                                                                    
granted powers by the federal  government under the program.                                                                    
She  wondered whether  it was  in the  state's authority  to                                                                    
consequently grant  coastal districts the ability  to create                                                                    
laws.  Representative  Herron   believed  that  the  federal                                                                    
government did grant the state  the authority to empower the                                                                    
ACMP.  He noted  that federal  authority could  override the                                                                    
state at any time. He  restated that coastal community input                                                                    
was the reason the ACMP existed.                                                                                                
                                                                                                                                
2:34:45 PM                                                                                                                    
                                                                                                                                
Representative Costello  questioned the original  purpose of                                                                    
the program.  Representative Herron provided an  analogy for                                                                    
the  ACMP. He  believed the  essence of  the program  was to                                                                    
allow  the  coastal  district  to  identify  what  was  most                                                                    
important.  The local  districts  concerns  were limited  by                                                                    
lacking veto  power in matters  of statewide  importance. He                                                                    
felt  it  struck  a  balance  between  local  and  statewide                                                                    
interests.  He  divulged  that no  one  wanted  the  federal                                                                    
government to run coastal zone management.                                                                                      
                                                                                                                                
Representative  Feige  explained that  enforceable  policies                                                                    
would apply only to the  boundaries of the coastal district.                                                                    
The purpose  of lines 18 -  21 was to provide  the state and                                                                    
federal  agencies  the  authority  to manage  that  area  by                                                                    
granting  them  the  final  authority,  while  enabling  the                                                                    
coastal district to present a desired enforceable policy.                                                                       
                                                                                                                                
Vice-chair  Fairclough  referenced  the  attorney  general's                                                                    
discussion  of the  retroactivity  issue in  regards to  the                                                                    
bill. She  asked the sponsors  whether they had  comments on                                                                    
the issue.                                                                                                                      
                                                                                                                                
Representative   Edgmon  relayed   that  the   coastal  zone                                                                    
management  program  was created  by  congress  in 1972.  He                                                                    
discussed  the program's  development.  The legislation  was                                                                    
enacted  in   recognition  of   the  sensitive   balance  of                                                                    
protection and  development in  managing the  coastal zones.                                                                    
The assumption  was that  it was  necessary to  grant higher                                                                    
authority to local entities  to achieve balanced management.                                                                    
Alaska chose to implement the  program in the late 1970s. He                                                                    
concurred with  Representative Herron in the  belief that if                                                                    
enforceable  provisions were  not inherent  in the  program,                                                                    
what  was the  reason  for  it. He  added  that the  federal                                                                    
government   recognized   that   the   state   should   have                                                                    
enforcement authority granted under them.                                                                                       
                                                                                                                                
Vice-chair  Fairclough surmised  that an  urban example  was                                                                    
characterized by  service areas.  She exemplified  the Eagle                                                                    
River/Chugiak  park   service  area  where   the  community,                                                                    
exercising  local  control  decided  to  pay  for  all  park                                                                    
projects up  front. The community  rejected the  practice of                                                                    
carrying  debt inside  of the  service  area. The  community                                                                    
chose   to  manage   its  service   area  differently   than                                                                    
Anchorage. She  qualified that  service areas  worked within                                                                    
the confines of state and municipal law.                                                                                        
                                                                                                                                
2:41:23 PM                                                                                                                    
                                                                                                                                
Representative   Neuman   wondered   how   much   discussion                                                                    
regarding the DEC  "carve out" ensued in  the House Resource                                                                    
Committee.  Representative   Feige  responded   that  modest                                                                    
discussions  had occurred  related to  the DEC  "carve out."                                                                    
The  governor strongly  advocated  retention  of the  "carve                                                                    
out."  The committee  ascertained  that  the DEC  permitting                                                                    
timeline took  much longer  (up to one  year) than  the ACMP                                                                    
consistency  review  process  (35-50   days)  and  that  DEC                                                                    
permitting should remain separate.                                                                                              
                                                                                                                                
Representative Neuman  asked for  an explanation of  the DEC                                                                    
"carve    out."    Representative    Herron    wanted    the                                                                    
administration to answer the  question. He characterized the                                                                    
"carve out" debate  as very "vigorous." He  relayed that Mr.                                                                    
Balash and the  Commissioner of DEC were  both very emphatic                                                                    
that the  "carve out"  would remain in  statute. He  did not                                                                    
anticipate that the DEC "carve  out" would change in a House                                                                    
Finance Committee  version of the  bill. He  appreciated the                                                                    
administration's huge effort in the process.                                                                                    
                                                                                                                                
2:44:51 PM                                                                                                                    
                                                                                                                                
Vice-chair  Fairclough pointed  to Page  3, line  17 of  the                                                                    
legislation.  She wondered  about  the  transition of  board                                                                    
members  between new  governors provided  in Alaska  Statute                                                                    
39.05.080.                                                                                                                      
                                                                                                                                
LINDSAY   WOLTER,   DEPARTMENT   OF  LAW,   ANCHORAGE   (via                                                                    
teleconference),  stated   that  she  would   respond  after                                                                    
examination of the statute.                                                                                                     
                                                                                                                                
Vice-chair Fairclough referenced concerns  related to the 45                                                                    
day timeline for a consistency review elevation.                                                                                
                                                                                                                                
2:47:16 PM                                                                                                                    
                                                                                                                                
JOSEPH  BALASH, DEPUTY  COMMISSIONER, DEPARTMENT  OF NATURAL                                                                    
RESOURCES, addressed Section 14  that defined the process of                                                                    
a  consistency determination  elevation.  He summarized  the                                                                    
process.  The applicant  or coastal  district may  contest a                                                                    
consistency determination  through an elevation  carried out                                                                    
by the  resource commissioners. He noted  that presently the                                                                    
Division  of Coastal  and Ocean  Management  (DCOM) was  the                                                                    
reviewing  entity  and  the commissioner  of  DNR  conducted                                                                    
elevation determinations.  In the current version  the three                                                                    
resource   commissioners  would   issue   a  written   order                                                                    
completed  within  45  days  and  signed  by  at  least  two                                                                    
commissioners.  The department  wanted clarification  on the                                                                    
repercussions in the  case of an impasse between  all of the                                                                    
commissioners   after  45   days.   He  noted   considerable                                                                    
discussion on  the issue during  the committee  process. The                                                                    
administration believed that  the proposed elevation process                                                                    
lacked consistency.  Representative Herron related  that the                                                                    
administration  wanted to  eliminate  the 45  day limit.  He                                                                    
believed an  uncertain time limit lacked  predictability. He                                                                    
proposed more dialogue on the issue.                                                                                            
                                                                                                                                
Vice-chair  Fairclough  queried  what  would  happen  if  an                                                                    
elevation process ended in an  impasse. She asked whether he                                                                    
had  a compromise  solution.  Representative Herron  relayed                                                                    
that the  attorney general would offer  compromise language.                                                                    
He hoped that the language would provide consistency.                                                                           
                                                                                                                                
2:52:13 PM                                                                                                                    
                                                                                                                                
Representative Edgmon asked  whether the present consistency                                                                    
review  process  dictated  timelines. Mr.  Balash  explained                                                                    
that  presently  a  30-day   or  50-day  consistency  review                                                                    
process was  utilized depending on  the type of  review. The                                                                    
applicant  or coastal  district  may  elevate a  consistency                                                                    
review determination  by DCOM to  the DNR  commissioner. The                                                                    
commissioner  had 45  days to  review the  determination. He                                                                    
added  that  once  an  elevation  was  requested  the  clock                                                                    
stopped on  the original consistency review  and began again                                                                    
after the elevation was completed.  He felt that elevating a                                                                    
determination to three commissioners was problematic.                                                                           
                                                                                                                                
Representative Doogan asked what would  happen if HB 106 was                                                                    
not  adopted. Mr.  Balash informed  the  committee that  the                                                                    
program was voluntary. The Coastal  Zone Management Act, the                                                                    
federal authorizing statute, would  be repealed and Alaska's                                                                    
participation would come  to an end. A  federal agency would                                                                    
become the  reviewing entity,  and take  the place  of DCOM.                                                                    
The state would be left  out of certain permitting decisions                                                                    
affecting the coastal zone.                                                                                                     
                                                                                                                                
2:56:04 PM                                                                                                                    
                                                                                                                                
Representative  Doogan   wondered  who  would   control  the                                                                    
coastal  zones. Mr.  Balash  remarked  that "the  permitting                                                                    
processes  would  go  on   without  the  consistency  review                                                                    
process at the front end of the permitting regime."                                                                             
                                                                                                                                
Representative  Herron  added  that the  federal  government                                                                    
would  take over.  He recommended  reading a  letter to  the                                                                    
Resources  Committee by  the mayor  of  Anchorage, which  he                                                                    
thought  was remarkable.  Representative  Doogan noted  that                                                                    
any  action or  inaction would  have impacts.  He wanted  to                                                                    
know what  they were in  case an  agreement on ACMP  was not                                                                    
reached.                                                                                                                        
                                                                                                                                
Co-Chair Thomas  believed that  if the  bill was  not passed                                                                    
the  coastal zone  management staff  would be  laid off.  He                                                                    
commented that $3.6 million in savings would occur.                                                                             
                                                                                                                                
Vice-chair Fairclough  pointed out  that outcome  could cost                                                                    
the  state  much  more  if  the  federal  government  gained                                                                    
control.                                                                                                                        
                                                                                                                                
Vice-chair  Fairclough asked  for clarification  of the  DEC                                                                    
carve-out.                                                                                                                      
                                                                                                                                
2:59:35 PM                                                                                                                    
                                                                                                                                
Mr. Balash cited  that the DEC "carve out" was  found in the                                                                    
Alaska Statute  4640.040b. He  detailed that  the subsection                                                                    
listed  the  statutory  authority of  DEC.  Subsection  040b                                                                    
stated that  DEC authorities were the  exclusive regulations                                                                    
for the ACMP. The issuance  of a permit by DEC automatically                                                                    
constituted consistency.  He added that certain  DEC permits                                                                    
had   complicated   and   drawn-out  timelines.   The   ACMP                                                                    
consistency review  timelines do  not match  up with  DEC in                                                                    
most cases. He  continued that some requirement  for air and                                                                    
water  standards  were under  federal  clean  water and  air                                                                    
regulations. The  "carve out"  ensured local  standards were                                                                    
kept in compliance with federal regulations.                                                                                    
                                                                                                                                
Vice-chair Fairclough CLOSED public testimony.                                                                                  
                                                                                                                                
3:03:06 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
3:03:15 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Representative  Joule offered  that the  discussion on  ACMP                                                                    
was  lacking  for five  years.  He  felt confident  that  an                                                                    
agreement  was within  reach. He  advocated maintaining  the                                                                    
ACMP.                                                                                                                           
                                                                                                                                
Representative  Edgmon  opined  that   if  the  program  was                                                                    
crafted  right  the  ACMP  would   enable  and  not  disable                                                                    
resource development. He thought  the ACMP could unite local                                                                    
districts to  form a buffer against  "interventionists" that                                                                    
held up  progress in  courts. He  believed the  ACMP process                                                                    
supported statewide interests.                                                                                                  
                                                                                                                                
3:07:33 PM                                                                                                                    
                                                                                                                                
Representative Feige agreed. He  opined that a well-defined,                                                                    
organized, and  enforceable coastal management plan  for all                                                                    
coastal  districts  added  certainty   to  go  forward  with                                                                    
coastal projects. The certainty  increased the potential for                                                                    
more coastal resource projects in the future.                                                                                   
                                                                                                                                
Representative  Herron acknowledged  that the  bill was  not                                                                    
perfect.  He relayed  what the  attorney  general wanted  to                                                                    
accomplish  in  a  new  CS.   The  attorney  general  wanted                                                                    
protection against  entities that  endeavored to  "take down                                                                    
responsible  resource  development" through  litigation.  He                                                                    
agreed the  legislation provided  an opportunity to  forge a                                                                    
responsible coastal policy.                                                                                                     
                                                                                                                                
HB  106  was  HEARD  and   HELD  in  committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
3:10:49 PM                                                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
The meeting was adjourned at 3:10 PM.                                                                                           
                                                                                                                                
                                                                                                                                

Document Name Date/Time Subjects
SB 90 2010 Fiscal Note HB 315.pdf HFIN 4/11/2011 1:30:00 PM
HB 315
SB 90
SB 90 DOA Determination on Range and Step.pdf HFIN 4/11/2011 1:30:00 PM
SB 90
SB 90 Enabling bill HB 315.pdf HFIN 4/11/2011 1:30:00 PM
HB 315
SB 90
SB 90 Board of Accountancy Background Letter.pdf HFIN 4/11/2011 1:30:00 PM
SB 90
SB 90 Alaska Society of CPA Support Letter.pdf HFIN 4/11/2011 1:30:00 PM
SB 90
SB 90 Sponsor Statement HFIN.pdf HFIN 4/11/2011 1:30:00 PM
SB 90
HB106 CAP & Brune-RDC testimony.pdf HFIN 4/11/2011 1:30:00 PM
HB 106