Legislature(1993 - 1994)
02/16/1994 05:00 PM O&G
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HOUSE SPECIAL COMMITTEE ON OIL & GAS February 16, 1994 5:00 p.m. MEMBERS PRESENT Representative Joe Green, Chairman Representative Pete Kott (arrived at 5:10 p.m.) Representative Gary Davis Representative Jerry Sanders Representative Joe Sitton Representative Jerry Mackie MEMBERS ABSENT Representative Harley Olberg OTHER LEGISLATORS PRESENT Representative Mike Navarre Representative Bill Williams Senator Suzanne Little Senator Judy Salo COMMITTEE CALENDAR *HB 426: "An Act establishing the Chickaloon Flats Critical Habitat Area." PASSED OUT OF COMMITTEE WITH INDIVIDUAL RECOMMENDATIONS *HB 474: "An Act modifying administrative procedures and decisions by state agencies that relate to uses and dispositions of state land, property, and resources, and to the interests within them, and that relate to land, property and resources, and to the interests within them, that are subject to the coastal management program; and providing for an effective date." HEARD AND HELD OVER PREVIOUS ACTION BILL: HB 426 SHORT TITLE: CHICKALOON FLATS CRITICAL HABITAT AREA SPONSOR(S): REPRESENTATIVE(S) BUNDE JRN-DATE JRN-PG ACTION 02/02/94 2219 (H) READ THE FIRST TIME/REFERRAL(S) 02/02/94 2219 (H) O&G, RES, FIN 02/16/94 (H) O&G AT 05:00 PM CAPITOL 124 BILL: HB 474 SHORT TITLE: ADMINISTRATIVE ACTION RELATING TO LAND SPONSOR(S): RESOURCES JRN-DATE JRN-PG ACTION 02/14/94 2375 (H) READ THE FIRST TIME/REFERRAL(S) 02/14/94 2375 (H) O&G, RESOURCES, JUDICIARY 02/16/94 (H) O&G AT 05:00 PM CAPITOL 124 WITNESS REGISTER REPRESENTATIVE CON BUNDE Alaska State Legislature Capitol Building Juneau, Alaska 99801 Phone: (907) 465-4843 POSITION STATEMENT: Sponsor of HB 426 FRANK RUE, Director Division of Habitat & Restoration Department of Fish & Game 1255 W. 8th Street Juneau, Alaska 99802 Phone: (907) 465-4105 POSITION STATEMENT: In Support of HB 426 JOHN HENDRICKSON, President Alaska Waterfowl Association 3105A Lakeshore Drive, Suite 102 Anchorage, Alaska 99517 Phone: (907) 243-3235 POSITION STATEMENT: In Support of HB 426 JAMES EASON, Director Division of Oil & Gas Department of Natural Resources 3601 C Street, Suite 1380 Anchorage, Alaska 99510-0734 Phone: (907) 762-2547 POSITION STATEMENT: In Support of HB 474 TOM LOHMAN North Slope Borough Box 69 Barrow, Alaska 99723 Phone: (907) 852-0350 POSITION STATEMENT: In Opposition to HB 474 NORMA CALVERT Marathon Oil P.O. Box 196168 Anchorage, Alaska 99519 Phone:(907) 564-6474 POSITION STATEMENT: In Support of HB 474 DOUG ROBBINS Marathon Oil P.O. Box 196168 Anchorage, Alaska 99519 Phone: (907) 564-6474 POSITION STATEMENT: In Support of HB 474 MAUREEN McCREA 6906 Big Mountain Drive Anchorage, Alaska 99516 Phone: (907) 345-2453 POSITION STATEMENT: In Opposition to HB 474 LOREN FLAGG, Executive Director Kenai Peninsula Fisherman's Association 34824 K Beach Road Soldotna, Alaska 99669 Phone: (907) 262-2492 POSITION STATEMENT: In Opposition to HB 474 SUSAN FLENSBURG P.O. Box 394 Dillingham, Alaska 99576 Phone: (907) 842-2666 POSITION STATEMENT: In Opposition to HB 474 NANCY WAINWRIGHT 13030 Back Road Anchorage, Alaska 99515 Phone: (907) 345-5595 POSITION STATEMENT: In Opposition to HB 474 NINA FAUST Kachemak Bay Conservation Society P.O. Box 846 Homer, Alaska 99603 Phone: None Given POSITION STATEMENT: In Opposition to HB 474 EDGAR BAILEY P.O. Box 2994 Homer, Alaska 99603 Phone: None POSITION STATEMENT: In Opposition to HB 474 RIKKI OTT United Fishermen of Alaska 211 Fourth Street #112 Juneau, Alaska 99802 Phone: (907) 586-2820 POSITION STATEMENT: In Opposition to HB 474 JOEL KAWAHARA United Fishermen of Alaska 211 Fourth Street #112 Juneau, Alaska 99802 Phone: (907) 586-2820 POSITION STATEMENT: In Opposition to HB 474 STAN STEPHENS Prince William Sound Regional Citizens Advisory Council Valdez, Alaska 99686 Phone: (907) 835-4731 POSITION STATEMENT: In Opposition to HB 474 CHIP TREINEN Area K Seiners Association P.O. Box 2399 Kodiak, Alaska 99615 Phone: (907) 486-4686 POSITION STATEMENT: In Opposition to HB 474 KARL KIRCHER Kenai Peninsula Fishermens Association Kasilof, Alaska 99610 Phone: None Given POSITION STATEMENT: In Opposition to HB 474 JOHN BOCCI Cordova District Fisheries United P.O. Box 1312 Cordova, Alaska 99574 Phone: (907) 424-5182 POSITION STATEMENT: In Opposition to HB 474 CHUCK DEGMAN Bering Straits Coastal Resource Service Area Unalakleet, Alaska 99684 Phone: None Given POSITION STATEMENT: In Opposition to HB 474 TAPE 94-7, SIDE A Number 002 CHAIRMAN GREEN called the meeting to order at 5:07 p.m. HB 426 - CHICKALOON FLATS CRITICAL HABITAT AREA Number 008 REPRESENTATIVE CON BUNDE stated that Chickaloon Flats is an area on the northeast side of the Kenai Peninsula, on Turnagain Arm, facing the Alaska Coastal Refuge. He said Potter Flats is just immediately across the inlet. He said the area has a local nesting population of ducks and geese and it is an important resting and feeding area, as well as a migration point in the fall. He stated the area serves ducks, geese, and shore birds, and the area has up to 25,000 birds in a day, particularly in the fall migration. He stated the birds use the area as a staging area when Portage Pass is closed due to bad weather. He said Chickaloon is the primary place in the Turnagain Arm for birds to have a place to rest and feed. He stated that Alaska has some other critical habitat areas and bird sanctuaries, the Mendenhall State Game Refuge, Anchorage Coastal Refuge, Trading Bay State Game Refuge, Palmer Hay Flats, and Susitna Flats. He said these areas range from 300,000 acres to 14,000 acres. He stated the Chickaloon Flats area would be approximately 22,000 acres, which is a small addition to the system. He said the purpose of HB 426 is to assure adequate habitat for waterfowl, rather than to create a stumbling block to future development of our resources. He said there are currently no valid oil or gas leases in the purposed critical habitat area and it would not be disrupting any current plans for development. He asked the committee to support HB 426. Number 049 REPRESENTATIVE GARY DAVIS moved that the committee adopt the committee substitute for HB 426. There were no objections. Number 054 REPRESENTATIVE JERRY MACKIE asked if oil development, potential timber development, hunting, fishing and other kinds of development would still be allowed. REPRESENTATIVE BUNDE stated it would be allowed if it does not disrupt the critical habitat. He said that hunting, fishing, hiking, birding would not be a problem. REPRESENTATIVE MACKIE asked what HB 426 does if one can have oil production and other development. He asked if there was a planned residential development for the area. He said usually a critical habitat area is exactly that - it locks the area up from development to protect a certain species of game or birds. He stated he did not understand what HB 426 does. Number 071 REPRESENTATIVE BUNDE stated his intention was that development could not take place if it would be disruptive and displace the resting birds. He said if development is mutually compatible, there would be no reason that it could not take place. Number 077 REPRESENTATIVE MACKIE stated the example Representative Bunde used was that if it was a condominium building it probably would not be compatible with the ducks, but if it was an oil drilling rig, it would be compatible. He asked for the differences between the two scenarios and how they might affect ducks. Number 080 REPRESENTATIVE BUNDE said he could see that one could have potential development that would have minimal, if any, impact and you could have potential development that would have maximum impact as far as destroying actual resting areas. Number 089 REPRESENTATIVE MACKIE said he believed the State does have regulations currently in place that do not allow for a paved highway to go through the marsh. He said they were called wetlands and critical habitat area regulations. He said the State has regulations protecting these type of areas. Number 098 CHAIRMAN GREEN stated for the record that Representative Mike Navarre joined the committee at the table. Number 100 FRANK RUE, DIRECTOR, DIVISION OF HABITAT AND RESTORATION, DEPARTMENT OF FISH AND GAME (ADF&G), stated there are three types of state land. He said there are park lands, which are withdrawn from the public domain and are the most restrictive state land designations the legislature can create. He stated there are refuges, critical habitat areas or sanctuaries, which are a less restrictive designation by the legislature because the Department of Natural Resources (DNR) retains authority, but the legislature has said that ADF&G must approve development on the area and give it permit. He said that other activities can go on in the area, it has not been withdrawn from public domain, but the legislature has put a higher standard for fish and wildlife by having ADF&G authorize activities in the area. He said he third type of land is general state lands which ADF&G does not authorize or permit. He said that ADF&G advises DNR about an area in a general state land situation. He said in the case of surface entry for oil and gas activity in Chickaloon Flats, it is a fairly small area and so ADF&G might limit the activity to the winter. He said ADF&G might recommend the avoidance of seismic work at the height of the bird migration. He said ADF&G supports HB 426 and they support the committee substitute language that DNR wanted because it wanted to make sure oil and gas was allowed as an option and that is fine with ADF&G. He said that ADF&G thinks HB 426 is a good idea because the Chickaloon Flats is a very important area for waterfowl migrating through the area. Number 140 JOHN HENDRICKSON, PRESIDENT, ALASKA WATERFOWL ASSOCIATION (via Anchorage), stated he is also State Chairman of Waterfowl, USA. He said the Alaska Waterfowl Association, along with ADF&G and many other groups, has been working for about 20 years to create a refuge and critical habitat system on Cook Inlet that was compatible with multiple use activities and getting along with the oil and gas industry, which the Alaska Waterfowl Association regards as very important. He said that Chickaloon Flats is very important for migrating birds. He stated that when the weather is bad to the south of Prince William Sound, birds pile up in Southcentral Alaska and they have to have a place to go and one of the places is Chickaloon Flats. He said all sorts of species of ducks and geese use Chickaloon Flats in the fall and there are some local nesting populations of green winged teal and pintail mallards. He said in the spring, Chickaloon Flats is also used by geese, shore birds, and ducks. He said the Alaska Waterfowl Association regards HB 426 as a very good bill. He said the key of HB 426 is that it gives ADF&G some oversight so that mistakes are not made in the future. He urged the committee to support HB 426. Number 177 REPRESENTATIVE MACKIE asked Representative Bunde in which district Chickaloon Flats is located. Number 178 REPRESENTATIVE BUNDE stated that Chickaloon Flats is located in Representative Navarre's district. Number 179 REPRESENTATIVE MACKIE asked Representative Navarre how he felt about HB 426. REPRESENTATIVE NAVARRE stated that he was looking at the bill for the first time so he was still formulating his opinion. He said in general, he thought he supported it, with a reservation for oil and gas leasing. Number 184 REPRESENTATIVE MACKIE made a motion to move HB 426 out of committee by unanimous consent, individual recommendations and zero fiscal note. REPRESENTATIVE DAVIS stated that he noticed on the map an island called Bird Island. He asked if the island was privately owned and if it is within the proposed critical habitat area and how might it affect the ownership and ownership activity. Number 192 REPRESENTATIVE BUNDE stated that to his knowledge, Bird Island is privately owned and the critical habitat designation would have no affect on the owners. He said they have access via the pipeline road. Number 198 CHAIRMAN GREEN asked if there were any objections to Representative Mackie's motion. There were none. HB 474 - ADMINISTRATIVE ACTION RELATING TO LAND Number 243 JIM EASON, DIRECTOR, DIVISION OF OIL & GAS, ALASKA DEPARTMENT OF NATURAL RESOURCES (DNR), stated the Hickel Administration is fully supportive and committed to working with the legislature to assure passage of HB 474. He said HB 474 does affect disposals of interests in resources other than oil and gas, however oil and gas is the primary catalyst for HB 474. He stated the problem the state has with oil and gas leasing is one that affects mining and other disposals where best interest findings under Title 38 and coastal zone management consistency determinations under Title 46 have to be written and issued. He said HB 474 is designed to do several things. The first is to clarify the legislature's intent that best interest findings and coastal zone consistency determinations under Title 38 and Title 46 will be formulated and issued under certain procedures, and depending upon certain information, can be in a staged fashion if there is a series of developments or projects that are intended to occur. He stated the legislation would make explicit that the director of the Division of Oil and Gas, through a delegation from the DNR commissioner would have the authority to establish the scope of the administrative review for a disposal and of the written finding in support of that disposal. He said the scope would be set or established and would address the issues of concern that the director is asked to look at under the statutes. He said most importantly, it would be the legislature's intent that DNR consider things that are not speculative, that are reasonably foreseeable, and that are direct effects. He said the reason for the language is very important because the problem that brings the Division of Oil and Gas to the committee is one that extends through several adverse court decisions on Coastal Zone Management consistency determinations and best interest findings. He stated the courts have essentially substituted their judgment for that of the legislature and the Administration in deciding how much is enough and how much to consider in a finding for a consistency determination. He said the scope of HB 474 would be also intended to include applicable law and facts pertaining to the land, resources, or property that the director of Oil and Gas finds material to the determination. He said it is important that the Division of Oil and Gas would not be held responsible for things that the division simply does not know or cannot know. He said it was also important that the public have an opportunity to make known during the division's review process those things that the division does not know. He said that finally, the scope also can be limited to issues that are found by the director to be relevant. He stated a very important feature of HB 474 is that it addresses the question of whether or not the division could review and issue best interest findings and consistency determinations as a discreet phase of multi-phase project. He said that currently the courts will not allow that and the courts want the division to be able to predict with some certainty what the future events are that will follow a lease sale. He stated the courts claim that the division must be able to do that in order to confirm that the division's mitigation measures and the lease sale terms do in fact make the sale consistent with the Coastal Zone Management Act and with the best interest standards under Title 38. He said the Division simply cannot do that and it believes there is enough common sense within the committee to understand that the division is telling the truth. He said he did not believe that anyone could predict the outcome of Lease Sale 78, if it had been held, or if it is ever held. He stated the division has a process in place now, and will continue to have a process in place, that assures that subsequent activities, requests to drill wells, requests to conduct geophysical surveys, and other activities also undergo Coastal Zone Management Review by all of the agencies and the public so there is an opportunity to further condition any lease that is issued as a result of a lease sale. He stated the division currently goes through this process, as it has in the past, and recently the courts have been ruling that it can no longer carry out this process. He said the courts have ruled that the division must know in advance in order to certify consistency before it issues the lease. He stated HB 474 would acknowledge the legislature's intent that the Division be allowed to issue best interest findings based upon the scope that was described previously and to issue them in discreet phases, but only if the division can condition subsequent activities so it is certain that it can look at them and make certain that the activities are consistent with the Coastal Zone Management Act in future permit applications. He said the division thinks that it is a common sense solution to an extraordinarily complex problem and one that is growing more complex as time goes on. He said the committee would hear many comments and themes on HB 474. He said the division passed out a series of four small discussion papers and he encouraged the committee to read them. He said the Alaska Supreme Court rejected DNR's arguments that it cannot understand the events that are going to follow from a mining/offshore prospecting permit with any specificity. He said the division thinks the record is clear, particularly in light of the Lease Sale 78 injunction, there is a pattern and that pattern will not go away. He said he could tell the committee based on his personal experience, that absent legislative intervention and redirection of legislative intent, every lease sale that the division will propose to hold, will be subject to the same vulnerability if it is in the coastal zone and if it has a best interest finding, which all of them must. He said that this point was very important to realize. He said the system truly is in a bad situation and it needs help. He stated the division cannot fix the situation and the courts are unwilling to help the division fix it with any specificity. He stated the time had come for the division to work with the legislature to ensure that the problem is fixed. He said the committee would hear that DNR is trying to avoid doing a good job. He said the trend of best interest findings since the statute in Title 38 was adopted has gone from a 10-15 page finding to a multi-hundred page finding. He said the record in Lease Sale 78 is between 15,000-20,000 pages of documents. He said the process occurred over four years leading to the sale. He said the record has grown exponentially and yet DNR is told that it is not doing enough, it could do more, and it has not considered the right issue under the right circumstances. He said under those circumstances, he did not know what to do and if the committee reviews the record with him, it will come to the same conclusion. He said the courts are telling the division that the E.I.S. process and the N.E.P.A. process the federal government uses is a better way. He said that was a judgment for the committee to make as policymakers. He said the committee would also hear that the lease sales simply have to be conditioned in more detail than the Division is doing now because it cannot subsequently condition those leases so as to prevent entry in the event it determines that entry is necessary. He said that was not true and as a matter of law, the Division retains in its lease and has the authority to prevent access to the lease in its entirety. He said that fortunately, the division does not often have to use it, but the record speaks for itself. He said that timing is very important. He said the division is issuing its final best interest finding for Lease Sale 79 at Yakataga on May 12, 1994. He said if anyone chooses to litigate it, and the Alaska Supreme Court has not acted before then to reverse Judge Cranston's decision in Lease Sale 78, it is highly likely that anyone who wants to challenge that sale will get the same result, since Judge Cranston's decision will be the standing decision at the time of injunction. He said his final comment was to urge the committee to look at HB 474 very carefully and to understand that it is a very serious problem, but it is a problem that Mr. Eason believes can be fixed without diminishing public participation. Number 444 REPRESENTATIVE JOE SITTON said it seemed to be the year of determining what legislative intent is. He said he would like to hear Mr. Eason's speculation on why the state has had such a string of adverse court decisions. He said there is a body of opinion that thinks it is because of the poor work of the division. He said that was not necessarily his view, but people think the division does sloppy work and the state ends up in court, as a result. MR. EASON said the instruction that was issued by Judge Cranston was the first in the state's history. He said he could not speculate better than anyone else, but he had speculated before the Lease Sale 78 injunction that it would be issued because he believed it was inevitable that a Superior Court judge was ultimately going to be influenced by the Supreme Court's decisions. He said the division had a record of all litigation that it was involved in. He said in every case the division was found to be in compliance with the best interest findings and the consistency determinations in Superior Court, but each ruling was reversed unanimously by the Alaska Supreme Court. REPRESENTATIVE SITTON asked what happened in between the rulings of the courts. Number 470 MR. EASON stated that Representative Sitton would have to ask the Supreme Court that question. He said his speculation was that Superior Court judges read Supreme Court justices' opinions. He said if the Superior Court kept sending opinions up that said something has been done right and it kept being told that it was being done wrong, ultimately the Superior Court judge would say that it is wrong first and let the Supreme Court sort it out. Number 477 CHAIRMAN GREEN stated that he wanted to recognize Representative Bill Williams, Senator Judy Salo and Senator Suzanne Little. Number 485 REPRESENTATIVE SITTON said that for four years he served as a director in state government and he would have been pleased to be given the powers as a director that Mr. Eason is asking for in HB 474. He asked if Mr. Eason thought he needed such broad powers to determine the scope of things and he thought it made Mr. Eason unusual among the hundreds of state directors. MR. EASON stated the powers are not for the Director of Oil & Gas, they are for the DNR commissioner's delegation. Number 496 REPRESENTATIVE SITTON said that effectively the powers would be for Mr. Eason, since he is the Director of Oil and Gas Division. Number 498 MR. EASON said, in fact the legislature has made that delegation in theory, and it is a matter of if the legislature wants that delegation to be made by the Administration or the courts. He said that someone ultimately has to have that delegation. Number 504 REPRESENTATIVE SITTON asked if the legislature wanted to delegate the powers at all. He said the legislature would be giving DNR some very broad powers under HB 474. He said there is element of trust and the legislature is building a tool for the future and the legislature did not know with whom it would be dealing. MR. EASON stated he agreed with Representative Sitton that the delegation of powers is a decision of the legislature. He said it is a power the legislature has given to DNR and it is a power that it can withdraw. Number 516 REPRESENTATIVE SITTON said he was not suggesting withdrawing any power from DNR, but he was suggesting that the legislature should be very careful and deal very carefully with HB 474. He stated he intends to read things very carefully because he is totally unsatisfied with the quality of work of the Alaska State Legislature that keeps the state in court all of the time. He said it was the legislature's own work that he was questioning also. Number 527 REPRESENTATIVE MACKIE asked Chairman Green whether or not it was good public policy to allow for a mid-level bureaucrat, such as Mr. Eason, to have that kind of discretion over people's lives. He said good relationships can happen when one has Coastal Zone Management and other types of safeguards in place that require all parties involved to meet their level of responsibility. He said the possibility of delegating total discretion to one mid-level government official was why the hearing room was full and why there were people on teleconference. He said he thought that it gave people much concern. He asked Mr. Eason if he felt comfortable accepting that responsibility and recommending that the Director of the Oil & Gas Division be given that authority. Number 550 MR.EASON stated the final decision making, the actual issuance of the finding and the consistency determination for a lease sale, has to rest with someone, but in fact the decision making is not that person's alone. He said the Oil & Gas Division does issue the consistency determinations but it has to have the concurrence of ADF&G, Department of Environmental Conservation (DEC), and the Division of Governmental Coordination (DGC). He said the Division of Oil & Gas does not issue the determination and make the final decision on its own. He said if the other agencies do not concur with the consistency terms, the division's consistency determination cannot be issued. Number 566 CHAIRMAN GREEN asked if it wasn't actually the DNR commissioner who delegates. Number 570 MR. EASON stated that was correct. He said it is the DNR commissioner's decision. He stated that an appeal of a decision in a best interest finding goes to the DNR commissioner and ultimately it is the commissioner's decision. He said the findings are actually issued with a disclaimer that they are made with the advance knowledge and concurrence of the DNR commissioner. He said final authority does not lie with the Director of the Division of Oil & Gas. Number 581 REPRESENTATIVE NAVARRE stated he has watched Mr. Eason through several administrations and he thought that Mr. Eason has done a good job as Director of Oil & Gas. He said he would not necessarily be concerned about Mr. Eason, but he had some concerns about the power that the legislature would be vesting in the Director of Oil & Gas through the DNR commissioner. He said he thought that it could lead to some potential problems in either seeking a statutory change at some point in the future in order to undo it, or perhaps in court. With regard to the ability to prevent or condition future provisions of the lease sale through permitting and other things of that nature, he asked if it was true that it only could be done to a certain degree. He asked Mr. Eason what would happen if the state sold a lease. He asked if there would be a right to entry or to develop the lease. Number 601 MR. EASON stated there is no right to enter. He said DNR has the right to condemn under the lease. He said the language is essentially a reasonable opportunity to develop, but it is clear the division has the authority if it determines that for environmental reasons it is no longer in the state's interest to do that. Number 609 REPRESENTATIVE NAVARRE asked what happens then. Number 610 MR. EASON stated the division has to repurchase the lease. He said there are standards set out in the lease on how that is done. He said it is a step that the division would probably be very concerned about before it would take it. Number 621 CHAIRMAN GREEN reminded Representative Navarre about the Kachemak Bay buy-back in the late 1970s. Number 623 REPRESENTATIVE NAVARRE stated that he did remember the buy-back and that is why he thought Lease 78 probably should not have been on the table in the first place, given the history of that portion of the lower Cook Inlet. He asked if the term "nonspeculative" was defined anywhere in statute. Number 635 MR. EASON stated he did not believe "nonspeculative" was defined in Alaskan statute. He said the term, however, was defined and when the courts do not have a defined term in statute they refer to the dictionary. He said there is an important linkage between the terms and they are there to establish a theme. He said the theme is only conveyed by the sequence of the terms, given the litigation and the findings the state has had in the litigation. He said he hoped the legislature would want the courts to understand that it seriously means that it does not want speculation, multiple scenarios, or hypothecated scenarios to drive the mitigation measures and the decisions of whether to lease because the state simply cannot do that. He said the state did not know what the outcome would be and the only way to talk about things in a way people can really judge the adequacy of mitigation and the ability to control development, is to talk about the facts, the things that are made known, and the things that can be reasonably expected based on the record. He said this theme, coupled with a provision that assures that one can condition future activities by permit, is simply the only practical way to approach the problem if the state wants to avoid a continuing process of arguing about things that nobody would know for sure if they would ever occur. Number 674 REPRESENTATIVE NAVARRE asked how HB 474 would change the public input, particularly at the municipal government level, on both the Coastal Zone Management Act and Title 38 best interest findings. Number 686 MR. EASON stated that HB 474 would have no affect on the current process of public input. Number 706 REPRESENTATIVE NAVARRE referred to page two, line 19. He said in the final analysis, the Director of Oil & Gas is allowed to determine what is in the best interest of the state. Number 724 MR. EASON said the state's findings are written rationalizations of what the state thinks the important issues are, why the state thinks they are important, and why the state does not think others are relevant or important. TAPE 94-7, SIDE B Number 001 MR. EASON said the Division of Oil & Gas often finds comments which, in Mr. Eason's judgment, are not relevant to the determination of whether the lease sale is in the best interest. He said he makes that determination when he looks at the standards in AS 38.05.035(g), which specify a series of issues and a context in which the state considers them. He said the state will receive many comments which are clearly irrelevant, unrelated, or the state simply does not know what the person intended the state to do with them. He said that the division will rationalize the comments and address them in writing and explain why the state thinks they are or are not relevant. He said he believed there will always be relevant and irrelevant issues raised in the consideration of something as major as a lease sale. Number 013 SENATOR SUZANNE LITTLE said under HB 474 the findings that the director will write will be narrowed to dealing with "...reasonably foreseeable, nonspeculative, direct effects." She asked Mr. Eason what the reports will deal with. Number 018 MR. EASON stated under HB 474, there will be no substantive change in the quality of the work, or in the scope of the work, other than the scope will focus on things that the state hopes a court will ultimately determine are reasonably foreseeable, nonspeculative and direct. He said the legislation is designed to avoid arguments about whether or not the state should consider the Gates of the Arctic and then if the state should consider the Gates of the Arctic, should the state consider the effects of a North Slope sale on Anchorage and whether the state should consider the effects on the West Coast oil market and those sorts of arguments. He said the dilemma is that the state is responsible for conducting a four to five year program, a very detailed process, where the state is totally open, everything is done publicly. He said the state issues the final decision and it receives a one paragraph allegation of what it has not done. He stated the courts receive the allegation and find that the state has not done it. He said the division is asking the legislature to help the state bring some balance back to the process. Number 035 SENATOR LITTLE stated she understood Mr. Eason's frustration. She said she was trying to think of one thing that would be reasonably foreseeable, nonspeculative, and a direct effect of a lease sale and she could not think of anything. She wondered if Mr. Eason might be able to give her an example. She stated she believes that a finding would be a written title across the page and nothing on the rest of it. MR. EASON said based on his personal experience, he is convinced that neither the Supreme Court nor the Superior Court would allow that to happen. Number 042 SENATOR LITTLE asked Mr. Eason if public input will be narrowed down to the scope of the director's determination. MR. EASON stated it would not. He said public input would be exactly what it is presently, perhaps greater. He said there will be a burden on the part of the Division of Oil & Gas to make a written rationalization of the relevance of all the standards that are set out and to address the issues raised. He said the division will address all of the comments received, as it has to under the statutes. He said the division will have to rationalize the standards, but the standards that are set are certainly not designed to limit public opportunities, they are designed for the eventuality that if the state finds itself in court again, the court will be forced to be constrained in looking at the written document to be sure of whether the state has properly rationalized and accepted or rejected information that is suggested to be speculative. Number 060 SENATOR LITTLE stated that HB 474 addresses all actions that require best interest findings, not only for oil and gas, but for other issues as well. She asked what types of actions fall under the best interest finding. Number 065 MR. EASON stated the actions could be agricultural disposals, timber disposals, certain types of mining disposals, or oil and gas leasing. He indicated this was not an exhaustive list. Number 070 SENATOR LITTLE asked if a recreational lease, such as the one occurring for Hatcher Pass, would be involved. Number 072 MR. EASON indicated that recreational leases would be involved. He said the intent, regardless of the disposal, is to apply the same standard so that decision making on a disposal decision rests on facts and not speculation. He said that it was the state's belief that all disposals of resources should have that standard, otherwise the courts are the only arbiters of what disposals happen. Number 080 TOM LOHMAN (via Barrow) stated that he works for the North Slope Borough on coastal management issues. He said it was clear to a lot of people who work in coastal management around the state, including some in state agencies, that HB 474 is not the way to solve whatever problems exist. He said DNR feels that it is being asked to consider too many potentially far removed impacts of state lease sales. He stated the DNR does not like its lease sales held up in litigation for months or years. He said if those are legitimate concerns, he does not think the language in HB 474, or the kind of frustration that it would create within the public, is going to either reduce litigation or give the public a better feeling about the whole process. He said there are a lot of people who have been participating in working groups for the past couple of years trying other ways to improve the process to give people a better feeling about the process. He said a lot of the lawsuits that the state has seen have been over the process and the public's frustration with it, rather than the substance of DNR's review. He said it is absurd that in light of what is essentially a partnership between the state and the local coastal districts with improved programs, the committee did not have the legislation sent down directly to the coastal districts or to members of the Coastal Policy Council, either before it was introduced or soon thereafter, so it could be reviewed in time to participate fully and meaningfully in the committee hearings. He urged the committee to not move HB 474 in order to allow other efforts to improve the Coastal Management Program, as well as Alaskan citizens' feelings about the consistency review process. He said it might not be a complete solution, but there are a lot of people involved in Coastal Management on a daily basis. He stated those people have put a lot of work into efforts to improve the process and those people think they will solve a good portion of the problem. He said he thought the committee would do very well to hear from different agencies such as DGC or the Department of Law, both of which have been working on the issue for a very long time in open forums where everybody speaks their peace, industry included. He said he hoped that the committee would let DNR go back to the table to try to work within the same working group setting that he has been working in, and try to improve the procedures to allow that openness early on in the process and avoid the eleventh hour conflicts over state lease sales. Number 129 NORMA CALVERT, MARATHON OIL (via Anchorage), said Marathon Oil supports the principles and intent of HB 474. She said Marathon believes that HB 474 provides an appropriate mechanism for all citizens to express legitimate concerns in a public review process and Marathon supports the defined authority of the DNR commissioner and the language to limit the scope of best interest findings to an analysis of reasonably foreseeable, nonspeculative, direct effects of leasing. She said continued delay or cancellations of lease sales will result in fewer companies investing time and energy to identify potential production areas. She said the decline of state revenues will be accelerated and reduced investment will increase unemployment. She said Marathon Oil does not believe the state of Alaska or its citizens can afford to curtail sound, responsible development of its most significant resource. She said Marathon Oil supports sound, responsible development of Alaska's natural resources and it believes that HB 474 provides definition and certainty in the leasing process that will allow such development. Number 158 DOUG ROBBINS, MARATHON OIL (via Anchorage), said Marathon regards itself as a partner with the state in producing the resources and providing for the welfare of Alaskans. He said Marathon has a need for regular, predictable lease offerings to plan investigations and investments. He asked the legislature to provide a clear direction to the agencies and to the courts to allow a smooth lease sale process. Number 186 MAUREEN McCREA (via Anchorage) stated her opposition to HB 474 is based on several concerns. She said it seemed to be a hasty response to recent court decisions. She stated HB 474 seems to imperil the state's position in reviewing topical federal activities. She said the state has actively pursued its ability to review federal activities for consistency with its Coastal Management Plan, including Outer Continental Shelf lease sales and timber sales. She said in the mid-80's, in response to some concern expressed by the MMS, she conducted some research to determine if MMS's perception that federal oil and gas sales were held to a higher standard of consistency review than state or private activities were held. She said she was able to conclude from that research that it was not necessarily an accurate perception. She said that there seemed to be a fairly even treatment of comparable activities. She said HB 474 would imperil that conclusion unless the state also plans to limit its review of federal activities to only those actions that would occur beyond three miles of the state shoreline and only for those activities that the state knew would happen. She said in 1990, the federal government passed amendments to the Coastal Zone Management Act, which exemplified the need to consider potential cumulative and secondary impact of activity. She said the very elements that the state is considering removing, jeopardizes the state's participation from that federal program and would possibly make moot the state's ability to look at federal activity for consistency. She stated she wanted to remind the committee that MMS also has the ability to rescind leases due to environmental concerns, such as the Bristol Bay buy-back. She said she wanted to emphasize that cooperation has worked. Number 255 LOREN FLAGG, EXECUTIVE DIRECTOR OF KENAI PENINSULA FISHERMAN'S ASSOCIATION (via Kenai), said he was concerned that HB 474 is being fast tracked through the legislature. He said it was only within the last hour that he received a copy of the legislation and was informed there was a hearing. He demanded a fair opportunity to review the bill and to make more detailed comments. He said the fast tracking of HB 474 runs parallel to the problems encountered with Lease Sale 78, where the final comment deadline was scheduled during the summer when fishermen are busy and unable to spend their time to participate in the comment process. He said once he reviewed HB 474 it was obvious that it represented some major changes in the coastal management program. He said it appeared to him that the Administration is trying to cover up DNR's incompetence in handling Lease Sale 78. He said the DNR has tried to subvert the requirements under the Coastal Zone Management Act. He urged the legislature to take a closer look at the operations within DNR and those responsible for conducting those operations. He referenced page two, lines seven through nine of HB 474. He said he had a serious problem with limiting the scope of the review to only nonspeculative, direct effects of the uses proposed. He stated in any finding of what is in the best interest of the state potential impacts must be considered. He said HB 474 would lead to more problems in the courts, not less. He said he also has a serious problem with page four, lines 15 and 16. He said it was absurd to limit the scope of the administrative review to only fish and wildlife species and their habitats within a lease sale area. He said in Cook Inlet, the tides and currents are such that the impacts of an oil spill within a lease area are almost immediately thrust to areas adjacent to the lease area. He asked how the state could not consider cumulative impacts in its administrative review. He urged the committee not to move HB 474. He said there is no problem with the laws and regulations and that no state lease sales have occurred without court delays. Number 308 REPRESENTATIVE NAVARRE said he knew that Chairman Green was interested in HB 474. He addressed fast tracking and said it occurs when legislation is moved through a committee and through the legislature without due deliberative process and public input. He said he thought the committee was trying to recognize there are people who think there are problems with the lease sale process in the state and he knew the Administration has been concerned about the process and there was a hearing in January 1994 with respect to Lease Sale 78. He said he thought the committee was attempting to address the problems and fix them, but this legislation should be worked on because he was not sure the legislation was taking the right approach. He addressed the concerns about fast tracking and said it was more of a concern about the overall issue and he did not think there was any attempt to fast track HB 474. He said there are other rules and regulations that prevent the legislature from fast tracking legislation. Number 345 SUSAN FLENSBURG, BRISTOL BAY SHARER (inaudible) via Dillingham, said she had major concerns with HB 474 from a coastal management standpoint, as well as a public process standpoint. She said HB 474 was introduced to fix problems that were characterized by DNR with the state's oil and gas leasing process under Title 38. She stated she was not unsympathetic with DNR's concerns and she even supported a few of the provisions in the legislation. She said HB 474 gives DNR incredibly broad, almost unchecked authority to decide the scope of review and the basis on which a best interest finding would be made under Title 38. She stated HB 474 takes away the ability of the public, resource agencies and coastal districts to raise and address issues of concern regarding a proposed project. She said a particular concern was some of the terminology in HB 474 that relates to the scope of review under Title 38 and the sections on consistency determinations under the ACMP. She said that terms are not defined and it is not clear what is meant. She said if the terms are not defined, it will pave a way for a lawsuit and put the courts in a position of clarifying what the terms mean. She said she agreed with Mr. Eason that it would help to put target delineation on what project is to be reviewed and when. She said she thought that one of the things that needs to be done with HB 474 is to include a definition for the terms "direct effect" and "nonspeculative." She said it would be a safe bet to say that the section on consistency determination also does not meet federal guidelines for the coastal management program. She said she wanted to raise the question of whether HB 474 is a back door attempt to dismantle the Coastal Management Program. She stated if that was not the case then she wanted to reiterate a previously made suggestion that a cooperative effort should be undertaken to address the problems that exist. She said she hoped HB 474 would not be moved too quickly and public concerns would be considered by the committee. Number 404 NANCY WAINWRIGHT, ATTORNEY (via Anchorage), said the Coastal Zone Management Program was a bargain between the state and the federal government. She said the state was to develop a program to manage the coastal zone and it created the Alaska Coastal Management Program (ACMP). She stated the ACMP had to meet the minimum federal standards in the broad language in the federal Coastal Zone Management Act. She said the federal government offered funding and a legally binding obligation of the federal agencies to adhere to the state's coastal policies through federal consistency. She stated HB 474 proposes to change this policy. She said the legislation will delegate authority to someone outside of the ACMP. She said HB 474 raises a host of legal issues. She said HB 474 will restrict the scope of review for oil and gas lease sales and the federal government has also confronted this issue. She stated the original language of the federal law said that each federal activity that directly affects the coastal zone must be consistent. The U.S. Supreme Court interpreted the language to mean that a lease sale has no direct effect and therefore they do not need to be considered in looking at coastal zone management. She said in 1990, when Congress was reviewing the Coastal Zone Management Reauthorization Act, their intent was made clear that the effects that are looked at should be broad. She stated that Congress took the direct effect language out of federal law and said the effects which are to be considered are those which may be reasonably anticipated, including cumulative and secondary effects. She said they intended the term "effect" to be construed broadly, including direct effects, which are caused by the activity, and indirect effects, which may be caused by the activity. She said the federal government has stated it wants a broad interpretation for coastal zone management purposes. She stated there are problems that need to be solved. She said the first was DNR's court ordered direction that it must broaden the scope of the impact it is looking at. She stated that secondly, the legislature needs to look at how DNR has failed in terms of the ACMP to work the system in advance and to get people to the table early so lawsuits are not brought to the courts. She said the solution may be allowing the DGC to have the funding and the expertise to conduct the coastal zone consistency review and leave the best interest findings to DNR. She said DNR could then devote its attention and its funds to analyzing the impact of the court and the ACMP. Number 509 NINA FAUST, KACHEMAK BAY CONSERVATION SOCIETY (via Homer), said she is opposed to HB 474 and hopes the committee will not pass it out. Number 531 EDGAR BAILEY, BIOLOGIST (via Homer), said he has reviewed a lot of the leases in the past and one of the obvious reasons there is an effort to push HB 474 through the legislature is because of the poor work that went into the planning of the leases. He said Lease Sale 78 is a good example. He stated that 56,000 parcels of land were included, yet there was not adequate notice to private landowners involved who had subsurface leases within Lease Sale 78. He stated the state should have listened to the advisory group that had been formed in the Kenai/Soldotna/Homer area. Mr. Bailey said the advisory group stated they did not recommend any lease tracts along the coast because of conflicts in the Nikiski, Ninilchik and Anchor Point areas. He said that same stance was recommended by various other groups as well, yet the state ignored them. He said the state's rejection of the groups' recommendations had a lot to do with the filing of the lawsuit. He said he thought it was clear that DNR was not doing a sound job as far as looking at all of the ramifications and consistency with the Coastal Zone Management Plan. He said HB 474 is not needed. He said DNR is not doing an adequate job and that is what is inviting all of the legal action. Number 602 RIKKI OTT, UNITED FISHERMEN OF ALASKA, she said she opposes HB 474. She said HB 474 attempts to ignore consideration of problems at the initial stage of projects. She stated the Alaska Coastal Management Program is not the problem. She said in April 1993, the Alaska Supreme Court ruled that DNR failed to adequately consider salient issues in making its best interest finding to allow Lease Sale 50 to proceed. She said in December 1993, the Alaska Supreme Court ruled that DNR again failed to adequately consider identical issues in making its best interest finding to allow Lease Sale 55. She said the Supreme Court specifically pointed out in its ruling that DNR appears to have copied, without altercation, the previously rejected Lease Sale 50 finding and tried to apply the same flawed finding to Lease Sale 55. She said in January 1994, the State Superior Court ruled preliminarily that DNR failed to adequately consider salient issues in making its best interest finding to allow Lease Sale 78 to proceed. She said with Lease sale 78, DNR ignored commercial fishing interests in Cook Inlet. She said legislative fixes are not going to substitute for professionalism. She said HB 474 will increase the risk that projects that are not in the best interests of the state will go forward. She said the Alaska Supreme Court noted that "...a finding that development that is economically feasible is not the same as a finding that the sale is in the state's best interest. DNR must consider the social, cultural, and environmental impacts on the state from oil production." She said the Alaska Supreme Court warned that "...the more segmented an assessment of environmental hazards, the greater the risk that prior permits will compel DNR to approve later environmentally unsound permits." She stated HB 474 allows DNR to conduct multi-phase administrative reviews and permitting without requiring all of the relevant information at the initial stage of the proposed project. She said this was counter to the best interests of the state because DNR will find it difficult to slow down or stop momentum once projects are initiated and developers have property interests. She said that halting projects once they are started is not a viable public option. She said that to be fair to the state, developers, and the public, it is imperative that all environmental and social risks are brought to the table at the initial stage of the project. She said she objects to the terms "nonspeculative" and "direct" and she wanted to remind the committee that the EXXON VALDEZ and GLACIER BAY were both speculative up until they ran aground. She said the public expects DNR to anticipate events and to work out resolutions in advance of any permits being issued. She said the Alaska Supreme Court found that "...DNR is required by law to take a hard look at the salient problems involved with a lease sale and it must engage in reasoned decision making." She said the Supreme Court further ruled that DNR "...must consider the probable, cumulative impact of all anticipated activities which will be part of the project." She said these are not unreasonable requests, yet DNR is appealing to the legislature to remove these requirements. She said the problem lies with DNR's ability to meet the requirements of the Coastal Management Program, not with the program itself. She stated the public, industry, and the state deserve to discuss and resolve issues up front to ensure projects proceed responsibly and with minimal impact on other resource users and the environment. TAPE 94-8, SIDE A Number 001 JOEL KAWAHARA, UNITED FISHERMAN OF ALASKA, stated he is not anti-development, however he feels strongly that development should be safe in terms of economic benefit to the state and in terms of protection to the environment. He said he opposes HB 474 because he does not feel it provides for that safety. He said the term "nonspeculative direct effect " is the issue in safety. He said allowing developments that may not avoid future problems is irresponsible and puts at risk both the industry involved and the other users of the coastal zone. Number 033 STAN STEPHENS, PRINCE WILLIAM SOUND REGIONAL CITIZENS ADVISORY COUNCIL (PWSRCAC), stated the PWSRCAC represents many people who have a keen interest in ensuring the maximum amount of public input into agencies' decisions within PWSRCAC's jurisdiction. He said PWSRCAC has been an active participant in the working groups which work to resolve problems regarding the ACMP and oil spill contingency plan reviews. He said the RCAC is named in the ACMP regulations as a reviewer for oil spill contingency plans. He said RCAC has a great deal of respect for the process of letting industry, local government, agencies, and the public work together to resolve complex issues. He said RCAC is concerned that HB 474 may narrow the scope of the project review process to such an extent as to possibly lose some valuable public input in the process. He stated some of the aspects of HB 474 with which RCAC is concerned is the uncertain language of Section Three regarding "reasonably foreseeable, nonspeculative, direct effects." He said the language narrows the breadth of analysis and may result in a review which is not as thorough as that which is found in the current ACMP language which requires analysis of direct and significant effects. He referred to the section of HB 474 dealing with the phasing of projects. He indicated that it would have an uncertain impact on the current phasing language under ACMP regulations in federal law. He said the language should be further defined and clarified before adoption, in order to make certain that it is consistent with other aspects of the ACMP. He urged that before HB 474 is finalized, the legal and definitional questions are answered and that local governments, industry, public citizens and agencies have an adequate opportunity to review the information presented. Number 067 CHIP TREINEN, AREA K SEINERS ASSOCIATION, urged the committee to slow HB 474 down so some considerations could be looked at a little more closely. He stated he was concerned that HB 474 would not allow the public to give adequate testimony and input in determining the effects of oil and gas projects. Number 087 KARL KIRCHER, KENAI PENINSULA FISHERMENS ASSOCIATION, stated he was opposed to HB 474. He referenced the terms "reasonably," "foreseeable," "nonspeculative," and "direct effects." He said if the state follows Mr. Eason's reasonings and comments regarding the words "speculative" it would conclude that it is highly speculative that a lease sale will lead to oil and gas exploration. JOHN BOCCI, CORDOVA DISTRICT FISHERIES UNITED, said the apparent fast track of HB 474 is very disturbing to him. He said not only does it undermine due public process, but it leaves the ability to make significant coastal zone management decisions in the hands of mid-level bureaucratic management. He said he did not think that state government was designed to be utilized in that manner. He said to give such power to department managers can only be a disaster waiting to happen. He said the public needs the ability to examine all sides of development to ensure that it is in the best interest of the state as a whole, not just the most persuasive special interest. Number 144 REPRESENTATIVE KOTT stated he has heard many comments about HB 474 being fast tracked. He said he hoped that the public does not have that perception. He said HB 474 has three committee referrals and that at best, it will be three to four weeks before it goes to the final committee of referral, House Judiciary. Number 157 REPRESENTATIVE MACKIE stated HB 474 was introduced on February 14, 1994, and it did not comply with the Five Day Rule. He said the Oil & Gas Committee was conducting an illegal meeting. He suggested the committee start with those points in their effort to determine why the public was concerned about fast tracking. Number 167 MR. EASON stated that Ms. Wainwright suggested the DNR consistency determination system was broken and could be fixed. He said he thought that it was important for the members of the committee to understand that DNR issues a consistency determination for a lease sale only after the DGC, DEC, ADF&G and other agencies certify that they also believe the finding and the consistency determination fully comply with the terms of the Coastal Zone Management Act. He said he thought that it was a mischaracterization to say that the problem is as simple as DNR's consistency determination. He said in the case of Lease Sale 78, the courts overturned the consistency determination that all parties agreed was proper and in compliance with the law. He said there is a very broad promotion of the benefit of public use and public development of Alaska's resources for the benefit of all Alaskans. He stated the legislature is the ultimate policymaker with regard to how DNR goes about implementing what the legislature wants it to do in furtherance of the general guidelines. He said the ultimate resource decision is the decision to withdraw areas from leasing. He said the legislature has generally withheld that delegation to itself. He said the system of having a five year oil and gas leasing schedule is intended to get sales before the legislature early, so it can make decisions in the broad public sense if it believes there is an area that is so sensitive that it should not be leased. He said DNR implements that program, if the legislature so chooses. He said DNR has the dilemma of trying to balance the resource use and making sure that all of the agencies and the public have an opportunity to comment. He said DNR does not think the legislature intends for DNR to make the decision that one use should have priority and the opportunity to explore, under carefully controlled conditions, is not provided. He said DNR does not think it is a good multiple use of the resource. He stated he agreed with Mr. Kawahara that there are instances when safety analyses should be undertaken. He said he believed those analyses should come when a project is proposed so that one has something real to analyze. Number 239 REPRESENTATIVE MACKIE referred to his earlier comment about mid-level bureaucrats. He said he had no reason to doubt that Mr. Eason was a very honorable person, but he was questioning from a public policy standpoint whether or not it was good to give such powerful authority to a director of a division. Number 251 CHUCK DEGMAN, BERING STRAITS COASTAL RESOURCE SERVICE AREA, said what is important is the community impact. He said his community depends on fish and wildlife and it is highly dependent on it. He said it is very important for local people to have a say and for the public process to be open to regular citizens who are not used to bureaucratic terminology where the English language is very vague and has several meanings. He said HB 474 eliminates all public participation by skirting around real issues so regular people cannot tell public employees their real concerns. He said he wanted the committee to consider the impact of HB 474 on local communities. Number 342 REPRESENTATIVE DAVIS stated there has been a lot of concern over the word "nonspeculative." He asked what Mr. Eason's interpretation was of that word. Number 351 MR. EASON said to his understanding, the word speculative means things that are not known with certainty, but are suspected or imagined. He said the intent to provide an opportunity for making a written discrimination between events which people may suggest should be considered and those that are unrelated. He said DNR is not proposing that people not talk to it about impacts they feel are real, as well as those they feel are speculative. He said ultimately the decision has to be made in writing as to whether a proposal is in the state's best interest and the decision would be made by rationalizing and discussing each of the things that are brought up. He said the burden would be on DNR to make a determination that a comment is speculative or immaterial. Number 387 REPRESENTATIVE DAVIS stated it was his impression that Mr. Eason's understanding of the court decisions have required DNR to make speculative judgments. MR. EASON stated that was correct. REPRESENTATIVE DAVIS referenced page four, subparagraph (c). He stated he could foresee problems with that section. He asked for a rationale for the language and how DNR expects to eliminate the concerns heard by the committee. Number 406 MR. EASON stated the intent is to define the universe so the court, DNR and potential litigants all have a common understanding of the area that would be under consideration, as well as the issues in that area that are under consideration. He said DNR believes that without the language, the state will see more challenges like the one that addresses DNR's consideration or non-consideration of events in the Gates of the Arctic. He said based on the recent string of court decisions, he thought the court was open to those types of challenges and there is no way to defend against them. Number 436 REPRESENTATIVE DAVIS referenced places in HB 474 that mention reasonably foreseeable, nonspeculative, direct effects of a project. He asked if any of that wording is currently in statute. MR. EASON referenced AS 30.805 (g), on page four of HB 474. He said that if one notes in 1(f) the words are "...reasonably foreseeable, cumulative effects." He said someone had said earlier that DNR should consider cumulative effects. He said DNR currently considers reasonably foreseeable cumulative effects in their findings. He said the problem has been with reasonably foreseeable speculative effects. Number 457 REPRESENTATIVE MACKIE stated he had the same concern as Representative Davis. He said in his capacity as a commercial fisherman, he knew that fish moved. He said it is not right to not address the concerns of those people who rely upon other natural resources. He said his constituents would be very upset about tampering with their ability to voice their concerns. Number 502 MR. EASON said the point is one of clarification. He said the statute as it reads now is for considerations within a lease sale area. He said there is another description of things to be considered adjacent to the sale area. He said there are different standards in the statutes as they exist today under section (g). Number 513 CHAIRMAN GREEN stated he would entertain a motion to move HB 474 out of committee and on to House Resources with a memo to the members recommending they look at the transcript of the hearing and possibly undertake some type of review of HB 474. Number 563 REPRESENTATIVE DAVIS requested that any memo sent to House Resources should be signed by all committee members and members should indicate specific concerns. CHAIRMAN GREEN indicated that was a good idea and possibly the committee should go one step further and request that any member of the oil and gas committee who would like to participate in the review of HB 474 be allowed to do so. Number 580 REPRESENTATIVE MACKIE stated he objected to moving HB 474 under any circumstances. He said since the House Resources Committee sponsored the bill, he was not comfortable with the fact that it is going to House Resources next. He said regardless of the situation, bills are held in committee all of the time, because members would like to see additional work done on the legislation. He stated he wanted to do more work on HB 474. He said HB 474 was put on the calendar pending introduction, but the bill was not introduced until February 14, 1994. He said the reason there is a Five Day Rule is so the public has the ability to monitor things that are becoming part of the record. He said a bill that was read on the House floor two days previous does not give the public ample opportunity to look at the legislation or testify. He said he was not saying that he was opposed to HB 474, but that it was important to protect the process. Number 643 REPRESENTATIVE SITTON said he also opposed moving HB 474 out of committee because it needed work. Number 654 REPRESENTATIVE DAVIS said he also opposed moving HB 474 out of committee. Number 668 REPRESENTATIVE PETE KOTT said he did not want to belabor the bill in the Oil and Gas Committee and we would like to see it moved to House Resources. Number 691 REPRESENTATIVE KOTT made a motion to move HB 474 to House Resources, with individual recommendations. Number 692 REPRESENTATIVE MACKIE objected to the motion. Number 694 ROLL CALL VOTE: YEAH: Green, Kott, Sanders NAY : G. Davis, Sitton, Mackie Number 701 CHAIRMAN GREEN noted that the motion failed. REPRESENTATIVE MACKIE offered his assistance to work with the committee so everyone feels comfortable with HB 474. Number 729 CHAIRMAN GREEN adjourned the meeting at 7:22 p.m.