Legislature(1995 - 1996)
02/16/1996 08:15 AM House RES
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE RESOURCES STANDING COMMITTEE
February 16, 1996
8:15 a.m.
MEMBERS PRESENT
Representative Joe Green, Co-Chairman
Representative Scott Ogan, Vice Chairman
Representative John Davies
Representative Don Long
MEMBERS ABSENT
Representative William K. "Bill" Williams, Co-Chairman
Representative Alan Austerman
Representative Ramona Barnes
Representative Pete Kott
Representative Irene Nicholia
COMMITTEE CALENDAR
HOUSE BILL 447
"An Act providing that state land, water, and land and water may
not be classified so as to preclude or restrict traditional means
of access for traditional recreational uses."
- HEARD AND HELD
*HOUSE BILL 360
"An Act prohibiting the Department of Environmental Conservation
from including an administrative fine in certain consent orders or
other agreements."
- HEARD AND HELD
(*FIRST PUBLIC HEARING)
PREVIOUS ACTION
BILL: HB 447
SHORT TITLE: CAN'T CLOSE LAND TO TRADITIONAL REC. USES
SPONSOR(S): REPRESENTATIVE(S) MASEK,Toohey,Kohring
JRN-DATE JRN-PG ACTION
01/24/96 2524 (H) READ THE FIRST TIME - REFERRAL(S)
01/24/96 2524 (H) RESOURCES
01/26/96 2548 (H) COSPONSOR(S): WILLIAMS
02/05/96 (H) RES AT 8:00 AM CAPITOL 124
(H) MINUTES
02/16/96 (H) RES AT 8:00 AM CAPITAL 124
BILL: HB 360
SHORT TITLE: PROHIBIT DEC FINES IN CONSENT ORDERS
SPONSOR(S): REPRESENTATIVE(S) THERRIAULT
JRN-DATE JRN-PG ACTION
12/29/95 2360 (H) PREFILE RELEASED
01/08/96 2360 (H) READ THE FIRST TIME - REFERRAL(S)
01/08/96 2360 (H) RESOURCES, FINANCE
02/16/96 (H) RES AT 8:00 AM CAPITOL 124
WITNESS REGISTER
REPRESENTATIVE BEVERLY MASEK
Alaska State Legislature
Capitol, Room 418
Juneau, AK 99801-1182
Telephone: (907) 465-2679
POSITION STATEMENT: Agreed with changes in CS for HB 447.
DAVID STANCLIFF, Legislative Staff
to Representative Beverly Masek
Alaska State Legislature
Capitol, Room 418
Juneau, AK 99801-1182
Telephone: (907) 465-2679
POSITION STATEMENT: Testified on CS HB 447.
BEVERLY NESTER
5465 Chena Hot Springs Road
Fairbanks, AK 99712
Telephone: (907) 488-6356
POSITION STATEMENT: Testified in support of CS HB 447.
JOHN LITTEN
Sitka Tours
P. O. Box 1001
Sitka, AK 99835
Telephone: (907) 747-8443
POSITION STATEMENT: Testified in support of CS HB 447.
RON SWANSON, Deputy Director
Division of Lands
Department of Natural Resources
3601 C Street, Suite 1122
Anchorage, AK 99503
Telephone: (907) 269-8503
POSITION STATEMENT: Available for questions on CS HB 447.
DON SHERWOOD
1640 Brick Drive
Anchorage, AK 99504
Telephone: (907) 333-6268
POSITION STATEMENT: Testified in support of CS HB 447.
TOM STARR
P. O. Box 870053
Wasilla, AK 99687
Telephone: (907) 373-7317
POSITION STATEMENT: Testified in support of CS HB 447.
KEN RIVARD
P. O. Box 871842
Wasilla, AK 99687
Telephone: (907) 376-2140
POSITION STATEMENT: Testified in support of CS HB 447.
ROD ARNO
P. O. Box 871842
Wasilla, AK 99687
Telephone: 376-2913
POSITION STATEMENT: Testified in support of CS HB 447.
JIM STRATTON, Director
Division of Parks
Department of Natural Resources
3601 C Street, Suite 1200
Anchorage, AK 99503-5921
Telephone: (907) 269-8700
POSITION STATEMENT: Available for questions on CS HB 447.
CLIFF EAMES
Alaska Center for the Environment
519 West 8th Street, Suite 201
Anchorage, AK 99501
Telephone: (907) 274-3621
POSITION STATEMENT: Has concerns with CS HB 447.
TINA LINDGREN, Director
Alaska Visitors Association
3601 C Street, Suite 403
Anchorage, AK 99503
Telephone: (907) 561-5733
POSITION STATEMENT: Testified in support of CS HB 447.
GARY MARIAN
7050 Fergy Circle
Anchorage, AK 99507
Telephone: (907) 349-6496
POSITION STATEMENT: Testified in support of CS HB 447.
MICK MANNS
Paradise Valley
Bettles, AK 99726
Telephone: (907) 479-5704
POSITION STATEMENT: Testified in support of CS HB 447.
REPRESENTATIVE GENE THERRIAULT
Alaska State Legislature
Capitol, Room 421
Juneau, AK 99801
Telephone: (907) 465-4797
POSITION STATEMENT: Testified on HB 360.
JANICE ADAIR, Director
Environmental Health
Department of Environmental Conservation
555 Cordova Street
Anchorage, AK 99501
Telephone: (907) 267-7644
POSITION STATEMENT: Testified on HB 360.
ACTION NARRATIVE
TAPE 96-17, SIDE A
Number 000
CO-CHAIRMAN JOE GREEN called the House Resources Committee meeting
to order at 8:15 a.m. Members present at the call to order were
Representatives Green, Ogan, Davies, and Long. Representatives
Austerman, Kott and Nicholia were excused. Members absent were
Representatives Barnes and Williams. No quorum was present.
HB 447 - CAN'T CLOSE LAND TO TRADITIONAL REC. USES
CO-CHAIRMAN GREEN announced that the committee would take testimony
on HB 447 but could not take action without a quorum.
Number 070
REPRESENTATIVE BEVERLY MASEK thanked Representative Scott Ogan for
chairing the subcommittee on HB 447. She said she had reviewed the
proposed committee substitute and is comfortable with the changes.
She said the companion bill in the Senate, SB 230, had received
tremendous support there.
Number 286
REPRESENTATIVE SCOTT OGAN discussed the changes in HB 447:
(1) New title to reflect changes in the bill.
(2) Section 1, adds intent language to assure nothing in the bill
affects private property interests.
(3) Section 3, lines 13 - 16, provides for reasonable alternatives
for access when conflict occurs. Lines 23, 24, 27 add new means of
access and new activities covered in bill.
(4) New Section 4, establishes authority for development interests
to control access across leased areas when a reasonable alternative
is not available to go around it.
Number 535
REPRESENTATIVE JOHN DAVIES noted that there is an exception for the
development of natural resources. He speculated supposing that a
commissioner wanted to develop a park or a nature trail with a pull
out along side of a highway. He asked if the language in CSHB 447
prohibits the commissioner from doing that and also not allowing
motorized vehicles on the nature trail.
DAVID STANCLIFF, Legislative Staff to Representative Beverly Masek,
responded that it does not. CSHB 477 purposefully stayed out of
Title 41 authority which is the park authority. This is Title 38,
which are general lands where either you have access for
traditional recreational activities or development such as mining,
timber and land disposals.
Number 626
REPRESENTATIVE DON LONG referred to the language in Section 3,
subsection (3) hunting, fishing, trapping, harvest of natural
foodstuffs and said that he did not consider any of those to mean
"traditional recreational activities." He said he prefers the
language "traditional outdoor activities" and would like to offer
an amendment.
Number 692
MR. STANCLIFF responded that Representative Long's suggested
language change would be considered a friendly or technical
amendment if the language were changed from "traditional
recreational activities" to "traditional outdoor activities"
throughout the bill.
CO-CHAIRMAN GREEN stated to Representative Long that in lieu of a
quorum, the committee would continue to hear comments but would be
unable to take action on the proposed amendment at this time.
REPRESENTATIVE LONG said that the proposed amendment would take
care of his concerns.
Number 814
REPRESENTATIVE OGAN stated that one other issue was discussed in
the subcommittee meeting. Representative Irene Nicholia had
recommended the exclusion of "air boats." He said he felt that was
a controlled use area and should be regulated by the Department of
Fish and Game as a resource problem.
CO-CHAIRMAN GREEN referred to the February 15 letter from Steven
Borell, Alaska Miners Association, requesting a new subsection in
Section 2, (d)(3), by adding "required for protection of public
safety."
Number 963
MR. STANCLIFF said if the Alaska Miners Association amendment is
adopted and it pertains specifically to conflicts with development,
that would be considered a friendly amendment. If the amendment is
broadened to public safety reasons for the entire concept of the
bill, then it creates a loophole for administrative regulators.
Number 1054
BEVERLY NESTER testified from Fairbanks stating that public access
to and use of public lands, waterways and right-of-ways have often
been hindered by interagency battles over authority and (indisc.)
existence of right-of-ways. While one agency may recognize right-
of-ways such as section lines, another may not. Many public lands
are landlocked by privately owned land, Native lands, or reserved
public lands such as state parks and do not allow access through
their boundaries. Some valid existing trails have through
bureaucratic decree have been changed to single use only, thus
depriving the general public of access. As a result, public lands
become the dominion of a select few. The key to unlocking the door
for public use or public lands is access. HB 447 appears to be a
step in the right direction. She stated that with the passage of
this bill, all state agencies with jurisdiction over public land,
waterways and right-of-ways could establish a clear policy and
procedure providing for local access to and within public lands.
Public lands without access are not public.
Number 1165
JOHN LITTEN testified from Sitka stating that he is an operator of
a small tourism business, and on a day-to-day basis, his company
requires access to public land. He said HB 447 is helpful to all
Alaskans and it will provide continual access to public lands for
traditional activities. He said his concern about the bill is that
it falls short of achieving ultimate goals for tourism uses but it
is a step in the right direction.
Number 1271
RON SWANSON, Deputy Director, Division of Lands, Department of
Natural Resources, said he did not have a copy of the committee
substitute and would appreciate a chance to review it.
Number 1293
REPRESENTATIVE DAVIES asked Mr. Swanson if he had heard the
exchange between himself and Mr. Stancliff about whether CSHB 447
prohibits the commissioner from developing a park or a nature trail
with a pull out along side of a highway and bans motorized vehicles
on the nature trail.
MR. SWANSON replied that he would have to review the committee
substitute before responding to the question.
Number 1343
DON SHERWOOD, Vice Chairman, Susitna Basin Recreational River
Management Plan, a civilian advisory committee, testified in
support of HB 447. He said it is time that we stopped the inroads
of the "big green machine" restricting our access and recommended
that the Department of Fish and Game and the Board of Game be
included in the bill. He said he was in complete agreement with
Representative Long's amendment to delete "traditional recreational
activities" and insert "traditional outdoor activities."
CO-CHAIRMAN GREEN asked that the record reflect the presence of
committee members Representatives Davies, Long, Ogan and Green.
Number 1496
TOM STARR, President, Mat-Su Motor Mushers Snowmobile Group,
testified in support of HB 447 saying that these areas need to be
further established and designated.
KEN RIVARD testified on behalf of the Alaska Airmen's Association
and the Mat-Su Aircraft Owners Association in support of HB 447.
He felt that HB 447 should also encompass Title 16 because Fish and
Game regulations restrict motorized vehicles in many areas. He
referred to Title 41, Section 23, as having a lot of restrictions
on float planes. He expressed frustration in dealing with the
Department of Natural Resources concerning the Deshka River.
Number 1784
ROD ARNO, President, Alaska Outdoor Council, stated that the
council applauds Representative Masek and her staff for the
introduction of HB 447. He said the council supports this bill
because access to public land for traditional outdoor uses is of
great interest to the Outdoor Council. He said that special
interest groups, in this case the Alaska Visitors Association, as
stated in "Destination Alaska," is determining what they consider
to be primary tourism zones without public input.
JIM STRATTON, Director, Division of Parks, Department of Natural
Resources stated that his participation was just to listen to the
witnesses.
Number 1840
CLIFF EAMES, Alaska Center for the Environment, testified that the
center is concerned with the level of management that HB 447 would
involve the legislature in. The present administrative process is
entirely adequate with regard to both public participation and
opportunities for fine tuning some fairly difficult and complex
issues. We think that these matters are best dealt with at the
administrative level. He felt that the thrust of the bill prevents
the Division of Lands from attempting to manage motorized vehicles.
MR. EAMES stated that the center believes that there is a very
serious question of fundamental fairness here and that is the state
is not providing adequate opportunities for people who enjoy quiet
recreational sports. "We believe that this is a gross imbalance,
it is greatly unfair and unequitable and it needs to be resolved.
We have been urging the Division of Lands and the Division of
Parks, for years, to redress this imbalance. So far without
success. This bill will make it even more difficult to provide
some opportunities for quiet recreation. I am not sure what the
Alaska Visitors Association will be saying today, but I would point
out that there a lot of tourism operators who do not feel that they
are adequately represented by the AVA who rely on wild areas, wild
quiet areas to make their living. They are very poorly provided
for on state lands."
Tina Lindgren, Executive Director, Alaska Visitors Association,
testified that over 600 members statewide make up the association.
She said the association relies heavily on public lands in Alaska
in order to accommodate people who cater to the visitor industry.
There is also tremendous pressure to restrict access for commercial
purposes of all kinds throughout the state. We believe that it is
essential that visitors be allowed to visit public lands and do
those things such as hiking with a guide. We support the premise
of HB 447 which is to protect recreational access to state land.
She responded that Mr. Arno misinterpreted "Destination Alaska,"
the AVA did not establish any zones. It was a recommendation made
by the report.
GARY MARIAN, Vice President, Alaska Boaters Association, and member
of the Alaska Outdoor Council testified stating that he should urge
the committee to go against this bill, but he felt that a temporary
commissioner should not have the right to close access. He urged
the committee to pass HB 447 stating that he did not feel that any
individual should have the right to close access to our public
lands.
Number 2131
MICK MANNS, representing Paradise Valley Mining, the miners from
the Wiseman, Coldfoot and Bettles areas, and the recreational dog
mushers and snowmachiners in the area, urged the passage of HB 447.
He said Section A of the Alaska Constitution reads, "the lessee has
the right to control trespass" and the UCC code adopted by the
state of Alaska reads, "a landlord who retains complete control
over an area also retains liability." He recommended the inclusion
of a no trespass provision for snowmachiners, dog mushers and other
people using those areas to stay out of the designated area.
Number 2230
MR. STANCLIFF commented that Mr. Manns may not have a copy of the
committee substitute. Page 3, lines 7 and 8 says that the lessee
may control and direct access across the development parcels.
Number 2277
CO-CHAIRMAN GREEN reiterated that the committee could not take
action on CSHB 447 due to a lack of quorum. He expressed
appreciation to the sponsor and the subcommittee for their work on
the committee substitute.
HB 360 - PROHIBIT DEC FINES IN CONSENT ORDERS
Number 2306
REPRESENTATIVE THERRIAULT read the sponsor statement for HB 360
into the record:
"This legislation is intended to halt a practice currently in use
by the Department of Environmental Conservation that allows the
agency to levy fines without having the specific statutory
authority to do so. Under current law, DEC has broad authority to
`enter into contracts necessary or convenient to carry out the
functions, powers and duties of the department.' Under that
authority, DEC can issue a `consent order' that functions as a
contract with an entity the DEC believes has violated an emission
standard or law. In the contract, DEC agrees to forgo other
remedies in return for the agreement of the other party to abate
the alleged pollution and pay a fine for past alleged pollution.
Although this practice could possibly hold up in court if
challenged, I do not believe it is appropriate as a policy matter
for an agency to levy administrative fines and penalties when the
Legislature has chosen not to grant them that specific power."
REPRESENTATIVE THERRIAULT said the legislature has not given the
DEC the power to fine individuals through administrative mechanism.
However, if a person is out of compliance with an operating permit,
rather than challenge the person's permit and institute actions to
review and, perhaps, pull that person's permit, they negotiate with
the permittee and enter into a contract with them to bring the
facilities into compliance and do certain things. In negotiating
that contract, one of the provisions of the contract may be that
the person pay a fine in the future if they are again out of
compliance. However, there have been instances where part of the
contract stipulates that they will pay a fine or fee for being out
of compliance in the past, so retroactively fining an individual.
REPRESENTATIVE THERRIAULT felt that there is an incredible amount
of pressure for facilities to, basically, do whatever the DEC wants
so that they can keep operating.
REPRESENTATIVE THERRIAULT said when it comes to large businesses
that is not so much of a problem. In Southeast Alaska, where you
have large logging operations, pulp mills, etc., they would rather
use the consent order than go to litigation to retain their permit.
In Southcentral, the Anchorage area, where you have a lot more
large corporations, they also see benefit in the consent orders.
But, in Fairbanks, we do not have that many large industries, we
have a lot of small moms and pops. They feel that they are under
considerable pressure from the DEC to capitulate to the demands of
the DEC or else their permit will be challenged through legal
action.....(change tape)
TAPE 96-17, SIDE B
Number 000
REPRESENTATIVE THERRIAULT said he has a real problem with consent
orders that levy fines retroactively. He hypothesized --if my
facility is out of compliance and the DEC wants to pressure me to
take certain steps to come into compliance, I do not have as much
a problem with that. If I have done something that is out of
compliance and cause a spill or pollution in the past and DEC wants
to negotiate with me to clean up that past violation, I do not have
that much of a problem. But just fining somebody retroactively,
and having them agree to be fined prospectively, I have a problem
with that. I think there is a policy call that the legislature
should make.
Number 039
CO-CHAIRMAN GREEN conjectured that if today, the DEC were to come
to a company and say we are going to get you for stuff that has
been going on for 10 years, but during that 10 year period, the DEC
had not approached the company to try and correct it.
Number 052
REPRESENTATIVE THERRIAULT said this particular instance, the DEC
and the permittee were negotiating back and forth. When they
finally entered into the agreement, the company agreed to be fined
in future, but also the DEC said, well, we have got these three
past notices of violations. The company felt like they were really
under the gun, they had contracts to perform on and DEC was
threatening to start legal proceedings to pull their permit. He
said if he had been involved in that particular case earlier, he
would have advised them not to sign a consent order, particularly
because of the retroactive fining. He said the company did sign
the consent order and now they are trying to bring their facility
into compliance and pay this retroactive fine and they find
themselves stretched almost to the point of breaking.
Number 128
REPRESENTATIVE THERRIAULT stated that he understood the DEC's
responsibility in being responsive to allegations and people
operating out of compliance and complaints.
Number 195
REPRESENTATIVE DAVIES asked Representative Therriault the nature of
the alleged violation.
REPRESENTATIVE THERRIAULT responded odor problems from an
incinerator. He said one of the complaints was that an individual
called up and said there was a smell of burning hair. He said the
plant does not put out that kind of a smell.
Number 239
JANICE ADAIR, Director, Division of Environmental Health,
Department of Environmental Conservation read her statement on HB
360 into the record:
"HB 360 would prevent DEC from including a fine for violations or
alleged violations of AS 46.03 in any `consent order" or other
agreement. The way this bill has been drafted is somewhat
confusing - DEC does not have the authority to levy fines. In
addition, consent orders are judgements entered by a court and
agreed to by both parties involved. We have not prepared a fiscal
note yet because we need to get clarification on both the question
of fines, and whether or not the intent of the bill is to divest
the judiciary of its ability to levy penalties.
MS. ADAIR continued, "It is probably worthwhile to first review
what kinds of costs can be assessed for violations of DEC statutes
and also review the kinds of agreements, including consent orders,
that DEC negotiates with permittees.
MS. ADAIR proceeded, "AS 46.03.760 outlines the costs a person who
violates provisions of Title 46 may be liable to pay in a civil
action. These costs are:
(1) liquidated damages that represent reasonable compensation for
adverse affects of the violation;
(2) reimbursement of reasonable costs incurred by the department
in the detection, investigation, and attempted correction of the
violation, and
(3) the economic savings realized by the person for not complying.
MS. ADAIR said, "The statute specifically states that these sums
must be compensatory and remedial in nature. They may not be
punitive. The only penalties that are authorized may be imposed by
the court for violations of the air statutes and hazardous waste
statutes. The language in the statute refers to `the need for an
enhanced civil penalty to deter future noncompliance.' The
imposition of penalties is not mandatory by the ability to do so is
a requirement for state primacy in both air and hazardous waste
programs.
MS. ADAIR said, "When we have a situation where there is a
violation, the department's preferred option is to negotiate a
compliance schedule with the permittee. There are two kinds of
negotiated agreements we use. The most common is a Compliance
Order by Consent, and the other is a Consent Order, or Consent
Decree. Both of these documents are negotiated with the permittee
who is allegedly violating some statute which DEC is required to
implement. They are contracts where both sides - the state and the
permittee - get something out of it. A Consent Decree is filed
with the Court, while a Compliance Order by Consent is not. Other
than that, they are essentially the same thing.
MS. ADAIR continued, "As I said, both sides get something out of
these agreements. The permittee gets time to come into compliance
while remaining in operation. The state gets compliance with the
law. Both sides stay out of court. Compliance Orders by Consent
and Consent Decrees or Orders will forestall an EPA action because
the state is actively seeking compliance. Consent Decrees can also
forestall citizen lawsuits which are allowed under most all federal
environmental laws for the same reason - the state is actively
seeking compliance.
MS. ADAIR proceeded, "Negotiated into these contracts will be
`stipulated' penalties. That is, penalties the permittee agrees to
pay if he fails to comply with the Compliance Order, or if more
time is needed for compliance, fails to work out a new schedule
with the department. Because the compliance schedule is negotiated
with the permittee based on the time lines they can meet, it is not
common for these penalty sections to be invoked. But the ability
to levy the penalty is a critical part of the `quid pro quo' that
allows the public and the courts to view these arrangements as fair
to both sides. They are also extremely effective in helping to
achieve compliance with the laws.
MS. ADAIR concluded, "The department questions why the legislature
would want to remove the department's ability to negotiate these
kinds of agreements with permittees. There is no requirement to
sign a Compliance Order by Consent or a Consent Order - they
represent a mutual agreement, and can allow a company the time and
flexibility they need to come into compliance while at the same
time assure the public that action is being taken to achieve that
compliance.
"Only if an agreement cannot be reached does going to court become
a viable option. But if this bill were passed, going to court
would be the only option."
MS. ADAIR referred to the situation that Representative Therriault
spoke to about the penalty for past actions. She said it did
happen in that particular instance, but it is the only instance
where she can find that it did happened.
Number 472
CO-CHAIRMAN GREEN asked for clarification about "the club" or the
threat that DEC has. Is this through the Environmental Protection
Agency?
MS. ADAIR replied that DEC sits down to negotiate a Compliance
Order by Consent with someone and, people have been very
forthcoming about what they can and cannot do, there is a concern,
because they are out of compliance with the law. That all by
itself raises the level of concern that they come into these
negotiations with. We will have an attorney with us from the
Department of Law and, in every case I have been involved with,
there has been an attorney there for the other party.
MS. ADAIR stated that the principal of the company that negotiated
the Compliance Order by Consent is an attorney, so in this
particular instance, they were represented by legal counsel.
Because they are operating out of violation of the law, there is a
concern that if we do not find some way to negotiate then some
other action will have to be taken. So to the extent that that
situation is there, people could perceive a club or some kind of
threat.
Number 542
CO-CHAIRMAN GREEN asked if during these meetings there was concern
that the violation happened because the requirements were too
stringent. Was there a problem that way or was it a malfunction of
equipment? He said if you are in violation, I do not see what
defense you have.
MS. ADAIR replied that these things can be for a variety of
reasons. In the drinking water program, we do Compliance Order by
Consent in this program frequently. The federal rules which the
state also adopts do require a lot of hoops for people to jump
through and sometimes they just need more time. Smaller facilities
with the surface water source need more time to come into
compliance and the Compliance Order by Consent will buy them that.
Number 622
REPRESENTATIVE DAVIES expressed his prejudice saying that he felt
that consent orders are a good intermediary between doing nothing
and allowing the pollution to continue and having the only option
of going to court. He asked Ms. Adair if she felt that the
Department of Environmental Conservation has adequate statutory
authority in doing this kind of process.
MS. ADAIR replied that DEC has very limited enforcement authority.
We do not have administrative penalty authority which is why we
developed these Compliance Orders by Consent. It allows us a way
to negotiate with permittees without going to court. The penalty
section that I gave you, those are all court ordered, court
penalties. Those are for civil actions, and outside of civil
actions, the Department of Environmental Conservation has no
specific statutory authority for penalties or for compliance
enforcement. We developed this process because everyone recognizes
that going to court is the last thing you want to do. Most of the
major companies, and even some of the smaller companies that
operate in this state, they do not want to go to court; they do not
want to have a pending environmental lawsuit against them. It is
just not good business. This is a very important part of how we
achieve compliance with the laws that have been passed.
Number 714
REPRESENTATIVE DAVIES repeated his question, do you feel that you
have adequate statutory authority?
MS. ADAIR responded that absent this legislation, it works. The
DEC has in the past taken the position that the administrative
penalty authority would be an enhancement to that.
Number 741
REPRESENTATIVE THERRIAULT commented that when the bill was being
scheduled, he contacted people in the Fairbanks area to let them
know it would be teleconferenced to Fairbanks and they could make
comments if they wanted. He said that no one was willing to cross
the Department of Environmental Conservation when they have this
ability to pull a permit or come in and force them into these
orders. He said there is something here that is not working right.
People should feel comfortable in working with the DEC, but they
hear that in doing so they can be not only forced to take steps in
the future to come into compliance but also hit with retroactive
fines. They are very fearful of dealing with the DEC.
Number 800
CO-CHAIRMAN GREEN discussed the circumstances with the sponsor.
Representative Therriault replied that the predicament was so bad
that the company is willing to agree to anything as long as they
can keep operating.
REPRESENTATIVE THERRIAULT continued, some of these companies are
stretched to the point that if they are shut down for a week they
are out of business. They have lost their contracts and will not
get their contracts back. So when the DEC and a person from the
attorney general's office is across the table, they are under
incredible pressure to agree to almost anything.
CO-CHAIRMAN GREEN asked if this company is in fact, in violation.
Number 845
REPRESENTATIVE THERRIAULT affirmed that was correct, they are in
violation but they are taking steps to come into compliance.
Number 871
CO-CHAIRMAN GREEN said if the DEC is willing to give them time to
come into compliance what is the real crux of the problem.
REPRESENTATIVE THERRIAULT explained that the company is going to be
fined $5,000 retroactively for three notices of violation.
Number 907
REPRESENTATIVE OGAN premised that HB 360 reflects the basic problem
of the overall structure of the government. We are supposed to
have the executive, the legislative and the judicial. What we have
is a fourth branch of government called the bureaucracy that has
all three powers wrapped up in it. He quoted from Winston
Churchill, "When you have a lack of separation of powers between
the executive and the judiciary, you have a formula for tyranny."
He commented to Representative Therriault that it seemed to him
that HB 360 would take away some of that judiciary power from the
DEC.
Number 977
REPRESENTATIVE DAVIES stated that if you were to take away that
judiciousness on the part of DEC, their only other alternative is
to go to court. We all know that is adversarial and expensive, and
brings in the opportunity for even more bureaucratic and
insensitive activities from the federal government.
REPRESENTATIVE DAVIES observed that often what comes to the
legislature's attention is almost the worst situation that exists.
When situations are worked out amicably, people do not complain
about them because they shrug and agree to them. But the absolute
worst cases are the ones that come up, like this example. We have
to understand that this is probably the most extreme case, we have
heard testimony that this is the only case where retroactive fine
was even considered. We should recognize that this is probably the
most extreme case. Maybe this situation can be resolved by just
simply reaching an understanding that it will not happen again or,
if necessary, we could do statutory amendments that would say we
just do not want this retroactive stuff. He asked Ms. Adair to
respond.
Number 1088
MS. ADAIR countered that this is the only situation found where the
department has done a retroactive penalty. She replied to
Representative Davies that it is difficult to say that in no case
again would it be necessary. We were getting complaints on this
particular facility and we had negotiated the Compliance Order by
Consent. It was given to the facility and four months went by
before they signed it. In that period of time, they continued to
have violations. She said as the sponsor suggested it may be that
some of those penalties will be dropped out because we can
negotiate with these agreements and that is one of their benefits.
MS. ADAIR said that there are certainly some situations that are
pretty egregious and by the time we find them there may be damage,
there may be an economic savings to this company for not having
operated in compliance with the law. That is just inherently
unfair to all those people that are operating in compliance with
the law. We may need to have that flexibility, that instead of
going to court to pursue that penalty or that economic savings, to
be able to level a penalty through a compliance order for that
economic savings.
Number 1199
REPRESENTATIVE DAVIES interpreted that without the possibility of
the DEC "hammer," it seems that we are inviting people to operate
in violation of the law until they got caught. Why bother, if we
are never going to be fined retroactively for being in violation of
the law. Why follow the stipulations of the permit until somebody
slaps you on the hand. Operate without fear of the consequences.
Number 1246
CO-CHAIRMAN GREEN discussed a case in Anchorage where a company's
incinerator was creating air pollution and they were given multiple
notices, the company made multiple promises, and no action. He
said that the frustration of the people he represents is that the
Department of Environmental Conservation needed a bigger club.
REPRESENTATIVE DAVIES said that in a case where there is notice and
then no action, to fine in that situation, from the time of the
notice, I would not consider that retroactive.
Number 1304
REPRESENTATIVE THERRIAULT replied that the particular case in
Fairbanks, the company had taken steps throughout the summer to
bring the facility into compliance and modify the plant to bring it
into compliance. The DEC always has the ability to challenge or
start a proceeding against the person's permit. If they are
negotiating and they really feel the operator is just leading them
on or stalling at any time, that person is truly out of compliance,
the DEC has the authority to start the process. For the small
operators, it is a different world than large industry who has
personnel that deal with this specifically and do nothing but
negotiate on compliance or noncompliance.
Number 1407
C0-CHAIRMAN GREEN commented that it was his observation that the
DEC was very swift to act against large companies because the
amount of pollution is greater. He expressed concern of the threat
or the hammer that the DEC would grab a license, and stated that,
from his viewpoint, the DEC is very workable and continue almost
`ad nauseam' to allow this compliance to be done.
Number 1454
MS. ADAIR stated that revoking a permit is a long drawn out
process. It is just not practical, it is costly and time
consuming. It is a very serious action.
Number 1530
REPRESENTATIVE LONG asked for clarification of statutes in the DEC
document, Compliance Order by Consent, page 7, section 23.
MS. ADAIR stated that this is the DEC's legal enforcement authority
and it says that if the compliance order does not work, we have the
right to take other action against the permittee to achieve
compliance or to enforce the provisions of law. We reserve our
right to bring an action in court for failure to comply.
Number 1622
REPRESENTATIVE THERRIAULT asked the committee to look at the
retroactive portion which is the real problem that needs to be
fixed. He referred to the comments about encouraging somebody to
be in violation until they are caught. He said that is the way it
is with any law, you speed until you get a ticket but they do not
look back and say we caught you speeding last week, we are going to
give you a ticket for that one too. It seems like the retroactive
portion which is not used by the department by their own admission
often seems to be the most egregious part.
Number 1664
MS. ADAIR said that when the department finds a violation, it gives
a notice of violation which says, in case you did not know, you are
violating the law and this is what you need to do to come into
compliance. We may do that several times before we negotiate a
Compliance Order by Consent. She said that taking away the ability
to use past violations to factor in the penalties for the
Compliance Order by Consent may result in not doing an (indisc.)
and going right to Compliance Order by Consent so we can get people
the first time. There may be instances where it is appropriate.
There may be instances where the violations are just so bad and the
department has tried everything to get them to comply that we ask
the company to agree to pay DEC this penalty for having not played
ball.
Number 1834
REPRESENTATIVE DAVIES supposed that at any time in the process, the
party can say no, I will see you in court. I do not agree to
negotiate, I do not agree to pay this fine. I do not agree to do
any of this stuff.
Number 1883
MS. ADAIR stated that that has happened. What the department has
then asked is, okay, what can you agree to, how can we work this so
that you can agree to it.
Number 1919
CO-CHAIRMAN GREEN assigned HB 360 to a subcommittee composed of
Representatives Ogan, Long and himself to consider the retroactive
issue and other questions. He invited Representative Therriault
and Ms. Adair to participate in those meetings.
ADJOURNMENT
There being no further business to come before the House Resources
Committee, Chairman Green adjourned the meeting at 9:20 a.m.
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