Legislature(1995 - 1996)
02/21/1996 08:07 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 21, 1996
8:07 a.m.
MEMBERS PRESENT
Representative William K. "Bill" Williams, Co-Chairman
Representative Joe Green, Co-Chairman
Representative Scott Ogan, Vice Chairman
Representative Alan Austerman
Representative Ramona Barnes
Representative John Davies
Representative Pete Kott
Representative Don Long
Representative Irene Nicholia, via teleconference from Minto
OTHER MEMBERS PRESENT
Representative Gail Phillips
MEMBERS ABSENT
All members were present
COMMITTEE CALENDAR
HOUSE BILL NO. 344
"An Act authorizing the commissioner of the Department of Natural
Resources to negotiate and enter into timber sale contracts that
provide for local manufacture of high value-added wood products;
and establishing an Alaska Forest Products Research and Marketing
Program within the Department of Commerce and Economic
Development."
- HEARD AND HELD
PRESENTATION: NAVIGABLE WATER AND SUBMERGED LANDS
Department of Fish and Game
Department of Law
Department of Natural Resources
PREVIOUS ACTION
BILL: HB 344
SHORT TITLE: VALUE-ADDED TIMBER SALES; MARKETING
SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR
JRN-DATE JRN-PG ACTION
05/10/95 2085 (H) READ THE FIRST TIME - REFERRAL(S)
05/10/95 2085 (H) RESOURCES, FINANCE
05/10/95 2085 (H) FISCAL NOTE (DNR)
05/10/95 2085 (H) 3 ZERO FNS (DCED, CRA, UA)
05/10/95 2085 (H) GOVERNOR'S TRANSMITTAL LETTER
09/19/95 (H) RES AT 9:00 AM
02/21/96 (H) RES AT 8:00 AM CAPITOL 124
WITNESS REGISTER
THOMAS H. BOUTIN, State Forester
Division of Forestry
Department of Natural Resources
400 Willoughby Avenue, 3rd Floor
Juneau, AK 99801-1724
Telephone: (907) 465-2780
POSITION STATEMENT: Testified in support of CS HB 344.
KARL OHLS, Resources Specialist
Division of Trade and Development
Department of Commerce and Economic Development
P. O. Box 110804
Juneau, AK 99811-0804
Telephone: (907) 465-5467
POSITION STATEMENT: Testified in support of CS HB 344.
JACK PHELPS, Executive Director
Alaska Forest Association, Inc.
111 Stedman, Suite 200
Ketchikan, AK 99901-6599
Telephone: (907) 225-6114
POSITION STATEMENT: Testified in support of CS HB 344.
RICK SMERIGLIO
HCR 64, Box 565
Seward, AK 99664
Telephone: (907) 288-3614
POSITION STATEMENT: Expressed concern with CS HB 344.
RONALD RICKETTS
Fairbanks Industrial Development Corporation
515 7th Avenue
Fairbanks, AK 99701
Telephone: (907) 452-2185
POSITION STATEMENT: Testified on CS HB 344.
JULES V. TILESTON, Director
Division of Mining and Water Management
Department of Natural Resources
3601 C Street, Suite 800
Anchorage, AK 99503-5935
Telephone: (907) 269-8624
POSITION STATEMENT: Navigable Waters/Submerged Lands Presentation
BRUCE BOTELHO, Attorney General
Department of Law
P.O. Box 110300
Juneau, AK 99811-0300
Telephone: (907) 465-3600
POSITION STATEMENT: Navigable Waters/Submerged Lands Presentation
FRANK RUE, Commissioner
Department of Fish and Game
P. O. Box 25526
Juneau, AK 99811-5526
Telephone: (907) 465-6141
POSITION STATEMENT: Navigable Waters/Submerged Lands Presentation
JOANNE GRACE, Assistant Attorney General
Department of Law
1031 West 4th Avenue
Anchorage, AK 99501
Telephone: (907) 269-5100
POSITION STATEMENT: Navigable Waters/Submerged Lands Presentation
MARTY RUTHERFORD, Deputy Commissioner
Department of Natural Resources
3601 C Street, Suite 1210
Anchorage, AK 99503
Telephone: (907) 269-8431
POSITION STATEMENT: Navigable Waters/Submerged Lands Presentation
JIM CULBERTSON, Resources Manager
Division of Land
Department of Natural Resources
3601 C Street
Anchorage, AK 99503
Telephone: (907) 269-8525
POSITION STATEMENT: Navigable Waters/Submerged Lands Presentation
ACTION NARRATIVE
TAPE 96-19, SIDE A
Number 000
CO-CHAIRMAN WILLIAM K. "BILL" WILLIAMS called the House Resources
Committee meeting to order at 8:07 a.m. Members present at the
call to order were Representatives Williams, Green, Ogan, Austerman
and Long. Representative Nicholia attended via the teleconference
network from Minto. Representatives Barnes, Davies and Kott
arrived late.
HB 344 VALUE-ADDED TIMBER SALES; MARKETING
Number 017
C0-CHAIRMAN WILLIAMS announced that the committee would hear HB 344
but it was not his intent to move the bill from committee. He said
Co-Chairman Green would chair the agency presentation on navigable
waters and submerged lands.
CO-CHAIRMAN WILLIAMS noted the arrival of Representative Davies.
Number 117
CO-CHAIRMAN GREEN moved to adopt committee substitute for HB 344 as
the working document. Hearing no objection, it was so ordered.
Number 170
REPRESENTATIVE JOHN DAVIES asked the origination of the committee
substitute and an explanation of the changes.
CO-CHAIRMAN WILLIAMS stated that the changes came primarily from
the Board of Forestry and would be addressed by Tom Boutin, the
State Forester.
Number 252
THOMAS BOUTIN, State Forester, Division of Forestry, Department of
Natural Resources said that he was expecting Karl Ohls, Department
of Commerce and Economic Development, to join him at the conference
table. He made available his prepared testimony on the committee
substitute and distributed a draft fiscal note. He introduced Ms.
Kathleen Morse, Forestry Economist, Department of Commerce and
Economic Development.
MR. BOUTIN read his testimony into the record:
"Thank you for allowing the Board of Forestry to add to the public
process on HB 344. Last Fall, the Board of Forestry held a hearing
on the bill and then worked what they heard into recommendations.
The committee substitute adopted virtually all of those
recommendations.
MR. BOUTIN proceeded, "We're very pleased with the processes of
which we have been a small part on both HB 212 and HB 344. The
work of the House Resources Committee and HB 212 sponsor
Representative Jeanette James allowed virtually all stakeholders
and interests to reach an understanding. With HB 344, the Board of
Forestry was able to bring its role as a consensus building body of
interest groups to the process, The Board of Forestry looks for
sound science and good process.
MR. BOUTIN informed, "The Governor introduced this legislation in
response to concerns of many groups, including members of the
timber industry that we better utilize the timber that is cut in
Alaska. HB 344 is our response to what we think we heard from
many constituents who want better utilization of state timber.
MR. BOUTIN said, "What you see in HB 344 is what we heard from
people like Steve Seley, of Ketchikan. The Governor's office told
me that Steve would be here to talk with you today but we just
received the sad news that Steve's Dad just passed away. I
understand that some other small Southeast operators would be
patched into this teleconference except for the busy scheduled you
have before you today.
MR. BOUTIN introduced the committee substitute:
"Section 1. The purpose of HB 344 is to bring some certainty of
wood supply to processors who bring high value in the manufacture
of state timber. The administration has talked with many small
operators and they agree on at least one point they can find a
market for any high-value product they can produce but they cannot
buy the capital equipment those products require unless there is a
reliable supply of timber. While HB 344 is not a mandate to
eliminate log exports or change the forest products industry, it is
still true that round log export prices prohibit small operators in
Southeast from putting capital equipment in place.
MR. BOUTIN continued, "HB 344 is a tool and an incentive for high
value-added processing. While Governor Knowles would like small
independent commercial wood users to have an advantage, this bill
is directed toward maximizing the number of jobs per acre harvested
and does not favor any sector of the forest products industry.
MR. BOUTIN proceeded, "Section 2. provides that negotiated timber
sales of up to 10 million board feet and 10 years in duration can
be negotiated for use in the local manufacture of high value-added
wood products. HB 344 originally provided for sales of no more
than 5 million board feet per year. We did not intend that would
be enough to supply all the wood needs of some types of value-added
processing. However, a firm that has a certainty of supply for a
substantial part of its needs can then compete on the open market
for timber sold by private and public timber owners. Very few wood
users receive all of their supply from one source.
Number 576
MR. BOUTIN stated, "While the CS now allows sales of up to 10
million board feet per year, we would feel more comfortable with 5
to 7 million board feet as a maximum. Most timber sale contracts
will be far less. A higher amount would alarm the public without
gaining any utility whatsoever. The Board of Forestry did not
recommend any change to the contract volume.
MR. BOUTIN proceeded, "The Board heard concerns about the increase
in timber offered that might result from this bill. Section 2
adopted the Board's recommendation to provide for limiting the
number of contracts per region by regulation. There has been some
discussion about different possible interpretations of line 16,
page 2. The way I understand it, the commissioner could set a
maximum number of contracts per region and that maximum must be two
or more. That is acceptable to us if that is the correct
interpretation.
MR. BOUTIN continued, "Another area that the Board of Forestry
investigated is the portion of state timber that is of sufficient
quality to produce high value-added products. The CS adopts the
Board of Forestry recommendation to allow consideration of other
value-added wood products.
MR. BOUTIN said, "Section 2, paragraph (e), required the
commissioner to consider not only the economic benefits for the
manufacture of high and other value-added wood products, but also
the likelihood of the venture being successful, job creation and
stability, fish and wildlife habitat and multiple use, and the
stumpage return to the state.
MR. BOUTIN informed, "The CS adds public process in providing for
an updated Forest Land Use Plan after a 5-year performance review.
The requirements of AS 38.05.112 (Forest Land Use Plans) and AS
38.05.113 (5 year schedules of timber sales) apply to HB 344
because the Governor wants good public process. The public has
told us that at least during the past 2 years, forest land use
plans and 5 year schedules have provided good public process.
MR. BOUTIN continued, "The Board of Forestry looked at the list of
high value-added products and recommended adding to the list. The
CS has the amended list to now include veneer, plywood, finger-
jointed lumber and house-logs, exactly as the Board of Forestry
recommended.
MR. BOUTIN said, "The Board also wanted to encourage the processing
of other value-added products where the resource just cannot make
high value-added products. The CS includes the list of other
value-added wood products in Section 2, paragraph (k)(2). Other
value-added wood products means pulp, chips, waferboard, green
lumber, fiberboard, cants, slabs or planks intended for
remanufacture. Similar products can be specified by regulation.
MR. BOUTIN added, "Section 3. As noted earlier, the Board of
Forestry heard about the public concern that this bill could lead
to large increases in the amount of timber offered. The CS limits
the number of these timber sales to no more than 2 per region in
1996, 1997 and 1998.
"HB 344 as originally drafted provided for an Alaska Forest
Products Research and Marketing Program. We had not heard of any
concerns over that proposal but the CS eliminates it. Karl Ohls
will talk about that in a moment.
MR. BOUTIN testified, "HB 344 does not add timber sales. Timber
sales on state land are unlikely to approach the ceiling of
sustained yield with multiple use because of budget realties.
MR. BOUTIN concluded, "HB 344 is simply a method of sale option.
It does not change public process for timber sales. It does not
transfer any forest management responsibilities to the timber
purchaser. It does not close the door on round log exports."
Number 803
KARL OHLS, Resources Specialist, Division of Trade and Economic
Development, Department of Commerce and Economic Development
testified stating, "the committee substitute deletes the original
Section 3, which created the Alaska Forest Products Research and
Marketing Program within the Department of Commerce. I understand
the committee made this change because of concerns about creating
a new program and adding to the fiscal cost of state government.
MR. OHLS said, "The Commerce Department recognizes and respects the
committee's legitimate concerns about adding more functions to
state government. The department had these same concerns in mind
when it decided to address HB 344 by setting new priorities within
its existing budget. We currently have a budgeted position for a
forest specialist in the Division of Trade and Development. We are
incorporating the job duties described in the original HB 344 into
the job description for the forest specialist. No additional
expense would be involved.
MR. OHLS declared that the department's fiscal note is zero.
Number 843
MR. OHLS introduced Ms. Kathleen Morse, who will fill Commerce's
existing position. "Ms. Morse currently works as a regional
economist for the U.S. Forest Service. We are working on the final
details of an Intergovernmental Personnel Act agreement with the
Forest Service that would allow Ms. Morse to work for the state,
starting in mid-March, with the official title of forestry
economist.
MR. OHLS said, "Ms. Morse will have two main assignments. The
first is working on a strategy for maintaining a viable timber
supply for the forest products industry. The second is developing
a strategy for the expansion of value-added wood products.
Number 916
MR. OHLS concluded, "In conclusion, the Commerce Department's view
is that Section 3, as originally drafted, should reassure Alaska's
forest products industry that the administration is committed to
the development of value-added wood products in Alaska. The
administration is willing to reinforce this commitment with
language in statute.
MR. OHLS added, "If the committee, however, leaves the CS as is,
the department still plans to commit a significant amount of Ms.
Morse's time to the duties described in the original HB 344. We
believe these duties are critical for the success of our efforts to
promote the value-added wood products industry.
Number 998
CO-CHAIRMAN WILLIAMS noted the arrival of Representative Pete Kott
and Representative Irene Nicholia announced her presence in Minto.
CO-CHAIRMAN WILLIAMS apprised the committee that Marty Rutherford,
Department of Natural Resources; Joanne Grace, Department of Law;
and Jane Angvik, Division of Lands were on the Anchorage network.
Number 1030
REPRESENTATIVE DAVIES referred to the CS on page 2, line 16, where
the commissioner sets the maximum number of contracts per region.
He asked if the Board of Forestry had discussed this issue.
MR. BOUTIN said the Board of Forestry asked for just what is in the
bill, that there be no more than two contracts per region for the
three years following enactment of the bill and then a maximum per
region be set by regulation. He added that the board did not
tender language specific to that but asked that, "Motion Number
Seven" of what we submitted to the House Resources Committee, that
limit for three years be a limit of two. However, they did not ask
that there be at least two per region, they asked that there be no
more than two per region for the three years following enactment
and after that the commissioner set it by regulation.
REPRESENTATIVE DAVIES wanted further clarification and asked if the
board's position was that there should be a maximum of two, or did
they contemplate that the commissioner might set a limit higher
than two sometime in the future.
MR. BOUTIN replied that the board wanted no more than two per
region for the three years following enactment and then, after
that, it should be set by regulation. He said they were silent on
the number and did not put, as section 2 has, that there be no less
than two.
Number 1164
C0-CHAIRMAN WILLIAMS addressed Joanne Grace, Department of Law, and
referred to the February 19, 1996 memorandum to his office from the
Division of Legal and Research Services regarding a risk that the
provisions of this bill requiring local manufacture may violate the
interstate commerce clause of the United States Constitution.
JOANNE GRACE, Assistant Attorney General, Department of Law,
informed the chairman that her attendance related to the Navigable
Waters and Submerged Lands presentation and said that she was not
prepared to discuss HB 344.
Number 1205
MR. BOUTIN responded that he had heard discussion by other
attorneys on Gerald Luckhaupt's memorandum and said the attorneys
seemed divided on that issue. He stated that he had talked to a
number of attorneys in the Department of Law and it would seem that
the consensus is that, on-balance, HB 344 is constitutional and
there certainly is a consensus that it is enforceable.
MR. BOUTIN continued the discussion stating that the strategy used
by the assistant attorney general for forestry was that since every
timber sale requires a best interest finding, and the DNR uses the
Forest Land Use Plan to substantiate that and DNR always talks
about the economics in the Plan, any value-added proposition that
is an increased number of jobs as a result of this sale, would
become part of this best interest finding.
Number 1328
MR. BOUTIN went on to say that it is true that HB 344 would be much
enhanced by action in Congress. He informed the committee that
language had been provided to the Alaska Congressional delegation
that the DNR wishes Congress would adopt and that would then settle
the question. He said all the attorneys he had talked with say
that HB 344 is certainly constitutional, but in the absence of
that, still the attorneys we have talked with believe that, on-
balance, it is constitutional. Secondly, all the attorneys believe
that the contract can be crafted as such that it is enforceable
without getting crosswise with southcentral timber development.
Number 1372
CO-CHAIRMAN WILLIAMS asked that the Department of Law provide the
committee with a written response to the constitutional question.
NUMBER 1382
REPRESENTATIVE DON LONG stated a concern that there is a 10 million
board feet limit in one area and then a designation of two
contracts per region. He asked the department to explain whether
they are going for the 10 million board feet or limiting operations
to two contracts per region.
MR. BOUTIN responded that the committee substitute allows timber
sale contracts of up to 10 million board feet. He said he had a
hard time imagining that there would be any contract as much as 10
million board feet. He said, except for the hardwood resource in
the Interior that is not being used, he does not know of a place
where the state has an ability to put together a 10 million board
foot, per year contract. He said that one million board feet is
a much more likely number than even five million board feet. It
does allow up to two of these a year, per region. So, in theory six
per year of these contracts. He said the 10 million board feet is
the absolute ceiling on the contract size and it is higher than it
needs to be and certainly most of the contracts would be far
smaller.
Number 1464
REPRESENTATIVE LONG asked Mr. Boutin how many regions there were.
MR. BOUTIN answered that there are three regions as set up in the
Forest Practices Act: coastal, southcentral and interior.
Number 1480
REPRESENTATIVE DAVIES said with respect to the interstate commerce
and the congressional exemption, has the Administration formally
transmitted this request to the congressional delegation.
MR. BOUTIN replied that the Governor's Office had done that and
responded to Representative Davies that he would provide the
committee with a copy of that communication.
Number 1537
REPRESENTATIVE ALAN AUSTERMAN asked for clarification on the fiscal
notes.
MR. BOUTIN explained that the Department of Commerce and Economic
Development fiscal note is zero. The draft of the Department of
Natural Resources fiscal note is $26.5 for the first year, for
principally putting together regulations, and $3.5 for each year
thereafter.
Number 1570
CO-CHAIRMAN WILLIAMS stated his intention was not to move CSHB 344
today and said he would take teleconference testimony at this time.
Number 1580
REPRESENTATIVE DAVIES said the fiscal note conflicts the expense
and asked if the department expects any additional state revenue as
a result of the letting of the contracts.
MR. BOUTIN replied that begs the question of would there be an
increase in the amount of timber sold. The state's timber sale
program brings more money to the general fund that it costs. In
the calendar year ending 12/31/95, the state brought in $1.9
million in timber sale receipts and that is a multiple of the cost
of putting that timber up for sale. He said, if there was an
increase in some part of the state, in the amount of timber, and
that timber would bring more money to the general fund than what it
cost, then that would balance out the amount in that fiscal note.
Number 1665
JACK PHELPS, Executive Director, Alaska Forest Association, Inc.,
testified that the association represents timber industry
throughout Alaska and supports legislation that enhances economic
opportunities by making the forest resources of Alaska available
for sustained harvest.
MR. PHELPS stated that the Alaska Forest Association wants to
express its appreciation to Governor Knowles for introducing HB
344. "We especially applaud the concept of fostering the growth of
the forest products industry in the Interior of Alaska. We would
also like to commend your efforts, Chairman Williams, in working
with industry to produce a substitute bill which is much more
likely to succeed in its stated goals."
MR. PHELPS said the AFA supports the proposed committee substitute
for HB 344. "We believe that the changes embodied in CS reflect
the real world needs that must be addressed if this bill is to help
foster an expanded forest industry in the Interior of Alaska."
MR. PHELPS recalled that at the House Resources Committee meeting
held in Anchorage, September 1995, "the industry told you that it
needed some assurance of a relatively long-term steady and reliable
supply of timber before it could make the investment necessary to
enlarge the industry in the Tanana Basin. HB 344, as originally
introduced, provided a sufficiently long term for the proposed
contract to satisfy the reliability factor, but it limited the
contract to a maximum volume of only five million board feet. That
simply is not large enough of a supply to support even a moderate
good sized mill. Your proposed substitute increases that number to
10 million board feet. While we might like an even larger number,
we believe that this amendment vastly improves the potential for
this bill to do its job. We ask that you resist any attempts to
reduce this maximum sale size. I point out that it is a maximum as
the bill is currently written, the commissioner is free to craft a
smaller sale if the situation suggests it." He said, the House
Resources Committee has heard Tom Boutin suggest that in most
instances that would be the case, and he did mention the Interior
hardwoods which are clearly an exception if somebody comes along:
there is a proposal on the table that would deal with that.
MR. PHELPS said the other major issue concerns the industry, at the
time of the Fairbanks hearing, and the severe limitations the
original bill placed on products qualified for these negotiated
sales. "In other words, the definition of high value-added was
entirely too restrictive. The proposed committee substitute adopts
the definition language that was recommended by the Board of
Forestry and we believe that this change addresses our previous
concerns. It also proposes an adjustable percentage of the harvest
that must go into these high value-added products and allows the
commissioner to consider the production of other value-added
products in negotiating the contract. These are excellent and
important improvements to the bill."
MR. PHELPS said, "In summary, Mr. Chairman, the AFA believes that
you have proposed a very workable solution to the problem of
encouraging the responsible harvest of timber from Alaska's boreal
forest while also helping build an increased employment base here
in Alaska. We commend you for crafting a vastly improved version
of HB 344. We urge you to continue on your present course. Please
be assured that we are available to work with you as the measure
makes its way through the legislative process."
Number 1824
RICK SMERIGLIO, of Moose Pass, testified from Seward. "I would
like to state my opposition to the provision in the bill that
requires renegotiation of the stumpage price once every three years
or, at least, once every three years. I do not believe that the
taxpayers will get the highest price for the resource that they own
when we only renegotiate the price once every three years. I would
like to say that Governor Hickel was right in calling this the
`owner state.' We, the taxpayers, do own that resource and I think
all interests are best protected when we get the highest dollar
value.
MR. SMERIGLIO reiterated that his main opposition to CSHB 344 is
the provision that requires renegotiation only once every three
years. He said, "I believe that the taxpayers ought to get the
highest value for the resource that they own and that means selling
the timber when the price is high and getting the highest value
that way."
Number 1911
RONALD RICKETTS, Executive Director, Fairbanks Industrial
Development Corporation, recalled that he had testified before the
House Resources Committee at the hearing in Fairbanks. He said, "I
am pleased with the results of your work to this date. The
committee substitute is a good piece of work. I also commend the
Board of Forestry for their input to this process."
MR. RICKETTS referred to page 4, beginning on line 21 of CSHB 344,
the definition of `high value-added wood products' and `other
similar finished wood products.' He said he equated plywood with
engineered wood products and felt it should fall into the category
of other similar finished wood products. He advised that oriented
strand board and plywood are used for exactly the same purposes.
Number 1982
MR. RICKETTS referred to line 26, page 4, and questioned the
language "high defect birch" and stated his opinion is that aspen
is more likely to be high defect. He related that his company sent
both birch and aspen to an Oregon mill for test runs through their
veneer plant; the birch was very acceptable but the aspen had too
much defect to be usable for the quality they were looking for.
Number 2061
MR. RICKETTS said he would like to present a copy of a letter sent
to the Board of Forestry last October having to do with a five-year
area plan: the operation schedule in the Fairbanks area. He said
the letter is from the Oregon company looking at the feasibility of
building a veneer mill in the Fairbanks area. The company asked
for 15 million board feet of hardwood timber sale within the Five
Year Schedule. He said he brought up this issue because it relates
to the volume of timber we are talking about.
Number 2105
REPRESENTATIVE SCOTT OGAN interpreted the language on page 4, line
26 "deciduous aspen, poplar, and high defect birch, includes
engineered wood products and paneled wood products" meant that for
that high defect product, it can be made into engineered wood
products. He said the language simply allows for the less than
high quality material to be used in engineered and paneled wood
products.
Number 2143
MR. RICKETTS suggested that the language read high defect aspen,
poplar and birch. He felt that definition would be clearer.
CO-CHAIRMAN WILLIAMS said the committee would make sure that the
language was clear to everyone. He proceeded to close the
testimony on CSHB 344 and turned the gavel over to Co-Chairman Joe
Green.
BRIEF AT EASE
Number 2262
CO-CHAIRMAN GREEN invited Attorney General Bruce Botelho,
Commissioner Frank Rue and Director Jules Tileston to come forward.
PRESENTATION: NAVIGABLE WATER AND SUBMERGED LANDS
Number 2312
CO-CHAIRMAN GREEN introduced the subject of the hearing saying that
the navigable waters issue dates back to statehood. It seems that
there is a degree of contention between just who owns the waterways
and the lands beneath them. He said of critical importance is who
will actually end up with ownership.
CO-CHAIRMAN GREEN asked, "Do we have title to submerged lands in
the state of Alaska? If we do not, why not? If we do not, are we
in jeopardy of losing those rights through any kind of statute of
limitations?"
Number 2333
BRUCE BOTELHO, Attorney General, Department of Law informed the
committee that two of the departments water law experts were on
line in Anchorage.
MR. BOTELHO said the state of Alaska has title to all navigable
waters within the state as a result of one law and one doctrine:
The doctrine is called the Equal Footing Doctrine which provides
that upon admission of a state to the union it is entitled to all
waters that have been the equivalent of waters given in any other
state. We have the benefit of previous admissions of, over the
last two hundred years, those waters that have been historically
recognized as waters belonging to a state. Under the Equal Footing
Doctrine, Alaska would be entitled to those navigable waterways and
inland waterways.
MR. BOTELHO said under the Submerged Lands Act, the state has a
separate leg to stand on with regard to navigable waters. He said
submerged lands extend to the territorial waters three miles from
the territorial lands of the state. He said there was controversy
over exactly what the extent of that boundary is. In United States
v. Alaska, particularly in the Beaufort Sea.
MR. BOTELHO said that we have been in litigation as a state with
the federal government in a couple of areas where the actual extent
of the state's acquisition has been a question. Probably the most
well known is the "PLO 82" lawsuit, involving a public land owner,
issued by the federal government in 1943, in which some 48,000,000
acres were withdrawn. The federal government has taken the
position that lands withdrawn prior to statehood, including those
waters, would basically preclude the state from accessing title to
submerged lands within that withdrawal. He said this is our test
case in that regard.
MR. BOTELHO said it is quite clear from the U.S. Supreme Court
decision on the, so called, Utah Lake case where the federal
government made a similar claim. The state challenged and the
Supreme Court held that that withdrawal would not defeat the
state's right to title unless there could be a two-fold finding:
One, that Congress clearly intended to include the submerged lands
in the withdrawal. Second, that Congress affirmatively intended to
defeat the future state's title to the submerged lands. That is
the point that we arguing in the "PLO 82"....(change tape)
TAPE 96-19, SIDE B
Number 000
MR. BOTELHO said, "...a major case to firm up the state's belief
that it is entitled to all submerged lands that are navigable
waters within the state. There has been a Gulkana case as well,
ultimately decided in 1989 by the ninth circuit, that also found
the river to be navigable water of the state. Again, supporting
the state's basic position with regard to navigable waters."
Number 035
REPRESENTATIVE DAVIES asked if there are any instances of the state
losing a claim.
MR. BOTELHO said he was unaware of any. The one area that was a
matter of great concern surrounded pre-1983 transfers of land to
Native corporations and whether the transfer included transfer to
the title of lands underlying water bodies that were pertinent to,
or adjacent to, these transfers. In 1983, there was an agreement
between the state and the federal government that those transfers
would specifically exclude transfers of submerged lands on
navigable waters.
Number 098
MR. BOTELHO followed up on Representative Davies concern about the
statute of limitations. He said it was important to know `vis-a-
vis' the federal government, there is no statute of limitations
running against the state on quiet title of submerged lands with
one exception. That is, to the extent that the federal government
has undertaken some development activity on a water body or
submerged lands, the state is limited to a 12-year period within
which to assert its claim to title. Absent that one exception,
that is some specific developmental activity, the state is not
barred by the statute of limitations. There is a different story
though if there is a transfer to a conveyee. At that point, the
state statute of limitations probably would run the possibility of
losing title.
Number 141
CO-CHAIRMAN GREEN acknowledged the arrival of Speaker of the House,
Gail Phillips.
CO-CHAIRMAN GREEN wanted to know, if the state has sovereignty over
submerged lands, why each individual case is contested and, often,
results in litigation.
Number 169
MR. BOTELHO said it reflects a variety of fact specific situations
where the federal government, or some other party, might contest
whether a particular water body is navigable where there might be
an attempt by the federal government to assert that it has certain
controls on, or the ability to restrict activities on, a water
body. That is usually where the conflicts arise. We also want to
remove any ambiguity on many of the water bodies of the state as to
whether or not they are navigable. There are several reasons why
one might for a policy choice decide to litigate. After litigation
is resolved, definitively, with the federal government, what the
status of the water bodies are, we have an excess of 2,000 rivers
and streams that would be considered navigable in Alaska.
Number 223
CO-CHAIRMAN GREEN asked if that meant the state has ownership to
some and not others.
MR. BOTELHO replied that the state has consolidated three cases in
Northeastern Alaska that are being litigated. He said there has
not been a firm assertion by the federal government that they are
not navigable waters, generally, but we are fighting over the
extent of it: the Kandik River, the Black River & the Nation River.
Number 251
FRANK RUE, Commissioner, Department of Fish and Game (ADF&G) said
the department is in a support role to the Department of Law and
the Department of Natural Resources and share the concern that we
want to be aggressive in asserting navigability for a number of
reasons. Recently with dual management in subsistence, it may be
important for the state's management of fish and wildlife that we
assert navigability. Also, primarily, for public use, public
access to fish and wildlife, the navigability issue can become
significant. So, we have supported the Department of Law and the
Department of Natural Resources in various litigations and/or
assertions and that has been our role. We give information and
point out areas where we think the federal agencies are
overreaching and trying to restrict public uses on what believe are
navigable waters.
Number 304
JULES V. TILESTON, Director, Division of Mining & Water Management,
Department of Natural Resources (DNR) said the DNR's technical
people have worked on navigability determinations and assertions
with the Attorney General's Office, the Department of Fish and Game
and other state agencies.
MR. TILESTON pointed out that last year the overall coordination
role was eliminated from the budget. He said the division and the
commissioner developed an alternate strategy which he would explain
to the committee.
MR. TILESTON said current budget deliberations provide leadership
and technical support for navigability litigation involving the
state, specifically, on the Kandik, Black and Nation rivers. He
said the DNR has been working closely with the Attorney General.
The original litigation was filed in the early 1990s, it has gone
through the ninth circuit twice and was finally remanded with a
decision that it is right. He said the state should have a
decision from the federal government within the next several weeks
on the determinations.
MR. TILESTON said the DNR is already programming work for this
summer to verify the factual information that the state needs. The
DNR has contacted the Department of the Interior with a proposal,
subject to legal advice, because of other pending litigation. If
the DNR can get the Interior and the state to agree on hydrologic
facts, or other facts, that determine navigability, then we can
stipulate in court what the facts are and argue about what the
interpretations would be. He said this is a cost savings.
MR. TILESTON stated that the DNR is exploring with the Department
of Interior whether to pick up on a project that was postponed last
year when the funding was deleted. That was a cooperative effort
with the Interior agencies to specifically look at arranging water
bodies in the state into one of three categories. The first being
water bodies that are clearly too small or ones that are clearly
navigable, the Yukon River, for example, and there is no dispute.
Then we can get the quiet title from the federal court.
Number 419
MR. TILESTON said the second category of rivers would be those
groups where there was not enough factual information to make that
type of a determination. Then we would work out a cooperative
program and seek funding to get the pieces of missing information
that we need and proceed with that.
MR. TILESTON said the third category of rivers are those where we
absolutely could not agree, for whatever reason, and there was no
administrative solution. Then we prepare and go to court on those
particular things. But the whole objective was to get away from a
water body-by-water body litigation which is very time consuming
and expensive. He said this issue is not on the table but the DNR
is exploring with the Department of Interior to see whether there
is any interest in picking it back up.
Number 449
MR. TILESTON said the DNR is prepared to take whatever programming
effort it needs to ensure that technical support to the Attorney
General's Office, on those three rivers, is there. If the federal
government is doing something or there is a problem with land
owners where navigability ownership questions arise, we are
prepared to take those on. He said the ADF&G and concerned
citizens called the DNR about the Russian River. After speaking
with Commissioner Rue, we did the field work, we analyzed the data
and we submitted a navigability assertion that (indisc. paper
tearing) all things being equal, the Russian River was in state
ownership. That in a nutshell is what we will be doing next year.
Number 493
CO-CHAIRMAN GREEN asked Mr. Tileston to explain what he meant by
the term "right" in referring to the three rivers.
MR. BOTELHO explained that when the state filed suit in late 1993,
the federal government did everything they could to get the case
dismissed. The United States District Court ruled in the state's
favor. The federal government then went to the ninth circuit. The
ninth circuit upheld the district court, and, as a consequence, we
have been jockeying back and forth. The court has now directed
that the federal government has until March 6th to file its formal
answer to the complaint. We filed our complaint timely and it will
be a very short time before an answer will be required from the
government, but because of procedural motions we are two and a half
years waiting for that answer. The court has directed that the
federal government file its answer by March 6th.
Number 602
REPRESENTATIVE GAIL PHILLIPS, Speaker of the House, Alaska State
Legislature stated that the first of her questions will be directed
to the Department of Natural Resources and said that she would also
appreciate a response from the Department of Law and the Department
of Fish and Game.
REPRESENTATIVE PHILLIPS asked Mr. Tileston if he thought asserting
title to navigable water bodies is a public trust responsibility.
MR. TILESTON indicated that his answer was yes.
Number 625
MR. BOTELHO said the answer is an unqualified yes. The public
trust term also has a very specific meaning which many members of
the public are not aware of and that is the whole concept of title
being held by the state being in trust for the public trust. That
in turn means to make sure that the rivers are available to be
navigated that the public can use it unhindered for commerce and
for fishing: to be unburdened by any private rights. So, when we
talk about the public trust term, there is the public trust concept
in general which we clearly support. There is also a very specific
meaning here that the state takes a major obligation, does take
navigable title in trust to make sure that this free access is
unhindered by unreasonable interference by private interests.
Number 686
REPRESENTATIVE PHILLIPS addressed all three participants asking if
this process meets state government's trust responsibilities under
the state constitution. Is the process working?
Number 705
MR. TILESTON responded that he has been working in this field both
nationally, since the 1960s, and in Alaska, since 1972. The
process is working from his perspective. This program is working
and we are able to respond to those situations which are very
significant. He said the Russian River is a good example.
Number 750
MR. BOTELHO said the role of the Department of Law is a supportive
role in the sense that we are trying to execute policies developed
by the DNR. To the extent that our role is, primarily, front line
litigation, we have had great support from the Department of
Natural Resources. Their support has made it possible for us to
engage in litigation to begin with, and to be able to carry it out.
He said, from a more limited perspective, yes, I think the state is
on the right track. The question is the extent to which we are
able to enjoin the battle in other parts of the state, resources
are obviously limited.
Number 789
REPRESENTATIVE PHILLIPS asked if the state is constitutionally on
track.
MR. BOTELHO replied that the state is constitutionally on track in
the sense of asserting our constitutional mandate and upholding
what we think federal law is with regard to our entitlement to
lands underlying navigable waters.
Number 811
COMMISSIONER RUE stated that he was concerned when the DNR's budget
was reduced and their ability to deal with navigability was
jeopardized. The Department of Fish and Game is continuing to work
with the DNR and will help them to assert navigability in critical
situations to make sure that we have public access.
REPRESENTATIVE PHILLIPS asked Commissioner Rue if the state is
constitutionally on track from his perspective.
COMMISSIONER RUE answered yes and deferred to the Department of
Law.
REPRESENTATIVE PHILLIPS questioned Mr. Tileston. "At one point, the
state of Alaska gave notice of its intent to file quiet title on
nearly 200 streams in Alaska. What is being done on these cases?"
Number 853
MR. TILESTON replied that the 200 streams were filed approximately
three-five years ago when interagency groups met and selected the
Kandik, the Nation and the Black Rivers as the ones to first take
to court. The final answer on those three rivers would direct us
to which next ones we would pick. The Kandik, Nation and Black
rivers are Interior, they are not lake fed and they are non-glacial
meaning that the court decision will have potential application to
those types of rivers and they are all smaller other than the Black
and the Gulkana. Depending on what the court tells us, we would
then select, subject to funding, another set of criteria and then
pursue those.
Number 913
REPRESENTATIVE PHILLIPS addressed the Attorney General regarding
his comments on the 12 year time limit, "Is it your assertion that
of these 200 rivers or streams that unless any kind of federal
development has occurred on them, then there is not a time limit
for the state to assert its ownership?"
MR. BOTELHO replied that is correct to the extent that these have
not otherwise been conveyed to third parties. That is the first
caveat. In which case, the statute of limitations would be a state
statute of limitations. The only restriction is that there is some
federal development activity putting the state on notice of an
adverse view. The state is not subject to a statute of limitations.
REPRESENTATIVE PHILLIPS interjected asking, "Of those 200 has the
federal government put the state on notice on any of them?"
MR. BOTELHO suspected that there very few, if any, and deferred to
Mr. Tileston.
MR. TILESTON said he would supply a written response.
Number 972
REPRESENTATIVE PHILLIPS proceeded, "If the legislature determined
by statute to ensure title within a time frame and, unless there
was a federal intervention of some sort, that would be the process
to take. The legislature by statute could determine a time frame
for the state gaining title to those."
MR. BOTELHO advised that where the legislature could act would be
to extend the state statute of limitations on conveyances to third
or private parties. It could not affect the 12 year federal
statute of limitations in terms of federal conduct on waters.
Number 1007
REPRESENTATIVE PHILLIPS inquired, "..if there was no federal
intervention?"
MR. BOTELHO responded that if there has been no federal transfer
and there has been no federal activity, there is no statute of
limitations.
CO-CHAIRMAN GREEN asked if a conveyance would be a federal
intervention.
MR. BOTELHO said a conveyance to another party, in effect, takes it
out of the federal quiet title act and makes the time subject to
state statute of limitations.
CO-CHAIRMAN GREEN expressed concern that something might slip
through the cracks.
Number 1049
REPRESENTATIVE PHILLIPS asked, "Have there been any conveyances?"
MR. BOTELHO said the answer is that there have been numerous
conveyances, mostly in the context of the Alaska Native Claims
Settlement Act. "As I remarked at the outset, of particular
concern are transfers prior to 1983. My recollection is that the
Department of Natural Resources, on behalf of the state, worked
closely with the federal government in trying to prevent any
further conveyances that left ambiguous transfers of waters
underlying navigable rivers. The law is that if it is not a
navigable water, in the first place, the property line extends to
the mid-point of the river or a water body. With respect to
transfers that were taking place before 1983, there have been
numerous transfers, and a great deal of confusion and concern about
whether the state is going to be in a posture adverse to various
Native corporations over the water bodies.
Number 1130
CO-CHAIRMAN GREEN asked about the Utah Lake case.
MR. BOTELHO explained that the United States v. Utah deals with the
question of withdrawals of federal lands prior to statehood and
whether those withdrawals effectively vitiated the Equal Footing
Doctrine or the Submerged Lands Act, in terms of the state's
acquisition.
Number 1173
C0-CHAIRMAN GREEN stated that his concern is that the Utah Lake
case established sovereignty with the states on navigable waters
and, subsequent to that, there was conveyance by the federal
government. He asked if the federal government is conveying rights
on navigable waters, for example, to a Native Corporation, it no
longer has.
MR. BOTELHO replied that is precisely the concern that was raised
and led to the agreement in 1983.
REPRESENTATIVE LONG asked if the transfer included a designation by
the federal government for parks, preserves, and wildlife?
MR. BOTELHO explained that would not be a transfer, it is change of
land status from the federal government and quiet title would not
be affected in terms of the statute of limitations.
Number 1281
MR. TILESTON said he had worked for the federal government in 1983,
and stated that he would prepare a written response.
MR. BOTELHO asked Joanne Grace to clarify if there are situations
where the federal government has transferred lands to third parties
where the title to the underlying or submerged lands is in
question. "My recollection is that was an issue prior to 1983 and
that, at least, since 1983, the state and the federal government
have reached agreement that transfers would not explicitly exclude
submerged lands adjacent to federal transfers."
MS. GRACE replied that was correct and was codified in 1987-1988,
in federal law, with the exception of waterways smaller than 198
feet. Those still have to be determined navigable or nonnavigable
to determine whether they should be charged to Native corporations
or not. She said that determination is made only for charging land
status and does not prevent a state from bringing a quiet title
action more than 10 years after.
Number 1393
CO-CHAIRMAN GREEN asked if the state is in the process of bringing
quiet title to some of those conveyed lands.
MS. GRACE responded that she was not aware of any. She deferred to
the Department of Natural Resources.
CO-CHAIRMAN GREEN said if the state lost its appeal process after
the 10 years, do we lose the chance to regain title to those lands?
Number 1455
MS. GRACE said that the United States does not purport to convey
submerged lands that are larger than a particular size lake or
river. If they do purport to convey something larger than that,
then the state has a certain amount to appeal that administrative
determination.
Number 1494
JIM CULBERTSON, Resources Manager, Division of Land, Department of
Natural Resources, testified that the statute of limitations was
repealed in 1987 and, prior to that time, a lot of lands had been
conveyed to corporations by Interim Conveyance. For the purposes
of chargeability of acreage to the entitlement of the Native
corporations, if a lake was over 50 acres in size, or a stream was
over 198 feet in width, it was meandered on the survey plat and the
acreage was not charged to the corporation. That same law also
repeals the statute of limitations in ANILCA and provided that the
state would not be prohibited from recovering title to any of those
lands that were conveyed by an Interim Conveyance document. That
document is issued prior to survey, it is title to the land. The
Native corporations that were conveyed land by Interim Conveyance,
hold title to the land. What the survey rules do is compensate the
entitlement in acreage but leave the issue of ownership up to
future settlement or litigation.
MR. CULBERTSON clarified that the statute of limitations was
repealed at the same time the survey rules were implemented.
Number 1598
CO-CHAIRMAN GREEN asked if, 10 or 15 years from now, a litigation
for ownership of that which was conveyed and agreed to in 1983,
could still be done, and we are not barred from that?
REPRESENTATIVE PHILLIPS addressed the DNR, "In the February 1996
memo from Mr. Tileston, he indicated that navigability
determinations are routinely made as part of a land transfer from
the federal government. I assume that this means to the state or
a third party such as a regional or village corporation. If this
is being done routinely, does the DNR monitor all of these
transfers and the navigability determinations?"
Number 1644
MR. TILESTON said the BLM issues, as in the Gulkana decision, on
all transfers so that they are applying the current court standards
that have been used. To the extent that the DNR checks state
acreages, we own it regardless if it becomes a chargeability thing
which Joanne Grace was talking about earlier. It is an acreage
issue that we need to keep track on but it is not an ownership
question. As far as the Native corporations are concerned, there
is a route, but not a case-by-case check. We do a screening check,
but we do not go through each and every application and that is one
of the concerns that the Department of Fish and Game has raised.
Number 1728
REPRESENTATIVE PHILLIPS said if it came to your attention that
there was a problem, "What would be your next step?"
MR. TILESTON answered the first thing would be to look at the
records and see whether we have a conflict. Because of Native
conveyances to date, the Native corporations have received title to
approximately 30,000,000 acres. A large part of the conveyances
that are being made involve lands and water bodies for which
previous determinations have been made. He said the first thing
the department would do is to go back and see what the previous
federal decisions were in that area. If it was inconsistent, then
we would call our lawyer.
Number 1785
C0-CHAIRMAN GREEN noted the arrival of Representative Ramona
Barnes.
REPRESENTATIVE PHILLIPS addressed Mr. Botelho, "Commissioner
Shively testified at the Senate Finance Committee overview of the
DNR that the state need not worry about navigability and title
because there is no statute of limitations for the state filing its
claims. Is that true?"
Number 1825
MR. BOTELHO responded that the answer is yes, it is true.
REPRESENTATIVE PHILLIPS said, "As a result of the Ninth Circuit,
court of appeals decision in the Katie John case, federal agencies
could attempt to exert management authority over some navigable and
nonnavigable waters. How are the state's interests being protected
and is the Department of Law getting the technical support it needs
in this case?
MR. BOTELHO said the state had filed, as of January 6, 1996, a
petition (indisc) with the United States Supreme Court in the Katie
John case precisely because of concerns raised by the Speaker. "We
solicited support from all Western states to join as amicus support
of our petition. We have garnered the support of 11 states, and
several states joined because of the efforts of the Speaker's
Office in making contact with counterparts in those states. We
have also made efforts with the U. S. Department of Justice and the
Department of the Interior to try and get them to support our
petition for certiorari? The winning parties may not see a great
a deal of advantage in doing so but we have a directly conflicting
Supreme Court case on point. And sooner or later, we are going to
see a major conflict that is between state and federal officials
that are going to affect the citizens of the state in trying to
decide which law to follow. In that respect, it is in everyone's
interest to see the Supreme Court resolve the issue once and for
all."
Number 2092
CO-CHAIRMAN GREEN asked the status of the eleven states that had
joined with Alaska because of the issue.
MR. BOTELHO replied that none of them have language similar to
ANILCA, which is Alaska specific, but the underlying principles of
what constitutes public land is one of great concern to Western
states and the overall, overreaching, in our view, of the federal
government in this area. There is a very strong motivation on
their part to join in this effort. There are numerous parties
within the state and around the country who are aligning themselves
to oppose the petition in amicus, in opposition to the certiorari
being taken.
REPRESENTATIVE PHILLIPS added that her office requested support
from 14 Western states. Eleven states offered their support and
the other three were not opposed to it but could not afford to
enter into the legal battle at this point in time. After it gets
to the court, they will revisit it.
Number 2154
MR. BOTELHO said that the Department of Law retained Paul Anzini to
draft a brief for amicus support, but it was largely due to the
efforts of Ron Sommerville who enlisted individual states to sign
on. In addition Cheri Jacobus, formerly of the AG's office, now
with the Idaho Attorney General's office, drafted a separate amicus
brief which elicited support from half of the 11 states.
MR. BOTELHO assured Chairman Green that if the state of Alaska was
forced to pay all of the costs, it would be well worth it. Just
getting the psychological sign-on by the states, sends a powerful
message to the Department of the Interior and, hopefully, to the
court itself.
Number 2245
REPRESENTATIVE PHILLIPS addressed Commissioner Rue, "There has been
considerable confusion and concern over navigability determinations
on the Russian River on the Kenai Peninsula. Because of the
importance of this stream for public recreation, primarily fishing,
can you explain how the state is protecting the public interest
access interest to this river?"
COMMISSIONER RUE responded that the Department of Fish and Game has
worked closely with the DNR to assert our rights to navigability on
the Russian River.
MR. TILESTON assured the committee that the Russian River is in
public ownership.
Number 2365
REPRESENTATIVE PHILLIPS referred to Mr. Tileston's memorandum of
February 7, 1996 and stated that the DNR is asserting navigability
only on the lower Russian River.
MR. TILESTON explained that the lower Russian River was the only
section up for potential land transfer.
Number 2416
MR. TILESTON explained to Chairman Green that the Gulkana decision
established a limit of 1,000 pounds for a raft, essentially for
adults.....(change tape)
TAPE 96-20, SIDE A
Number 031
REPRESENTATIVE PHILLIPS addressed Marty Rutherford and Commissioner
Rue, "Would there ever be an occasion in a navigability debate
whereby the resource of the waterway, the habitat, and the
environmental resource of the waterway would hinder the
navigability assertion?" "If you determine that this river was
primarily going to be used for fishing, but not necessarily
navigable and we are asserting that the navigability status should
be transferred to the state, would we have a battle between the DNR
and the Department of Fish and Game to block the navigability
assertion?"
Number 108
COMMISSIONER RUE stated that the Department of Fish and Game
pressed the DNR hard to assert navigability because of the presence
of the resource, like fish, so that the people who have access to
it, can use it.
MARTY RUTHERFORD, Deputy Commissioner, Department of Natural
Resources, agreed with Commissioner Rue stating that the DNR's
experience has been that the ADF&G has encouraged the Department of
Natural Resources to assure that a river is navigable when there
was sport fishing opportunities. She said the DNR would continue
to look at the criteria for navigability of 1,000 pounds for a
raft.
Number 259
MR. BOTELHO explained that the big issue with Utah Lake, and the
reason that it is important is the question of withdrawals pre-
statehood, and whether or not that withdrawal took the waters
within that withdrawal outside of the Equal Footing Doctrine or the
Submerged Lands Act. The importance of the Utah Lake case was the
rejection of the federal government assumption that a simple
withdrawal, absent an explicit finding by Congress that the
withdrawal included the waters, and an explicit finding by Congress
of an attempt to defeat a future state's right to those waters.
The state would assume, at statehood, title to those submerged
lands. He stated that the Utah Lake case is the state of Alaska's
"ace" in the PLO 82 litigation and the 48,000,000 acres included in
that 1943 withdrawal.
MR. BOTELHO said that all the water bodies within that 48,000,000
acres that are navigable would become the state's.
Number 410
MR. BOTELHO answered Chairman Green's question saying that it is
the land underneath it that is really the issue. He referred to
"PLO 82" and said the 48,000,000 acres of land and waters and the
argument that the federal government has made that everything that
was in those outer boundaries is federal. We are taking the
position that the federal government is wrong. The navigable
waters in there belong to the state of Alaska, and the lands
underlying those waters title rests with the state of Alaska not
the federal government. That is the point that we expect to
prevail on.
Number 497
MR. TILESTON discussed with the committee instances of short
stretches of a river which are not navigable and discussion ensued
on natural physical conditions and the river being susceptible to
navigation and seasonal variations.
Number 718
REPRESENTATIVE DAVIES asked if there are situations other than
Interim Conveyances where the state statute of limitations is
running.
MS. GRACE responded that a conveyance to anyone other than a Native
corporation. She felt that the normal statute of limitations would
apply to other conveyances to private parties, but did not know of
any.
Number 799
REPRESENTATIVE DAVIES asked Mr. Tileston to research that issue for
the committee.
CO-CHAIRMAN GREEN said that prior Native allotments would only go
to the waters edge, they do not go to the mid-point of the stream.
MR. TILESTON replied that it would not include the stream if it is
navigable. He referred to the Third Judicial District Court Palmer
decision dealing with the Chickaloon River; it specifically dealt
with a Native allotment. In that case, the state court said it did
have jurisdiction; the public had the right on the Chickaloon River
because of the documented rafting that had been going. The BLM
made that determination in 1988, and the allotment went to court in
1990. The court said the public had the right to use the river
because of the state's ownership of the water itself, irrespective
of who owned the land, and the allotment did include the river
bottom when it was navigable.
Number 931
MR. CULBERTSON said there seems to be a lot of confusion about the
statute of limitations with third parties. He said he is not aware
of any state law that provides a statute of limitations for
navigability. There is an issue dealing with whether or not Native
allotments, in particular, which are federal trust lands and have
been conveyed to third parties, have a statute of limitations or
some other bar to recovering title. That may be where some of the
confusion is coming from because the case in Chickaloon did deal
with the Native allotment and basically what the court did was
skirted the issue of whether the state had title by falling back on
a state statute that that access was provided by the water column
itself regardless of the ownership of submerged lands.
Number 1007
MR. CULBERTSON responded to Chairman Green that because allotments
are in a special trust status there is a question about the 12 year
statute of limitations and how that would apply to them. It was
the federal 12 year statute of limitations that was revoked in 1983
when the survey rules were put into effect.
Number 1048
MR. BOTELHO said that given the obvious importance of the statute
of limitations and, the lack of clarity internally, he recommended
that the Resources Committee allow him the opportunity to prepare
a chart, that graphs out where the statute of limitations does and
does not apply, and highlight where there is ambiguity.
Number 1086
REPRESENTATIVE RAMONA BARNES asked if RS 2477 lands are access
corridors and said is there not a statute of limitation on that.
MR. BOTELHO replied that RS 2477 is an issue the Administration has
spent a great deal of time on. It is our view that we do not have
a statute running with the land changes reflected in ANILCA.
Number 1140
REPRESENTATIVE BARNES said her understanding was that there was a
specific period of time for the state to assert corridor claims on
RS 2477 lands. She asked what the Department of Law is doing on
that issue.
MR. BOTELHO said with regard to RS 2477, the state filed notice,
with the DNR taking the lead, and engaged in a major study of
various RS 2477 routes in the state. There were some 1900 hundred
potential routes identified. The list was narrowed to about 500,
to those where there was little ambiguity about the historical
basis, or not otherwise duplicated. He said the Department of Law
and the DNR identified routes that we gave notice on, as required
by federal law, to the federal government. This Administration,
like the Hickel Administration, filed its opposition to the
Department of the Interior's proposed role making that takes the
position that RS 2477 determinations are a federal law issue and
not a state law issue. He said the state is also working to try
and revitalize a process with Interior to try and resolve some of
these routes without having to resort to case-by-case litigation.
Number 1406
REPRESENTATIVE OGAN reported that during the interim, in a joint
House/Senate State Affairs meeting, Mr. Botelho stated that RS 2477
was not a priority because the department's priority was protecting
the children. "Now you are asserting that it is becoming more of
a priority, and you have identified 11 out of the 500, out of 1500
possibilities, that you are going to assert state's rights."
MR. BOTELHO responded that Representative Ogan was correct that he
had specifically identified that one of the areas the Department of
Law would be forced to cut was the staff position doing RS 2477
litigation.
MR. BOTELHO affirmed that there are 11 routes and the department is
reevaluating whether there are others. He said that it is important
that these are very fact specific and they are not any different,
in kind, than the issue of navigable waters where you have to
litigate on a fact specific basis, the historical use.
Number 1591
REPRESENTATIVE OGAN confronted Mr. Botelho saying, "Given your past
record with dropping lawsuits, with prejudice, which were done
forever, what assurances do we have that you will not do the same
on navigable waterways and RS 2477?"
MR. BOTELHO replied that his track record is not very long, people
point obviously to the Babbitt lawsuit. He said, "I serve the
Governor of the state. He is the elected chief executive, and to
the extent that policies and litigation are set by the Governor, in
terms of executing his views of what is in the state's interest,
that is what I will fall on. I think that you are giving an
indication here, and it has been consistent about what the state's
views are on RS 2477, they have not changed appreciably from
Administration to Administration on this issue nor have they on
navigable waters."
Number 1669
REPRESENTATIVE BARNES disputed Mr. Botelho's comment about the CEO
establishing policy. She said, "That is true, but you as the chief
law enforcement agent of the state of Alaska have an absolute
responsibility to the people of this state. If your only assertion
is to serve whomever happens to be the chief executive, I think we
should again visit the question of an elected Attorney General."
REPRESENTATIVE BARNES refuted Mr. Botelho's testimony about either
protecting the children or asserting states rights in RS 2477. She
reminded him that she had served on finance for many years and she
did not believe that was a choice the Attorney General had to make.
Number 1741
MR. BOTELHO said the choices are limited to very few sections that
are unrestricted general funds.
Number 1811
CO-CHAIRMAN GREEN addressed Commissioner Rue and asked if the
department exercised jurisdiction on anadromous streams.
COMMISSIONER RUE affirmed that was correct.
CO-CHAIRMAN GREEN expressed concern about agency budget reductions
and suggested that a re-prioritization may be necessary in some
departments where the legislature is forced to cut expenditures.
He said we want to know that we are not subject to any kind of
statute of limitations which would bar our right to exercise
jurisdiction ownership. He emphasized that the Department of Law
not allow that to slip through the cracks and suggested that this
become a high priority issue in the budget.
Number 1952
MR. BOTELHO said none would dispute the fact that we could use more
resources to do a job much more aggressively. The Administration
is very committed with competent individuals who are interested in
pursuing these matters.
REPRESENTATIVE OGAN asked if there is a time line on RS 2477. "Do
we have a deadline that if we do not file, we are done forever with
these assertions?"
MR. BOTELHO answered that it is the Administration's view that
there is not a statute of limitations running. There is an
argument that has not been asserted, but might be asserted, that we
are faced with some time line. Within the last several weeks, the
Department of Law communicated with the Department of the Interior
to find out if they might join in atolling agreements so that, if
there is any ambiguity, we have got it shut off. Interior inferred
that the Department of Justice will not authorize them to enter
into such an agreement, and that will play a role in our decision
on how we are going to move forward on this.
CO-CHAIRMAN GREEN thanked all participants for their attendance. He
announced that the House Resources Committee would meet in Kenai on
Friday, February 23, 1996.
ADJOURNMENT
There being no further business to come before the House Resources
Committee, Chairman Green adjourned the meeting at 10:17 a.m.
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