Legislature(1997 - 1998)

04/19/1997 01:45 PM House RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                HOUSE RESOURCES STANDING COMMITTEE                             
                          April 19, 1997                                       
                             1:45 p.m.                                         
                                                                               
                                                                               
 MEMBERS PRESENT                                                               
                                                                               
 Representative Bill Hudson, Co-Chairman                                       
 Representative Scott Ogan, Co-Chairman                                        
 Representative Beverly Masek, Vice Chair                                      
 Representative Ramona Barnes                                                  
 Representative Fred Dyson                                                     
 Representative Joe Green                                                      
 Representative Irene Nicholia                                                 
 Representative Reggie Joule                                                   
                                                                               
 MEMBERS ABSENT                                                                
                                                                               
 Representative William K. ("Bill") Williams                                   
                                                                               
 COMMITTEE CALENDAR                                                            
                                                                               
 CONFIRMATION HEARINGS:                                                        
                                                                               
 Alaska Commercial Fisheries Entry Commission                                  
                                                                               
      Marlene A. Johnson - Juneau                                              
      Bruce Twomley - Juneau                                                   
                                                                               
      - CONFIRMATIONS ADVANCED                                                 
                                                                               
 Board of Fisheries                                                            
                                                                               
      Larry J. Engel - Palmer                                                  
      Robert E. (Ed) Dersham - Anchor Point                                    
                                                                               
      - CONFIRMATIONS ADVANCED                                                 
                                                                               
 Alaska Oil and Gas Conservation Commission                                    
                                                                               
      Mary Coffey Marshburn - Homer                                            
                                                                               
      - CONFIRMATION ADVANCED                                                  
                                                                               
 WITNESS REGISTER                                                              
                                                                               
 MARLENE A. JOHNSON, Appointee                                                 
    to the Commercial Fisheries Entry Commission                               
 9505 Antler Way                                                               
 Juneau, Alaska  99801                                                         
 Telephone:  (907) 789-4833                                                    
 POSITION STATEMENT:  Testified as appointee to the CFEC.                      
                                                                               
 JERRY McCUNE, President                                                       
 United Fishermen of Alaska                                                    
 211 Fourth Street, Suite 112                                                  
 Telephone:  (907) 586-2820                                                    
 POSITION STATEMENT:  Testified in support of Marlene Johnson and              
                      Bruce Twomley as appointees to the CFEC.                 
                                                                               
 BRUCE TWOMLEY, Appointee                                                      
    to the Commercial Fisheries Entry Commission                               
 P.O. Box 020972                                                               
 Juneau, Alaska  99802-0972                                                    
 Telephone:  (907) 789-6160 (wk); 586-3251 (hm)                                
 POSITION STATEMENT:  Testified as appointee to the CFEC.                      
                                                                               
 LARRY ENGEL, Appointee                                                        
    to the Board of Fisheries                                                  
 P.O. Box 197                                                                  
 Palmer, Alaska  99645                                                         
 Telephone:  (907) 745-4132                                                    
 POSITION STATEMENT:  Testified as appointee to the Board of                   
                      Fisheries.                                               
                                                                               
 MARY COFFEY MARSHBURN, Appointee                                              
    to the Alaska Oil and Gas Conservation Commission                          
 P.O. Box 277                                                                  
 Homer, Alaska  99603                                                          
 Telephone:  (907) 235-7978                                                    
 POSITION STATEMENT:  Testified as appointee to the AOGCC.                     
                                                                               
 ACTION NARRATIVE                                                              
                                                                               
 TAPE 97-46, SIDE A                                                            
 Number 0001                                                                   
                                                                               
 CO-CHAIRMAN BILL HUDSON called the House Resources Standing                   
 Committee meeting to order at 1:45 p.m.  Members present at the               
 call to order were Representatives Hudson, Ogan, Masek, Barnes,               
 Dyson and Nicholia.  Representatives Joule and Green arrived at               
 1:46 p.m. and 1:47 p.m., respectively.                                        
                                                                               
 CONFIRMATION HEARINGS                                                         
                                                                               
 CO-CHAIRMAN HUDSON announced the committee would consider two                 
 nominees for the Board of Fisheries, two for the Alaska Commercial            
 Fisheries Entry Commission, and one for the Alaska Oil and Gas                
 Conservation Commission.  They would not vote for the nominees but            
 would pass them out of committee for full consideration of the                
 House and Senate.  (Resumes were provided for all appointees.)                
                                                                               
                                                                               
 Alaska Commercial Fisheries Entry Commission                                  
                                                                               
 Number 0205                                                                   
                                                                               
 MARLENE A. JOHNSON, Appointee to the Alaska Commercial Fisheries              
 Entry Commission (CFEC), came forward to testify, saying she knew             
 most of the members there.  She told members she'd been interested            
 in fisheries all of her life.  A lifelong Alaskan from Southeast              
 Alaska, she'd served in several capacities and in several areas in            
 the fishing industry, including being the chairperson of a                    
 processor, serving with fishermen, working with individual                    
 fisheries for years, and being a license vendor.  Because she has             
 lived in a fishing village, fishing has been very much a part of              
 her life.  She has also served on the School of Fisheries and Ocean           
 Sciences advisory board since it was formed, which she believes has           
 been eight years, and she will serve another two years.  Ms.                  
 Johnson expressed interest in "conservation of our resource" and in           
 ensuring that the fisheries are economic for fishermen.                       
                                                                               
 Number 0343                                                                   
                                                                               
 CO-CHAIRMAN SCOTT OGAN asked how many collective years of                     
 experience they would have on the commission, assuming that Ms.               
 Johnson was confirmed.                                                        
                                                                               
 MS. JOHNSON described herself as the "new kid on the block."  She             
 said Commissioner Twomley, the chairman, has served since 1982, and           
 Commissioner Anderson has served four years.  Members have 16 or 17           
 years' combined experience, with most of it contributed by Mr.                
 Twomley.                                                                      
                                                                               
 Number 0417                                                                   
                                                                               
 CO-CHAIRMAN OGAN asked Ms. Johnson to provide her background of               
 past commercial fishing experience and to explain why she is                  
 qualified for this job.                                                       
                                                                               
 MS. JOHNSON indicated she'd worked for what is now "Columbia Wards            
 Fisheries," and she also mentioned Coastal Glacier Seafoods and               
 Excursion Inlet Packing Company.  She'd done accounting and                   
 commercial settlements for crab fishermen, halibut fishermen and              
 salmon fishermen, for example, which was her experience in the                
 early days.  Her brothers and sisters were commercial fishermen               
 most of their lives; however, they've either died or retired.                 
                                                                               
 MS. JOHNSON advised members that she was then on the Sealaska                 
 Corporation board, and she was its chairperson for a number of                
 years.  She stated, "We acquired Ocean Beauty Seafoods, which was             
 a conglomerate and had a number of - 18 - companies underneath it.            
 I was the chairman of the board of Ocean Beauty Seafoods, also, and           
 served on the executive committee.  So I've worked in that                    
 capacity, in the processing."                                                 
                                                                               
 Number 0528                                                                   
                                                                               
 CO-CHAIRMAN OGAN said there are inherent conflicts coming up with             
 the takeover of fisheries management by the federal government, as            
 well as possible conflicts relating to sovereignty issues, for                
 example.  He believes these possibly threaten the existence of                
 commercial fishing, and they undermine the value of permits.  He              
 noted that Ms. Johnson had been a board member of the Alaska                  
 Federation of Natives (AFN).                                                  
                                                                               
 MS. JOHNSON indicated she'd not only been a board member of the AFN           
 but had helped to form it.  She mentioned the Tlingit and Haida               
 Central Council, Executive Committee, as well.                                
                                                                               
 Number 0592                                                                   
                                                                               
 CO-CHAIRMAN OGAN asked whether Ms. Johnson has any conflicts with             
 past associations and the possible threat to commercial fisheries.            
                                                                               
 MS. JOHNSON replied, "No. ... I don't see any conflict whatsoever.            
 I think the state needs to manage the fisheries.  I think, if                 
 possible, the state should contract with the federal government for           
 whatever they have in managing the fisheries.  And I feel very                
 strongly about that. ... My being a member of the Native community            
 does not affect that at all.  I don't think in the long run that,             
 at least in my area, ... that my corporation would support that at            
 all."                                                                         
                                                                               
 CO-CHAIRMAN OGAN asked whether she'd taken an oath to do that.                
                                                                               
 MS. JOHNSON said yes.                                                         
                                                                               
 CO-CHAIRMAN OGAN asked whether she'd defend the constitution as               
 written.                                                                      
                                                                               
 MS. JOHNSON replied, "Absolutely, absolutely.  I have no problem              
 with that."                                                                   
                                                                               
 Number 0656                                                                   
                                                                               
 CO-CHAIRMAN HUDSON offered his opinion that Ms. Johnson has the               
 ability to "professionally administer between really varying,                 
 different opinions, particularly on the board of directors of the             
 various Native associations."  He said over the years he has                  
 observed this, and he believes Ms. Johnson has always been a                  
 professional.                                                                 
                                                                               
 Number 0687                                                                   
                                                                               
 REPRESENTATIVE REGGIE JOULE said he is glad to see Ms. Johnson                
 going into something like this.  He indicated his belief that Ms.             
 Johnson fully recognizes the commitment of time and energy                    
 required.  He said to Ms. Johnson, "And on the other boards and               
 commissions that I've sat with you on, in addition to being busy              
 doing other things, you've always managed to be a leader in                   
 everything ... that you've done."  He said he expects that probably           
 will continue.                                                                
                                                                               
 REPRESENTATIVE JOULE stated, "I guess I am a little concerned about           
 the questions around Alaska Natives that are going to be serving on           
 our boards and commissions and whether or not the conflict with               
 regards to Indian country -- because I think that question can be             
 asked to any resident of the state, both sides of the aisle."  He             
 said he understands the concern, and maybe it has to be stated for            
 the record.  However, if that is the case, then maybe they should             
 ask that question of people who may be representing the Alaska                
 Outdoor Council or commercial fisheries, or ask it of whoever else            
 has a stake in the outcome of the decision of the Venetie case,               
 rather than specifically asking Alaska Natives just because it is             
 called "Indian country."                                                      
                                                                               
 Number 0804                                                                   
                                                                               
 REPRESENTATIVE FRED DYSON responded that he appreciates                       
 Representative Joule's concern, but his own sense is that there is            
 nothing racist about the question.                                            
                                                                               
 REPRESENTATIVE JOULE said he understands that.                                
                                                                               
 REPRESENTATIVE DYSON said if the co-chair hadn't asked the                    
 question, he himself would have; his perception at this time is               
 that the AFN has an official position that the state constitution             
 must be modified.  He said, "And I think it was a legitimate                  
 question to ask this apparently very qualified nominee, if there is           
 a conflict between that organization that you're not only a part of           
 but are a founder of and their position and the oath of office                
 you've taken.  And I think you satisfied that question very well.             
 And it is a tough question to ask, and a delicate one; I appreciate           
 it coming up."                                                                
                                                                               
 REPRESENTATIVE DYSON commented that he would do the same thing with           
 any nominee who was part of an organization.  He mentioned                    
 consumptive use; he recalled that this committee got into that when           
 a person who'd been part of an organization took exception to what            
 the constitution says.  Representative Dyson concluded by saying,             
 "I think the question is legitimate.  I will share your objection             
 and jump up and holler if I sense that any of the questions here              
 are unfair, ... based on race.  And I appreciate your sensitivity."           
                                                                               
 Number 0906                                                                   
                                                                               
 REPRESENTATIVE RAMONA BARNES requested clarification on Ms.                   
 Johnson's comment about the "state contracting with the federal               
 government to manage."                                                        
                                                                               
 Number 0926                                                                   
                                                                               
 MS. JOHNSON replied, "Those fisheries in the federal waters.  I'm             
 talking about the halibut and ... the IFQ [Individual Fishery                 
 Quota] programs and those that ... are landed in our state and not            
 taken to Canada, that we need to have a way to enforce our laws               
 with the federal government.  And I think we need to find a way to            
 do that."                                                                     
                                                                               
 Number 0948                                                                   
                                                                               
 CO-CHAIRMAN HUDSON asked whether Ms. Johnson was speaking about the           
 halibut subsistence fisheries.                                                
                                                                               
 MS. JOHNSON replied, "No, Mr. Chairman.  I'm not speaking about               
 subsistence in any way.  And I want that very clear."  She said the           
 AFN's position is on subsistence; they don't have a position on               
 commercial fisheries.  Ms. Johnson stated, "I feel my role is                 
 dealing with commercial fisheries, not with the subsistence                   
 fishery."                                                                     
                                                                               
 Number 0998                                                                   
                                                                               
 JERRY McCUNE, President, United Fishermen of Alaska (UFA), came               
 forward to testify, specifying that the UFA's position is to                  
 support both nominees for the CFEC.  He said they'd been quite                
 comfortable with Bruce Twomley's position on protecting the state's           
 rights on all the issues, including the James (ph) case and limited           
 entry.  He stated, "So I think Bruce has done a tremendous job."              
                                                                               
 MR. McCUNE said that after talking to Marlene Johnson and talking             
 to 21 different groups around the state, they're all comfortable              
 that she'll do a good job on the commission, if confirmed.  He                
 noted that most members are direct stakeholders; they have permits            
 or are directly tied to commercial fishing.                                   
                                                                               
 Number 1068                                                                   
                                                                               
 BRUCE TWOMLEY, Appointee to the Commercial Fisheries Entry                    
 Commission (CFEC), came forward to testify.  Originally appointed             
 to the CFEC by then-Governor Hammond in late 1982, he subsequently            
 was appointed chair by then-Governor Sheffield and had been                   
 reappointed since that time.  He stated, "I've been very happy to             
 serve on the commission.  Prior to serving on the commission, I               
 used to sue state and federal governments for a living and also               
 represented individual fishermen before the commission.  And so I             
 have some sense about how agencies affect real people, and I have             
 a sense of how to avoid mistakes that I've seen other agencies                
 make.  And I think the area where I can make the primary                      
 contribution is in doing adjudications.  We are primarily                     
 administrative law judges."                                                   
                                                                               
 MR. TWOMLEY spoke on behalf of Marlene Johnson, saying "she brings            
 a special background to our jobs as administrative law judges                 
 because she has been one, on a number of occasions in the past, and           
 she served on the Labor Relations Board, for example."                        
                                                                               
 MR. TWOMLEY stated, "And so, primarily, what we have to do is apply           
 the law as you have written it.  And the job ... is a fairly                  
 confining job in that respect, although what isn't confined is the            
 amount of work. ... There is a lot of it, and it's a job that I               
 have found very rewarding, and I certainly appreciate ... your                
 attention to this matter."                                                    
                                                                               
 Number 1170                                                                   
                                                                               
 REPRESENTATIVE DYSON stated for the record that he is holds a                 
 limited entry permit.  He commented, "And I don't believe I have a            
 conflict of interest in voting on this, although with your long               
 length of service, my fair treatment before the board might ... be            
 taken to predispose me in your favor.  But I don't think that I do            
 have a conflict, but I'll bow to the rule of the chair."                      
                                                                               
 Number 1198                                                                   
                                                                               
 CO-CHAIRMAN HUDSON observed that over the years, Bruce Twomley has            
 been a powerful advocate for the fishermen and fisherwomen of this            
 state, on whose behalf he has taken on the Internal Revenue                   
 Service, for example.  He expressed appreciation for that.                    
                                                                               
 CO-CHAIRMAN HUDSON advised members that there was no one else to              
 testify on these two candidates.  He requested that all members               
 provide their signatures on the appropriate documents.                        
                                                                               
 Board of Fisheries                                                            
                                                                               
 Number 1231                                                                   
                                                                               
 CO-CHAIRMAN HUDSON announced the committee would next consider the            
 two appointees to the Board of Fisheries.  Although Larry Engel was           
 on teleconference, Ed Dersham was unavailable for the                         
 teleconference that day.                                                      
                                                                               
 Number 1254                                                                   
                                                                               
 LARRY ENGEL, Appointee to the Board of Fisheries, testified via               
 teleconference from Palmer.  Born and raised in a rural setting               
 near Seattle, Washington, he was involved in his family's                     
 commercial fishing activity in the San Juan Islands as a teenager.            
 He came to Alaska in 1958 with the U.S. Navy and was stationed in             
 Kodiak.  He has lived in Alaska ever since, with the exception of             
 time spent in Washington state to further his education.                      
                                                                               
 MR. ENGEL began working with the Department of Fish and Game in               
 1960; he worked there every year until 1992, more than 30 years.              
 Shortly after retirement, he worked as a fishery advisor for the              
 Matanuska-Susitna Borough, through a professional services                    
 agreement.  In February 1994, he was appointed to the Board of                
 Fisheries by then-Governor Hickel.  He'd served a three-year term             
 and is now being considered for a second term.                                
                                                                               
 MR. ENGEL said he believes he has the credentials, the desire, the            
 abilities, and the skills to perform the difficult task asked of a            
 Board of Fisheries member, and he is willing to do it.  He stated,            
 "The resource has been very kind to me.  As I've indicated, more              
 than 30-some years I've been involved in fisheries; I've been able            
 to support my family, raised two fine young sons to ... young                 
 adulthood.  And now I have the time to give back to that resource,            
 in a voluntary capacity, some of which it's given to me."                     
 Number 1356                                                                   
                                                                               
 REPRESENTATIVE JOE GREEN informed members that feedback he'd                  
 received has been very complimentary, indicating there is fairness,           
 objectivity, and preparation, and indicating Mr. Engel has been an            
 outstanding board member in his first three years.                            
                                                                               
 Number 1385                                                                   
                                                                               
 CO-CHAIRMAN HUDSON asked whether anyone else had questions.  He               
 said his own observation over the years has been a testament to Mr.           
 Engel's fairness.  He acknowledged that it is an extremely                    
 difficult job to do, as evidenced by conflicts between commercial             
 fishing and subsistence or sport fishing, for example.  He said he            
 has always felt strongly that professionalism within the CFEC needs           
 to be maintained.  He said they have an "awesome job" of trying to            
 allocate on a fair-minded basis.  He thanked Mr. Engel.                       
                                                                               
 CO-CHAIRMAN HUDSON again noted that Robert E. (Ed) Dersham from               
 Anchor Point wasn't available on line that day.  (Committee packets           
 contained a resume, a press release from the Governor's office, and           
 an endorsement from the Alaska Outdoor Council; the latter two                
 documents refer to other appointees as well.)  Co-Chair Hudson                
 advised members that the Speaker of the House has spoken quite                
 highly of Mr. Dersham.                                                        
                                                                               
 Number 1462                                                                   
                                                                               
 CO-CHAIRMAN OGAN recalled that they'd heard from Mr. Dersham in the           
 House Special Committee on Fisheries.  He confirmed that Speaker              
 Gail Phillips had spoken highly of him; she'd indicated Mr. Dersham           
 always had a level head when things got "hot" on contentious                  
 issues, he was statesmanlike, and he could negotiate tough                    
 decisions.                                                                    
                                                                               
 CO-CHAIRMAN HUDSON indicated that portion of the hearing was                  
 concluded.                                                                    
                                                                               
 Alaska Oil and Gas Conservation Commission                                    
                                                                               
 Number 1497                                                                   
                                                                               
 CO-CHAIRMAN HUDSON announced the final item of business was                   
 consideration of the confirmation of Mary Coffey Marshburn to the             
 public seat on the Alaska Oil and Gas Conservation Commission.                
                                                                               
 Number 1530                                                                   
                                                                               
 MARY COFFEY MARSHBURN, Appointee to the Alaska Oil and Gas                    
 Conservation Commission (AOGCC), came forward to testify.  She                
 explained that the AOGCC's role is, for the benefit of Alaska's               
 people, to ensure efficient depletion of the state's hydrocarbon              
 resources.  They do so by preventing waste, both on the surface and           
 below ground, and by maximizing ultimate recovery of the resource             
 and protecting the opportunities of other owners to produce.  They            
 do this through a variety of methods, including permitting systems,           
 reservoir surveillance, joint plans of development and field                  
 inspections.  These help ensure good design of wells and control in           
 production.                                                                   
                                                                               
 MS. MARSHBURN stated her belief that a commissioner's role benefits           
 from a broad perspective.  On the three-member commission, with a             
 geologist, an engineer and a public member, the positions                     
 complement each other.  She referred to her 12 years as a municipal           
 clerk and said that position is part of the legislative branch of             
 government, serving as a focal point for representation of the                
 public interest and dealing with the Administration on a daily                
 basis.                                                                        
                                                                               
 MS. MARSHBURN explained, "During those 12 years, I developed the              
 ability to deal with all of the segments that I just described, to            
 communicate effectively.  I learned that there's obviously more               
 than one view to an issue, more than one solution.  I was                     
 responsible for developing the community councils program, the                
 ombudsman program, the computerized voting program that you have              
 today.  So I'm familiar with program development and also                     
 intimately, from those years, aware of protecting public interest."           
                                                                               
 Number 1629                                                                   
                                                                               
 MS. MARSHBURN continued, "The last two years have been spent with             
 the Oil and Gas Policy Council, taking them from the administrative           
 order through the completion of their work, and that was basically            
 a review of all of the state's petroleum policies. ... It was a               
 two-year effort and included examining the fiscal system, all of              
 the resources, the leasing policy, the regulatory environment,                
 North Slope gas commercialization and a number of other issues.  It           
 culminated in the writing of two reports, and I think that all                
 members of the legislature got copies of those reports."                      
                                                                               
 MS. MARSHBURN said she brings this knowledge of the broader policy            
 areas to the AOGCC.  She believes members must have integrity, a              
 judicious temperament and the ability to listen to and examine all            
 sides.  She believes her background as a municipal clerk and with             
 the policy council brings the needed abilities to the commission.             
                                                                               
 MS. MARSHBURN stated, "I'm obviously not a geologist.  I'm not an             
 engineer.  I don't have the technical background.  My background is           
 business administration.  I do have the ability, at least                     
 conceptually, to understand technical relationships.  And probably            
 equally important, I'm not afraid to ask questions for explanation            
 by people who do have the background; that I do."                             
                                                                               
 Number 1733                                                                   
                                                                               
 REPRESENTATIVE BARNES asked what Ms. Marshburn's personal position            
 was on Lease Sale 85.                                                         
                                                                               
 MS. MARSHBURN asked whether that was on the lower peninsula.                  
                                                                               
 REPRESENTATIVE BARNES said yes.                                               
                                                                               
 MS. MARSHBURN replied, "The AOGCC is not involved in leasing.  I am           
 a resident of Homer.  My position was that the lease sale should              
 have gone forward."                                                           
                                                                               
 Number 1749                                                                   
                                                                               
 REPRESENTATIVE BARNES asked whether there were two, 85 and 85A.               
                                                                               
 MS. MARSHBURN said she believed 85 was the federal lease sale and             
 85A was on the southern peninsula.  "I'm not sure which number is             
 which," she added.                                                            
                                                                               
 MS. MARSHBURN said she had attempted to individually meet as many             
 House Resource Committee and Senate Resource Committee members as             
 possible because she is new to the process.  In the course of that,           
 three concerns were brought forward.  She explained, "I was asked             
 by one legislator if I had been given a particular direction, a               
 particular agenda, when I was asked to accept the appointment.  And           
 the answer is no, I wasn't.  No one ever asked me or told me that             
 there was a particular path they wanted me to pursue.  If that had            
 been the case, I wouldn't be here."                                           
                                                                               
 MS. MARSHBURN continued, "The second thing that raised concern was            
 [by] Representative Hodgins, because he is from the peninsula, and            
 one other legislator whose name I can't recall, was I think what              
 Representative Barnes is talking about, which is the fact that I am           
 from Homer.  There is a segment of that population which believes             
 that the oil and gas industry cannot develop responsibly and should           
 not develop.  And I was asked my opinion on that, or my feelings.             
 And I have seen responsible development.  I know that they can.  I            
 think mistakes are far too costly for any industry, and not just in           
 terms of dollars."                                                            
                                                                               
 MS. MARSHBURN continued, "And the third concern that has been                 
 brought up was brought up by Representative Green and by Senator              
 Leman, both of whom are engineers, and that's the vacancy in the              
 engineer's position on the commission.  Chairman Johnston and I               
 will both be glad when that position is filled.  There is plenty of           
 work to go around for everyone.  I think that all boards, all                 
 commissions, including the legislature, function better with their            
 full complement."                                                             
                                                                               
 Number 1840                                                                   
                                                                               
 REPRESENTATIVE BARNES asked Ms. Marshburn to answer her question              
 regarding her personal position on Lease Sales 85 and 85A.                    
                                                                               
 MS. MARSHBURN said she thought she had.  She stated, "My position             
 is that the lease sale should have gone forward."                             
                                                                               
 REPRESENTATIVE BARNES said, "Both."                                           
                                                                               
 MS. MARSHBURN stated, "I am not as familiar with the federal lease            
 sale.  I can speak only to the one that was a state lease sale on             
 the lower peninsula."                                                         
                                                                               
 Number 1861                                                                   
                                                                               
 REPRESENTATIVE GREEN asked how Ms. Marshburn learned about the                
 position.                                                                     
                                                                               
 MS. MARSHBURN replied, "The Governor asked me if I would consider             
 appointment to the commission."                                               
                                                                               
 REPRESENTATIVE GREEN stated his understanding that she had worked             
 with the current Governor when he was mayor of Anchorage and also             
 had worked on his campaign.                                                   
                                                                               
 MS. MARSHBURN responded, "No, sir, that's not 100 percent correct.            
 I was the borough clerk in Anchorage the first time the Governor              
 ran for public office.  I believe it was the first time; it was               
 when he ran for the assembly.  I did not work with him when he was            
 mayor. ... My family moved to Homer in the late '70s, and I was               
 living in Homer during his term of office as mayor.  Yes, I did               
 work on his campaign."                                                        
                                                                               
 Number 1894                                                                   
                                                                               
 REPRESENTATIVE GREEN asked, "If you are apparently pretty well-               
 known with the Governor, do you feel there's any possible conflict            
 of trying to remain independent, as you would have to as a member             
 of this commission, from the Governor?"                                       
                                                                               
 MS. MARSHBURN said no.  She said she had received no direction, nor           
 was there discussion of what she is to do, other than doing the               
 best job she can.  "No, I don't have a problem with independence,"            
 she added.                                                                    
                                                                               
 Number 1922                                                                   
                                                                               
 CO-CHAIRMAN HUDSON asked about the membership and relationship of             
 the position she was being nominated to fill.                                 
                                                                               
 REPRESENTATIVE GREEN reported that in 1978, the concept changed               
 from being a division within the Department of Natural Resources              
 (DNR) to becoming an independent, quasi-judicial commission, with             
 the new name, "Alaska Oil and Gas Conservation Commission."  He               
 stated, "And with that, they established a triad similar to the               
 Texas Railroad Commission.  There would be one who was an expert in           
 surface and subsurface engineering; one who would be a specialist             
 in geological considerations; and the third need be neither, and              
 would be ... kind of a public member.  And the concept, I think,              
 was that you'd have two `technocrats' and one who was kind of                 
 looking at the rest of the spectrum."                                         
                                                                               
 REPRESENTATIVE GREEN noted that they have staff as well.  They are            
 charged with conservation of waste, which is producing a reservoir            
 in the most efficient manner so the least amount of hydrocarbons              
 remain, and protecting correlative rights between lease A and lease           
 B, for example.                                                               
                                                                               
 Number 1996                                                                   
                                                                               
 CO-CHAIRMAN HUDSON asked whether this small commission advocates or           
 looks after the interests of the state as well, as far as                     
 conservation is concerned.                                                    
                                                                               
 REPRESENTATIVE GREEN replied, "They shouldn't look after our                  
 interests any different than any other land owner."  He said by               
 their charge, they would have to look at what is good for all land            
 owners as far as reservoir management and, for example, to prevent            
 problems between leaseholders.  "And that is why there is a                   
 setback," he said.  "There is a requirement that the bottom hole              
 wells be set back 500 feet from the property to prevent correlative           
 rights interference.  But we, in their eyes, should be no different           
 than any other land owner -- or actually not land owner, because so           
 few of our subsurface rights go with the surface rights, but as any           
 other leaseholder."                                                           
                                                                               
 Number 2041                                                                   
                                                                               
 CO-CHAIRMAN OGAN stated, "You're quoted in the Alaska Journal of              
 Commerce saying that you want to work with the Department of                  
 Natural Resources to see how you can cooperate, work together more.           
 How do you describe the responsibilities of the commission towards            
 the Department of Natural Resources?"                                         
                                                                               
 MS. MARSHBURN replied, "The statutes indicate the Department of               
 Natural Resources is given no status above any other, as                      
 Representative Green has described.  We have a - I'd like to think            
 - a complementary relationship with the Department of Natural                 
 Resources.  I know there has been considerable discussion about the           
 relationship in the short time I've been with the commission.  I              
 have no true personal experience with that.  I know that the                  
 commission in the past has been affiliated with Natural Resources,            
 with Commerce and now with the Department of Administration.  I               
 think that there is a need to maintain, obviously, the independence           
 of the commission.  Any appearance of impropriety on the part of              
 industry needs to be avoided.  And so I think that the relationship           
 with the Department of Natural Resources, there's a need to be very           
 sensitive to that.  Right now, we share data with them.  There is             
 communication back and forth on a staff level.  To my knowledge, we           
 have a good working relationship with them."                                  
                                                                               
 Number 2103                                                                   
                                                                               
 CO-CHAIRMAN OGAN asked, "Is that relationship any different than              
 any relationship with ARCO, BP, Exxon or any other oil or gas                 
 operators in Alaska?"                                                         
                                                                               
 MS. MARSHBURN responded, "The AOGCC has a good relationship with              
 industry.  One of the things that I have done in the short time               
 I've been with the commission is to spend time with industry, with            
 Revenue, with Resources, and ask about (indisc.--coughing), its               
 necessity, its responsiveness, the product that it delivers, those            
 kinds of things.  And industry feels that the AOGCC is necessary,             
 and they are impressed with the way in which it does its business.            
 It takes roughly, I think, five days from application to approval             
 for a permit to drill.  It's a very responsive agency, and it has             
 a good relationship with industry."                                           
                                                                               
 Number 2137                                                                   
                                                                               
 CO-CHAIRMAN OGAN said he was wondering whether the relationship               
 with the Department of Natural Resources is different from the                
 relation with BP, Exxon or any other producer.                                
                                                                               
 MS. MARSHBURN replied, "No, not according to statute.  They are to            
 be treated equally."                                                          
                                                                               
 Number 2156                                                                   
                                                                               
 CO-CHAIRMAN OGAN asked how long the vacancy on the AOGCC has                  
 existed.                                                                      
                                                                               
 MS. MARSHBURN said she could not say for sure, although it was                
 probably about nine months.                                                   
                                                                               
 CO-CHAIRMAN OGAN noted that the vacant position requires a                    
 professional engineer, including education and background, but that           
 her position does not.                                                        
                                                                               
 MS. MARSHBURN concurred.                                                      
                                                                               
 CO-CHAIRMAN OGAN asked whether Ms. Marshburn has experience with              
 petroleum engineering or geology.                                             
                                                                               
 MS. MARSHBURN said the extent of it is that she took geology                  
 courses in college.                                                           
                                                                               
 Number 2196                                                                   
                                                                               
 CO-CHAIRMAN OGAN stated, "You know, we're very concerned here about           
 that vacant position and the fact that it hasn't been appointed.              
 Have you had any conversations with the Administration about                  
 filling that appointment?"                                                    
                                                                               
 MS. MARSHBURN replied, "I have telephoned; both Chairman Johnston             
 and I have talked to the Governor's boards and commissions office,            
 which is the office that takes care of those sorts of things.  They           
 have assured us that they are working on candidates for the                   
 position, that this is not something which has been dropped by the            
 wayside.  Beyond that -- that's the extent of my information."                
                                                                               
 Number 2218                                                                   
                                                                               
 CO-CHAIRMAN OGAN stated his belief that it has been dropped by the            
 wayside.  He expressed concern about not having the well-rounded              
 commission called for in statute.  He asked whether Ms. Marshburn             
 had an opinion on why no appointment had been made.                           
                                                                               
 MS. MARSHBURN said she honestly did not, nor did she believe it was           
 her place to ask details of the Administration about it.  She                 
 restated that both she and the chairman will be glad when the                 
 position is filled.  "All bodies operate better when you've got               
 everybody on board," she said.  "We have very good staff engineers,           
 as Representative Green may remember, but obviously the third                 
 position is of value."                                                        
                                                                               
 Number 2280                                                                   
                                                                               
 CO-CHAIRMAN OGAN asked Ms. Marshburn to explain the difference in             
 degree between her work as a special assistant to the commissioner            
 of the Department of Commerce and Economic Development and this               
 quasi-judicial position.                                                      
                                                                               
 MS. MARSHBURN clarified, "I was not a special assistant to the                
 commissioner of Commerce, though I did assist him in some of those            
 things.  My job specifically was the project coordinator for the              
 Oil and Gas Policy Council.  This position is a position wherein              
 judgment is exercised.  There are specific statutes that govern the           
 parameters of this position and of what this board must do.  It               
 needs to interpret those statutes and those regulations.  That                
 position did not.  That position was a position of facilitation of            
 research, of writing."                                                        
                                                                               
 Number 2316                                                                   
                                                                               
 CO-CHAIRMAN OGAN referred to a letter dated March 13, 1997, to Dan            
 Donkle.  He asked whether it is unusual for a quasi-judicial                  
 officer to sign a document on behalf of another commissioner.                 
                                                                               
 MS. MARSHBURN asked for clarification.                                        
                                                                               
 CO-CHAIRMAN OGAN stated, "Well, the letter is signed by you for               
 David Johnston, and signed by you as a commissioner."                         
                                                                               
 MS. MARSHBURN replied that Mr. Johnston was out of the office at              
 the time.  As he agreed with the letter, she signed it for him.               
                                                                               
 CO-CHAIRMAN OGAN asked whether Mr. Johnston had reviewed the letter           
 or given her permission to sign.                                              
                                                                               
 MS. MARSHBURN replied, "I would have to say no, not specifically.             
 My understanding, as I recall, he agreed with that course of                  
 action; we had discussed that course of action and that letter.               
 The letter was drafted at his request and as a result of our                  
 discussion.  That is the only letter that I've signed for him."               
                                                                               
 Number 2369                                                                   
                                                                               
 REPRESENTATIVE GREEN referred to Ms. Marshburn's comments that she            
 and Mr. Johnston would be glad when the third seat is filled.  He             
 asked whether she believes it would be improper, as a close friend            
 of the Governor's since she had worked on his campaign, to express            
 that open desire to the Governor for a more concentrated effort.              
 He stated, "I think there has been correspondence with the Governor           
 that there are qualified engineers that could be appointed and are            
 willing to serve."                                                            
                                                                               
 MS. MARSHBURN replied, "The last time I talked to the Governor was            
 in December of last year.  I haven't seen him since.  I have                  
 expressed the desire to the boards and commissions office that we             
 will be glad when that position is filled.  I would be happy to               
 tell the Governor that, `Yes, we will be happy when the position is           
 filled.'"                                                                     
                                                                               
 Number 2414                                                                   
                                                                               
 REPRESENTATIVE GREEN questioned the time lag and suggested it might           
 be good to become proactive as a member of the commission to fill             
 that other seat through a discussion with the Governor.  He asked             
 whether Ms. Marshburn believes that would be appropriate.                     
                                                                               
 MS. MARSHBURN said yes.                                                       
                                                                               
 REPRESENTATIVE GREEN asked whether that meant she would do so.                
                                                                               
 MS. MARSHBURN said yes.                                                       
                                                                               
 Number 2448                                                                   
                                                                               
 REPRESENTATIVE GREEN referred to a "decision regarding                        
 jurisdiction, and this is a fairly lengthy hearing that was held              
 between the Department of Natural Resources and the Conservation              
 Commission."  He asked whether Ms. Marshburn was familiar with that           
 document.                                                                     
                                                                               
 MS. MARSHBURN replied, "Only superficially, Mr. Chairman.  It is on           
 my desk to read, but no, I have not read that yet."                           
                                                                               
 REPRESENTATIVE GREEN said, "One of the orders in there - it was               
 actually a finding, number 174, which reads in part, and if I can             
 quote:  `The DNR argues that voluntary unitization -- unitized                
 state leases are solely within the purview of DNR and that the                
 commission has extremely limited or even nonexistent jurisdiction             
 to address issues ...."  [Cut off mid-speech by tape change]                  
                                                                               
 TAPE 97-46, SIDE B                                                            
 Number 0006                                                                   
                                                                               
 MS. MARSHBURN stated, "Prefacing my answer with the fact that I               
 have not read the document, I'm not familiar with it and I have a             
 limited amount of time on the commission, the statutes have said              
 that we are to be concerned with waste.  So at first glance, I                
 would think that waste would be a consideration within the Prudhoe            
 Bay Unit, would be a consideration of the commission."                        
                                                                               
 REPRESENTATIVE GREEN said, "I certainly subscribe to that, too,               
 because they are different and yet the commissioner has actually              
 indicated that in the Prudhoe Bay Unit, the conservation commission           
 has perhaps no jurisdiction, certainly limited jurisdiction, on               
 matters of conservation within the unit.  So do I hear you saying             
 that you would take issue with that and argue against that?"                  
                                                                               
 REPRESENTATIVE GREEN acknowledged that Ms. Marshburn hadn't read              
 the document, and he pointed out that that was a quote from it.  He           
 stated, "And that was one of the major contentions within this                
 hearing, that there were two agencies here exerting jurisdiction.             
 And from the voluntary unitization or the organization of `who owns           
 what amount of what they're going to do as a single lease,' then,             
 that's one thing, and that certainly is DNR; but the actual                   
 conservation of the reservoir, as I heard you say, I think, that              
 you feel that that is in the purview of the AOGCC."                           
                                                                               
 MS. MARSHBURN responded, "At first glance -- I would have to say              
 yes.  Obviously, I would need to know more about what we were                 
 talking about, but yes."                                                      
                                                                               
 Number 0068                                                                   
                                                                               
 REPRESENTATIVE GREEN asked whether Ms. Marshburn is familiar enough           
 with voluntary or compulsory unitization to know the difference.              
                                                                               
 MS. MARSHBURN replied, "I am superficially familiar with the                  
 difference between voluntary and compulsory.  I've not been                   
 involved at this point in either; we've not gotten into that."                
                                                                               
 REPRESENTATIVE GREEN asked, "If there was an issue of prevention of           
 waste which would require that a leaseholder over here, as part of            
 this full reservoir, was not willing to operate in the most                   
 efficient manner, by unitization there is a - and this is called              
 the hammer - there is a law that allows the conservation commission           
 to force unitization of the substances under the prevention of                
 waste concern.  That's compulsory unitization."                               
                                                                               
 REPRESENTATIVE GREEN continued, "Voluntary unitization is when                
 everybody just signs up to the document as they did at Prudhoe Bay.           
 That's a voluntary unit.  We have no compulsory unitization in this           
 state.  My concern is, knowing and on the basis that you may wonder           
 yet, and you're going to have to check this out, but believe me,              
 you would have the hammer, would you concur with the conservation             
 department or the AOGCC that that should stay within the                      
 conservation commission and not, in any way, be misconstrued by DNR           
 that they have that authority?"                                               
                                                                               
 MS. MARSHBURN asked whether Representative Green was referring to             
 compulsory unitization.                                                       
                                                                               
 REPRESENTATIVE GREEN said yes.                                                
                                                                               
 Number 0130                                                                   
                                                                               
 MS. MARSHBURN responded, "Yes, I think so."                                   
                                                                               
 REPRESENTATIVE GREEN said, "Whether it be a gas cap or an oil rim,            
 it's got to be voluntary if they, as a land owner, and that's all             
 they are, are involved."                                                      
                                                                               
 MS. MARSHBURN replied, "My reading, what reading I have done of               
 their statutes as relates to unitization, and then as of the AOGCC            
 statutes that relate to unitization -- I would have to say yes."              
                                                                               
 Number 0149                                                                   
                                                                               
 REPRESENTATIVE GREEN said, "Governor Knowles has repeatedly                   
 mentioned that he wants to make Alaska open and ready for business            
 and wants to cooperate with the oil and gas industry.  And yet we             
 know that you helped on the Governor's election and that you                  
 obviously are a friend, or at least more than a casual                        
 acquaintance."  He expressed concern that as a member of the AOGCC,           
 she has "police power" and does not have the right to say this will           
 be done in cooperation to make things better for the oil industry.            
 He stated, "You have the objective and the responsibility to act as           
 a policeman of that industry.  Do you see any conflict now?"                  
                                                                               
 MS. MARSHBURN said no.  She advised members that the Governor's               
 campaign is not the only campaign she worked on.  "And obviously I            
 have friends in all walks of life," she said.  "I am not beholden             
 in any way to the Governor or to anyone else whose campaign I                 
 worked on.  I accepted and am interested in this appointment                  
 because I think I can do the job, and I think I can do a good job,            
 and that I bring value to this commission.  I don't see any                   
 conflict."                                                                    
                                                                               
 Number 0218                                                                   
                                                                               
 REPRESENTATIVE BARNES asked, "This letter that you signed, what was           
 conservation order number 391?"                                               
                                                                               
 MS. MARSHBURN replied, "With Dan Donkle; this was the Dan Donkle              
 conservation order."  She said she would have to look at it; it was           
 an order the commission signed after holding a hearing with Mr.               
 Donkle, who had requested unitization into the North Cook Inlet               
 Unit.  There was a procedural question, and that was whether to               
 proceed with hearing the case on the merits.  "And the commission             
 determined that that was not the case," she said.  Ms. Marshburn              
 advised members that it is up for rehearing, and she expressed                
 reluctance to discuss it further.                                             
                                                                               
 Number 0257                                                                   
                                                                               
 CO-CHAIRMAN OGAN said Commissioner Johnston had told legislators,             
 in response to direct questions, that he neither saw that letter              
 nor gave Ms. Marshburn permission to sign it.  He asked whether she           
 believes it is appropriate to be signing her name on letters he has           
 not seen or given her permission to sign.                                     
                                                                               
 MS. MARSHBURN said no.  She said Commissioner Johnston had                    
 discussed the letter and that he had requested that it be drafted.            
 "It was a procedural matter," she said.  "I signed the letter; it             
 would appear that that is a mistake.  It has not been brought to my           
 attention by Commissioner Johnston or by anyone else at the                   
 commission office.  This is the first time that it has been brought           
 up.  But obviously no, that's not the case.  That's the only time             
 and the only reason that I signed anything for him."                          
                                                                               
 Number 0297                                                                   
                                                                               
 REPRESENTATIVE IRENE NICHOLIA said, "I don't think that we should             
 go by hearsay of what was said between members," she said.                    
 Referring to Mr. Johnston, she stated, "If he had a problem with              
 that, then the letter should have been in front of us today."                 
                                                                               
 Number 0326                                                                   
                                                                               
 REPRESENTATIVE JOULE commented on the awesome responsibility of the           
 appointees.                                                                   
                                                                               
 Number 0344                                                                   
                                                                               
 CO-CHAIRMAN HUDSON advised the committee that in accordance with AS           
 39.05.080, the committee had reviewed the qualifications of all the           
 nominees and recommended that the appointments be forwarded to a              
 joint session for consideration.  He emphasized that the forwarding           
 and members' signatures did not reflect any intent to vote for or             
 against these individuals in further confirmation sessions.                   
                                                                               
 ADJOURNMENT                                                                   
                                                                               
 CO-CHAIRMAN HUDSON adjourned the House Resources Standing Committee           
 meeting at 2:42 p.m.                                                          
                                                                               

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