Legislature(1999 - 2000)
03/20/2000 01:10 PM 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
March 20, 2000
1:10 p.m.
MEMBERS PRESENT
Representative Bill Hudson, Co-Chair
Representative Beverly Masek, Co-Chair
Representative John Cowdery, Vice Chair
Representative John Harris
Representative Carl Morgan
Representative Ramona Barnes
Representative Reggie Joule
Representative Mary Kapsner
MEMBERS ABSENT
Representative Jim Whitaker
COMMITTEE CALENDAR
HOUSE JOINT RESOLUTION NO. 59
Supporting the passage by the United States Congress of H.R.
3671, the Wildlife and Sport Fish Restoration Programs
Improvement Act of 2000.
- MOVED HJR 59 OUT OF COMMITTEE
HOUSE BILL NO. 432
"An Act extending the termination date of the Board of Storage
Tank Assistance; expanding the authority of the board to issue
recommendations concerning cleanup decisions; and providing for
an effective date."
- MOVED HB 432 OUT OF COMMITTEE
CS FOR SENATE BILL NO. 255(RES)
"An Act relating to best interest findings and land use permits,
rights-of-way, and easements issued by the Department of Natural
Resources; and providing for an effective date."
- MOVED CSSB 255(RES) OUT OF COMMITTEE
PREVIOUS ACTION
BILL: HJR 59
SHORT TITLE: SUPPORT WILDLIFE & SPORT FISH RESTOR.ACT
Jrn-Date Jrn-Page Action
3/01/00 2359 (H) READ THE FIRST TIME - REFERRALS
3/01/00 2359 (H) RES
3/20/00 (H) RES AT 1:00 PM CAPITOL 124
BILL: HB 432
SHORT TITLE: BOARD OF STORAGE TANK ASSISTANCE
Jrn-Date Jrn-Page Action
3/08/00 2455 (H) READ THE FIRST TIME - REFERRALS
3/08/00 2455 (H) RES, FIN
3/20/00 (H) RES AT 1:00 PM CAPITOL 124
BILL: SB 255
SHORT TITLE: PUB.LAND: BEST INT. FINDINGS/ PUB NOTICE
Jrn-Date Jrn-Page Action
2/08/00 2226 (S) READ THE FIRST TIME - REFERRALS
2/08/00 2226 (S) RES, FIN
2/18/00 (S) RES AT 3:00 PM BUTROVICH 205
2/18/00 (S) Heard & Held
2/18/00 (S) MINUTE(RES)
2/23/00 (S) RES AT 2:30 PM SENATE FINANCE 532
2/23/00 (S) Scheduled But Not Heard
3/01/00 (S) RES AT 3:00 PM BUTROVICH 205
3/01/00 (S) Moved CS(Res) Out of Committee
3/01/00 (S) MINUTE(RES)
3/02/00 2492 (S) RES RPT CS 4DP NEW TITLE
3/02/00 2492 (S) DP: HALFORD, MACKIE, PETE KELLY,
GREEN
3/02/00 2492 (S) ZERO FISCAL NOTE (DNR)
3/02/00 2492 (S) FIN REFERRAL WAIVED
3/03/00 (S) RLS AT 11:30 AM FAHRENKAMP 203
3/03/00 (S) MINUTE(RLS)
3/03/00 2510 (S) RLS TO CALENDAR AND 1 OR 03/03/00
3/03/00 2510 (S) READ THE SECOND TIME
3/03/00 2511 (S) RES CS ADOPTED UNAN CONSENT
3/03/00 2511 (S) ADVANCED TO THIRD READING UNAN
CONSENT
3/03/00 2511 (S) READ THE THIRD TIME CSSB 255(RES)
3/03/00 2511 (S) PASSED Y16 N2 E2
3/03/00 2511 (S) EFFECTIVE DATE(S) SAME AS PASSAGE
3/03/00 2512 (S) ELLIS NOTICE OF RECONSIDERATION
3/06/00 2533 (S) RECONSIDERATION NOT TAKEN UP
3/06/00 2533 (S) TRANSMITTED TO (H)
3/08/00 2442 (H) READ THE FIRST TIME - REFERRALS
3/08/00 2443 (H) RES
3/20/00 (H) RES AT 1:00 PM CAPITOL 124
WITNESS REGISTER
LORALI MEIER, Staff
to Representative Masek
Alaska State Legislature
Capitol Building, Room 128
Juneau, Alaska 99801
POSITION STATEMENT: Provided the sponsor statement for HJR 59
and presented HB 432.
JOHN BARNETT
Board of Storage Tank Assistance
PO Box 240651
Douglas, Alaska 99824
POSITION STATEMENT: Discussed the need for HB 432.
GARY WEBER, Secretary Treasury
Alaska Underground Tank Owners and Operators Association
PO Box 871216
Wasilla, Alaska 99687
POSITION STATEMENT: Urged the committee to forward HB 432.
BOB GILFILLIAN, Private Engineer
2605 Denali Street, Number 203
Anchorage, Alaska 99503
POSITION STATEMENT: Testified in favor of HB 432.
JOHN COOK, Owner
Sterling Tesoro
Box 49
Sterling, Alaska 99672
POSITION STATEMENT: Urged the committee to continue the board
and suggested that an internal investigation be performed.
SENATOR PETE KELLY
Alaska State Legislature
Capitol Building, Room 510
Juneau, Alaska 99801
POSITION STATEMENT: Testified as sponsor of SB 255.
NANCY FRESCO
Northern Alaska Environmental Center
2605 Denali Street, Number 203
Anchorage, Alaska 99503
POSITION STATEMENT: Testified that the Northern Alaska
Environmental Center is opposed to SB 255.
SUE SCHRADER
Alaska Conservation Voters
PO Box 22151
Juneau, Alaska 99802
POSITION STATEMENT: Testified that SB 255 should not be
supported.
TOM WALDO, Staff Attorney
Earthjustice Legal Defense Fund
625 Fourth Street
Juneau, Alaska 99801
POSITION STATEMENT: Urged the committee to reject SB 255.
JOHN SHIVELY, Commissioner
Department of Natural Resources
400 Willoughby Avenue, 5th floor
Juneau, Alaska 99801-1724
POSITION STATEMENT: Urged the committee to adopt CSSB 255(RES).
IRENE ALEXAKOS
1311 Tarn Court
Juneau, Alaska
POSITION STATEMENT: Discussed concerns regarding SB 255.
ACTION NARRATIVE
TAPE 00-22, SIDE A
Number 0001
CO-CHAIR MASEK called the House Resources Standing Committee
meeting to order at 1:10 p.m. Members present at the call to
order were Representatives Masek, Cowdery, Harris, Morgan, Barnes
and Kapsner. Representatives Hudson and Joule arrived as the
meeting was in progress.
HJR 59-SUPPORT WILDLIFE & SPORT FISH RESTOR.ACT
CO-CHAIR MASEK announced that the first order of business would
be HOUSE JOINT RESOLUTION NO. 59, Supporting the passage by the
United States Congress of H.R. 3671, the Wildlife and Sport Fish
Restoration Programs Improvement Act of 2000.
Number 0180
LORALI MEIER, Staff to Representative Masek, Alaska State
Legislature, read the sponsor statement into the record as
follows:
HJR 59 demonstrates the legislature's support for the
proper use and management of money in the Pittman-
Robertson and Dingell-Johnson Trust Funds.
The Dingell-Johnson Trust Fund levies a 10 percent tax
on all sportfishing equipment, motor boat fuel, and
some boat imports. The Pittman-Robertson Trust Fund
levies an 11 percent excise tax on sporting arms and
ammunition, and a 10 percent tax on handguns. Both
acts mandate that the money generated from the taxes be
reapportioned back to the state in the form of grants
for programs that benefit fish and wildlife.
Last year Congressman Don Young requested the General
Accounting Office to audit the Pittman-Robertson Trust
Fund. Uncovered was waste, fraud, abuse, and
mismanagement. Instances include expensive foreign
travel junkets and large bonuses for some U.S. Fish and
Wildlife employees. One career U.S. Fish and Wildlife
employee testified before ... Congressman Young's
committee that he was pressured to approve handouts of
Pittman-Robertson money to so-called "animal rights"
groups that have actively worked to destroy hunting.
Last year about 15 percent of Alaskans purchased
hunting licenses and about 30 percent purchased
sportfishing licenses. This minority deserves the
benefits of the Pittman-Robertson and Dingell-Johnson
Trust Funds to protect their rights and interests.
Number 0353
REPRESENTATIVE COWDERY asked whether this money that is returned
to the state as grants would be placed in the general fund or
would have to be appropriated.
MS. MEIER deferred to Representative Barnes.
REPRESENTATIVE BARNES answered that this money would have to be
appropriated. She noted that in the past this money has been
abused here [in Alaska] because these are primarily sport fishing
and sport hunting funds. In the past some of these funds have
been appropriated to the Division of Commercial Fisheries.
REPRESENTATIVE COWDERY asked if there is any way to ensure that
these funds are not abused.
REPRESENTATIVE BARNES pointed out that these funds are audited
from time to time, as HJR 59 indicates. If there are abuses, the
states that abuse the funds are held accountable. In further
response to Representative Cowdery, Representative Barnes said
that the only way to ensure there are no abuses would be to
ensure that the Finance committees that appropriate these monies
adhere to the intent and letter of the law.
Number 0530
REPRESENTATIVE JOULE asked: When the subcommittees of the Alaska
Department of Fish & Game review these funds, could they take the
opportunity to closely scrutinize the use of the funds?
REPRESENTATIVE BARNES replied yes. When the subcommittees have
these funds before them, the origins of the funds are identified
as well as what the funds are supposed to be appropriated for.
CO-CHAIR MASEK asked whether anyone wished to testify; no one
came forward.
Number 0620
REPRESENTATIVE BARNES made a motion to move HJR 59 out of
committee with individual recommendations and the accompanying
fiscal note. She requested unanimous consent. There being no
objection, HJR 59 was moved from the House Resources Standing
Committee.
HB 432-BOARD OF STORAGE TANK ASSISTANCE
CO-CHAIR MASEK announced that the next order of business would be
HOUSE BILL NO. 432, "An Act extending the termination date of the
Board of Storage Tank Assistance; expanding the authority of the
board to issue recommendations concerning cleanup decisions; and
providing for an effective date."
Number 0688
LORALI MEIER, Staff to Representative Masek, Alaska State
Legislature, informed everyone that HB 432 was introduced by this
committee as a safeguard to ensure that the Board of Storage Tank
Assistance will still be effective while cleanup projects of
contaminated sites continue. She pointed out that HB 432 would
extend the Board of Storage Tank Assistance to [June 30,] 2003,
which is necessary because many sites have just initiated cleanup
or are in the midst of a long-term cleanup process. It is
important for the board to be available during the upcoming
construction season in order to [mediate] and resolve disputes
between the Department of Environmental Conservation (DEC) and
the underground storage tank owners.
MS. MEIER pointed out that HB 432 also expands the authority of
the board to allow the board to make recommendations concerning
cleanup decisions. This would not be a binding authority, but
would merely provide a forum for the board, businesses, and DEC
to discuss final decision letters. Ms. Meier stated that passage
of HB 432 this session is imperative or there will be no mediator
between DEC and underground storage tank owners. She noted that
she would refer most questions to Mr. Barnett, Board of Storage
Tank Assistance.
MS. MEIER, in response to Representative Joule, clarified that
this was dealt with last year in the form of SB 128, which was
sponsored by the Senate Finance Committee. She explained that SB
128 dealt with many issues concerning the underground storage
tank facilities and the board. Currently, the board has already
"sunset" and is in its "wind-down year;" however, there are sites
that are still being cleaned up. Therefore, it is important that
the board act as the mediator between DEC and the storage tank
owners.
REPRESENTATIVE COWDERY remarked that this [issue] has been around
for about ten years. He inquired as to whether it is mainly the
small or the large operators that are still not in compliance.
MR. MEIER answered that she believes that most of the sites still
being cleaned up are those of small business owners. She
deferred to Mr. Barnett in regard to specific numbers.
REPRESENTATIVE HARRIS referred to the fiscal note and asked if
the "$40,200 contractual" is for only one person.
MS. MEIER deferred to Mr. Barnett.
Number 0960
JOHN BARNETT, Board of Storage Tank Assistance, informed the
committee that he is a private contractor that provides staff
support to the board. In response to Representative Cowdery's
question, Mr. Barnett explained that initially there were a lot
of large companies in this program as well as many on the waiting
list. The bill that passed last year, SB 128, converted the
predominantly grant program to a loan program. Senate Bill 128
also established new eligibility standards in order to ensure
that only smaller facilities, "mom and pop" facilities, would be
eligible for grants. There are still 60 of those small
facilities that have started their cleanup program in the last
year or two, or that will be starting their cleanup program this
year. He noted that over 1,000 grants have been issued and thus
the program is predominantly a loan program available to large
businesses and a grant program for very small facilities.
REPRESENTATIVE HARRIS restated his question with regard to
whether the $40,200 covers the extension of Mr. Barnett's
contract.
MR. BARNETT replied yes. He explained that the board was
privatized last year, and this fiscal note represents only travel
and one person on contract, which would be himself. He further
noted that it [the contract] goes out to a competitive bid
process should HB 432 pass.
REPRESENTATIVE COWDERY commented that when natural gas came to
Anchorage, many privately owned homes had buried oil tanks.
Since that time, he believes that the majority of those buried
tanks have been removed due to refinancing and so forth.
Representative Cowdery asked what is happening with buried tanks
in Wasilla as [use of] natural gas is expanding in that area.
MR. BARNETT pointed out that most of those [buried] tanks are
residential heating oil tanks and therefore not regulated by DEC
or the Environmental Protection Agency (EPA). There is not an
active tracking mechanism. Nor is the extent of the problem
known. He noted that the banking industry for financing new home
sales/purchases has requested voluntary site assessments and the
removal of old tanks. Since such tanks are not regulated,
however, there are no standards in place for those tanks.
Number 1210
GARY WEBER, Secretary Treasury, Alaska Underground Tank Owners
and Operators Association, testified via teleconference from the
Mat-Su Valley. He informed the committee that the underground-
tank owners are counting on the board's being extended for the
next three years because there are many that have not completed
[cleanup]. He noted that he had not completed his own cleanup,
which he has been involved in for ten years. Mr. Weber noted
that when this program was initially established, the tank owners
lobbied for high tank fees in order that money would be available
to provide for this board. Although the tank fees have decreased
as the upgrades have occurred, there is adequate money to support
the board. In conclusion, Mr. Weber said that he hoped the
committee would forward HB 432.
Number 1325
BOB GILFILLIAN, Private Engineer, testified via teleconference
from Anchorage. He informed the committee that he has been
dealing with many environmental issues throughout the state in
the private sector for about 20 years. He noted that before he
moved into the private sector, he worked in DEC for three years.
He also noted that he served as the first chairman of the board
when it was created. Recently, he served on the Privatization
Subcommittee on DEC. Mr. Gilfillian stated that he was in favor
of HB 432 and recommended its passage.
MR. GILFILLIAN stated that over the years he has found it
problematic for "mom and pop" businesses to resolve problems when
there is no one to go to. Since the creation of this board, he
has found it to be a very effective to resolve issues and bring
forward appeals when the department makes determinations. With
the board, disputes have been resolved with the department at the
table. Currently, many of these sites are approaching final
cleanup or are in the cleanup phase, which have many complicated
issues. Having the board continue is critical at this time. Mr.
Gilfillian believes the board provides great value to the general
public. Furthermore, the Privatization [Sub]Committee [on DEC]
recommended continuation of the board and expansion of its
authority in order to include all the contaminated sites besides
the underground tank program. In conclusion, Mr. Gilfillian
stated that he is in favor of the continuation of the board as
well as for its expanded role.
Number 1605
JOHN COOK, Owner, Sterling Tesoro, testified via teleconference
from Kenai. He informed the committee that he is one of DEC's
victims. If it were not for the board, he predicted that he
would be in the "poorhouse." He stressed the need for the
department's power to be overseen by the board. [The department]
almost ruined him and others that are "mom and pop" businesses,
he said. Mr. Cook informed the committee that he ended up with a
$1 million grant, which [the department] wasted on monitor wells
and extra regulations that were not necessary. [The
department's] trick is to make more regulations in order to make
their jobs binding. He pointed out that "these guys" charge
exorbitant fees for cleanup and inspection of the site, but no
one ever sees them. He expressed the need to clean up and
perform an internal investigation [on the department]. For
example, Mr. Cook pointed out that [the department] had an
agricultural engineer in charge of his cleanup. Mr. Cook urged
the committee to continue the board and suggested that an
internal investigation be performed on the qualifications and
actions of "these guys." He related his belief that "these guys"
could be replaced by three engineers and a secretary.
Number 1831
REPRESENTATIVE COWDERY made a motion to move HB 432 out of
committee with individual recommendations and the accompanying
fiscal note. He requested unanimous consent. There being no
objection, HB 432 was moved from the House Resources Standing
Committee.
SB 255-PUB.LAND: BEST INT. FINDINGS/ PUB NOTICE
CO-CHAIR MASEK announced that the final item before the committee
would be CS FOR SENATE BILL NO. 255(RES), "An Act relating to
best interest findings and land use permits, rights-of-way, and
easements issued by the Department of Natural Resources; and
providing for an effective date."
Number 1874
SENATOR PETE KELLY, Alaska State Legislature, testified as the
sponsor of SB 255. He explained that SB 255 clarifies the way
the state issues permits for certain rights-of-way. In Fairbanks
the Golden Valley Electric Association (GVEA) has, over the past
few years, attempted to obtain a transmission line built from the
Healy power plant to Fairbanks. The GVEA was proceeding with a
multitude of environmental impact statement (EIS) hearings and
public hearings; GVEA attempted to proceed in an environmentally
sound way with public notice and support. However, a court
decision reversed how such permits are issued. He explained
that for some 20 years, [the state] has issued permits under AS
38.05.850 instead of performing "best interest findings." He
said that performing a best interest finding every time a small
right-of-way is needed would be a great hindrance to development.
The court determined that the transmission right-of-way was
functionally revocable and thus was a state divestiture of its
interest in lands. In his opinion, the court misinterpreted the
intent of the legislature.
SENATOR PETE KELLY said that much of how the state conducts
business in the Department of Natural Resources is now in
jeopardy because [under the aforementioned court case] the state
will have to perform best interest findings for almost every
small right-of-way. He informed the committee that under the
statute, as it existed before the court decision, the following
projects were accomplished: the Snettisham power project, the
municipal sewage outfall line in Klawock, the Whittier access
road project, the communications line issued to the Mat-Su
Telephone Association, electric distribution lines, natural gas
distribution lines, gathering lines, and many of the permits
issued on the North Slope.
SENATOR PETE KELLY predicted that the opposition to SB 255 will
say that the best interest finding is being taken away, which he
said is not true. He stated that the best interest finding never
existed, and that "it only existed when a court made an
interpretation on state statute and reversed 20 years of the way
we did business." Opposition has also said that "we" [SB 255]
will take away public notice. However, Section 4 of SB 255 adds
public notice because before SB 255 the public was not required
to do public notice for these types of permits. He offered to
take questions but pointed out that others present could better
answer some questions. Senator Kelly noted that when SB 255 was
first introduced, he was accused of doing special interest
statutes for his region. Although this legislation would impact
his region, it would impact business throughout Alaska. Without
SB 255, he stressed that there will be serious problems with the
budget of the Department of Natural Resources (DNR) and its
ability to perform basic projects with its allotted manpower.
Furthermore, [the department] will be tied up in court time after
time for small projects.
Number 2158
REPRESENTATIVE BARNES interjected that before public testimony is
taken, she would like to read the following statement into the
record. Representative Barnes stated:
Senate Bill 255 was introduced to deal with a serious
problem brought to light in a recent Alaska Supreme
Court decision related to best interest findings and
land use permits, rights-of-way and easements issued by
the Department of Natural Resources. Passage of SB 255
will clarify and confirm that permits issued under AS
38.05.035 are exempt from the best interest finding
requirement.
The Alaska Constitution in Article VIII, Section 10,
provides that "no disposals or leases of state lands,
or interests therein, shall be made without prior
public notice and other safeguards of the public
interest as may be prescribed by law." The legislature
addressed this issue in law in AS 38.05.035 by
providing for an exclusion for permits that could be
revoked.
Over the years, I have fought long and hard to protect
the Railbelt Energy Fund until we could get the votes
to appropriate those monies to build the northern and
southern interties. And as you will remember, we also
contributed heavily to PCE [power cost equalization] at
the time. A stable, reliable, reasonably priced source
of energy is the key to any future major development in
the Railbelt area. In 1993, we passed the most
comprehensive energy bill that this state has ever
seen. Since the passage of the 1993 legislation, the
professional preservationists have used every
conceivable effort to delay and stall these projects.
Last year, their efforts were directed at the
Fairbanks to Healy Electric Transmission Intertie
project.
First, the opposition filed in federal court for a
"stay" on the route chosen in the environmental impact
statement. The "stay" was rejected. Second, they
appealed the decision by the federal court. They lost
the appeal following a series of additional public
meetings. Third, they filed in Superior Court and
asked that the right-of-way permit that had been issued
by the DNR be revoked. The issuance of the right-of-way
permit was upheld. This is a tenacious group, they
don't give up easily. Their last action was to file in
the Alaska Supreme Court challenging the Department of
Natural Resources for issuing the permit without first
making a best interest finding. Upon reviewing the
matter, the court reversed the decision of the
Commissioner of the Department of Natural Resources and
remanded the case back to DNR for a best interest
finding.
The court went on to say that when a power line right-
of-way permit is issued for use of state-owned
property, this is disposing of state land and the
permit cannot be issued until a best interest finding
has been made. The court cited an old case, Wilderness
Society v. Morgan, in which they determined that to be
revocable one would have to consider whether the
structure could be moved and whether the land could be
left in its original condition. The court concluded
that in this case, the permit was not functionally
revocable and therefore was subject to the best
interest finding. To comply with the Supreme Court
Order, the Department of Natural Resources has
undertaken the process of making a best interest
finding.
Since 1993, this project has been the subject of the
intense scrutiny of a federal environmental impact
statement and a rigorous review by the Department of
Natural Resources' permitting process. This project
has been studied almost to death. There have been
hours and hours of public testimony, scores of studies,
pages of public and private input, and months of
professional review. The result, BLM [the Bureau of
Land Management] granted a right-of-way from a point
just south of Fairbanks 28 miles west to Wood River.
The Army, the federal agency that uses this area,
issued a letter of non-objection. The borough also
issued a letter of non-objection with one slight route
shift.
The right-of-way granted to Golden Valley Electric
Association by DNR was from Wood River west to a point
4 miles east of Nenana and then south to Healy. The
route was determined by the agencies following multiple
hearings, not by Golden Valley Electric. GVEA needs
this new line. They have just enough generating
capacity to serve their existing load when everything
is running. There is no margin. Any remaining
generating capacity that is available to GVEA is
located south of Healy. Fairbanks is connected to this
additional generation capacity through one single, 33
year old undersized line that is desperately in need of
rebuilding. When this line trips during peak demand in
winter, power load is lost. This is expensive and
totally unacceptable. It also jeopardizes existing
businesses.
The February 22, 1999, decision by the Alaska Supreme
Court ordered that the issuance of the permit to Golden
Valley Electric Association for the construction of the
electric transmission intertie between Fairbanks and
Healy was subject to a best interest finding by the
Department of Natural Resources. The court determined
that due to the magnitude and intent of the electric
transmission intertie project, the project does not
meet the requirements of AS 38.05.035 exemptions and
therefore ruled in favor of the plaintiffs, the Alaska
Center for the Environment and the Sierra Club.
Not to diminish the importance of the Fairbanks to
Healy Intertie project, but of even greater concern is
[that] several other major projects in our state that
have been permitted under our existing statute; the
same statute that DNR used to issue the permit to
Golden Valley. The court's decision now jeopardizes
the status of these previously issued permits as each
of them may, under the court's logic, constitute a
disposal of state land for which a best interest
finding (under existing law) would be required. This
is why there is a retroactive provision in this bill.
These older projects include, but are not limited to,
the following:
1. The right-of-way for the power
transmission line and related facilities for
the Snettisham Power Project from Snettisham
to Juneau;
2. The forced main and marine outfall line
right-of-way issued to the City of Klawock;
3. The right-of-way issued to Matanuska
Telephone Association for 1,200 feet of
buried communication line on the bottom of
Willow Lake;
4. The right-of-way issued to Norgasco,
Inc. for a gas distribution line in the
industrial leased area at Prudhoe Bay; and
5. The right-of-way issued to SOHIO (now
known as BP Exploration [Alaska]) for an 11
mile permanent gravel road for access to the
Duck Island Unit in conjunction with the
Endicott Pipeline.
SB 255 will amend and clarify the legislature's intent
as it relates to the issuance of permits by the
Department of Natural Resources.
Number 2655
NANCY FRESCO, Northern Alaska Environmental Center, testified via
teleconference from Fairbanks. Ms. Fresco said that the Northern
Alaska Environmental Center is opposed to SB 255. She reiterated
Senator Pete Kelly's earlier comment that current laws do not
require a best interest finding or any other lengthy process for
small revocable rights-of-way on state land, which makes up the
vast majority of the permits granted by DNR. This bill creates
an exemption from the best interest finding for all permits under
AS 38.05.850 regardless of the size or scope [of the project].
Ms. Fresco pointed out that the Healy-Fairbanks intertie project,
which sparked this attempt to limit the public process, is unique
in both its size and controversial location. She believes this
is why it took so many years of public process before such a case
appeared before the Alaska Supreme Court and this discrepancy
became apparent. She stated:
When considering permits for very large projects such
as this one [the Healy-Fairbanks intertie],
particularly when the use of the land is functionally
nonrevocable, it should be the obvious responsibility
of the Department of Natural Resources to examine the
type of questions raised by a best interest finding;
... Is the use of the state land in the best interest
of Alaska, and this includes the best interest for
environmental purposes and also the best interest for
development purposes.
MS. FRESCO said removal of this formal examination could lead to
poor decision making. She told members that SB 255 also falls
short of required constitutional safeguards. Article VIII,
Section 10 of the Alaska Constitution requires public notice and
other safeguards prior to the disposal or lease of state land.
Public notice alone, without any means for input or response
cannot be considered adequate to fulfill the aforementioned
clause. State land belongs to the people of Alaska and SB 255
would dangerously undermine the ability of Alaskan citizens to
know how the state's land is being managed. In conclusion, Ms.
Fresco said, "Contrary to a lot of the testimony I've been
hearing, this is not a change that would affect the vast majority
of permits, it's something that would only affect those large
scale permits where many citizens here in Fairbanks as well as
elsewhere in the state feel that it is their right to have due
public process, to have a chance for public input as well as just
the formality of a very brief public notice as would be provided
by this bill." Therefore, Ms. Fresco believes that SB 255 should
not be supported.
MS. FRESCO replied, in response to Representative Cowdery, that
she is representing the Northern Alaska Environmental Center in
Fairbanks, which has a current membership of approximately 1,200.
In further response to Representative Cowdery, Ms. Fresco stated
that she had contacted the membership numerous times. She
specified that the 1,200 membership only represents the due-
paying membership, but there are many citizens who are not
members of the center that support the center's position on SB
255.
Number 2843
SUE SCHRADER, Alaska Conservation Voters, noted that the Alaska
Conservation Voters and the Alaska Conservation Alliance are
sister nonprofit organizations dedicated to protecting Alaska's
environment through public education and advocacy. Many of the
Alaska Conservation Voters' members actively participate in land
use issues and take advantage of the public process when
available. The Alaska Conservation Voters is concerned that the
passage of SB 255 would "remove the accountability and
responsibility that the state has towards its citizens to show
that the state is managing our publicly-owned assets properly."
MS. SCHRADER stated that the Alaska Conservation Voters believes
that SB 255 "represents a dangerous grant of authority to DNR at
the expense of the public's right to know how our land is being
managed." This bill is a broad-sweeping reaction to an Alaska
Supreme Court decision which addressed the largest right-of-way
permit ever issued under this statute. She indicated that the
court ruled in this manner due to the size of the project, which
impacts over 1,200 acres of land. Due to the size of the
project, the court ruled that the permit was not functionally
revocable, and therefore DNR should perform a best interest
finding. Therefore, the court was looking out for all Alaskans.
MS. SCHRADER acknowledged that Senator Pete Kelly expressed many
concerns today and in his March 6 press release one of which is
concerned that the court decision would require a best interest
finding for every right-of-way. The Alaska Conservation Voters
finds that markedly misleading. As mentioned the Healy-Fairbanks
intertie project is unique due to its large size. Ms. Schrader
maintained that the vast majority of right-of-way permits issued
under the statute in question would not need to have a best
interest finding under this court decision. She felt that the
most troubling aspect of SB 255 is that "it gets DNR off the hook
from ever doing a best interest finding on a right-of-way utility
regardless of the size."
TAPE 00-22, SIDE B
MS. SCHRADER emphasized that despite the addition of a provision
for public notice in the CS, there is concern that the bill does
not meet the requirements of the constitution. A simple public
notice in the classified section of the newspaper does not meet
the requirements that the Alaska Conservation Voters think
Alaskans need on these huge projects. She specified that
Alaskans need access to public hearings and testimony and a
critical analysis by the department and other interested parties
with regards to the merits of the project. This is the only way
to safeguard the public's interest. Although SB 255 has been
framed as protecting DNR and developers of projects on state
land, the Alaska Conservation Voters believes "it's yet another
attack on all Alaskans' ability to provide oversight of
government actions." She further stated, "We believe that it
represents a special interest legislation aimed at negating a
very narrowly crafted court decision that had financial
implications for the sponsor's family and as such, this
legislation should not be supported."
Number 2889
TOM WALDO, Staff Attorney, Earthjustice Legal Defense Fund,
explained that Earthjustice is a national nonprofit public
interest environmental law firm. The firm represented the
Northern Alaska Environmental Center and the Sierra Club in the
lawsuit regarding the northern intertie, which prompted SB 255.
Mr. Waldo urged the committee to reject SB 255 because it is bad
public policy and it violates Article VIII, Section 10 of the
Alaska Constitution. The bill exempts all permits, easements and
rights-of-way from the best interest finding requirement. He
specified that this exemption applies whether the easement is
revocable or not. He pointed out that if DNR conveys an
irrevocable easement or right-of-way, a disposal of an interest
in state land, then Article VIII, Section 10 of the constitution
applies. Article VIII, Section 10 provides, "No disposals or
leases of state lands, or interests therein, shall be made
without prior public notice and other safeguards of the public
interest as may be prescribed by law." He informed the committee
that in the Senate, it was pointed out that SB 255 would violate
Article VIII, Section 10 by stripping away all of the public
notice and other safeguards. Therefore, the Senate amended SB
255 and inserted Section 4 which provides for public notice for
permits that are not functionally revocable. He explained, "What
this means is that DNR could, theoretically, issue a single
permanent nonrevocable easement covering all 100 million acres of
state land and could do so with nothing more than a legal notice
published back in the classified section of the newspaper." He
restated that this [SB 255] is poor public policy and does not
satisfy Article VIII, Section 10 of the Alaska Constitution. Mr.
Waldo informed the committee that this issue was litigated in
1993 before Judge Green in the Superior Court in Fairbanks in the
case of Vern Weiss v. State of Alaska, which was the Mental
Health Trust litigation. Upon review of Article VIII, Section 10
of the Alaska Constitution and the constitutional history and its
purposes, Judge Green, in a decision on summary, wrote the
following:
This constitutional history demonstrates that the
framers were not interested only in public notice.
Rather it is clear that they intended a mandatory
obligation on the legislature to establish other
appropriate safeguards in addition to public notice to
protect the public interest in state lands. The
framers contemplated discretion in the legislature to
provide other safeguards of the public interest, but
they clearly expected and required something beyond
public notice.
MR. WALDO said, "The problem with SB 255 is that it allows DNR to
convey substantial interests in state land with nothing more than
bare public notice." Again, he reiterated that SB 255 is poor
public policy and does not satisfy the constitution.
Furthermore, SB 255 is unnecessary because the Supreme Court's
decision, as Ms. Schrader and Ms. Fresco testified, applies only
to the small number of permits for which the improvements to the
land are so substantial that the permit is not revocable in any
practical sense. In those rare cases, a best interest finding is
an appropriate process to follow. Therefore, Mr. Waldo urged the
committee to reject SB 255.
REPRESENTATIVE BARNES pointed out that Article VIII, Section 10
of the constitution says, "The legislature shall prescribe by law
what the public notice safeguards are." She believes the
legislature has done so quite adequately.
Number 2668
JOHN SHIVELY, Commissioner, Department of Natural Resources,
testified via teleconference. He thanked Senator Pete Kelly and
Representative Barnes for their statements as they accurately
reflect the reality that "we" [DNR] see as a result of the
[Alaska] Supreme Court decision. Although the environmental
community claims that the court decision would apply to large
projects, there is nothing in the decision which would indicate
such. He pointed out that functionally irrevocable permits could
be anything from a sewer outfall to a fiber optics cable. He
said that the [Alaska] Supreme Court did not provide good
direction, and therefore SB 255 is necessary.
COMMISSIONER SHIVELY turned to the public process and noted that
the department has, in issuing permits and rights-of-way, used a
variety of processes under the existing legislation, including a
best interest finding when the department felt such was
necessary. He remarked that if this project had only been on
state land, the department might have used the best interest
process for finding for the right-of-way. However, since the
federal government was involved the department chose a more
onerous public process, the environmental impact statement. He
noted that there were hearings held between the federal and state
governments on this matter. Additionally, Commissioner Shively
noted that he held his own hearing, a totally discretionary
hearing. Commissioner Shively said that he resented the
implications of the environmental community that DNR would merely
place a small public notice in the newspaper for a major public
project. There is nothing in the department's history that would
indicate that would be the way it would be handled. Commissioner
Shively said, "It's irrelevant what's in this law, about whether
we meet the constitutional requirements or not. We're either
going to meet them or not if this goes to court. The court will
decide whether or not we've met our constitutional
responsibilities. The law can only help guide us." He commented
that the Senate amendment does help guide the department. In
conclusion, Commissioner Shively urged the committee to adopt
[CSSB 255(RES)].
Number 2513
IRENE ALEXAKOS commented that to say that the only purposes of
the environmental community were to delay and stall the Golden
intertie project is false. The environmental community does not
disagree with an intertie. Ms. Alexakos clarified that the
environmental community disagreed with the proposed route. An
existing route that had the railroad corridor, the existing
intertie and the road could have been utilized versus cutting a
swath through the wilderness and making unnecessary environmental
destruction. With regard to the comments that the court's
opinion jeopardizes the status of previously issued permits, that
is also false. She said, "You won't see Earthjustice Legal
Defense Fund or the environmental groups challenging other
permits, they would have done so by now if that was the case."
Furthermore, Ms. Alexakos refuted the claim that months of
professional review has been performed on this [intertie project]
because DNR does not have any professional electrical engineers
on staff. She believes that SB 255 takes brotherly love to an
extreme as the bill was clearly introduced for the benefit of
Senator Pete Kelly's brother, the CEO of Golden Valley Electric.
REPRESENTATIVE BARNES interjected that the witness is out of line
with accusations that Senator Pete Kelly introduced SB 255 for
his brother. Representative Barnes pointed out that she wrote
the legislation that originally allowed the northern and southern
interties to proceed. Representative Barnes stressed that she
would not tolerate such accusations.
MS. ALESAKOS specified that although Representative Barnes may
have written the legislation that allowed that [the northern and
southern interties], Senator Pete Kelly wrote and introduced SB
255.
REPRESENTATIVE BARNES refuted that and noted that Senator Pete
Kelly's brother is retiring from Golden Valley. She remarked
that she would put her name on the bill [as] sponsor and request
that Senator Pete Kelly's name be removed. Representative Barnes
said that such an accusation is appalling.
CO-CHAIR MASEK asked if Ms. Alesakos worked for Earthjustice.
MS. ALESAKOS stated that she is representing herself. In further
response to Co-Chair Masek, she said she is a member of many
conservation groups.
CO-CHAIR MASEK stated that the committee is discussing the merits
of the bill, and therefore she requested that Ms. Alexakos direct
her testimony to the legislation. Furthermore, Co-Chair Masek
said that she did not want to hear accusations of false
information.
MS. ALEXAKOS inquired as to what she said that could be found
false as she believes that she is sticking to the basis of the
bill.
Number 2310
CO-CHAIR HUDSON pointed out that in all proceedings, regardless
of the side of the issue one takes, it has been a practice to
avoid trying to impugn someone's motives or reputation. Co-Chair
Hudson requested that Ms. Alexakos speak to her conflict in
regard to the intent of the bill or elements that she would
recommend be changed. He said that Ms. Alexakos could make her
point without trying to attach some personal motive to Senator
Pete Kelly or any other member.
REPRESENTATIVE HARRIS said that he wanted to echo Representative
Barnes and Co-Chair Hudson's comments. As a new member of the
legislature, he believes that one learns not to determine what
people, legislators or the public, think. That is asked of
witnesses as well because "we" can return the favor and can also
deny one the opportunity to testify if "we" wish. In fairness
that is not done, and therefore in fairness he requested that Ms.
Alexakos not make determinations of another's motives.
MS. ALEXAKOS remarked that she could hardly see how this could be
ignored.
REPRESENTATIVE COWDERY informed Ms. Alexakos that there other
remedies, the Ethics Committee, if she believes there is an
abuse.
MS. ALEXAKOS pointed out that this body [the legislature] brings
complaints to the Ethics Committee.
REPRESENTATIVE COWDERY stated that private citizens can bring
complaints to the Ethics Committee as well. Generally, most of
the complaints to the Ethics Committee are brought by the private
sector.
MS. ALEXAKOS noted that legislators themselves compose the
membership of the Ethics Committee.
REPRESENTATIVE HARRIS stated a point of order as the testimony
seems to be straying.
CO-CHAIR MASEK asked if Ms. Alexakos had any further testimony
that she would like to add.
Number 2134
MS. ALEXAKOS said that SB 255, a bill introduced in response to a
ruling about the northern intertie project, goes too far and is
not in the public interest. She reiterated that DNR has no
electrical engineers on staff.
REPRESENTATIVE COWDERY asked if Ms. Alexakos' organization has
professional electrical engineers on its staff that have reviewed
this [project]. If so, he requested that she provide the
committee with their written review.
MS. ALEXAKOS reiterated that she was not representing any
organization.
REPRESENTATIVE COWDERY said, "So, you have no professional
engineer knowledge whatsoever then on this; is that what I heard
you say?"
MS. ALEXAKOS answered that she did not understand Representative
Cowdery's point.
REPRESENTATIVE JOULE remarked that with regards to Ms. Alexakos
comment that the Ethics Committee consists of legislators seems
to assume/imply that those members are not going to be fair,
which already impugns the body.
[Ms. Alexakos made an inaudible response.]
Number 1969
REPRESENTATIVE BARNES made a motion to move CSSB 255(RES) out of
committee with individual recommendations and the accompanying
zero fiscal note. She requested unanimous consent. There being
no objection, CSSB 255(RES) was moved from the House Resources
Standing Committee.
ADJOURNMENT
There being no further business before the committee, the House
Resources Standing Committee meeting was adjourned at 2:20 p.m.
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