02/23/2004 01:36 PM House RES
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+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
HOUSE RESOURCES STANDING COMMITTEE
February 23, 2004
1:36 p.m.
MEMBERS PRESENT
Representative Nancy Dahlstrom, Co-Chair
Representative Beverly Masek, Co-Chair
Representative Carl Gatto
Representative Bob Lynn
Representative Nick Stepovich
Representative Kelly Wolf
Representative Beth Kerttula
Representative David Guttenberg
MEMBERS ABSENT
Representative Cheryll Heinze, Vice Chair
COMMITTEE CALENDAR
CONFIRMATION HEARING(S)
Alaska Royalty Oil and Gas Development Advisory Board
Charles E. Cole - Fairbanks
Kenneth O. Stout - Anchorage
- CONFIRMATION(S) ADVANCED
Alaska Oil and Gas Conservation Commission
John K. Norman - Anchorage
- CONFIRMATION(S) ADVANCED
Alaska Commercial Fisheries Entry Commission
Frank M. Homan - Juneau
- CONFIRMATION(S) ADVANCED
HOUSE BILL NO. 344
"An Act relating to annual rental fees for mining claims, and
providing for reduced royalties during the first three years of
production."
- HEARD AND HELD
PREVIOUS COMMITTEE ACTION
BILL: HB 344
SHORT TITLE: MINING FEES/LABOR/ROYALTIES/ABANDONMENT
SPONSOR(S): REPRESENTATIVE(S) FATE
01/12/04 (H) PREFILE RELEASED (1/2/04)
01/12/04 (H) READ THE FIRST TIME - REFERRALS
01/12/04 (H) RES, FIN
02/04/04 (H) RES AT 1:00 PM CAPITOL 124
02/04/04 (H) Heard & Held
02/04/04 (H) MINUTE(RES)
02/23/04 (H) RES AT 1:00 PM CAPITOL 124
WITNESS REGISTER
KENNETH O. STOUT, Appointee
to the Alaska Royalty Oil and Gas Development Advisory Board
Anchorage, Alaska
POSITION STATEMENT: As appointee to the Alaska Royalty Oil and
Gas Development Advisory Board, discussed the position and
answered questions from the committee.
CHARLES E. COLE, Appointee
to the Alaska Royalty Oil and Gas Development Advisory Board
Fairbanks, Alaska
POSITION STATEMENT: As appointee to the Alaska Royalty Oil and
Gas Development Advisory Board, discussed the position and
answered questions from the committee.
JOHN K. NORMAN, Appointee
to the Alaska Oil and Gas Conservation Commission
Anchorage, Alaska
POSITION STATEMENT: Discussed the position and answered
questions from the committee.
FRANK M. HOMAN, Appointee
to the Alaska Commercial Fisheries Entry Commission
Juneau, Alaska
POSITION STATEMENT: Discussed the position and answered
questions from the committee.
JIM POUND, Staff
to Representative Hugh Fate
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Testified on CSHB 344(RES) and spoke to
changes on behalf of Representative Fate, sponsor.
ACTION NARRATIVE
TAPE 04-07, SIDE A
Number 0001
CO-CHAIR BEVERLY MASEK called the House Resources Standing
Committee meeting to order at 1:36 p.m. Representatives Masek,
Dahlstrom, Lynn, Stepovich, Guttenberg, and Kerttula were
present at the call to order. Representatives Gatto and Wolf
arrived as the meeting was in progress.
CO-CHAIR MASEK announced for the record that Representative Wolf
had joined the meeting.
^CONFIRMATION HEARING(S)
CO-CHAIR MASEK announced that the first order of business would
be the confirmation hearings of the governor's appointments to
various boards as listed above in the committee calendar.
^Alaska Royalty Oil and Gas Development Advisory Board
Number 0064
CO-CHAIR MASEK brought before the committee the appointment of
Kenneth O. Stout to the Alaska Royalty Oil and Gas Development
Advisory Board. She asked Mr. Stout to comment on his
appointment to the board.
Number 0172
KENNETH O. STOUT, Appointee to the Alaska Royalty Oil and Gas
Development Advisory Board, discussed the position and answered
questions from the committee. He told the members that the
board attended a conference in Fairbanks and was well pleased
with the recommendation to move ahead with the Black Hills
purchase.
CO-CHAIR MASEK pointed out that Mr. Stout's resume is in the
members' packet for review.
Number 0261
REPRESENTATIVE GUTTENBERG commented that his concern lies with a
previous appointee who stepped down because of political
involvement, and asked Mr. Stout to address the issue.
MR. STOUT asked for clarification that he has already been
appointed and confirmed as a member of the board.
CO-CHAIR MASEK told Mr. Stout that while he has been appointed
by the governor, he has not yet been confirmed by the
legislature.
MR. STOUT thanked Co-Chair Masek for clarifying that point. He
responded that his political affiliation will not have anything
to do with the way he approaches his service to the board. Mr.
Stout said as the members know, he is conservative and will work
to get the biggest "bang for the buck." In the case of the
Black Hills purchase he told the members that he believes it is
in the best interest of the state to go forward with it. He
confirmed that he has been a member of the Republican Party for
many years, and reassured the members that fact would not have
any effect on the way he votes on the board.
Number 0453
REPRESENTATIVE KERTTULA asked Mr. Stout if he currently holds
any party office.
MR. STOUT replied that he does not. He commented that he is
running for the city assembly, but clarified that it is a non-
partisan election.
REPRESENTATIVE KERTTULA asked if he is elected to the city
assembly does he believe he will have enough time to serve in
both offices.
MR. STOUT responded that he will. He explained that neither the
assembly position nor the position on the Alaska Royalty Oil and
Gas Development Advisory Board are full time positions.
Number 0523
REPRESENTATIVE STEPOVICH commended Mr. Stout for his community
activism in running for local office. He said that
Representative Guttenberg's question must have been spurred by
an individual stepping down from some other committee, as
Representative Stepovich does not recall anyone on the Alaska
Royalty Oil and Gas Development Advisory Board stepping down.
He asked Mr. Stout what he believes he can do to help the state
through his service.
Number 0579
MR. STOUT replied that his past experience of working through
problems and finding reasonable solutions will benefit the state
of Alaska. He summarized that he is willing to do whatever he
can to help the state.
CO-CHAIR MASEK announced for the record that Representative
Gatto had joined the meeting.
CO-CHAIR DAHLSTROM thanked Mr. Stout for his military service to
the United States. She noted that on Mr. Stout's resume the
group called Common Sense for Alaska is listed under former and
current professional organizations. Co-Chair Dahlstrom asked
him to comment on his current involvement. She noted for the
record that Common Sense for Alaska is a group that has been
campaigning for the use of the earnings of the permanent fund.
Number 0735
MR. STOUT assured the members that he is not currently active in
the group and has not been for many years. He commented that he
listed groups that he has been involved with over the years, in
come cases the list goes back 23 years.
MR. STOUT pointed out that he also currently serves on a
veteran's commission. He just returned from Washington, D.C.
where he attended a meeting. Part of that meeting included a
visit to Walter Reed Army Medical Center, Ward 57, which is
where amputees go to recuperate and have new limbs fitted for
them. Mr. Stout explained that [in the current war on
terrorism] with the new body armor soldiers are not being killed
in as high a numbers as previous wars; however, they are loosing
a lot more limbs, he said. He told the members that he cannot
stress the incredible respect he feels for the military who
serve our country.
Number 0926
CO-CHAIR MASEK brought before the committee the appointment of
Charles E. Cole to the Alaska Royalty Oil and Gas Development
Advisory Board. She asked Mr. Cole to comment on his
appointment to the board.
CHARLES E. COLE, Appointee to the Alaska Royalty Oil and Gas
Development Advisory Board, discussed the position and answered
questions from the committee. He told the members that he came
to Alaska in January of 1954 and since that time has practiced
law. In fact, as of January 27, 2004 he has practiced law in
Alaska for 50 years. Mr. Cole said that he spent one year in
Juneau working for the territorial commissioner of veterans'
affairs which was a revolving loan program for veterans. After
about six months in that position he went to work for Attorney
General Williams and served as assistant attorney general for
about six months. In December of 1954 he came to Fairbanks and
met the U.S. District Attorney Ted Stevens who persuaded him to
go to work for the newly appointed U.S. District Judge in
Fairbanks, which he did for about 18 months. He shared that in
1956 he ran for and was elected to the city magistrate position.
In April of 1957 he began the practice of law in Fairbanks and
continued until December of 1990 when he was appointed Attorney
General by Governor Hickel. He told the members that he served
in that capacity until January of 1994, and then returned to
private practice in Fairbanks, where he currently works.
Number 1150
REPRESENTATIVE GATTO asked if he is any good at baseball.
MR. COLE responded that he played professional baseball for
three years; two years riding the buses in the California league
in the early 1950s, and one year in the pioneer league in Idaho
in 1953.
REPRESENTATIVE GATTO commented that he sees that Mr. Cole played
for Stanford University. Did it have a decent season when you
played for them, he asked.
MR. COLE responded that in the first year of law school the team
won the California Inter-collegiate Baseball Association
championship, and went to Washington to compete. Unfortunately,
he said, due to his miserable performance the team was defeated
by "WSC" [Washington State College]. Mr. Cole told the members
that he played every inning and every game for three consecutive
years.
REPRESENTATIVE GATTO asked if this position pays as well as the
Stanford [University] position.
MR. COLE replied that when he played in Stockton in the
California league he was paid $350 per month and $3 per day for
travel money for meals. It wasn't that lucrative in those days,
he commented.
REPRESENTATIVE GATTO commented that this position pays a little
more.
MR. COLE replied that he is not sure this appointment pays
anything, but said that is okay with him because he is not
looking for any compensation from this position.
Number 1280
CO-CHAIR DAHLSTROM thanked Mr. Cole for his service to the
United States. She commented that she believes both he and Mr.
Stout would be excellent resources for the veterans' committees.
Co-Chair Dahlstrom said that HB 28 passed both the house and
senate last session. That bill provided clarification of the
Commissioner of the Department of Natural Resources' ability to
adjust the state's royalties to encourage economic production.
She asked Mr. Cole to comment on his experience with royalty
modification issues and also what his general philosophy is in
evaluating proposals that may or may not be on the table for
royalty modification.
Number 1362
MR. COLE responded that it is hard to say what his general view
is for royalty modification. He said he thinks that whenever
agreements are modified it should be done with care and the
modification must be supported with good solid reasons. That is
true because there had to be good solid reasons for the initial
formulation of the agreement, he explained. Mr. Cole reiterated
that he would look upon modifications of existing agreements
with great care.
REPRESENTATIVE DAHLSTROM said that with the stranded gas
application, the Alaska Natural Gas Development Authority
bringing natural gas development issues to the forefront, and
the governor's statement that access to the North Slope gas is a
crucial element to Alaska's negotiating platform, she asked what
role Mr. Cole sees the Alaska Royalty Oil and Gas Development
Advisory Board playing in these negotiations. How critical does
Mr. Cole believe this board's role is, she asked.
MR. COLE said that he does not believe the board is a
participant in any of the negotiations. He added that he has
not been briefed on any negotiations so he is totally in the
dark with respect to it. He said that under the act he believes
the board will be required to discharge its statutory
responsibilities with respect to any such agreements.
Number 1511
REPRESENTATIVE STEPOVICH thanked Mr. Cole for his 50 years of
service to Alaska, and asked him what he believes he can do on
the board to enhance resource development.
Number 1558
MR. COLE said that he does not know what the board can do to
enhance resource development because those are the primary
responsibilities of the governor and the legislature. He said
he thinks that his experiences in negotiations, formulations,
and drafting of agreements over the years could be useful in
reviewing and strengthening the agreements by looking for
pitfalls and providing oversight. Mr. Cole said he generally
sees his role one where he provides an oversight of the public
interest with respect to those agreements. He commented that he
would not rubber-stamp any agreement that the administration
might make because the members of the board have a broad
responsibility to the public. Mr. Cole stated that when he
makes recommendations with respect to those agreements he
expects that the legislature would hold him responsible for
discharging his statutory duties and would therefore act with
care.
REPRESENTATIVE STEPOVICH noted that Mr. Cole did do that with
the Exxon Valdez case, and he thanked him for that work. He
recommended that Mr. Cole be confirmed to the board.
REPRESENTATIVE GUTTENBERG thanked him for his service and said
that he hopes he continues to hear his voice speaking out for
all Alaskans.
CO-CHAIR MASEK asked Mr. Cole to speak on his opinion of the
subsistence issue.
MR. COLE said he is pleased to say that he believes the state
needs to adopt a constitutional amendment to obtain as much
power to act on the subsistence issue as is possible under
Alaska National Interest Lands Conservation Act (ANILCA). It is
important for Alaskans on all sides of the issue that the state
come together and achieve as much control over subsistence as
possible, he said. Mr. Cole told the members that he believes
it is in the best interest of Native people, and the fishing and
hunting population of Alaska. He said he will continue to exert
any efforts to achieve that end. Mr. Cole warned that he
believes it will be a terrible mistake if it is not done. The
possibilities of achieving that end are rapidly slipping away,
and he looks upon that with great regret, he added.
Number 1843
CO-CHAIR MASEK asked if he believes changes need to be made in
ANILCA before tinkering with the Alaska State Constitution.
MR. COLE commented that he would like to see changes in ANILCA,
but believes it would be very difficult to obtain. However, if
the state went to Senator Stevens with a unified position some
changes are possible.
REPRESENTATIVE STEPOVICH commented that Mr. Cole will only be
getting per diem if he is confirmed to the board.
MR. COLE replied that he is not that interested in per diem; he
is just pleased to make a contribution to the system. He told
the members that he hopes the legislature approves Mr. Stout
because he has served with him on the review of the Foothills
Pipe Lines Ltd. contract for the North Pole refinery and found
that Mr. Stout had a lot of constructive comments in that
process.
^Alaska Oil and Gas Conservation Commission
Number 1964
CO-CHAIR MASEK said next appointment for review is that of John
K. Norman to the Alaska Oil and Gas Conservation Commission
(AOGCC). She asked Mr. Norman to comment on his appointment to
the commission.
Number 1990
JOHN K. NORMAN, Appointee to the Alaska Oil and Gas Conservation
Commission, discussed the position and answered questions from
the committee. He told the members that he came to Alaska 1968
when he was transferred here by an oil company in Texas. He
explained that he had joined the oil company after finishing
military service. In 1968 the Prudhoe Bay discovery was
announced, and he joined the Department of Law as council for
the Department of Natural Resources and had a good opportunity
work on oil and gas matters. He shared that he also served as
the legal council for the Alaska Oil and Gas Conservation
Commission. He worked as an assistant attorney general until
November of 1971 when he went into private practice where he has
worked for the last 32 years. Recently, Governor Murkowski
called to ask him to serve in this position and he said he
believes he is qualified. This is not a stepping-stone to any
other position or aspiration. If confirmed by the legislature
he said he looks forward to bringing to this position the
experience that he has had gained over the last 32 years, he
summarized.
Number 2130
CO-CHAIR MASEK noted that his statement in the letter to
Governor Murkowski [dated January 21, 2004] sites that this
commission is a regulatory body that must remain independent of
the Division of Oil and Gas.
CO-CHAIR DAHLSTROM asked Mr. Norman to comment on the fact that
he was named to the commission just hours after a former public
member resigned. She asked if he would also comment on the
statutory situation with the commission. Both drilling and
disposal regulations have advanced quite a lot in the last few
years. The commission has been operating on basically the same
framework in which it was created.
MR. NORMAN replied that for at least the last 30 years he has
closely followed and has been familiar with the work of the
AOGCC. He commented that he knew the first members of the
committee. Mr. Norman told the members that he lamented the
amount of publicity in the paper and the lack of understanding
of the important work of the AOGCC. When the opening occurred
several people talked to him about whether he would be
interested in applying. Mr. Norman said he believed it was time
for him to give something back to the state, and it was then
that he wrote the letter to the governor. He shared that he did
not know if he would be appointed or not, but had heard that
there might be some discussion concerning changes in the AOGCC.
With that in mind he wrote the last paragraphs in the letter to
clarify that he believed it would be definite mistake to put the
regulatory responsibilities of the commission under the same
roof as the state Department of Natural Resources. Mr. Norman
explained that he felt it should remain an independent
commission and not slip backwards, as had been done previously.
He said he thought that within a short period of time there
would be an effort to make it independent again if that change
were made. Alaska's industry is dependent on a well-regulated
carefully watched oil and gas industry for a significant part of
the revenues of state government and contributions to the
private economy, he added. Mr. Norman summarized that he
believed an independent regulatory commission is essential to
meet industry needs in timely permitting, but more importantly
he said believed it is important for all Alaskans to know that
there is a commission who is on watch 24-hours per day. Every
time a hole is drilled the AOGCC monitors and follows it until
years later when that project may be plugged and abandoned.
MR. NORMAN told the members that he had a sense that some of the
professionalism that he had known in years passed was slipping
away, and that is what motivated him to write the letter. He
added that he had no idea why he was called so quickly, but
noted that according to statute two members are required. When
one member resigned the AOGCC was down to one member. Mr.
Norman said if he had been able to control the timing he would
have provided more time to wrap up the things he was working on
and then move into the position.
Number 2551
MR. NORMAN said in conclusion he read something he wrote for a
publication for the Alaska Bar Association over 30 years ago as
follows:
The concern for all Alaskans for orderly development
of the state's natural resources is reflected in the
attitudes and policies of the state's Oil and Gas
Conservation Committee.
MR. NORMAN commented that at that time AOGCC was called the Oil
and Gas Conservation Committee, but functioned much as the
commission does today. He continued reading his statement:
This committee can be expected to play a significant
role in shaping the future of the natural gas industry
in Alaska.
MR. NORMAN summarized that he is not a newcomer to the
commission and is very well familiar with this and other
commissions. He said he is also cognizant of the fact that
Alaskans demands a leading place in the area of oil and gas
development. Alaska is looked to as a leader and has been
viewed as having a first-class, professional commission. He
told the members that he has not sought other positions in the
past 33 years even though he has been approached for federal
positions. It is his wish to make a contribution to the state
of Alaska, he concluded.
Number 2600
CO-CHAIR DAHLSTROM asked Mr. Norman what he believes the
commission can do to attract smaller independent oil companies
to the North Slope.
MR. NORMAN responded that the AOGCC can look at its regulations,
which it has already been doing, he added. He commented that
Alaska is a very expensive place to operate and that is
particularly true on the North Slope. Mr. Norman explained that
new companies look for infrastructure and support facilities.
One thing AOGCC could do is update its records to provide data
electronically. The drilling wells are being regulated to the
West across the boundary line into the National Petroleum
Reserve - Alaska (NPR-A), and that is a positive development, he
added. Mr. Norman told the members that he believes the AOGCC
should be responsive to the new companies that come into Alaska.
He added that he is very impressed with the staff in the agency.
There is a sense of urgency in the agency that could be a model
for many other agencies, he said. The oil industry operates 24-
hours per day and the standby cost for a rig is thousands and
thousands of dollars. Mr. Norman noted that to have a one or
two day delay in a permit application can be extremely costly.
The more that can be done to take the uncertainty out of the
process and streamline the process, while at the same time
carefully regulating the industry will help attract more
companies to Alaska. Companies that come into an area look at
the regulatory climate and want an independent regulatory
agency, he explained. The smaller companies look for that
because when operating next to larger companies it is important
that the small companies are not improperly excluded from the
unit, and that they are allowed to produce their fair share of
any resource, Mr. Norman said. In summary, he said the biggest
thing that can be done is to assure land availability.
Number 2841
CO-CHAIR DAHLSTROM commented that one of his web sites says that
one of the functions is to "protect fresh water from
contamination by oil, gas, and mud during drilling, production,
and abandonment operations." She asked if the commission has
been out to the Matanuska-Susitna Valley assuring people that
there are laws and an agency already in place that will protect
their drinking waters from the shallow gas development that has
been such a controversial issue.
Number 2860
MR. NORMAN replied yes. He told the members that AOGCC has
participated in a series of meetings there. The next meeting
will consist of a presentation this Saturday. The focus will be
on two areas that are of considerable concern to the residents
of the Matanuska-Susitna Valley in the area of shallow gas
leasing. One of those areas is the question of whether there
should be an allowance for production from the same aquifer
where people get drinking water. The area the commission is
focusing on is to assure the people that their drinking water
will be protected by the proper completion of wells by using
techniques that will seal off any potential contamination of
aquifers. Another area that is being looked at is the
stimulation of wells, or the fracturing of wells, where fluids
are put under pressure into a reservoir to open it up and allow
it to flow more freely, he said. Mr. Norman assured the members
that AOGCC will be looking at this extremely closely to ensure
that if development occurs it will not proceed in a way that
contaminates or degrade any aquifer from which any Alaskan gets
their drinking water.
CO-CHAIR DAHLSTROM thanked Mr. Norman. There is much "doom and
gloom" being spread on that issue. She said she does not
believe that citizens are convinced of the safety and urged the
AOGCC to step up its efforts and move efficiently as possible to
get that information out to the public.
REPRESENTATIVE STEPOVICH asked Mr. Norman how many grievances by
the public and producers are before the AOGCC currently.
TAPE 04-7, SIDE B
Number 2955
MR. NORMAN responded that there are no active protests currently
before the commission; however, there is one matter in
litigation in the Alaska Superior Court.
MR. STEPOVICH commented that there are grievances that come from
people who have difficulty working with government agencies. He
agreed with Mr. Norman that it is important the AOGCC be
independent of those agencies. He asked if the Attorney
General's Office is doing any work for the commission.
MR. NORMAN responded that there is one assistant attorney
general that is assigned to the AOGCC. He said to his knowledge
his work does not cross over to other agencies, and he is able
to give the commission independent advice.
Number 2892
REPRESENTATIVE STEPOVICH said it is his understanding that
Alaska statutes say that the AOGCC is required to be independent
of the Department of Natural Resources and the Attorney
General's Office. He asked Mr. Norman if that is how he
understands it.
MR. NORMAN replied that is correct.
REPRESENTATIVE STEPOVICH asked if Mr. Norman believes the
commission and the agencies collided in the past.
MR. NORMAN said that it is his personal viewpoint that there may
have been a collision in the past. However, he would not want
to say any more on that point without further investigation. He
assured the members that whatever the case in the past, it will
not occur in the future.
REPRESENTATIVE STEPOVICH asked how many staff work for the
commission and how many members are on the commission right now.
MR. NORMAN replied that there are 23 full-time employees. They
are geologists, petroleum engineers, and reservoir engineers.
Of those particular professionals there are two teams that
operate and regulate the industry statewide. Each team consists
of a geologists, a reservoir engineer, and a petroleum engineer.
Those six professionals have a responsibility to oversee
literally hundreds of industry professionals across the state.
There are also inspectors on the wells inspecting a number of
operations. The commission maintains a repository with
historical records of every well that has ever been drilled in
Alaska. There are three commissioners provided for by statute
and the commission currently has two.
Number 2829
REPRESENTATIVE STEPOVICH asked Mr. Norman if he believes there
is a movement to phase out the AOGCC.
MR. NORMAN responded that he does not see a movement to phase
out the commission. He said he believes if that were to occur
it would be huge mistake for the state of Alaska.
REPRESENTATIVE STEPOVICH asked if Mr. Norman is pushing to add
another member to the commission.
MR. NORMAN told the members that he is looking at the work of
the commission and plans to submit a recommendation to the
governor. He said currently he has not recommended that a third
member be appointed because he believes the work can be done by
two commissioners. Mr. Norman requested that the position be
held open until the completion of his review, when he will make
a recommendation.
CO-CHAIR MASEK pointed out that the AOGCC does not appoint
members to the commission; the governor makes the appointments.
REPRESENTATIVE STEPOVICH commented that when there was no one on
the commission it left a void. Alaska Oil and Gas Conservation
Commission has a strong role, and he said he has not seen the
commission fulfill that role in past administrations. He said
he was concerned with the recent "back biting" that was going on
within the commission. He said he wants a commission and Mr.
Norman to stand independent of the Department of Natural
Resources, the Attorney General's Office, and work for the good
of all Alaskans.
Number 2700
REPRESENTATIVE GUTTENBERG referred to one of Mr. Norman's
published works, Considerations When Entering the Alaska Energy
Market, [IBC Global Conferences] in September 2002. He asked if
it is Mr. Norman's opinion that the bar has been raised too high
for the energy industry.
MR. NORMAN responded that there is no question that the bar is
high here in Alaska. Some of it is simply the fact that this is
a state where infrastructure costs are higher and it is required
that development proceed in an orderly, well regulated way.
That's not bad, he said. He said he does not believe the bar is
high, but acknowledged that there is a problem with land
availability and access. Mr. Norman pointed out that the Arctic
National Wildlife Refuge (ANWR) is the most striking example of
that problem, but that is beyond the state's control. He noted
that there is a trend over the last 18 to 36 months of a number
of smaller, independent companies coming into the state and
taking up a position. Very often these are the companies that
find the oil and gas, he added.
^Alaska Commercial Fisheries Entry Commission
Number 2595
CO-CHAIR DAHLSTOM said the next appointment for review is that
of Commissioner Frank M. Homan to the Alaska Commercial
Fisheries Entry Commission (CFEC). She asked Mr. Homan to
comment on his appointment to the commission.
Number 2578
FRANK M. HOMAN, Appointee to the Alaska Commercial Fisheries
Entry Commission, discussed the position and answered questions
from the committee. He told the members that in the summer of
1946 he arrived in Ketchikan on the Canadian steamship, Prince
Rupert, which was the beginning of his adventure in Alaska.
During World War II his father worked on the Alaska Highway for
a couple of years so that was his introduction to Alaska.
Originally, his family was from San Francisco. He said he
started 1st grade in Ketchikan and been in Alaska ever since.
In the early days his family was in the fish buying business in
Southeast Alaska. They had a series of fish buying stations
around Prince of Wales, he explained. This was in the days
before iceboats. Fish was purchased daily and then a scow came
once a week to pick up the fish and deliver them. That was his
life experience until he went to college. During his college
days he worked in the pulp mill in the summers. Mr. Homan
summarized that his background has always been in resources.
Part way through college he went into the U.S. Army, and after
his military service he returned to college. When he finished
college in 1967 he came to Juneau because he had an opportunity
to work on resource issues as an economist in the newly created
Department of Economic Development.
MR. HOMAN said that in 1971 he left the state and created his
own business for a number of years where the company did
economic analysis for businesses and communities. The company
was known as the Homan-McDowell Associates, and is now known as
the McDowell Group. In the mid-1980s he had the opportunity to
work for Senator Arliss Sturgulewski as a resource development
specialist and went on to work for her for many years. In 1991
he was appointed to the Limited Entry Commission for five years.
After that service he did private consulting and a number of
other interesting jobs, his favorite was working with the cruise
ship industry, a company that provided shore support services to
the cruise ships. Last year another opportunity occurred where
he was offered a position as a special assistant to Governor
Murkowski in resource development. When the position came open
in the Alaska Commercial Fisheries Entry Commission he was
pleased that the governor appointed him, he said.
Number 2320
CO-CHAIR DAHLSTROM told the members that the Commercial
Fisheries Entry Commission position is a salaried. The salary
is $85,397 per year, and the commission meets throughout the
year. She commended Mr. Homan for his military service to the
United States.
Number 2291
REPRESENTATIVE WOLF asked if he currently serves on the Alaska
Commercial Fishing and Agriculture Bank (CFAB).
MR. NORMAN responded that in the early 1980 he was chairman of
the Alaska Commercial Fishing and Agriculture Bank.
Number 2258
CO-CHAIR DAHLSTROM moved to forward the names of Charles E.
Cole, Kenneth O. Stout for the Alaska Oil And Gas Development
Advisory Board; the name of John K. Norman for the Alaska Oil
and Gas Conservation Commission; and the name of Frank M. Homan
for the Alaska Commercial Fisheries Entry Commission to the
joint session of the House and Senate for confirmation. There
being no objection, the confirmations of Charles E. Cole,
Kenneth O. Stout, John K. Norman, and Frank M. Homan were
advanced from the House Resources Standing Committee.
HB 344-MINING FEES/LABOR/ROYALTIES/ABANDONMENT
Number 2204
CO-CHAIR DAHLSTROM announced that the final order of business
would be HOUSE BILL NO. 344, "An Act relating to annual rental
fees for mining claims, and providing for reduced royalties
during the first three years of production."
Number 2192
CO-CHAIR MASEK moved to adopt the proposed committee substitute
(CS), Version 23-LS1298\I, Bullock, 2/20/04 as a work draft.
There being no objection, Version I was before the committee.
Number 2167
JIM POUND, Staff to Representative Hugh Fate, Alaska State
Legislature, speaking on behalf of Representative Fate, sponsor,
told the committee that the sponsor is in support of the CS. He
explained that under current statute if a miner files his or her
paperwork - a statement of annual labor or the payment of rent
or royalties - one day late, the state considers the mine
abandoned. Mr. Pound said CSHB 344(RES) will change that by
allowing a "cure" for the miner, but it does not prevent the
miner from meeting the requirements in statute, nor does it
allow the miner the right to "let it slide without there being a
penalty." Under the penalty clause of CSHB 344(RES), the miner
will have to pay a late fee equal to at least one year's rent.
He said the CS accomplishes what was intended in the original
bill, which was to keep the miners working and "bring their
local economy stimulus" to Alaska. He urged the committee's
support.
Number 2100
CO-CHAIR MASEK clarified that her motion to adopt CSHB 344(RES)
was for purposes of discussion.
Number 2076
CO-CHAIR DAHLSTROM announced that HB 344 would be held over.
ADJOURNMENT
There being no further business before the committee, the House
Resources Standing Committee meeting was adjourned at 2:42 p.m.
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