Legislature(2013 - 2014)BARNES 124
02/19/2014 01:00 PM House RESOURCES
| Audio | Topic |
|---|---|
| Start | |
| HB135 | |
| HB161 | |
| HJR26 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 161 | TELECONFERENCED | |
| *+ | HB 135 | TELECONFERENCED | |
| *+ | HJR 26 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
HOUSE RESOURCES STANDING COMMITTEE
February 19, 2014
1:32 p.m.
MEMBERS PRESENT
Representative Eric Feige, Co-Chair
Representative Dan Saddler, Co-Chair
Representative Peggy Wilson, Vice Chair
Representative Mike Hawker
Representative Craig Johnson
Representative Kurt Olson
Representative Paul Seaton
Representative Scott Kawasaki
Representative Geran Tarr
MEMBERS ABSENT
All members present
OTHER LEGISLATORS PRESENT
Representative Andrew Josephson
COMMITTEE CALENDAR
HOUSE BILL NO. 135
"An Act relating to the reservation of certain mining claims
from all uses incompatible with the purposes for establishing
the Petersville Recreational Mining Area."
- MOVED HB 135 OUT OF COMMITTEE
HOUSE BILL NO. 161
"An Act relating to auctions or raffles for big game harvest
permits and to the selection of nonprofit organizations to
conduct auctions and raffles for the Department of Fish and
Game."
- HEARD & HELD
HOUSE JOINT RESOLUTION NO. 26
Urging the United States Congress to provide a means for
consistently and equitably sharing with all oil and gas
producing states adjacent to federal outer continental shelf
areas a portion of revenue generated from oil and gas
development on the outer continental shelf to ensure that those
states develop necessary infrastructure to support outer
continental shelf development and preserve environmental
integrity.
- MOVED HJR 26 OUT OF COMMITTEE
PREVIOUS COMMITTEE ACTION
BILL: HB 135
SHORT TITLE: PETERSVILLE RECREATIONAL MINING AREA
SPONSOR(s): REPRESENTATIVE(s) KELLER
02/22/13 (H) READ THE FIRST TIME - REFERRALS
02/22/13 (H) RES
02/19/14 (H) RES AT 1:00 PM BARNES 124
BILL: HB 161
SHORT TITLE: AUCTIONS FOR BIG GAME HARVEST PERMITS
SPONSOR(s): REPRESENTATIVE(s) GATTIS
03/11/13 (H) READ THE FIRST TIME - REFERRALS
03/11/13 (H) RES
04/10/13 (H) RES AT 1:00 PM BARNES 124
04/10/13 (H) Heard & Held
04/10/13 (H) MINUTE(RES)
02/19/14 (H) RES AT 1:00 PM BARNES 124
BILL: HJR 26
SHORT TITLE: OFFSHORE OIL & GAS REVENUE SHARING
SPONSOR(s): REPRESENTATIVE(s) SADDLER
02/17/14 (H) READ THE FIRST TIME - REFERRALS
02/17/14 (H) RES
02/19/14 (H) RES AT 1:00 PM BARNES 124
WITNESS REGISTER
JIM POUND, Staff
Representative Wes Keller
Juneau, Alaska
POSITION STATEMENT: Testified on behalf of the prime sponsor of
HB 135, Representative Wes Keller.
BRENT GOODRUM, Director
Central Office
Division of Mining, Land and Water
Department of Natural Resources (DNR)
Anchorage, Alaska
POSITION STATEMENT: Answered questions during the discussion of
HB 135.
MICHELE STEVENS
Petersville, Alaska
POSITION STATEMENT: Testified during the discussion of HB 135.
JULES TILESTON
Anchorage, Alaska
POSITION STATEMENT: Testified in favor of HB 135.
REPRESENTATIVE LYNN GATTIS
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Testified as prime sponsor of HB 161.
WAYNE E. HEIMER
Fairbanks, Alaska
POSITION STATEMENT: Testified in opposition to HB 161.
REID HARRIS, Staff
Representative Lynn Gattis
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Testified on behalf of the prime sponsor of
HB 161, Representative Lynn Gattis.
DOUG VINCENT-LANG, Director
Division of Wildlife Conservation
Alaska Department of Fish & Game
Anchorage, Alaska
POSITION STATEMENT: Answered questions during the discussion of
HB 161.
KAREN GORDON
Fairbanks, Alaska
POSITION STATEMENT: Testified in opposition to HB 161.
DAVE CAMPBELL, Donations Chairman
Southcentral Alaska Chapter
Ruffed Grouse Society
Eagle River, Alaska
POSITION STATEMENT: Testified in support of HB 161.
GARY STEVENS
Chugiak, Alaska
POSITION STATEMENT: Testified in opposition to HB 161.
MIKE CRAWFORD, Regional Representative
Safari Club International (SCI)
Soldotna, Alaska
POSITION STATEMENT: Testified in support of HB 161.
HELEN NETSCHERT, President
Alaska Kenai Peninsula Chapter
Safari Club International
Soldotna, Alaska
POSITION STATEMENT: Testified in support of HB 161.
EDDIE GRASSER, Chairman
Legislative Outdoor Heritage Caucus Advisory Council
Palmer, Alaska
POSITION STATEMENT: Testified in support of HB 161.
DON QUARBERG
Delta Junction, Alaska
POSITION STATEMENT: Testified in opposition to HB 161, Version
Y, as currently written.
CHARLOTTE BROWER, Mayor
North Slope Borough (NSB)
Barrow, Alaska
POSITION STATEMENT: Testified in support of HJR 26.
SARAH ERKMANN, External Affairs Manager
Alaska Oil and Gas Association (AOGA)
Anchorage, Alaska
POSITION STATEMENT: Testified in support of HJR 26.
ADRIAN HERRERA, Washington D.C. Coordinator
Arctic Power
Washington, D.C.
POSITION STATEMENT: Testified in support of HJR 26.
ACTION NARRATIVE
1:32:21 PM
CO-CHAIR DAN SADDLER called the House Resources Standing
Committee meeting to order at 1:32 p.m. Representatives Seaton,
Kawasaki, Johnson, and P. Wilson, Feige, and Saddler were
present at the call to order. Representatives Hawker, Olson,
and Tarr arrived as the meeting was in progress. Representative
Josephson was also present.
HB 135-PETERSVILLE RECREATIONAL MINING AREA
1:32:46 PM
CO-CHAIR SADDLER announced that the first order of business
would be HOUSE BILL NO. 135, "An Act relating to the reservation
of certain mining claims from all uses incompatible with the
purposes for establishing the Petersville Recreational Mining
Area."
1:32:56 PM
JIM POUND, Staff, Representative Wes Keller, on behalf of prime
sponsor of HB 135, stated that HB 135 will allow the state to
fulfill an agreement it made back in the 1990s with a potential
business owner. This bill would allow the state to obtain about
200 acres of federal land it has previously selected and
determine the land use as most likely recreational mining. He
said this area [in the Petersville Recreational Mining Area] is
currently being "somewhat" managed by the stakeholder who has
long ago developed historic sites, buildings, and equipment from
mining. This bill could help the [Petersville Recreational
Mining Area] become the home of a mining museum and create
opportunities for locals and tourists to try gold panning
without worrying about being on someone else's claim. He asked
members for their support for HB 135.
1:34:32 PM
REPRESENTATIVE SEATON understood that if HB 135 passes it would
then be up to the Department of Natural Resources (DNR) to
determine the allowable land uses. He asked for further
clarification since he interprets the bill to mean it would
reserve the land from all uses incompatible with the
recreational mining district.
BRENT GOODRUM, Director, Central Office, Division of Mining,
Land and Water, Department of Natural Resources (DNR), stated
that HB 135 would remove a parcel of land from the southern
portion of the Petersville Recreational Mining Area. He
explained that House Bill 46 passed the legislature in May 1997
and was signed into law creating a recreational mining area in
Petersville in the upper Susitna Valley. He described the
northern Petersville Recreational Mining Area, which consists of
approximately 280 acres and is currently open and active under
state ownership; however, the southern portion of the
aforementioned mining area consists of approximately 220 acres
of state-selected land that is still under federal ownership.
This bill would seek to specifically remove the southern portion
from the Petersville Recreational Mining Area.
1:36:05 PM
REPRESENTATIVE SEATON referred to [page 1, line 5, subsection
(f),] which read, "The vacant and unappropriated state-owned
land and water and the state land and water acquired in the
future that lie within the following described mining claims
described in United States Mineral Survey No. 2384 are reserved
from all uses incompatible with the purposes of this section and
are assigned to the department for control and management [as
the Petersville Recreational Mining Area:....]" He said the
title reads, "An Act relating to the reservation of certain
mining claims from all uses incompatible with the purposes for
establishing the Petersville Recreational Mining Area." He
asked for further clarification on the bill.
MR. GOODRUM responded that this language relates to the creation
of the Petersville Recreational Mining Area but the aspect he
will focus on would remove sections of land from the mining area
that comprises the southern portion of the Petersville
Recreational Mining Area.
REPRESENTATIVE SEATON said he understood and thanked Mr. Goodrum
for the clarification.
1:37:43 PM
CO-CHAIR SADDLER noted the committee is working on Version A
[the original version] of HB 135.
CO-CHAIR SADDLER opened public testimony on HB 135.
1:38:39 PM
MICHELE STEVENS stated she was a lifelong Alaskan. She
summarized her written testimony [in members' packets]. In the
1990s she gifted about 500 acres of state mining claims to the
state with the hope that she would be able to operate a
recreational mining operation on the site. At the time, it was
illegal to conduct any recreational mining on mining claims.
Although House Bill 46 was initiated and passed the legislature,
the Department of Natural Resources (DNR), Division of Mining,
Land and Water was not able to move forward with the agreement.
Thus, HB 135 would remove the parcel in order to allow the
mining claims to revert back to her in hopes that she will be
able to proceed forward with a new mechanism - a mining lease
from the State of Alaska that would allow her to [conduct
recreational mining activities]. Same questions arose in 2012
on whether the land would revert back to her, which was remedied
by placing amendments on the Peters Creek's claims. She related
her understanding that if HB 135 passes the land will revert
back to her and that she will be able to move forward with the
aforementioned state's agreement in a different manner.
1:41:08 PM
CO-CHAIR SADDLER related his understanding that this bill would
mean all parties could fulfill the intent of the previous
agreement made [in the 1990s]. Thus, this bill would clear the
path forward to reach the original intent, he said.
MS. STEVENS answered yes. She said this bill would put her on a
different path. She remarked that Steve Hirshbah has "blazed"
some trails by working with the DNR on land leases. She
anticipated that under the bill she would be able to move
forward with the state [on the aforementioned agreement].
1:42:05 PM
REPRESENTATIVE P. WILSON asked for further clarification on the
zero fiscal note. She wondered whether the state would need to
spend money or if Ms. Stevens is requesting any additional
funding.
MS. STEVENS answered that the State of Alaska would not be
putting any money into the process. Instead, she thought that
the state would likely gain revenue by allowing her to operate
her business.
1:42:39 PM
CO-CHAIR SADDLER asked her to outline her hopes and intentions
for recreational mining activity in the Petersville area.
MS. STEVENS responded that her buildings were built in 1996.
Additionally, she has obtained a Marion shovel that was used to
build the Panama Canal and used on the Alaska Railroad as well
as for mining in the Petersville area. She would like to
consider opening a museum to showcase mining relics such as the
shovel and to open the creek area for gold panning and picnics.
1:43:33 PM
JULES TILESTON, speaking as a private citizen, noted that he
previously served as the director of the Division of Mining and
Water Management 21 years ago when this situation initially
began. He stated he has submitted written testimony to the
committee. He said he strongly supports the bill as written.
1:44:04 PM
REPRESENTATIVE TARR surmised the proposed Petersville
Recreational Mining Area operation would be similar to the
operation at Crow Creek mine.
MR. TILSTON confirmed this; however, she noted that the
difference between Petersville area and Crow Creek is that the
Crow Creek mine is on private land completely owned by the Crow
Creek group as allowable under the federal mining laws whereas
the Petersville mining claim would be managed under the final
jurisdiction by the state's DNR.
1:44:48 PM
CO-CHAIR SADDLER, after first determining no one else wished to
testify, closed public testimony on HB 135.
1:45:09 PM
REPRESENTATIVE JOHNSON asked whether this area is accessible by
road.
MR. GOODRUM confirmed a road lies in close proximity to the
southern portion of the Petersville Recreational Mining Area.
REPRESENTATIVE JOHNSON asked for a more definitive definition of
"close proximity."
MR. GOODRUM directed attention to a map in committee members'
packets that shows a faint line for the road. He offered to
provide more precise information on the road.
REPRESENTATIVE JOHNSON wondered what type of business
opportunity and clientele would be served, for example, if the
mining would be geared for tourists or if one person seeks to
generate mining revenue.
MR. GOODRUM replied that the division would work with the
applicant on a business plan. Currently, the land is still
considered federal land and the state needs to complete the
conveyance process. He anticipated the division would then work
on a business plan with the potential applicant to determine how
the rules would be applied. He characterized this as being an
important first step to "untangle" this complicated situation.
He offered his belief that this information would be
forthcoming.
1:47:02 PM
REPRESENTATIVE KAWASAKI referred to a memo in members' packets
from the [Division of Legal and Research Services], Legal
Services [dated January 29, 2013] from Donald M. Bullock, Jr.
who raised the question on the reason mining claims were
excluded from this bill.
MR. GOODRUM answered that the entire Petersville mining area was
at one point state-selected land with previous federal mining
claims located there. A mineral survey was conducted in 1984
that prevented the state from taking ownership of the selected
land. The aforementioned federal mining claims were abandoned
prior to the land being patented. Therefore the state's
selection still "hovered" over the top and the state has the
ability to bring the land into ownership. During the mineral
survey that land was surveyed and the easiest way to reference
back and identify this area is to reference the 1984 surveys.
This is how the Petersville Recreational Mining Area was
created, he said, since it leveraged existing surveys in place.
REPRESENTATIVE KAWASAKI inquired whether any current federal
claims exist on that land.
MR. GOODRUM answered that to his knowledge there are not any
active federal claims that in the [Petersville Recreational
Mining Area].
REPRESENTATIVE KAWASAKI asked whether recreational use is the
best use of the lands or if other uses exist.
MR. GOODRUM replied that the aforementioned land use question is
several steps down the road. He said the state determines the
best use of the land and the division will work with the
potential applicant on the appropriate type of activities
allowable on the land. He said, "I think that those decisions
are still in front of us, but it's clearly paved the way for the
state to follow through on what had been originally conceived as
far as what could be done with this area."
1:49:58 PM
REPRESENTATIVE P. WILSON moved to report HB 135 out of committee
with individual recommendations and the accompanying fiscal
note. There being no objection, HB 135 was reported from the
House Resources Standing Committee.
The committee took an at-ease from 1:50 p.m. to 1:52 p.m.
HB 161-AUCTIONS FOR BIG GAME HARVEST PERMITS
1:52:27 PM
CO-CHAIR SADDLER announced that the next order of business would
be HOUSE BILL NO. 161, "An Act relating to auctions or raffles
for big game harvest permits and to the selection of nonprofit
organizations to conduct auctions and raffles for the Department
of Fish and Game."
1:52:51 PM
REPRESENTATIVE LYNN GATTIS, Alaska State Legislature, stated the
committee held a hearing last year on HB 161 and she has
subsequently worked on the bill with the Alaska Department of
Fish & Game (ADF&G) as well as several sporting groups to create
the work draft in members' packets.
1:53:43 PM
REPRESENTATIVE SEATON moved to adopt the proposed committee
substitute (CS) for HB 161, Version Y, labeled 28-LS0530\Y,
Bullard, 2/17/14 as the working document.
REPRESENTATIVE KAWASAKI objected for discussion purposes.
1:53:53 PM
REPRESENTATIVE GATTIS stated that the ADF&G operates several
programs that allow big game permits to be donated to nonprofit
sporting groups to support state wildlife management. Three
separate auction programs are authorized in statute, including
the Delta Bison, Etolin Elk and Big Game programs. The current
statutory framework governing the two most prominent programs
has become outdated - Delta Bison and Big Game - and therefore
many groups are ambivalent about participating in these
programs.
REPRESENTATIVE GATTIS explained HB 161 [Version Y] would expand
the previously mentioned program's scope by allowing additional
permits to be issued for more species and increase the current
statutory limit of 19 permits to 42 permits. The bill would
further invigorate the program by giving the designated
nonprofit organizations a greater share of the proceeds from the
auction of the permit[s].
REPRESENTATIVE GATTIS indicated the reason for this is that not
enough folks wanted to participate in the permit fundraising
effort [when the organization could only retain [10] percent of
the net profits]. By increasing the nonprofit's share to [30]
percent, the program could attract more interest and the permit
raffle or auction should be more attractive to organizations.
REPRESENTATIVE GATTIS highlighted changes in the guidelines that
allow the department to auction off permits [in Section 1].
This language would allow the ADF&G to limit the donations to
nonprofit organizations that are established to promote
education in outdoor traditions and conservation and wildlife
protection programs in partnership with the department.
1:55:55 PM
REPRESENTATIVE GATTIS noted that two types of permits can be
issued under the bill. She explained that permits under Section
1 allow 100 percent of the proceeds from the auction to be
retained by the sporting group operating the auction. Permits
under Section 2 of the bill would allocate 30 percent of the
proceeds to qualified sporting group organizations while 70
percent will be retained by the department and deposited in the
fish and game fund.
REPRESENTATIVE GATTIS reported the sale of these specific game
permits brought in $460,000 in revenue from 2009 to 2013. She
reiterated that this money is deposited in the fish and game
fund and has been used to directly benefit purchasers of general
hunting, fishing and trapping licenses.
REPRESENTATIVE GATTIS said the "North American Model of Wildlife
Conservation" has been removed from HB 161. This language
brought some confusion that was never intended, she said.
1:56:31 PM
CO-CHAIR SADDLER opened public testimony on HB 161.
1:56:53 PM
WAYNE E. HEIMER provided background on the permit auction
system. He said this system has always existed in western
states, in which governors would give hunting and fishing
permits away as a form of political patronage. In fact, until
the 1960s Alaska's permit system was very much like this, but
was withdrawn by the legislature after Governor Egan issued a
governor's permit for the taking of Dall sheep in the Brooks
Range by the nephew of the Shah of Iran. He related his
understanding the Shah was really was there to steal peregrine
falcons, which were considered an endangered species. The idea
to use these permits for conservation purposes arose in Wyoming
during the time that he was the Dall sheep research biologist
for the Alaska Department of Fish & Game. He offered his belief
that he was the first person to advocate using permits to raise
conservation money although the department was not interested in
the program. Thus, he shifted the program idea to the
Foundation for North American Wild Sheep, now known as the Wild
Sheep Foundation. The Alaska Chapter of the Wild Sheep
Foundation later worked with Senator Con Bunde on the enabling
legislation that allows permit auctions to take place in Alaska.
MR. HEIMER related his background, such that he spent over 15
years with the Foundation for North American Wild Sheep and Wild
Sheep Foundation, having served three terms on the board, as
well as having served as the Alaska Chapter president. These
organizations generate "big dollars" for permits, in particular,
for Dall sheep. In fact, he previously worked to advertise and
sell Dall sheep permits in the market when the permits weren't
as attractive as they are now.
1:59:16 PM
MR. HEIMER said he is opposed to HB 161 because the premises are
highly questionable. The idea that the permit system is a
"Golden Goose" from which one can repeatedly squeeze eggs is
false. The auction prices for these permits can vary much as
100 percent. "Sometimes they attract significant dollars but
sometimes they don't," he said. These buyers typically state
that they want to give back to the resource that they enjoy and
he acknowledged that benefit. He noted these hunters are also
looking for an unusual animal although they will not pay more
than the other bidders are willing to pay. He characterized
this market as a "volatile" market and he questioned the
assumption that one could simply make more permits available and
maintain the high price for permits.
MR. HEIMER also questioned the rationale or ethos behind HB 161.
He stated his preference to have amateur non-governmental
organizations (NGOs) but not industrial ones auctioning the hunt
permits such as the Wild Sheep Foundation. He questioned
capitalizing the NGOs over the manager. He said that having one
permit go specifically to an NGO for education seems to presume
that this action will be more beneficial in the long run than
capitalizing the managers who produce the benefits from the
resource under Alaska's Constitution and state statutes.
MR. HEIMER said non-governmental organizations (NGOs) often
confuse themselves with the [governmental] managers, which they
are not. In fact, the NGOs exist to support and assist the
managers. The aforementioned reasons lead to him to question
the premise of HB 161. Further, someone will need to market
these permits, which will entail substantial work. Although an
organization might earn 30 percent of the proceeds, but again,
he wondered whether 30 percent of the proceeds could be better
spent by the agency providing benefits or if it would just be
used to pay the NGO's overhead costs. In response to a
question, he answered that he had previously submitted written
comments last April but has not recently done so.
2:02:21 PM
REPRESENTATIVE SEATON asked whether his main objection to HB 161
has been that expanding the number of permits will deflate the
value in a pretty small market.
MR. HEIMER replied that is a major concern of his since the
buyers at auction really tend to appreciate the appearance of
exclusivity of the permits.
2:03:05 PM
REPRESENTATIVE P. WILSON understood the concern that the NGOs or
organizations really end up paying [administrative costs] for
the managers and the proceeds are not used for the NGOs' goals
and activities to enhance wildlife.
MR. HEIMER related a scenario in which a permit brought in
$100,000, with 30 percent being spent to market the NGO. The
state would need to assume the NGO will produce more benefits
with the $30,000 than the [state's] managers would produce with
the same funds. He offered his belief it is likely that the
NGOs will spend it on overhead.
2:04:27 PM
REPRESENTATIVE SEATON referred to page 2, lines 13-14 of Version
Y. He understood 30 percent of the net proceeds from the permit
auction would be retained by the organization, noting the costs
of marketing, advertising, and holding the auction would be
deducted first.
MR. HEIMER remarked that this troubles him even more.
REPRESENTATIVE GATTIS said anyone who has organized fundraisers
knows the costs and efforts involved in doing so. She explained
that this bill seeks to make it worthwhile for fundraisers to
fundraise. She characterized the situation as a "win-win"
situation when the fundraising organization can raise more money
for the organization and the state through the auction process.
The bill would allow the state to obtain 70 percent of the
proceeds with 30 percent retained by the NGOs. She stated that
the current level of allowing 10 net proceeds be retained by
NGOs has resulted in people simply not willing to raise the
funds.
2:06:19 PM
REPRESENTATIVE JOHNSON asked whether the bill relates to one
permit out of several permits in an area. He further asked
whether the auctioned permit is a guaranteed permit rather than
an opportunity to participate in a drawing permit hunt.
REPRESENTATIVE GATTIS agreed it was a guaranteed permit.
REPRESENTATIVE JOHNSON asked how much the state typically
receives for other permits in the hunt area.
REID HARRIS, Staff, Representative Lynn Gattis, Alaska State
Legislature, on behalf of Representative Lynn Gattis, the prime
sponsor of HB 161, said he deferred to the ADF&G to answer. He
confirmed the permit would be guaranteed.
REPRESENTATIVE JOHNSON asked how much revenue the state receives
from any permit that is a drawing permit.
MR. HARRIS deferred to ADF&G to answer.
REPRESENTATIVE JOHNSON reiterated his question by posing a
scenario in which 10 permits are available in one area and one
permit is auctioned off. He asked how much revenue the state
receives on the remaining nine permits for drawing permit hunts.
DOUG VINCENT-LANG, Director, Division of Wildlife Conservation,
Alaska Department of Fish & Game, responded the department only
makes the amount of money equivalent to the license fees and
application fee to enter the drawing hunt.
2:08:26 PM
REPRESENTATIVE JOHNSON asked whether the amount would be
approximately $25-$50 fees for the drawing hunt entry fees.
MR. VINCENT-LANG answered that is correct.
REPRESENTATIVE JOHNSON asked whether any drawing has made less
than $50.
MR. VINCENT-LANG answered no.
REPRESENTATIVE JOHNSON summarized there isn't any comparison
between the [permit hunts being auctioned] for regular hunts in
terms of generating funds for the state. For example, if an
auctioned hunt raises $100,000 and the state receives 70
percent, or even 50 percent of the proceeds, the state will
still receive $50,000 as opposed to the $50 it would receive if
the department issued drawing permits. Therefore, this bill
represents an opportunity to increase the state's treasury by
allowing qualified organizations to raise money to help preserve
species. He summarized this bill would allow organizations to
auction one hunt per area per species. He emphasized the
difference in terms of economics alone is significant; however,
the bill would not adversely affect the species. He
characterized HB 161 as making it economic for someone to make
money for the state.
2:10:08 PM
REPRESENTATIVE P. WILSON said she was familiar with Etolin
Island. She asked how many elk permits would be issued and of
those the number that would be auctioned off.
REPRESENTATIVE JOHNSON responded that the number of permits in
the game management system allow for a certain number of animals
to be taken. One hunt would be reserved for the ADF&G's auction
and the remaining permits will be issued to citizens, he said.
He reiterated the number of permits issued would depend on the
size of the herd.
REPRESENTATIVE P. WILSON maintained her interest in how many
permits will be auctioned off and the total number of permits
that will be issued.
MR. HARRIS said the original bill removed all four tags
designated for Etolin Island out of the ADF&G's auction permits.
He said the Devil's Thumb Archers Archery Club objected since
this organization has been the recipient of the elk raffle
permit for some time. In fact, the club has applied for and
received a tag nearly every year and has typically been the only
organization applying for the permits. The sponsor decided not
to change the Etolin Island elk permit language so the language
in Version Y will reinstate the language [under AS
16.05.343(b)].
2:12:27 PM
REPRESENTATIVE KAWASAKI removed his objection.
[Version Y was before the committee].
2:12:42 PM
KAREN GORDON, testifying on behalf of herself, noted she
currently serves as a board member for the Wild Sheep Foundation
and has been involved with this foundation for several years.
She previously wrote an article about the ADF&G's permit system
and has followed the [auction or raffle of big game harvest
permit] program. She offered her belief that this bill is a
"clever scheme" to fund a special interest private organization
without any benefit to the state. Current enabling legislation
- enacted in 1995 - prescribes profit as a motive to sell
permits. The laws in place provide significant funds to the
state since the permits go to the organizations best experienced
in [conducting the auctions.] She questioned reducing the
state's percentage of net proceeds from the 90 percent to 70
percent under the bill. She said, "This doesn't make sense."
This bill would preclude permits being sold where they have
proven to be the most profitable to the state. Instead, under
the bill, 30 percent of the net proceeds will generously fund a
private organization. For example, if the bill was applied to
the recent Dall sheep permit sold at the Wild Sheep convention
last month the process would cost the state $52,500 in net
proceeds rather than $17,500. She characterized the Wild Sheep
convention as a place where "sheep-crazed" wealthy hunters
congregate to specifically buy these permits. She reported the
first Dall sheep permit was auctioned off for $200,000, a second
one was auctioned off for $200,000 several years ago, and the
most recent one was auctioned off for $175,000.
2:14:43 PM
MS. GORDON said the permit system in place for the Wild Sheep
Foundation alone raised $926,000 in state permits since 1997.
Thus, it isn't as though this process doesn't already bring
money to the state. She cautioned against setting up a monopoly
without any controls on how the money is spent. In fact, funds
could be used for political contributions since safeguards will
be removed under the bill. She questioned whether a conflict of
interest exists since the Wild Sheep Foundation's board includes
the commissioner of the ADF&G and another department employee,
but the commissioner sets the terms of the permits that are
awarded, rather than by law, as it appropriately is now. She
concluded that this bill entirely fails to benefit the state and
should not proceed any further in any form. This plan will
decrease profit to the state over the short and long term and
will establish a funding stream from the state to a private
organization managed, in part, by several ADF&G employees. This
bill is an example of fixing something that is not broken, she
said.
REPRESENTATIVE GATTIS respectfully disagreed, saying that
offering 30 percent is far more of an incentive to get
organizations to participate. She offered her belief that the
state will receive more revenue by having more people involved
and the process will gain more funding for the state.
2:17:12 PM
DAVE CAMPBELL, Donations Chairman, Southcentral Alaska Chapter,
Ruffed Grouse Society, stated he has resided in Alaska for over
47 years. He detailed his membership in relevant organization,
including that he is a member of the Ruffed Grouse Society, a
life member of the Rocky Mountain Elk Foundation, the National
Rifle Association (NRA), the Boone and Crockett Association, the
KwaZulu-Natal Hunting and Conservation Association, the One-Shot
Antelope Hunt Club, as well as a member of Trout Unlimited and
the Arctic Bird Dog Association. He said he supports ethical
and legal means of flora and fauna throughout the world, but
especially in Alaska. He said, "I believe with all my heart
that HB 161 is needed by 501 (3) (c) organizations in Alaska to
benefit their individual programs for conservation, legal sport
hunting, and sport fishing." This bill will aid the nonprofit
organizations in their fundraising endeavors as well as
increasing funds to the general fund in Alaska. He offered his
belief that this bill is long overdue for passage in this
legislature.
2:18:59 PM
GARY STEVENS, speaking on behalf of himself, said he also serves
on the Board of Directors for the Outdoor Council. He pointed
out the number of permits would increase from 19 to 46, not
including ones for wolves. He offered his belief this is too
many permits. He agreed with Mr. Heimer's testimony in terms of
the sheer volume of permits being detrimental to the state, in
particular, in terms of bison and Dall sheep. In terms of the
value of the permits for the raffle, he estimated over 20,000
applicants apply for the bison hunts in Delta. Based on $10
resident and non-residents fees he further estimated that the
bison hunt generates over $200,000. He noted the permittee can
enjoy the natural resource that belongs to all Alaskans.
Although he does not have a copy of the proposed committee
substitute, (CS) for HB 161, Version Y, he referred to page 1,
line 8 of HB 161 as introduced, [Version U] which reads, "The
donation may be made only to a nonprofit corporation established
to promote outdoor and conservation programs in partnership with
the department ...." He understood the sponsor to say this
language changed, but he was not aware of any nonprofit
organization that would qualify using this language. He
expressed interest in identifying which organizations could
qualify.
2:21:21 PM
REPRESENTATIVE TARR related her understanding that management
issues and a perceived shortage of Dall sheep and bison have
prompted him to comment on these species.
MR. STEVENS responded that it is not a "perceived" shortage
since the bill will create a shortage of opportunities for
Alaska and non-residents to participate in hunting Dall sheep
and bison. He questioned taking five permits from those two
species from the limited number of permits available for the
general public, which he found to be excessive.
2:22:39 PM
MIKE CRAWFORD, Regional Representative, Safari Club
International (SCI), stated he lives on the Kenai Peninsula and
is a member of the Legislative Outdoor Heritage Caucus Advisory
Committee and is the Chair of the Kenai Soldotna Advisory
Committee of Fish and Game. He represents two award-winning
chapters in Alaska. He reported that SCI has over 50,000
members and over 200 chapters. He stated that the SCI is a
nonprofit organization, a leader in defending hunting rights and
conservation around the world, the U.S., and Alaska. He offered
SCI's support of HB 161. He offered his belief that the main
objection to this bill is that people might think that the
organization is being greedy. He disagreed, noting that SCI has
given over $750,000 to fish and game projects and State of
Alaska fish and game projects, including the Wood Bison
reintroduction project, the recent Kenai Peninsula moose calf
survival study, the Kodiak Island chronic wasting disease
affecting deer, the Kodiak brown bear. The SCI spends more time
and money on the permit tags for a small return. He related a
scenario in which the SCI held a Friday night auction for a Tok
[Dall sheep] tag, which drew $16,000. Recently, the Wild Sheep
Foundation sold the same Dall sheep tag for $180,000. He
indicated the same people attend these conventions and if the
SCI had held its auction on a Saturday it may have needed more
funds. He said the auctions benefit the wildlife, the hunters,
and the state. The SCI looks forward to advancing conservation
and hunter's rights by working with the state on projects for
years to come.
2:25:39 PM
REPRESENTATIVE SEATON referred to page 1, Version Y, and asked
whether SCI will fit under the definition. The language in
subsection (a) read, in part, "The denotation may be made only
to a nonprofit corporation established to promote education in
outdoor traditions and conservation and wildlife protection
programs in partnership with the department subject to the terms
of a memorandum of agreement developed by the department."
MR. CRAWFORD replied he believes so.
2:26:16 PM
REPRESENTATIVE TARR referred to the administrative burden and
motivation of nonprofits to participate in permits. She asked
whether simply increasing the 10 percent to 30 percent alone
would have a positive benefit for the organization.
MR. CRAWFORD answered that he believed it would. He stated that
when the fundraiser is done, the organization knows a set amount
of money will be raised, and if the organization must give up 90
percent of the proceeds, it is more likely the nonprofit will
use something to generate more income. Of course, the SCI would
also like to help the ADF&G and the state on conservation
projects and interests, but the increase in the percentage is
what he is most interested in [rather than an increase in the
number of permits].
2:27:37 PM
REPRESENTATIVE SEATON turned to the donor license auction
proceeds in 2011 and 2012, which identifies species for permits
that have been held, including bison, musk ox, brown bear, and
Dall sheep, but not for moose. He asked whether the
organization chose not to auction them off.
MR. CRAWFORD believed that is the case. He said his
organization attempts to get the most money it can for its
efforts. He indicated that receiving a greater percentage [30
percent of net proceeds] would create an incentive.
REPRESENTATIVE SEATON wondered if 19 permits were available at
[30] percent if the organization would apply for more permits or
if the SCI would only offer one at its fundraiser.
MR. CRAWFORD related that he receives an invitation from ADF&G
each year to apply for those tags. He reported that the SCI has
declined to offer certain tags. He suggested that the [30]
percent will get everyone's attention. He offered his belief
that this should generate additional income for the state. He
anticipated the tag would be auctioned off for more money so the
state' portion will be greater, too. He characterized the SCI
organization as a great organization and people attending will
be willing to pay for these experiences in Alaska.
2:30:41 PM
HELEN NETSCHERT, President, Alaska Kenai Peninsula Chapter,
Safari Club International, reported that her club is a 501 (c)
(3) nonprofit corporation consisting of approximately 200
volunteers and none of their officers are compensated for any
work they do. She stated that HB 161 will benefit all of her
organization's educational, wildlife, and conservation efforts
on the Kenai Peninsula. Currently, the organization has been
focused on moose. Additionally, the club offers educational
programs for children ages 10 and above. She said her club
supports HB 161.
2:32:02 PM
REPRESENTATIVE JOHNSON asked whether the tag alone is sold or if
the club packages the hunt and includes a guide.
MS. NETSCHERT responded that the Safari Club International (SCI)
markets it as a hunt and the person buying the hunt must obtain
a [big game guide-outfitter] and transportation. The SCI
provides this information in the explanation of the hunt. Of
course, an out-of-state person is required to have a guide for
Dall sheep anyway. She recapped that the SCI markets it as a
hunt.
MR. CRAWFORD added there have been times when the tag was
matched with a guide as a package, but not always. Thus,
sometimes the SCI packages the hunts and will probably do so in
the future.
REPRESENTATIVE JOHNSON asked for further clarification on how
the cost of the permit would be broken out in packaged hunts.
MR. CRAWFORD advised that the SCI tries to get the guide to
donate 100 percent of his/her services and the club may cover
some costs involved.
2:34:47 PM
EDDIE GRASSER, Chairman, Legislative Outdoor Heritage Caucus
Advisory Council, stated he wears many hats but today represents
the aforementioned organization, which he chairs. A number of
organizations have seats on the council, including SCI, Kenai
River Sportfishing Association, Rocky Mountain Elk Foundation,
National Rifle Association, and Ruffed Grouse Society. He
offered support for HB 161 and believes it will greatly benefit
the state in terms of conservation and enhanced revenues for the
ADF&G. Based on over thirty years of fundraising, he
highlighted clarification on several points. He noted that in
Version Y, one Dall sheep has been added, but no additional
bison so it takes it back to the original statutory language.
Thus, no additional bison are added in Version Y. Additionally,
the organization can raffle permit package hunts in the
marketplace, especially for prevalent species, such as moose and
caribou to enhance fundraising. He acknowledged a popular area
is the Nelchina Basin, although it is a subsistence tier 2, tier
1, area so those permits are not available for this type of
permit.
MR. GRASSER reinforced what Mr. Harris stated about Etolin
Island. He said that the four permits for Etolin Island elk are
in current statute. In terms of money going to private
organizations, the 30 percent must be spent in consultation with
the department. Therefore, if SCI obtained one of these permits
and raised $100,000 and obtained 30 percent, it would need to
consult with the department on how the funds will be spent. He
characterized it as being a built in safeguard. Further, the
department has memorandum of agreements (MOA) with several
organizations. In fact, any of the aforementioned nonprofits
has the ability to enter into MOAs with the department. He said
there isn't any exclusionary language that prevents any
organization such as the Wild Sheep Foundation (WSF), the Ruffed
Grouse Society (RGS), the Alaska Outdoor Council, or the SCI.
MR. GRASSER said the LOHCAC has made this bill a priority for
the session since the organization believes it will greatly
benefit Alaska.
2:38:42 PM
REPRESENTATIVE KAWASAKI stated that part of the rub of the bill
as introduced had to do with being able to use the proceeds to
pay for expenses associated with lobbying. He understood that
Mr. Grasser lobbies for some groups. He asked whether the
organization have any objections to the change and how the
information is audited.
MR. GRASSER referred to page 2 of HB 161 [Version Y, lines 14-
17]. He emphasized that the organization would need to consult
with the department on how to spend the 30 percent of the net
proceeds.
REPRESENTATIVE KAWASAKI asked for further clarification on how
the department currently audits to ensure the funds are not used
for lobbying.
MR. GRASSER deferred to the department.
2:40:34 PM
DON QUARBERG, said he speaking on behalf of himself, but noted
he also serves as Chair of the Delta Advisory Committee;
however, the advisory committee has not discussed HB 161. He
expressed concern about the supply side economics, noting the
committee has already discussed this; however, he agreed that
saturating the market with permits will reduce their value. He
would prefer not to focus only on the economics. He highlighted
that the chances of obtaining a Tok management area Dall sheep
permit is about one percent. He suggested that with the limited
number of tags the department could auction the permits off, but
the department must manage based on a sustained-yield basis for
Alaskans. The bill provides the commissioner with a lot of
latitude and discretion to design how the funds are spent. He
suggested the bill should have some sideboards. He referred to
page 2, lines 13-17 [of the original bill] to language
restricting contributions for political campaigns and lobbying.
He did not object to that language being inserted. He preferred
not to allow proceeds to be spent on lobbying.
MR. QUARBERG added that he thought 10 percent profit was
acceptable. He expressed concern about the potential for
creative accounting in administrative costs associated prior to
the net proceeds from permits. He said until these concerns are
satisfied he did not think he could support the bill. He
understood the organizations wanting to support the bill to
increase funding for these worthy nonprofits especially since
these organizations benefit the public, too.
2:44:32 PM
CO-CHAIR SADDLER, after first determining no one else wished to
testify, closed public testimony on HB 161. He then passed the
gavel to Co-Chair Feige.
[HB 161 was held over.]
The committee took an at-ease from 2:44 p.m. to 2:46 p.m.
HJR 26-OFFSHORE OIL & GAS REVENUE SHARING
2:46:00 PM
CO-CHAIR FEIGE announced that the next order of business would
be HOUSE JOINT RESOLUTION NO. 26, Urging the United States
Congress to provide a means for consistently and equitably
sharing with all oil and gas producing states adjacent to
federal outer continental shelf areas a portion of revenue
generated from oil and gas development on the outer continental
shelf to ensure that those states develop necessary
infrastructure to support outer continental shelf development
and preserve environmental integrity.
2:46:07 PM
CO-CHAIR SADDLER, as sponsor of HJR 26, introduced the
resolution. He said that oil and gas development in federal
areas can be a boon for our country, providing revenue and jobs
and secure sources of domestic energy, but it also creates
costly impacts on nearby states, communities, and their
residents. While the federal government recognizes these
strains, they set policies in place to share proceeds from such
development to help states offset the costs for the improvements
and services necessary for safe and responsible development.
The federal government shares 50 percent on onshore areas where
the production occurs, in areas within three miles of shore, the
near shore, it shares 27 percent, and for offshore areas, it
shares 37.5 percent of the revenues. However, current federal
law says the State of Alaska and similarly situated states don't
receive any share of federal revenues oil produced out of
prospects in areas such as the Chukchi or Beaufort Seas.
CO-CHAIR SADDLER said many believe there is lots of oil in the
outer continental shelf (OCS). The industry shares that belief
in its investment of millions of dollars in leasing,
exploration, and drilling. Just as onshore development on the
North Slope requires infrastructure and investment, offshore
development will require infrastructure investment in ports,
roads, airports, utilities, housing, and more. Further, it
would require additional state services such as oil spill
emergency response, public health and safety, and environmental
monitoring and mitigation. Right now might be the best
opportunity in years in progress for OCS revenue sharing. He
pointed out that U.S. Senator Lisa Murkowski is the ranking
Republican member of the Senate Energy and Resources Committee.
The new chair is U.S. Senator Mary Landrieu, Louisiana, a strong
advocate for the oil industry and an advocate for OCS revenue
sharing. These two senators have introduced the Fixing Americas
Inequities with Revenue (FAIR Act), which would extend to all
OCS states the same 37.5 percent share that the Gulf Coast
states currently receive. This resolution, HJR 26, would send a
strong message from the State of Alaska to the U.S. Congress in
support of the FAIR Act or similar legislation that aims at a
fair and sensible system of federal revenue sharing.
2:48:19 PM
CO-CHAIR FEIGE opened public testimony on HJR 26.
2:48:45 PM
CHARLOTTE BROWER, Mayor, North Slope Borough (NSB), speaking
from written testimony, paraphrased, as follows:
Good afternoon. My name is Charlotte Brower. I am
the Mayor of the North Slope Borough and foremost am
the wife of a whaling captain, mother of six children
and grandmother of 25 so I have a dear investment in
the North Slope.
Thank you for the opportunity to speak on HJR 26, a
resolution urging the United States Congress to
provide for sharing with local areas the revenue from
the oil and gas development on our outer continental
shelf.
On July 23rd of this past summer, I was invited to
testify before the U.S. Senate Energy Committee in
support of S. 1273, known as the "Fixing America's
Inequities with Revenues Act of 2013" or "FAIR Act".
Today I am here before you to express support for HJR
26 as a way to help secure passage of measures like S.
1273 in Washington D.C. By working together as
Alaskans, we need to send a message for receiving a
fair and equitable distribution of revenues that come
from energy development on our Outer Continental Shelf
(OCS).
2:50:44 PM
MAYOR BROWER continued reading her written testimony, as
follows:
The Congress should pass legislation to ensure that
state and local governments will have resources to
keep up with infrastructure requirements, expand
emergency response and search and rescue capabilities,
take an active role in oil spill preparedness, and
work to maintain healthy communities and a healthy
ecosystem.
The North Slope Borough is the largest municipality in
the United States encompassing over 94,000 square
miles, including more than 8,000 miles of Arctic
coastline along the Beaufort and Chukchi Seas.
The majority of North Slope residents are Inupiat
Eskimos. We are heavily dependent upon marine
mammals, such as Bowhead and Beluga whales, seals and
walruses to sustain our physical health and our
cultural and spiritual well-being. The importance of
subsistence in our coastal communities and marine
environment goes beyond the need for food. Our unique
Inupiat culture, our traditions, and our links to our
ancestors and history are also tied to our subsistence
lifestyle, to our custom of sharing with others, and
to celebrating our connection to the land and the
ocean.
We are mindful of the critical need to protect the
environment and preserve our culture and our
resources. However, we also recognize that our
ability to continue to provide even basic services to
our communities depends upon revenue from the oil and
gas industry, which today primarily operates on state
land in our region. Without these revenues, the North
Slope Borough would not be able to maintain the
airstrips, health care facilities, water and sewer,
search and rescue or other services we provide in our
villages.
What many people in the Lower 48 do not understand is
that the infrastructure enjoyed today by other coastal
states - paved roads, deep water ports, and modern
communications - those don't exist in the North Slope
region.
Most people do not understand the challenges Alaska's
rural governments' face. As one example, a gallon of
milk costs $10 today in Barrow. That same gallon of
milk might cost $18 or more in some of our villages.
Other food items such as fresh fruits and vegetables
are even more expensive relative to the Lower 48 or
even other parts of Alaska because the cost of
transportation in our region is very high. And now
imagine the cost to the North Slope Borough for new
roads, upgrades to airstrips, new health care
facilities or new water and sewer or gas lines that
must be built through permafrost.
2:54:09 PM
MAYOR BROWER continued reading her written testimony, as
follows:
We also face threats to the infrastructure we have in
place today. With the Arctic Ocean now ice free for a
longer period every spring and fall, storms are
eroding the land around our villages - in some cases
over five to six feet per year. [A] moderate storm
once consumed more than a million dollars in response
costs from our borough. Over the last ten years the
coastline near Barrow has receded toward an old
landfill that holds tens of thousands of barrels of
[U.S.] Navy and {U.S.] Air Force waste. Ten years
ago, the ocean was 200 feet away from the landfill.
Now it is only 120 feet away.
Coastal erosion also threatens Barrow's utility
system, which is an underground system of tunnels
designed to protect the city's utilities from the
cold. This system provides indoor plumbing to our
residents and eliminates the need for outhouses and
water delivery by truck. And like most other things
in the Arctic, it is very expensive.
2:55:30 PM
MAYOR BROWER continued reading her written testimony, as
follows:
I would also like to note that the oil and gas
industry, researchers, and federal agencies, including
the U.S. Coast Guard, all use our local infrastructure
- our airports, roads, and hospitals. We welcome
people to our community and we are grateful for the
[U.S.] Coast Guard's presence in Barrow during the
2012 drilling season, but Congress must recognize the
cost to our community of maintaining and expanding
critical infrastructure as industry develops offshore
resources.
There is also a great [deal] of scientific research
needed to understand how best to mitigate the impact
of oil and gas development on the Arctic Environment
and the North Slope Borough can and should be part of
that effort.
The last thing I would like to emphasize is the role
of the state and local governments in emergency
preparedness associated with offshore energy
development, including oil spill response. Let us
pray that our good Lord will prevent the need, but in
the event of an emergency it will be the brave men and
women from the North Slope Borough Search and Rescue
Department and the Alaska Department of Public
Safety's troopers and the village [police safety
officers] VPSOs who will most likely be first on the
scene.
In summary, the people of the North Slope live in one
of the most undeveloped regions in our nation.
Investments must be made in the infrastructure
necessary to ensure that the OCS development can be
conducted safely and responsibly. And the burden of
providing such infrastructure should not fall solely
on the people [who] have the most to lose in case of
an oil spill.
Thank you for sponsoring HJR 26 [and] to help the
people of the North Slope Borough [to] send this
message to the United States Congress.
2:57:59 PM
CO-CHAIR SADDLER remarked that it is appropriate to have Mayor
Brower and Inupiaq spoken in the House Resources Committee room
as the committee discusses the impact of the OCS on the North
Slope.
2:58:31 PM
SARAH ERKMANN, External Affairs Manager, Alaska Oil and Gas
Association (AOGA), stated that AOGA supports HJR 26. She
related that AOGA is the business trade organization
representing the majority of oil and gas producers, explorers,
refiners, transporters, and marketers in Alaska. With 15 member
companies, the AOGA represents both large and small companies
with interest on the North Slope, in the Cook Inlet, and in the
OCS [often referred to as the "Offshore"].
MS. ERKMANN said the AOGA appreciate the focus on developing
Alaska's offshore resources in a way that recognizes Alaskans'
interest in advancing the issue because the Offshore is
considered the "next generation" of oil and gas development in
Alaska. It is truly a world-class resource with an anticipated
27 billion barrels of oil to produce. She said, "AOGA can say
at a high level that we support an OCS revenue-sharing program
as long as additional costs are not passed on to the offshore
oil and gas industry in the form of bonuses, rent, or
royalties." The AOGA appreciates the legislature's efforts as
well as efforts made by Alaska's Congressional delegation to
keep the Offshore Revenue Sharing alive at the federal level.
She thanked members for the opportunity to testify.
3:00:15 PM
ADRIAN HERRERA, Washington D.C. Coordinator, Arctic Power, asked
to speak in support of HJR 26. He related that Arctic Power is
a 501 (c) (6) not-for-profit citizens' based organization
arguing for the environmentally responsible development of oil
and gas resources in the Arctic region of Alaska. The Arctic
Power strongly supports HJR 26 and support for OCS revenue
sharing nationwide as well as in the state. Two prime reasons
are to bring parity with the rest of the nation, in particular,
with the Gulf of Mexico states, which receive 37.5 percent.
Additionally, Arctic Power works to mitigate impacts to coastal
communities in Alaska and the state as a whole. The current
status of zero percent revenue sharing does nothing to encourage
the State of Alaska or any other coastal state to pursue
offshore development nor does it provide any mitigation costs
against problems or impacts to the environment or coastal
communities. As previously mentioned, a bill is before the
Congress, S. 1273, the "Fair Act", which is probably the prime
target HJR 26 will be used for although another bill, S. 199 by
U.S. Senator Mark Begich. He advised that S. 199 carries much
the same language as S. 1273, except it is geographically
limited to the State of Alaska. It has received strong support
and U.S. Senator Begich has signed on as a sponsor of S. 1273,
which will likely be the vehicle. Thus, Alaska has full support
for the OCS revenue-sharing bills currently active in the U.S.
Senate, he said. Last year, in the U.S. House of
Representatives, H.R. 2231, an OCS revenue-sharing bill, passed
carrying the same figure of 37.5 percent to the state closest to
the development, which was sponsored by U.S. Representative
Richard Norman "Doc" Hastings, Chair of the Natural Resources
Committee, representing Washington's 4th district.
3:02:43 PM
MR. HERRERA related that the White House has expressed strong
concerns against revenue sharing towards states not receiving
it, such as Alaska due to the loss of revenue to the federal
government. He noted that taking 37.5 percent from the entire
OCS royalties and revenues going to states would represent a
loss to the U.S. Treasury. Similarly, based on a bill passed in
2006 called the "Gulf of Mexico Energy Security Act of 2006
(Pub. Law 109-432 [GOMESA], drafted by U.S. Senator Mary
Landrieu, allow 37.5 percent of royalty and revenue to the local
communities up to a cap of $500 million per year. The "FAIR
Act" reduces that cap to zero in 2025 and the White House and
U.S. Treasury finds this to be "stealing money from the
treasury." In fact, during hearings U.S. Senators stated this
concern.
MR. HERRERA said another front mentioned by the White House and
the Department of the Interior relates to the environmental
mitigation programs specific to the Land and Water Conservation
Fund (LWCF). The Land and Water Conservation Fund so far has
been a boondoggle because it has been raided by various
presidents and Congressional committees to fund other projects
not related to environmental conservation or environmental
mitigation. He reported that the President seeks to fund the
LCWF with $900 million, noting it already receives $125 million
under GOMESA and will receive $62.5 million under the proposed
FAIR Act. During debate on the proposed FAIR Act in July the
Chair and ranking member Senator Murkowski both stated for the
record that LWCF should not be reduced. However, in the Arctic
Power's opinion the proposed $900 million for future OCS revenue
for the LCWF is really a "pie in the sky" and would not receive
that type of support in the Congress, he said. He reiterated
that the Arctic Power supports the clause in HJR 26 that
addresses this.
3:05:45 PM
MR. HERRERA pointed out that the delegation agree that the
purpose of the change in revenue sharing is to bring parity
between onshore development, which receives 50 percent from
federal lands going towards the state; parity between the Gulf
of Mexico under the GOMESA Act of 2006, which receives 37.5
percent; and parity between the entire nation as a whole. He
questioned why one state would receive some funds but another
state, such as Alaska receives nothing at all, particularly
since the state has more coastline, more rural area, and is
closer to development than any other state.
MR. HERRERA said the second point brought up by U.S. Senator
Murkowski was impact. She indicated that it doesn't matter if
it is one mile offshore or 50 miles offshore, the impact to the
shoreline is still very high. Finally, in his organization's
opinion, the White House has been taking a very myopic view in
that it "doesn't look at the big picture." For example, if one
increases the attractiveness of development by allowing
infrastructure to be built on the shoreline, more companies will
take advantage of that and develop offshore. Further, greater
offshore development leads to greater revenue streams and under
the proposed FAIR Act and GOMESA Act of 2006, additional
environmental mitigation would exist. The proposed FAIR Act
allows for 10 percent of the entire OCS revenue nationwide to be
spent by coastal communities on environmental mitigation and
also on alternative energy development. In closing, he said the
Arctic Power believes this will address the views of President
Obama, the White House, and the DOI. He offered appreciation
for HJR 26 to address these issues.
3:08:44 PM
CO-CHAIR FEIGE, after first determining no one else wished to
testify, closed public testimony on HJR 26.
3:09:03 PM
REPRESENTATIVE JOHNSON moved to report HJR 26 out of committee
with individual recommendations and the accompanying fiscal
note.
REPRESENTATIVE JOHNSON said he would like the committee to take
a roll call vote on this measure.
REPRESENTATIVE SEATON objected to reporting HJR 26 from
committee.
The committee took a brief at-ease.
3:09:57 PM
A roll call vote was taken. Representatives Johnson, Olson,
Seaton, Feige, and Saddler voted in favor of reporting HJR 26
out of committee. [Representatives Hawker, P. Wilson, Tarr, and
Kawasaki were not in the room]. Therefore, HJR 26 was reported
out of the House Resources Standing Committee by a vote of 5-0.
3:10:57 PM
ADJOURNMENT
There being no further business before the committee, the House
Resources Standing Committee meeting was adjourned at 3:11 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 135 2010 DNR Letter.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 135 |
| HB 135 Legal question memo.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 135 |
| HB 135 Michele Stevens Testimony.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 135 |
| HB 135 Petersville Mine Map II.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 135 |
| HB 135 Petersville Mine Map.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 135 |
| HB 135 Sponsor.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 135 |
| HB 135 Version A.PDF |
HRES 2/19/2014 1:00:00 PM |
HB 135 |
| HB135-DNR-MLW-2-14-14.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 135 |
| HB161 Auction Proceeds.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 161 |
| HB161 Fiscal Note.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 161 |
| HB161 Explanation of Changes U to Y.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 161 |
| HB161 Permit count.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 161 |
| HB161 SCI Support.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 161 |
| HB161 Sponsor.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 161 |
| HB161 Support JHall.xps |
HRES 2/19/2014 1:00:00 PM |
HB 161 |
| HB161 Support LOHCAC.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 161 |
| HB161 Version Y.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 161 |
| HJR 26 BOEM Alaska OCS Lease Sales.pdf |
HRES 2/19/2014 1:00:00 PM SRES 2/26/2014 3:30:00 PM |
HJR 26 |
| HJR 26 BPC Revenue Sharing 101.pdf |
HRES 2/19/2014 1:00:00 PM SRES 2/26/2014 3:30:00 PM |
HJR 26 |
| HJR 26 OCS States Letter.pdf |
HRES 2/19/2014 1:00:00 PM SRES 2/26/2014 3:30:00 PM |
HJR 26 |
| HJR 26 Sponsor Statement.pdf |
HRES 2/19/2014 1:00:00 PM SRES 2/26/2014 3:30:00 PM |
HJR 26 |
| HJR 26 Version N.pdf |
HRES 2/19/2014 1:00:00 PM SRES 2/26/2014 3:30:00 PM |
HJR 26 |
| HJR26-LEG-SESS-02-18-14.pdf |
HRES 2/19/2014 1:00:00 PM SRES 2/26/2014 3:30:00 PM |
HJR 26 |
| HB161 SCI President Letter.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 161 |
| HB135 AMA Letter.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 135 |
| HB 135 Tileston Letter.pdf |
HRES 2/19/2014 1:00:00 PM |
HB 135 |
| HJR 26 FAIR Act (S.1273).pdf |
HRES 2/19/2014 1:00:00 PM SRES 2/26/2014 3:30:00 PM |
HJR 26 |
| HJR 26 FAIR Act Summary.pdf |
HRES 2/19/2014 1:00:00 PM SRES 2/26/2014 3:30:00 PM |
HJR 26 |
| HJR 26 Mayor Brower Testimony.pdf |
HRES 2/19/2014 1:00:00 PM SRES 2/26/2014 3:30:00 PM |
HJR 26 |