Legislature(1993 - 1994)

02/14/1994 08:15 AM RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
               HOUSE RESOURCES STANDING COMMITTEE                              
                        February 14, 1994                                      
                            8:15 a.m.                                          
  MEMBERS PRESENT                                                              
  Representative Bill Williams, Chairman                                       
  Representative Bill Hudson, Vice Chairman                                    
  Representative Con Bunde                                                     
  Representative Pat Carney                                                    
  Representative David Finkelstein                                             
  Representative Joe Green                                                     
  MEMBERS ABSENT                                                               
  Representative John Davies                                                   
  Representative Jeannette James                                               
  Representative Eldon Mulder                                                  
  OTHER LEGISLATORS PRESENT                                                    
  Senator Drue Pearce                                                          
  Representative Gary Davis                                                    
  COMMITTEE CALENDAR                                                           
  SJR 40:   Urging the Congress to amend the Oil Pollution                     
            Act of 1990 with respect to the financial                          
            responsibility requirements for offshore                           
            exploration and production facilities.                             
            CSSJR 40(RES) MOVED OUT OF COMMITTEE WITH                          
            INDIVIDUAL RECOMMENDATIONS                                         
  *HB 306: "An Act relating to an optional municipal tax                       
            credit for costs of certain river habitat                          
            protection improvements."                                          
            ADOPTED CSHB 306(RES) AND MOVED OUT OF COMMITTEE                   
            WITH INDIVIDUAL RECOMMENDATIONS                                    
  WITNESS REGISTER                                                             
  SENATOR DRUE PEARCE                                                          
  Alaska State Legislature                                                     
  State Capitol, Room 508                                                      
  Juneau, Alaska   99801-1182                                                  
  Phone:  465-4993                                                             
  POSITION STATEMENT:  Prime sponsor SJR 40                                    
  REPRESENTATIVE GARY DAVIS                                                    
  Alaska State Legislature                                                     
  State Capitol, Room 15                                                       
  Juneau, Alaska   99801-1182                                                  
  Phone:  465-2693                                                             
  POSITION STATEMENT:  Prime sponsor HB 306                                    
  GERON BRUCE                                                                  
  Alaska Department of Fish and Game                                           
  P.O. Box 25526                                                               
  Juneau, Alaska  99802                                                        
  Phone:  465-6143                                                             
  POSITION STATEMENT:  Supported HB 306 and answered questions                 
  PREVIOUS ACTION                                                              
  BILL:  SJR 40                                                                
  SPONSOR(S): SENATOR(S) PEARCE,Leman,Taylor                                   
  JRN-DATE     JRN-PG               ACTION                                     
  01/19/94      2543    (S)   READ THE FIRST TIME/REFERRAL(S)                  
  01/19/94      2544    (S)   RESOURCES                                        
  01/24/94              (S)   RES AT 03:30 PM BUTRVICH RM 205                  
  01/28/94              (S)   RES AT 03:30 PM BUTRVICH RM 205                  
  01/28/94              (S)   MINUTE(RES)                                      
  02/02/94      2656    (S)   RES RPT  CS  4DP SAME TITLE                      
  02/02/94      2656    (S)   ZERO FN TO SJR & CS PUBLISHED                    
  02/04/94              (S)   RLS AT 00:00 AM FAHRENKAMP                       
                              ROOM 203                                         
  02/04/94              (S)   MINUTE(RLS)                                      
  02/07/94      2719    (S)   RULES TO CALENDAR 3CAL 1NR 2/7                   
  02/07/94      2722    (S)   READ THE SECOND TIME                             
  02/07/94      2722    (S)   RES  CS ADOPTED UNAN CONSENT                     
  02/07/94      2722    (S)   ADVANCED TO THIRD READING UNAN                   
  02/07/94      2723    (S)   PASSED Y14 N6-                                   
  02/07/94      2723    (S)   ADAMS NOTICE OF RECONSIDERATION                  
  02/07/94      2725    (S)   COSPONSOR(S):  TAYLOR                            
  02/09/94      2764    (S)   RECON TAKEN UP-IN THIRD READING                  
  02/09/94      2764    (S)   PASSED ON RECONSIDERATION                        
                              Y20 N-                                           
  02/09/94      2766    (S)   TRANSMITTED TO (H)                               
  02/11/94      2334    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  02/11/94      2334    (H)   RESOURCES                                        
  02/14/94              (H)   RES AT 08:15 AM CAPITOL 124                      
  BILL:  HB 306                                                                
  SPONSOR(S): REPRESENTATIVE(S) G.DAVIS,Phillips,Green                         
  JRN-DATE     JRN-PG               ACTION                                     
  01/03/94              (H)   PREFILE RELEASED                                 
  01/10/94      2007    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  01/10/94      2007    (H)   RESOURCES, FINANCE                               
  01/14/94      2083    (H)   COSPONSOR(S):  GREEN                             
  02/14/94              (H)   RES AT 08:15 AM CAPITOL 124                      
  ACTION NARRATIVE                                                             
  TAPE 94-14, SIDE A                                                           
  Number 000                                                                   
  The House Resources Committee was called to order by                         
  Chairman Bill Williams at 8:20 a.m.  Members present at the                  
  call to order were Representatives Williams, Hudson, Bunde,                  
  Carney, and Finkelstein.  Members absent were                                
  Representatives Davies, Green, James and Mulder.                             
  CHAIRMAN BILL WILLIAMS announced a quorum was present and                    
  advised committee members they will hear SJR 40 and HB 306.                  
  SJR 40 - URGE CONGRESS TO AMEND OIL POLLUTION LAW                            
  CHAIRMAN WILLIAMS told committee members they had passed HJR
  49 several weeks ago, which urged the federal Minerals                       
  Management Service (MMS) to interpret definitions in the Oil                 
  Pollution Act of 1990 (OPA `90) as narrowly as possible in                   
  promulgating their regulations under the financial                           
  responsibility sections of OPA '90.                                          
  CHAIRMAN WILLIAMS said SJR 40 addresses the same concerns,                   
  but covers another angle of the problem by addressing the                    
  concerns to Congress.  He encouraged members to use the                      
  hearing to refresh their memories about the issues involved                  
  with the OPA `90 regulations, because the committee would be                 
  meeting with the MMS officials the next day to discuss                       
  Number 028                                                                   
  SENATOR DRUE PEARCE, PRIME SPONSOR, SJR 40, stated SJR 40                    
  takes a different tack than HJR 49 did.  In December, the                    
  Energy Council passed a resolution in favor of changes to                    
  the OPA `90 financial responsibility section.  As a part of                  
  that, and after meetings with people from the MMS, the                       
  Executive Committee had a draft resolution drawn up and SJR
  40 follows the lines of that resolution.  She said even                      
  though MMS would like to interpret the OPA `90 restrictions                  
  and regulations innovatively, the law says there is a $150                   
  million financial responsibility for every facility.  Those                  
  facilities are offshore facilities but include anything that                 
  is in, under or on any U.S. navigable or territorial water.                  
  Therein, lies the problem.                                                   
  Number 045                                                                   
  SENATOR PEARCE pointed out that MMS cannot change the                        
  definition because it will then filter down onto some of                     
  their other regulations.  It is believed that Congress will                  
  ultimately need to change that section of the bill.  SJR 40                  
  requests that Congress act now before the financial                          
  responsibility section has negative effects on Alaska                        
  businesses.  She noted the Energy Council has it's spring                    
  meeting in Washington, D.C., every year and the first                        
  weekend in March she will be attending that meeting.  She                    
  added there will be a meeting with the Alaska Congressional                  
  delegation.  She hoped to present both resolutions to the                    
  delegation and have a discussion directly with them, along                   
  with a meeting at the Department of Interior and the                         
  Department of Energy.  Senator Pearce stated she planned to                  
  present both resolutions into public record on Wednesday.                    
  Number 070                                                                   
  REPRESENTATIVE DAVID FINKELSTEIN asked Senator Pearce to                     
  explain why the two resolutions are not redundant.                           
  SENATOR PEARCE replied that Representative Green's and her                   
  staff chose different language.  The Administration feels                    
  the two resolutions are very complimentary and feels                         
  comfortable with having both resolutions taking a different                  
  tack.  She noted that the MMS people have been asking for a                  
  way to interpret the definition in some manner in which they                 
  can make the regulations more palatable for states like                      
  REPRESENTATIVE FINKELSTEIN thought that if there are two                     
  measures on the same subject, the first one passes and the                   
  other one disappears.                                                        
  SENATOR PEARCE stated the two resolutions are on the same                    
  subject, but take different tacks.                                           
  Number 091                                                                   
  REPRESENTATIVE JOE GREEN explained the final cure has to be                  
  through Congress which can sometimes be a slow, methodical                   
  process.  If the state can suppress MMS to not implement the                 
  rigid regulations, (interpreting the definition in the                       
  broadest possible sense) through HJR 49 and then allow SJR
  40 to get to Congress, the state will prevent a period of                    
  time when the regulations might be enacted before the law is                 
  REPRESENTATIVE BILL HUDSON felt both resolutions are                         
  complimentary.  He asked Senator Pearce if she had asked the                 
  Congressional delegation of the probability of having                        
  Congress act on changes of OPA `90.                                          
  SENATOR PEARCE replied she had discussed the issue primarily                 
  with Senator Steven's office.  She said all Congressional                    
  delegations are reticent to go back into OPA `90, but they                   
  understand that it is not just an Alaska problem or a                        
  wetlands problem, it is a problem in every state.  She                       
  pointed out that the broad way MMS is interpreting the                       
  definition, it will include many airports throughout the                     
  country, gas stations, etc.  She did not think that is what                  
  Congress intended and added that Congress has admitted that                  
  is not what they intended.                                                   
  SENATOR PEARCE remarked that MMS believes they need to go to                 
  Congress with clear definitions of the actual economic                       
  problems which the strict interpretation will cause.  She                    
  said the final response from the state will be delivered to                  
  MMS in testimony on Wednesday.                                               
  Number 131                                                                   
  REPRESENTATIVE HUDSON made a motion to MOVE CSSJR 40(RES)                    
  with a fiscal note out of committee with INDIVIDUAL                          
  CHAIRMAN WILLIAMS asked if there were any objections to the                  
  motion.  Hearing none, the MOTION PASSED.                                    
  (CHAIRMAN WILLIAMS noted for the record that REPRESENTATIVE                  
  GREEN joined the committee at 8:25 a.m.)                                     
  HB 306 - MUNICIPAL TAX CREDIT/HABITAT PROTECTION                             
  Number 147                                                                   
  CHAIRMAN WILLIAMS advised committee members there is a draft                 
  committee substitute in their folders, which was prepared by                 
  the sponsor of the bill.                                                     
  REPRESENTATIVE GARY DAVIS, PRIME SPONSOR, read his sponsor                   
  statement:  "House Bill 306 will create a Municipal Tax                      
  Incentive Program (MTIP) to encourage private property                       
  owners to voluntarily protect important fishing habitat.                     
  Currently, under statute, it is not possible for local                       
  governments to provide a property tax credit.  This                          
  legislation will grant local municipalities the ability to                   
  designate certain tax incentives for improving certain                       
  anadromous riparian habitats.  This bill specifically                        
  addresses the Kenai River.  The habitats must be determined                  
  by the State to warrant special management.  In order to be                  
  eligible for a tax credit, the constructed improvement must                  
  aid in protecting the Kenai River or a tributary of the                      
  Kenai River from degradation due to public or private use;                   
  or restoring riparian fish habitat in the Kenai River or a                   
  tributary of the Kenai River that has been damaged by land                   
  use practices or can be damaged without preventative                         
  "The eligible improvements will be in compliance with state                  
  and federal laws and certified by the Alaska Department of                   
  Fish and Game (ADF&G) as meeting the established criteria.                   
  Let it be noted that the Kenai River Special Management Area                 
  (KRSMA) Advisory Board established under statute, supports                   
  HB 306.  The KRSMA Advisory Board is appointed by the                        
  Commissioner of Natural Resources to develop and implement                   
  the Kenai River Special Management Area plan established in                  
  AS 41.21.502(a).  House Bill 306 sets parameters that allow                  
  local governments flexibility in determining their needs and                 
  interests, while protecting riparian habitats.  No local                     
  government is required to create a MTIP that is not wanted.                  
  MTIPs have proven effective in conserving riparian habitat                   
  elsewhere in the country.  Once the MTIP proves effective on                 
  the Kenai River it may serve as a pilot project for other                    
  areas of the state."                                                         
  Number 201                                                                   
  REPRESENTATIVE DAVIS said as indicated in the sponsor                        
  statement, the KRSMA Advisory Board is an important board in                 
  relating what goes on in the Kenai River.  They made certain                 
  recommendations on HB 306 and their concerns have been                       
  incorporated into the committee substitute.                                  
  REPRESENTATIVE PAT CARNEY asked why HB 306 was not written                   
  to permit any municipality in the state to allow the tax                     
  credit for other projects other than just the Kenai River.                   
  REPRESENTATIVE DAVIS responded that as indicated, there                      
  would probably be a fiscal note should the bill cover                        
  statewide.   Since the Kenai River is established under                      
  statute as a special management area, it is felt that it                     
  will be in the state's best interest to use HB 306 as a                      
  pilot project to determine the expected benefits.  He said                   
  there was an attempt to think of other areas in the state                    
  which might be in the same situation where there are a lot                   
  of private property owners along a heavily fished river, and                 
  none could be identified.                                                    
  Number 241                                                                   
  REPRESENTATIVE CON BUNDE wondered if passing HB 306 and                      
  providing tools to the communities along the Kenai River to                  
  use, will the communities use the tools.                                     
  REPRESENTATIVE DAVIS felt the communities will.  The Kenai                   
  River has been under the sharp eye of habitat agencies for a                 
  number of years.  The habitat question along the river is                    
  something that both commercial and sport fish interests have                 
  agreed is in their best interests to conserve as much of the                 
  habitat as possible, in order to preserve and see continued                  
  returns of all salmon species.  He said the city of Soldotna                 
  has established an overlay district, which requires Kenai                    
  Riverfront property owners to submit a request to the city                   
  before any development can be done on their property.                        
  Through that additional zoning requirement, there have been                  
  many innovative approaches to improvements along the                         
  riverbank seen.  He felt HB 306 will see the same amount of                  
  interest at the borough level.                                               
  REPRESENTATIVE DAVIS pointed out that the program will also                  
  be used as an educational tool.  For years, there has been                   
  an attempt to inform everyone who uses the riverbanks about                  
  the need to preserve habitat.                                                
  Number 300                                                                   
  REPRESENTATIVE GREEN stated he has gone with a guide to look                 
  at some of the inexpensive repairs made along the river.  He                 
  stressed there are large areas of the river which are                        
  eroding and some of these repairs not only stabilize the                     
  bank, but do provide habitat.  He felt HB 306 is extremely                   
  timely and a great idea.                                                     
  REPRESENTATIVE HUDSON felt there are other streams which                     
  also have been impacted and hoped there will be language in                  
  the bill indicating it is a pilot project, so it can                         
  possibly be expanded to include other streams which ADF&G                    
  might identify as potential recipients.                                      
  REPRESENTATIVE DAVIS agreed and hoped that people keep an                    
  eye on the activity afforded under HB 360 so it can be                       
  expanded at some point.                                                      
  Number 345                                                                   
  REPRESENTATIVE CARNEY asked if they were talking about                       
  private property on the Kenai River which people are                         
  trespassing on.                                                              
  REPRESENTATIVE DAVIS responded HB 306 addresses private                      
  REPRESENTATIVE CARNEY wondered if people with private                        
  property have a choice as to whether or not other people can                 
  use their property for access to the river.                                  
  Number 370                                                                   
  REPRESENTATIVE DAVIS replied it is their private land.                       
  There have been questions regarding an automatic 25-foot                     
  public easement along each side of the river, but he had not                 
  been able to find anything in statute which allows that.                     
  Over the years, in pursuing that question, he has been                       
  assured that is not the case.  He stressed that private                      
  property owners do have control over their property.                         
  REPRESENTATIVE CARNEY said in many cases private property                    
  owners do not have a choice with regard to allowing other                    
  people to use their property for recreational purposes.  He                  
  noted that he almost had to abandon a piece of property he                   
  owns because there is so much public traffic.  He would have                 
  to spend all of his time policing it.  He felt perhaps they                  
  should consider giving people a tax credit when their                        
  property is heavily utilized by the public.                                  
  Number 418                                                                   
  REPRESENTATIVE DAVIS remarked that in the Kenai River area,                  
  everyone is aware of how people will use whatever property                   
  they want to get to a fishing spot.  What is happening is                    
  people are sending requests to ADF&G saying their land is                    
  being used as a public fishing ground and asking the state                   
  to buy their property.  The state would like to buy much of                  
  that land, as sufficient public access is definitely a                       
  REPRESENTATIVE GREEN stated a person can get on the Russian                  
  River from almost anywhere along it's three mile length.  It                 
  is just about the opposite on the Kenai River.  There are                    
  very few access points and the Kenai is a very fast moving                   
  river.  He stressed that a wake really causes a problem and                  
  tying up a boat where there is no vegetation to take up the                  
  constant movement of water between the boat and the land,                    
  causes the land to erode rapidly.  He felt if there can be                   
  more private people taking advantage of HB 306 and showing                   
  that it is possible, then the Park Service might do the same                 
  REPRESENTATIVE BUNDE asked ADF&G to answer the easement                      
  question.  He also wondered if usage will be increased with                  
  this bill, thereby increasing habitat degradation.                           
  Number 495                                                                   
  REPRESENTATIVE HUDSON stated it was not desirable to put too                 
  much more of the private land in public hands because the                    
  number of people on the river will increase.                                 
  REPRESENTATIVE CARNEY wondered why the words "Kenai River"                   
  could not be eliminated from HB 306 and make it generally                    
  apply to any river in the state.                                             
  REPRESENTATIVE DAVIS believed with the Kenai River Special                   
  Management Area in place and with the amount of work the                     
  habitat division will be required to do, the department                      
  would be flooded with plans to review, etc.                                  
  REPRESENTATIVE CARNEY stated there is a zero fiscal note for                 
  the Kenai River, which has many problems and he cannot                       
  imagine there will be additional costs with other streams.                   
  REPRESENTATIVE FINKELSTEIN felt there would be a higher                      
  fiscal note and pointed out that the fiscal note in the                      
  committee members' files was somewhat odd.  It says it will                  
  cost a fair amount of money but they love the idea so much,                  
  they will do it.                                                             
  Number 580                                                                   
  GERON BRUCE, ALASKA DEPARTMENT OF FISH AND GAME, expressed                   
  support of HB 306.  The Kenai River is being loved to death.                 
  There is a combination of extraordinary resources which                      
  attract much use, easy accessibility and a large population                  
  center nearby.  He said the department has been watching the                 
  situation on the Kenai River with some concern for a period                  
  of time, and there are a number of programs which are being                  
  implemented to address the problems.  He noted that HB 306                   
  will provide an additional tool which will be valuable and                   
  help correct the situation, as well as prevent it from                       
  getting worse.                                                               
  MR. BRUCE told members to keep in mind, the department's                     
  studies indicate that 80 percent of the juvenile rearing                     
  salmon in the Kenai River inhabit the area within six feet                   
  of the bank.   They utilize the area for cover and feed, and                 
  it is an area where the water velocity slows down, so the                    
  small juvenile fish are able to maintain their position.                     
  Therefore, it is an extremely productive area.  In the                       
  entire river itself, 80 acres account for approximately 80                   
  percent of the productivity for rearing fish.                                
  Number 600                                                                   
  REPRESENTATIVE HUDSON asked if ADF&G has the authority to                    
  charge a fee for private property plans review.                              
  MR. BRUCE said he did not believe they did.  He stated the                   
  legislature is usually rigorous about restricting the                        
  ability of the department to charge and establish fees.                      
  REPRESENTATIVE HUDSON believed the legislature had given the                 
  Department of Commerce and Economic Development authority to                 
  charge whatever fees necessary to handle licenses, etc. and                  
  thought it might be something they will want to consider.                    
  REPRESENTATIVE BUNDE asked Mr. Bruce if he could address the                 
  question about public easements.                                             
  MR. BRUCE responded that he could not answer the question                    
  and felt it was a land management question which the                         
  Department of Natural Resources or legal could answer.  He                   
  said he will pursue an answer.                                               
  REPRESENTATIVE GREEN asked Mr. Bruce to also check and see                   
  when there is a setback from the existing riverbank and the                  
  bank erodes, does the setback follow the bank.                               
  Number 647                                                                   
  REPRESENTATIVE FINKELSTEIN stated he would be surprised if                   
  there is a public easement because if there is, a person                     
  could walk along the entire shore of the Kenai River.  He                    
  said there is very little public land and it can be                          
  frustrating when trying to find access to the river.  He                     
  asked what the general status is of the $3 million which was                 
  appropriated for habitat work along the Kenai River.                         
  MR. BRUCE explained that is the other major initiative which                 
  is beginning to go forward and he will provide an update to                  
  the committee at a later date.                                               
  REPRESENTATIVE FINKELSTEIN questioned if that money and work                 
  can include acquisition.                                                     
  MR. BRUCE replied it can.                                                    
  REPRESENTATIVE BUNDE made a motion to MOVE committee                         
  substitute for HB 306 with two fiscal notes from committee                   
  with INDIVIDUAL RECOMMENDATIONS.                                             
  CHAIRMAN WILLIAMS stated there is a need to adopt the                        
  committee substitute first.                                                  
  REPRESENTATIVE BUNDE WITHDREW his motion.                                    
  REPRESENTATIVE FINKELSTEIN asked the sponsor to explain the                  
  differences between the committee substitute and the                         
  original bill.                                                               
  TAPE 94-14, SIDE B                                                           
  Number 000                                                                   
  REPRESENTATIVE DAVIS replied, the differences resulted from                  
  the recommendations made by the KRSMA subcommittee.  He said                 
  on page 1, line 11, it now reads "degradation of fish                        
  habitat due to public or private use;".  Page 1, line 12,                    
  now reads "restoring riparian fish habitat along or in the                   
  Kenai River...".  Page 2, lines 4 and 5, now read "If the                    
  credit is granted for more than one year and the land or                     
  taxable interest in the land is conveyed, the portion of the                 
  credit remaining is extinguished."  Page 2, line 13, now                     
  reads "located more than 150 feet from the mean high tide                    
  line...".  Page 2, lines 25 and 26 now read "the criteria                    
  established under this subsection.  The department may                       
  require submission of plans for approval before construction                 
  as a condition of certification."                                            
  REPRESENTATIVE CARNEY asked if someone could define fish                     
  habitat, as he thought fish habitat was in the water itself                  
  rather than on the shore.                                                    
  Number 025                                                                   
  REPRESENTATIVE DAVIS responded that HB 306 allows for review                 
  and credit for improvements along or in the Kenai River and                  
  back up to 150 feet.                                                         
  REPRESENTATIVE HUDSON made a motion to ADOPT the committee                   
  substitute for HB 306.                                                       
  CHAIRMAN WILLIAMS asked if there were objections.  Hearing                   
  none, CSHB 306(RES) was ADOPTED.                                             
  REPRESENTATIVE HUDSON made a motion to MOVE CSHB 306(RES)                    
  with two zero fiscal notes out of committee with INDIVIDUAL                  
  CHAIRMAN WILLIAMS asked if there were objections.  Hearing                   
  none, the MOTION PASSED.                                                     
  CHAIRMAN WILLIAMS announced the committee will meet February                 
  15 at 3:00 p.m. with officials from the Minerals Management                  
  Service to discuss issues concerning the Oil Pollution Act                   
  of 1990.  He also announced the committee will meet February                 
  16 at 8:15 a.m. to consider SB 77 and SJR 13.                                
  There being no further business to come before the House                     
  Resources Committee, Chairman Williams adjourned the meeting                 
  at 9:10 a.m.                                                                 

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