Legislature(1995 - 1996)

05/01/1996 08:10 AM RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
               HOUSE RESOURCES STANDING COMMITTEE                              
                          May 1, 1996                                          
                           8:10 a.m.                                           
                                                                               
                                                                               
 MEMBERS PRESENT                                                               
                                                                               
 Representative Joe Green, Co-Chairman                                         
 Representative William K. "Bill" Williams, Co-Chairman                        
 Representative Scott Ogan, Vice Chairman                                      
 Representative Alan Austerman                                                 
 Representative Pete Kott                                                      
 Representative Don Long                                                       
 Representative Irene Nicholia                                                 
 Representative John Davies                                                    
 Representative Ramona Barnes                                                  
                                                                               
 MEMBERS ABSENT                                                                
                                                                               
 All Members Present                                                           
                                                                               
 COMMITTEE CALENDAR                                                            
                                                                               
 CS FOR SENATE BILL NO. 283(RLS)                                               
                                                                               
 "An Act relating to filing, recording, and indexing of documents              
 with or by the Department of Natural Resources; repealing certain             
 filing requirements concerning property involving nonresident                 
 aliens; and providing for an effective date."                                 
                                                                               
      - PASSED CSSB 283(RLS) OUT OF COMMITTEE                                  
                                                                               
 SENATE BILL NO. 257 am                                                        
                                                                               
 "An Act relating to the taking of game or fish for public safety              
 purposes."                                                                    
                                                                               
      - PASSED SB 257 am OUT OF COMMITTEE                                      
                                                                               
 CS FOR SENATE BILL NO. 262(RES)(ct rule fld)                                  
                                                                               
 "An Act relating to management of game populations for maximum                
 sustained yield for human harvest and providing for the replacement           
 of areas closed to consumptive uses of game; relating to management           
 of fish and game areas."                                                      
                                                                               
      - PASSED HCS CSSB 262(RES) OUT OF COMMITTEE                              
                                                                               
 CS FOR SENATE BILL NO. 199(FIN)                                               
                                                                               
 "An Act relating to environmental audits and health and safety                
 audits to determine compliance with certain laws, permits, and                
 regulations."                                                                 
                                                                               
      - PASSED HCS CSSB 199(RES) OUT OF COMMITTEE                              
                                                                               
 CS FOR SENATE BILL NO. 247(RLS) am(efd fld)(ct rule fld)                      
                                                                               
 "An Act restricting the use of certain funds deposited in the fish            
 and game fund; and relating to the powers and duties of the                   
 commissioner of fish and game."                                               
                                                                               
      -  SCHEDULED BUT NOT HEARD                                               
                                                                               
 PREVIOUS ACTION                                                               
                                                                               
 BILL:  SB 283                                                               
 SHORT TITLE: DOCUMENT FILING, INDEXING, & RECORDING                           
 SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR                                  
                                                                               
 JRN-DATE     JRN-PG               ACTION                                      
 02/09/96      2353    (S)   READ THE FIRST TIME - REFERRAL(S)                 
 02/09/96      2353    (S)   RES, STA, FIN                                     
 02/09/96      2353    (S)   FISCAL NOTE (DNR)                                 
 02/09/96      2354    (S)   GOVERNOR'S TRANSMITTAL LETTER                     
 03/08/96              (S)   RES AT  3:30 PM BUTROVICH ROOM 205                
 03/08/96              (S)   MINUTE(RES)                                       
 03/11/96              (S)   RES AT  3:30 PM BUTROVICH ROOM 205                
 03/11/96              (S)   MINUTE(RES)                                       
 03/13/96              (S)   RES AT  3:30 PM BUTROVICH ROOM 205                
 03/13/96              (S)   MINUTE(RES)                                       
 03/14/96      2737    (S)   RES RPT    4DP 1NR                                
 03/14/96      2737    (S)   PREVIOUS FN (DNR)                                 
 04/10/96      3135    (S)   STA REFERRAL WAIVED                               
 04/17/96              (S)   FIN AT  5:00 PM SENATE FINANCE 532                
 04/18/96              (S)   FIN AT  9:00 AM SENATE FINANCE 532                
 04/19/96              (S)   FIN AT  8:30 AM SENATE FINANCE 532                
 04/23/96              (S)   FIN AT  8:30 AM SENATE FINANCE 532                
 04/23/96      3445    (S)   FIN RPT  1DP 6NR                                  
 04/23/96      3445    (S)   PREVIOUS FN (DNR)                                 
 04/24/96              (S)   RLS AT 10:30 AM FAHRENKAMP RM 203                 
 04/24/96              (S)   MINUTE(RLS)                                       
 04/25/96              (S)   RLS AT 10:30 AM FAHRENKAMP RM 203                 
 04/25/96              (S)   MINUTE(RLS)                                       
 04/25/96      3555    (S)   RULES TO CALENDAR WITH CS 4/25/96                 
 04/25/96      3557    (S)   READ THE SECOND TIME                              
 04/25/96      3558    (S)   RLS  CS ADOPTED UNAN CONSENT                      
 04/25/96      3558    (S)   ADVANCED TO THIRD READING UNAN                    
                             CONSENT                                           
 04/25/96      3558    (S)   READ THE THIRD TIME  CSSB 283(RLS)                
 04/25/96      3558    (S)   PASSED Y20 N-                                     
 04/25/96      3558    (S)   EFFECTIVE DATE(S) SAME AS PASSAGE                 
 04/25/96      3581    (S)   TRANSMITTED TO (H)                                
 04/26/96      4034    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 04/26/96      4034    (H)   RESOURCES, FINANCE                                
 04/29/96              (H)   RES AT  8:00 AM CAPITOL 124                       
 04/29/96              (H)   MINUTE(RES)                                       
 05/01/96              (H)   RES AT  8:00 AM CAPITOL 124                       
                                                                               
 BILL:  SB 257                                                               
 SHORT TITLE: TAKING FISH OR GAME FOR PUBLIC SAFETY                            
 SPONSOR(S): SENATOR(S) ZHAROFF                                                
                                                                               
 JRN-DATE     JRN-PG               ACTION                                      
 02/02/96      2282    (S)   READ THE FIRST TIME - REFERRAL(S)                 
 02/02/96      2282    (S)   RES, JUD                                          
 02/19/96              (S)   RES AT  3:30 PM BUTROVICH ROOM 205                
 02/19/96              (S)   MINUTE(RES)                                       
 02/21/96      2488    (S)   RES RPT  5DP                                      
 02/21/96      2488    (S)   ZERO FISCAL NOTE (F&G)                            
 03/22/96              (S)   JUD AT  9:00 AM BELTZ ROOM 211                    
 03/22/96              (S)   MINUTE(JUD)                                       
 03/25/96              (S)   RLS AT  7:00 PM FAHRENKAMP RM 203                 
 03/25/96              (S)   MINUTE(RLS)                                       
 03/25/96      2862    (S)   JUD RPT  4DP                                      
 03/25/96      2862    (S)   ZERO FISCAL NOTES (DPS-2)                         
 03/25/96      2862    (S)   PREVIOUS ZERO FN (F&G)                            
 04/03/96      3045    (S)   RULES TO CALENDAR  4/3/96                         
 04/03/96      3045    (S)   READ THE SECOND TIME                              
 04/03/96      3046    (S)   ADVANCED TO THIRD READING UNAN                    
                             CONSENT                                           
 04/03/96      3046    (S)   READ THE THIRD TIME  SB 257                       
 04/03/96      3046    (S)   PASSED Y12 N7 E1                                  
 04/03/96      3046    (S)   MILLER  NOTICE OF RECONSIDERATION                 
 04/04/96      3070    (S)   HELD ON RECONSIDERATION TO 4/9                    
                             CALENDAR                                          
 04/09/96      3097    (S)   HELD ON RECONSIDERATION TO 4/10                   
                             CALENDAR                                          
 04/10/96      3129    (S)   PLACED AT BOTTOM OF CALENDAR                      
 04/10/96      3134    (S)   RECON TAKEN UP - IN THIRD READING                 
 04/10/96      3134    (S)   RETURN TO SECOND FOR AM 1  UNAN                   
                             CONSENT                                           
 04/10/96      3134    (S)   AM NO  1     ADOPTED UNAN CONSENT                 
 04/10/96      3134    (S)   AUTOMATICALLY IN THIRD READING                    
 04/10/96      3134    (S)   PASSED ON RECONSIDERATION Y20 N-                  
 04/10/96      3136    (S)   TRANSMITTED TO (H)                                
 04/12/96      3690    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 04/12/96      3690    (H)   RESOURCES, JUDICIARY                              
 04/26/96              (H)   RES AT  8:00 AM CAPITOL 124                       
 04/26/96              (H)   MINUTE(RES)                                       
 04/29/96              (H)   RES AT  8:00 AM CAPITOL 124                       
 04/29/96              (H)   MINUTE(RES)                                       
 05/01/96              (H)   RES AT  8:00 AM CAPITOL 124                       
                                                                               
 BILL:  SB 262                                                               
 SHORT TITLE: MANAGEMENT OF FISH/GAME POPULATION & AREA                        
 SPONSOR(S): SENATOR(S) MILLER, Sharp, Pearce, Halford, Green,                 
 Frank, Taylor                                                                 
                                                                               
 JRN-DATE     JRN-PG               ACTION                                      
 02/02/96      2286    (S)   READ THE FIRST TIME - REFERRAL(S)                 
 02/02/96      2286    (S)   RES, JUD                                          
 02/05/96      2309    (S)   COSPONSOR(S): TAYLOR                              
 02/12/96              (S)   RES AT  3:30 PM BUTROVICH ROOM 205                
 02/12/96              (S)   MINUTE(RES)                                       
 03/08/96              (S)   RES AT  3:30 PM BUTROVICH ROOM 205                
 03/08/96              (S)   MINUTE(RES)                                       
 03/11/96              (S)   RES AT  3:30 PM BUTROVICH ROOM 205                
 03/11/96              (S)   MINUTE(RES)                                       
 03/12/96      2709    (S)   RES RPT  CS  5DP 1NR   SAME TITLE                 
 03/12/96      2709    (S)   FISCAL NOTE TO SB & CS (F&G)                      
 03/18/96      2785    (S)   FIN REFERRAL ADDED                                
 03/26/96      2910    (S)   JUD REFERRAL WAIVED   Y12 N8                      
 04/03/96              (S)   FIN AT  9:00 AM SENATE FINANCE 532                
 04/03/96              (S)   MINUTE(FIN)                                       
 04/04/96      3065    (S)   FIN RPT  2DP 2NR  (RES)CS                         
 04/04/96      3065    (S)   PREVIOUS FN (F&G)                                 
 04/09/96              (S)   RLS AT 12:20 PM FAHRENKAMP RM 203                 
 04/09/96              (S)   MINUTE(RLS)                                       
 04/10/96      3112    (S)   RULES TO CAL & 1 NR    4/10/96                    
 04/10/96      3116    (S)   READ THE SECOND TIME                              
 04/10/96      3116    (S)   RES  CS ADOPTED UNAN CONSENT                      
 04/10/96      3116    (S)   ADVANCE TO THIRD READING FLD Y12 N8               
 04/10/96      3116    (S)   THIRD READING 4/11 CALENDAR                       
 04/11/96      3168    (S)   READ THE THIRD TIME  CSSB 262(RES)                
 04/11/96      3168    (S)   PASSED Y12 N8                                     
 04/11/96      3169    (S)   COURT RULE CHANGES FAILED  Y13 N7                 
 04/11/96      3176    (S)   TRANSMITTED TO (H)                                
 04/12/96      3690    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 04/12/96      3690    (H)   RESOURCES, JUDICIARY                              
 04/26/96              (H)   RES AT  8:00 AM CAPITOL 124                       
 04/26/96              (H)   MINUTE(RES)                                       
 04/29/96              (H)   RES AT  8:00 AM CAPITOL 124                       
 04/29/96              (H)   MINUTE(RES)                                       
 05/01/96              (H)   RES AT  8:00 AM CAPITOL 124                       
                                                                               
 BILL:  SB 199                                                               
 SHORT TITLE: ENVIRONMENTAL & HEALTH/SAFETY AUDITS                             
 SPONSOR(S): SENATOR(S) LEMAN,Pearce                                           
                                                                               
 JRN-DATE     JRN-PG               ACTION                                      
 01/05/96      2058    (S)   PREFILE RELEASED - 1/5/96                         
 01/08/96      2058    (S)   READ THE FIRST TIME - REFERRAL(S)                 
 01/08/96      2058    (S)   RESOURCES                                         
 01/31/96              (S)   RES AT  3:30 PM BUTROVICH ROOM 205                
 01/31/96              (S)   MINUTE(RES)                                       
 02/02/96      2287    (S)   FIN REFERRAL ADDED                                
 03/06/96              (S)   RES AT  3:30 PM BUTROVICH ROOM 205                
 03/06/96              (S)   MINUTE(RES)                                       
 03/11/96              (S)   RES AT  3:30 PM BUTROVICH ROOM 205                
 03/11/96              (S)   MINUTE(RES)                                       
 03/12/96      2708    (S)   RES RPT  CS  4DP 1NR    NEW TITLE                 
 03/12/96      2708    (S)   FISCAL NOTES TO SB & CS (DEC, F&G)                
 03/12/96      2708    (S)   INDETERMINATE FISCAL NOTE (DNR)                   
 03/12/96      2708    (S)   ZERO FISCAL NOTES TO SB & CS                      
                             (DOT, MVA)                                        
 03/20/96              (S)   FIN AT  9:00 AM SENATE FINANCE 532                
 03/21/96              (S)   MINUTE(FIN)                                       
 03/26/96              (S)   FIN AT  9:00 AM SENATE FINANCE 532                
 03/27/96              (S)   MINUTE(FIN)                                       
 04/02/96              (S)   FIN AT  9:00 AM SENATE FINANCE 532                
 04/03/96              (S)   FIN AT  9:00 AM SENATE FINANCE 532                
 04/03/96              (S)   RLS AT  1:15 PM FAHRENKAMP RM 203                 
 04/03/96              (S)   MINUTE(FIN)                                       
 04/03/96              (S)   MINUTE(RLS)                                       
 04/03/96      3041    (S)   FIN RPT  CS  1DP 4NR 1AM  NEW TITLE               
 04/03/96      3041    (S)   FNS TO CS (DEC, DNR)                              
 04/03/96      3041    (S)   ZERO FN TO CS (DOT)                               
 04/03/96      3041    (S)   PREVIOUS FN (F&G)                                 
 04/03/96      3041    (S)   PREVIOUS ZERO FN (DMVA)                           
 04/09/96      3092    (S)   RULES TO CALENDAR & 1NR   4/9/96                  
 04/09/96      3094    (S)   READ THE SECOND TIME                              
 04/09/96      3094    (S)   FIN  CS ADOPTED Y11 N5 E4                         
 04/09/96      3095    (S)   ADVANCE TO THIRD READING FLD                      
                             Y11 N5 E4                                         
 04/09/96      3095    (S)   THIRD READING 4/10 CALENDAR                       
 04/10/96      3128    (S)   READ THE THIRD TIME  CSSB 199(FIN)                
 04/10/96      3128    (S)   PASSED Y11 N9                                     
 04/10/96      3128    (S)   SALO  NOTICE OF RECONSIDERATION                   
 04/11/96      3161    (S)   RECON TAKEN UP - IN THIRD READING                 
 04/11/96      3161    (S)   PLACED AT BOTTOM OF CALENDAR                      
 04/11/96      3171    (S)   PASSED Y11 N9                                     
 04/11/96      3176    (S)   TRANSMITTED TO (H)                                
 04/12/96      3689    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 04/12/96      3690    (H)   RESOURCES, LABOR & COMMERCE                       
 04/17/96              (H)   RES AT  8:00 AM CAPITOL 124                       
 04/17/96              (H)   L&C AT  3:00 PM CAPITOL 17                        
 04/17/96              (H)   MINUTE(RES)                                       
 04/17/96              (H)   MINUTE(L&C)                                       
 04/19/96              (H)   L&C AT  3:00 PM CAPITOL 17                        
 04/19/96              (H)   MINUTE(L&C)                                       
 04/22/96              (H)   RES AT  8:00 AM CAPITOL 124                       
 04/22/96              (H)   MINUTE(RES)                                       
 04/23/96              (H)   RES AT  3:00 PM CAPITOL 124                       
 04/23/96              (H)   MINUTE(RES)                                       
 04/24/96              (H)   RES AT  8:00 AM CAPITOL 124                       
 04/24/96              (H)   MINUTE(RES)                                       
 04/29/96              (H)   RES AT 10:00 AM CAPITOL 17                        
 04/29/96              (H)   MINUTE(RES)                                       
 04/30/96              (H)   RES AT  8:00 AM CAPITOL 17                        
 04/30/96              (H)   MINUTE(RES)                                       
 05/01/96              (H)   RES AT  8:00 AM CAPITOL 124                       
                                                                               
 WITNESS REGISTER                                                              
                                                                               
 NICO BUS, Acting Director                                                     
 Division of Support Services                                                  
 Department of Natural Resources                                               
 400 Willoughby Avenue                                                         
 Juneau, Alaska  99801-1724                                                    
 Telephone:  (907) 465-2406                                                    
 POSITION STATEMENT:  Testified in support of CSSB 283(RLS)                    
                                                                               
 GORDON WILLIAMS, Legislative Assistant                                        
   to Senator Fred Zharoff                                                     
 Alaska State Legislature                                                      
 Capitol Building, Room 121                                                    
 Juneau, Alaska  99801-1182                                                    
 Telephone:  (907) 465-3473                                                    
 POSITION STATEMENT:  Gave sponsor statement for SB 257 am                     
                                                                               
 WAYNE REGELIN, Director                                                       
 Division of Wildlife Conservation                                             
 Department of Fish & Game                                                     
 P.O. Box 25526                                                                
 Juneau, Alaska  99802-5526                                                    
 Telephone:  (907) 465-4190                                                    
 POSITION STATEMENT:  Testified on CSSB 262(RES) (ct rule fld)                 
                                                                               
 KEVIN SAXBY, Assistant Attorney General                                       
 Natural Resources Section                                                     
 Department of Law                                                             
 1031 West 4th Avenue, Suite 200                                               
 Anchorage, Alaska  99501-1994                                                 
 Telephone:  (907) 269-5100                                                    
 POSITION STATEMENT:  Testified on CSSB 262(RES) (ct rule fld)                 
                                                                               
 STEVEN DAUGHERTY, Assistant Attorney General                                  
 Natural Resources Section                                                     
 Department of Law                                                             
 P.O. Box 110300                                                               
 Juneau, Alaska  99811-0300                                                    
 Telephone:  (907) 465-3600                                                    
 POSITION STATEMENT:  Testified on CSSB 262(RES) (ct rule fld)                 
                                                                               
 SENATOR LOREN LEMAN                                                           
 Alaska State Legislature                                                      
 Capitol Building, Room 115                                                    
 Juneau, Alaska  99801-1182                                                    
 Telephone:  (907) 465-2095                                                    
 POSITION STATEMENT:  Sponsor of SB 199                                        
                                                                               
 J. DAVENPORT                                                                  
 Address Unknown                                                               
 Telephone:  (918) 584-1962                                                    
 POSITION STATEMENT:  Testified in support of CSSB 199(FIN)                    
                                                                               
 JOHN RILEY, Director                                                          
 Litigation Support                                                            
 Texas Natural Resources Conservation Commission                               
 Address and Telephone Number Unknown                                          
 POSITION STATEMENT:  Testified on CSSB 199(FIN)                               
                                                                               
 SARA HANNAN, Representative                                                   
 Alaska Environmental Lobby, Inc.                                              
 P.O. Box 22151                                                                
 Juneau, Alaska  99802                                                         
 Telephone:  (907) 463-3366                                                    
 POSITION STATEMENT:  Testified in opposition to CSSB 199(FIN)                 
                                                                               
 DWIGHT PERKINS, Special Assistant                                             
 Office of the Commissioner                                                    
 Department of Labor                                                           
 P.O. Box 21149                                                                
 Juneau, Alaska  99802-1149                                                    
 Telephone:  (907) 465-2700                                                    
 POSITION STATEMENT:  Testified on the Proposed Committee Substitute           
                      for CSSB 199(FIN)                                        
                                                                               
 MARIE SANSONE, Assistant Attorney General                                     
 Natural Resources Section                                                     
 Department of Law                                                             
 P.O. Box 110300                                                               
 Juneau, Alaska  99811-0300                                                    
 Telephone:  (907) 465-3600                                                    
 POSITION STATEMENT:  Testified on the Proposed Committee Substitute           
                      for CSSB 199(FIN)                                        
                                                                               
 NANCY WELLER, Medical Assistance Administrator                                
 Division of Medical Assistance                                                
 Department of Health & Social Services                                        
 P.O. Box 110660                                                               
 Juneau, Alaska  99811-0660                                                    
 Telephone:  (907) 465-3355                                                    
 POSITION STATEMENT:  Testified in support of the Proposed Committee           
                      Substitute for CSSB 199(FIN)                             
                                                                               
 JANICE ADAIR, Director                                                        
 Division of Environmental Health                                              
 Department of Environmental Conservation                                      
 555 Cordova Street                                                            
 Anchorage, Alaska  99501                                                      
 Telephone:  (907) 269-7644                                                    
 POSITION STATEMENT:  Testified on the Proposed Committee Substitute           
                      for CSSB 199(FIN)                                        
                                                                               
 MIKE PAULEY, Legislative Administrative Assistant                             
    to Senator Loren Leman                                                     
 Alaska State Legislature                                                      
 Capitol Building, Room 115                                                    
 Juneau, Alaska  99801-1182                                                    
 Telephone:  (907) 465-2095                                                    
 POSITION STATEMENT:  Testified on the Proposed Committee Substitute           
                      for CSSB 199(FIN)                                        
                                                                               
 ACTION NARRATIVE                                                              
                                                                               
 TAPE 96-73, SIDE A                                                            
 Number 001                                                                    
                                                                               
 CO-CHAIRMAN JOE GREEN called the House Resources Committee meeting            
 to order at 8:10 a.m.  Members present at the call to order were              
 Representatives Green, Williams, Ogan, Austerman and Davies.                  
 Members absent at the call to order were Representatives Barnes,              
 Kott, Long and Nicholia.                                                      
                                                                               
 CSSB 283(RLS) - DOCUMENT FILING, INDEXING, & RECORDING                      
                                                                               
 CO-CHAIRMAN GREEN announced the first order of business would be              
 CSSB 283(RLS).  He asked Nico Bus to come forward to testify.                 
                                                                               
 Number 043                                                                    
                                                                               
 NICO BUS, Acting Director, Division of Support Services, Department           
 of Natural Resources, said that Senate Bill 283 is a combination of           
 bills.  House Bill 438 sponsored by Representative Tom Brice is the           
 recording bill by location index and the essence of that bill is              
 that the Recorder's Office has been doing recording by location               
 indexing since 1972 on a discretionary basis.  When the workload              
 would get too heavy, that would be dropped and the Recorder's                 
 Office would simply do grant or grantee.  Section 5 of CSSB
 283(RLS) would make that mandatory and guarantee a better quality             
 record in terms of researching the real estate files.                         
                                                                               
 Number 123                                                                    
                                                                               
 MR. BUS further explained the other part of CSSB 283(RLS) is the              
 result of many years of process analyses by the Recorder's Office.            
 Knowing they have to do more with less, the office has tried to               
 streamline the operation to make it more uniform and easily                   
 understood by the public and by the 14 different offices.  In doing           
 so, the Recorder's Office has done everything they could on the               
 administrative side and those things which they were unable to do             
 are contained in this bill.  The housekeeping measures would                  
 actually make the recording process easier, there would be less               
 rejection and the documents could be turned around faster.  The               
 department has met with their customers - the mining industry and             
 the title companies and they all support this legislation.  He                
 noted the department will be saving some money and has prepared a             
 positive fiscal note.  If CSSB 283(RLS) is passed, the department             
 projects a savings between $140,000 and $145,000 annually.  He                
 commented that in budget deliberations, the Senate recognized they            
 had reduced the department's budget immediately for 1997; the                 
 department had hoped that could be delayed in order to catch up on            
 the backlog of archiving.                                                     
                                                                               
 MR. BUS directed the committee's attention to a letter of support             
 from Alaska Land Title Association which represents all the title             
 companies which is 40 percent of the customers of the Recorder's              
 Office.  He urged the committee's support of CSSB 283(RLS).                   
                                                                               
 Number 293                                                                    
                                                                               
 CO-CHAIRMAN GREEN noted that Mr. Bus had testified that with this             
 legislation the department could do a better job, a faster job and            
 also save money.  He asked what was wrong with the bill?                      
                                                                               
 MR. BUS said this is a win/win for everyone involved.                         
                                                                               
 Number 315                                                                    
                                                                               
 REPRESENTATIVE SCOTT OGAN made a motion and asked unanimous consent           
 to pass CSSB 283(RLS), Version C from the House Resources Committee           
 with individual recommendations and the attached positive fiscal              
 note.  Hearing no objection, it was so ordered.                               
                                                                               
 SB 257 am - TAKING FISH OR GAME FOR PUBLIC SAFETY                            
                                                                              
 Number 352                                                                    
                                                                               
 CO-CHAIRMAN GREEN announced that SB 257 am was the next bill to be            
 heard.                                                                        
                                                                               
 Number 371                                                                    
                                                                               
 GORDON WILLIAMS, Legislative Assistant to Senator Fred Zharoff,               
 testified that SB 257 amended was introduced by Senator Zharoff in            
 response to a lot of problems expressed by individuals throughout             
 his district about habituated bears in communities which was                  
 affecting people's feeling of safety.  Additionally, it was felt              
 that the defense of life and property laws were not addressing the            
 situation with the habituated animals.  Senator Zharoff met with              
 the Department of Fish & Game and the Board of Game last fall and             
 through those discussions, it was determined that at this point               
 neither the department nor the board had the clear authority to               
 make regulations for the taking of fish or game for public safety             
 reasons.                                                                      
                                                                               
 Number 474                                                                    
                                                                               
 MR. WILLIAMS explained that Section 1 of the bill provides that the           
 commissioner of the Department of Fish & Game can authorize the               
 taking of fish or game for public safety reasons.  Section 2                  
 addresses the Board of Game's authority in this area.  In December,           
 Senator Zharoff addressed the Board of Game and the Attorney                  
 General's Office was also present to notify the board that they               
 probably had never had the authority to make regulations for public           
 safety, clearly did not have it, probably couldn't adopt the                  
 regulations that were before them at that meeting and probably                
 didn't have the authority to do some of the things they had done in           
 the past including defense of life and property, hunter education             
 classes, taking birds around airports and those types of things               
 that are done for public safety reasons.  The Attorney General's              
 Office advised the board they needed to addressed the issue and out           
 of that came this legislation.                                                
                                                                               
 Number 563                                                                    
                                                                               
 CO-CHAIRMAN BILL WILLIAMS made a motion to pass SB 257 amended from           
 committee with individual recommendations.                                    
                                                                               
 CO-CHAIRMAN GREEN commented the committee had heard this bill                 
 previously; however, not all the members were present.  He asked if           
 there was further discussion.                                                 
                                                                               
 Number 579                                                                    
                                                                               
 REPRESENTATIVE JOHN DAVIES referred to Section 1 and asked Mr.                
 Williams if there would be some consideration to alternate means              
 rather than disposing of the animal.                                          
                                                                               
 MR. WILLIAMS responded they envision the department working with              
 the board to establish criteria for how this will be implemented.             
 That will be done through a public process to establish steps that            
 a community or group would go through to contact the department and           
 explain what they have done to alleviate the habituated bear, moose           
 or whatever.  He noted that Haines has put together a community               
 policy on exactly what needs to be done and he foresees something             
 along those guidelines but it would be developed along with the               
 board.  While there's been no opposition to this bill, individuals            
 have expressed concern in that they don't want this bill viewed as            
 relieving the community responsibility for not attracting animals             
 in the first place.  Those things need to be addressed on a                   
 continuing basis to remove the attractions for the animals;                   
 however, when the animals are clearly habituated, he thinks this is           
 a needed tool.                                                                
                                                                               
 Number 709                                                                    
                                                                               
 REPRESENTATIVE OGAN asked what methodology would be in place to               
 ensure that this wasn't abused.  The way he interpreted the statute           
 was for example, if there was a problem with birds at an airport,             
 as we've had recently, you could technically blast the birds, take            
 eggs or whatever.  He asked if that was a fair interpretation of              
 the statute?                                                                  
                                                                               
 MR. WILLIAMS said it is envisioned that both the board and                    
 department would establish the criteria.  He noted the board has              
 done some things with regard to birds, but they're being told now             
 that they never clearly had the authority to implement regulations            
 for public safety so they can't do that type of thing unless it's             
 clarified in statute that they have those powers.                             
                                                                               
 Number 808                                                                    
                                                                               
 CO-CHAIRMAN WILLIAMS made a motion to pass SB 257 am out of                   
 committee with individual recommendations.  Hearing no objection,             
 it was so ordered.                                                            
                                                                               
 CSSB 262(RES) (ct rule fld) - MANAGEMENT OF FISH/GAME POPULATION &           
 AREA                                                                         
                                                                               
 CO-CHAIRMAN GREEN announced that CSSB 262(RES) would be the next              
 bill for consideration.                                                       
                                                                               
 Number 868                                                                    
                                                                               
 REPRESENTATIVE ALAN AUSTERMAN noted that he had spoken against the            
 bill last week and would probably continue to have opposition, but            
 a number of legislators had contacted him with reference to their             
 wishes to have the opportunity to vote on this legislation on the             
 House floor.  Therefore, he was going to withdraw his objection to            
 voting it out of committee.                                                   
                                                                               
 CO-CHAIRMAN GREEN noted there had been some minor changes made.               
 The committee had before them proposed Committee Substitute,                  
 Version O.                                                                    
                                                                               
 REPRESENTATIVE OGAN made a motion to adopt Committee Substitute,              
 Draft 9-LS 1431\O, dated 4/29/96 as the working draft.  Hearing no            
 objection, it was so ordered.                                                 
                                                                               
 Number 938                                                                    
                                                                               
 REPRESENTATIVE IRENE NICHOLIA inquired if the Department of Fish &            
 Game was going to comment on the Committee Substitute just adopted            
 by the committee.                                                             
                                                                               
 CO-CHAIRMAN GREEN asked Wayne Regelin if he wished to comment on              
 the Committee Substitute?                                                     
                                                                               
 Number 955                                                                    
                                                                               
 WAYNE REGELIN, Director, Division of Wildlife Conservation,                   
 Department of Fish & Game, said, "I think the CS changed it from              
 replacing one acre for one acre rather than one for three and then            
 took out some of this where you were going to guarantee any lawyer            
 that sued us that they'd get rich."  That helps a little bit, but             
 he didn't think it solves the basic problems the department has               
 with the bill and they are still very strongly opposed to it.  He             
 said the Department of Law had some concerns about the trust                  
 relationship.  It's the first time it would be in statute and he              
 had expected a representative from the Department of Law to be                
 present at this hearing.                                                      
                                                                               
 CO-CHAIRMAN GREEN noted this committee had also expressed some                
 concern about the trust aspect.  Even though the "almost                      
 invitation" to litigation only deals with closing, there is still             
 a concern if it also energizes further litigation.  He had                    
 expressed his concern at the previous hearing and still maintains             
 that concern.                                                                 
                                                                               
 Number 1034                                                                   
                                                                               
 REPRESENTATIVE DAVIES asked Mr. Regelin to comment on the                     
 harvestable surplus, highest levels of human harvest and maximum              
 sustained yield definition.                                                   
                                                                               
 MR. REGELIN responded, "I think those definitions, tied together,             
 would require the department in areas that are going to be managed            
 for intensive purposes to harvest one-third of the number of                  
 animals born each year.  Our feeling is that it's very difficult to           
 achieve that in most areas of Alaska.  We approach it on areas                
 where we don't have any predators, such as on the Army bases in               
 Anchorage and that place, but in most areas of Alaska where you               
 have severe winters in the farther north in those areas, that it's            
 just not a level of harvest that's sustainable over time.  Even if            
 we would reduce the wolf and bear populations to very, very low               
 levels, we probably couldn't achieve that level over time because             
 of the severe winter weather we have.  So we have some real                   
 concerns with that.  It's the same language and definitions that              
 were in SB 77."                                                               
                                                                               
 REPRESENTATIVE DAVIES commented that he was trying to contemplate             
 how the department would manage this if it's simply an unworkable             
 level.  Based on Mr. Regelin's testimony that these goals were                
 simply unattainable, he wondered if in Mr. Regelin's view, there              
 would be litigation as a result of not meeting those goals.                   
                                                                               
 MR. REGELIN said if this became law, the department would do their            
 very best to achieve those goals.  They would probably reduce the             
 wolf and bear populations and see what they could maintain.  He               
 didn't think that biological reality could be mandated by                     
 legislation; the department would probably not achieve it and then            
 he'd probably get sued according to the way this bill is drafted.             
                                                                               
 Number 1214                                                                   
                                                                               
 REPRESENTATIVE DAVIES said, "I guess the next question I had is in            
 terms of this opening up new habitat that's called no net loss                
 features of this and based on restrictions -- is it your reading of           
 this bill that even a change in the methods of access would be                
 viewed as a restriction, if the change were to eliminate one method           
 of access?"                                                                   
                                                                               
 MR. REGELIN replied yes, he thought it's very clear that is what              
 this law does.                                                                
                                                                               
 REPRESENTATIVE DAVIES asked if in Mr. Regelin's view it was                   
 possible to find one for one?   What are the typical sizes of an              
 area that those kinds of changes and restriction might apply to and           
 would those comparable areas be available within the geographic               
 regions all over the state?                                                   
                                                                               
 MR. REGELIN said the way the Board of Game usually does that is               
 when they make regulations, it's a good sized area for the                    
 convenience of the hunter.  He noted there are 26 game management             
 units in the area, many with sub-units, so often it's done on a               
 sub-unit basis.  In certain places where it's not necessary, it's             
 restricted by portions of the sub-unit if there's rivers or roads             
 that allow the hunter to know where they're at in the woods.  These           
 areas are typically large.  For example, on the North Slope where             
 the moose harvest was restricted in a big area even though the                
 moose are only along the river corridors and to find a replacement            
 for that size that the Board of Game could look at just doesn't               
 exist.  He thought the result would be that the Board of Game                 
 wouldn't be able to restrict because there's nothing else to open             
 up.  He noted the Department of Law is looking at this and may be             
 able to provide additional information.                                       
                                                                               
 Number 1323                                                                   
                                                                               
 REPRESENTATIVE DAVIES referred to page 4, line 15, which states,              
 "The Board shall adopt regulations guaranteeing access to and for             
 continued consumptive uses" and asked if that was a similar kind of           
 restriction against any kind of restrictions?                                 
                                                                               
 MR. REGELIN said he thought the guarantee of access is a different            
 part of the bill and has its own special problems in his mind                 
 because in many areas they allow hunting but they restrict it by              
 the number of permits.  If the opportunity to hunt is guaranteed in           
 statute, he didn't think the department could by regulation                   
 restrict them by permits.  So in many of the trophy areas or where            
 they have to limit the number of animals taken, they probably won't           
 be able to do that.  The other alternative is shorter seasons which           
 presents a "Catch 22" situation because if the season is shortened,           
 then another place has to be found to replace that.                           
                                                                               
 Number 1382                                                                   
                                                                               
 CO-CHAIRMAN GREEN said, "On that same idea, under harvestable                 
 surplus, where it talks about excluding those animals that are                
 taken for predation and human harvest, am I misreading that or does           
 that lead to a convolution of reducing the number of game?"                   
                                                                               
 MR. REGELIN replied, "Over time, you would be mandated by the                 
 regulation to always harvest one-third of the number born less                
 those that die from natural causes other than predation.  And when            
 you have severe winters and you lose 10, 15 and even 30 percent of            
 the populations at times, you wouldn't be allowed to reduce the               
 harvest levels to allow the herds to rebuild.  That's one of the              
 basic concerns we've had with this language from the beginning.  I            
 should also say on the closure of these areas where restrictions,             
 there's a clause in there that says, `except for biological                   
 emergencies' so what that means, I'm not sure.  The Board of Game             
 doesn't manage by emergency, they try to think ahead so I would               
 think it would be difficult to say that the board was taking this             
 action for an emergency.  Now the department has emergency                    
 authority to close seasons when we reach certain harvest levels or            
 something unusual happens, so I don't think they'd be restricted in           
 that case because we call it emergency order.  I'm not sure if                
 that's what they meant or not - the drafters."                                
                                                                               
 CO-CHAIRMAN GREEN remarked like the severe winter when there were             
 so many killed by the railroad and also by freezing, etc.                     
                                                                               
 MR. REGELIN thought the goals of the bill were to ensure higher               
 harvest levels which he didn't object to, but he didn't think the             
 means of getting there in this case were not very wise.                       
                                                                               
 Number 1491                                                                   
                                                                               
 REPRESENTATIVE DAVIES asked, "Do you think it's possible that this            
 bill might have the opposite result in the sense that -- I'm trying           
 to envision being on the Board of Game and contemplating increasing           
 access to an area where suppose the population has increased and              
 you wanted to maybe add another method of access or add to the                
 length of the season - I might under the terms of this bill, be               
 pretty uncomfortable with making those additions when I knew that             
 if I had at some point in the future to produce that, I would be              
 prohibited from doing that.  Wouldn't this actually - I think in              
 some respects have a dampening effect on opening up access when               
 there was some possibility that you might have to withdraw that               
 three or four years in the future?"                                           
                                                                               
 MR. REGELIN said it was a possibility that the Board of Game would            
 be reluctant to take a short term opportunity to harvest more                 
 wildlife because in the long term, that level couldn't be                     
 sustained.  He added, "Or for instance in Unit 13, where we're                
 trying to reduce the caribou population and harvest, I think 15,000           
 caribou this year, if they're going to be forced to maintain that             
 harvest level some way, they probably wouldn't be able to do it.              
 They probably wouldn't do it in the first place."                             
                                                                               
 Number 1567                                                                   
                                                                               
 REPRESENTATIVE OGAN said this subsection does not apply to                    
 temporary closure based on biological emergency.  If it's a tough             
 winter, it means that's a biological emergency.  There is still               
 latitude in this legislation to manage wildlife.  Section 1 says              
 that it's to be managed solely on a biological basis.  The                    
 legislation simply says that if an area is going to be closed, it             
 has to be closed for a good reason; not because some special                  
 interest group wants to have the area closed.                                 
                                                                               
 Number 1626                                                                   
                                                                               
 MR. REGELIN said he agreed that that's probably what the intent of            
 the bill is, but individuals from the Departments of Fish & Game              
 and Law who have analyzed the bill believe these are real problems            
 and the department would probably end up in court.                            
                                                                               
 Number 1647                                                                   
                                                                               
 CO-CHAIRMAN WILLIAMS referred to the deer and timber in the                   
 Southeast area and asked how this would affect the timber industry.           
                                                                               
 MR. REGELIN said he didn't think it would have any affect on the              
 timber industry, but the Department of Law had some concerns with             
 the trust language so perhaps they should address that question.              
                                                                               
 Number 1683                                                                   
                                                                               
 REPRESENTATIVE NICHOLIA asked how this legislation would affect the           
 controlled use areas, which in her district are used to rebuild               
 their big game populations.                                                   
                                                                               
 MR. REGELIN responded, "The way that we feel the bill is                      
 structured, and it guarantees access by different methods and                 
 means, that you wouldn't be able to do that.  I'm not sure that we            
 wouldn't be able to maintain the ones that are in place now, but              
 new controlled use areas that restrict methods of access - I don't            
 think they'd be allowed because it's very clear that you can't                
 restrict methods of access except to protect habitat.  You can't do           
 it to use methods of access to restrict harvest."                             
                                                                               
 Number 1735                                                                   
                                                                               
 REPRESENTATIVE NICHOLIA commented, "Then, if we can't use                     
 controlled use areas then you're probably going to tell me that we            
 can't use the restricting the human consumption uses - restricting            
 human uses?"                                                                  
                                                                               
 MR. REGELIN thought the board would still be able to restrict                 
 seasons and bag limits but when they do, they would have to find              
 another area to open.  He added that if this could be interpreted             
 that it's for a biological emergency, then they wouldn't have to do           
 that.  It's the language regarding the emergency that concerns him            
 because he didn't think the actions taken by the Board of Game                
 could be construed as emergencies.  During his 13 years of working            
 with the board, he recalled only twice when the board did emergency           
 actions because of having to give advance notice of a meeting.                
                                                                               
 Number 1815                                                                   
                                                                               
 REPRESENTATIVE NICHOLIA said, "I first got involved in fish and               
 game activities since 1984 and then I learned that the Yukon Flats            
 had a low moose population and they've been rebuilding every since.           
 They had low moose populations across the whole Yukon Flats, so I             
 don't see how that provision would help them because you don't                
 really want to open up one part of it and restrict one part of it             
 because then you would decrease the population in that one section            
 some more.  It says if you restrict one area, then you have to open           
 up another portion of another area.  I just don't see how that                
 would work."                                                                  
                                                                               
 MR. REGELIN said he thought it would be difficult for the board to            
 do that because there wouldn't be other areas to open.                        
                                                                               
 Number 1868                                                                   
                                                                               
 REPRESENTATIVE NICHOLIA said under this bill if one area is                   
 restricted for moose for example, then another area is supposed to            
 be opened up but what happens if the department doesn't open                  
 another area.                                                                 
                                                                               
 MR. REGELIN said there are two things that would happen.  The Board           
 of Game would not be allowed to close the area or the Department of           
 Fish and Game would be sued and he didn't know what the relief                
 would be if there's no area to open.                                          
                                                                               
 Number 1902                                                                   
                                                                               
 REPRESENTATIVE DAVIES said he was also concerned about the                    
 restrictions on the use of revenues.  He referred to page 3 which             
 includes a restriction on the utilization of revenue generated from           
 taxes, license fees and other fees paid by sportsmen or funds                 
 received from federal aid in sport fish and wildlife programs and             
 prohibits the use of those funds in an area where consumptive use             
 of fish and game is not permitted or for the use for management of            
 nongame species and asked how these funds are used and what the               
 impact of this language would be on how the funds are used now.               
                                                                               
 MR. REGELIN replied that since the department has lost their                  
 general funds, they are using fish and game funds which are license           
 fees, to help manage areas like Pack Creek, Cramer's Field and                
 McNeil River - although some of these are paid somewhat by user               
 fees - this legislation would prohibit the use of fish and game               
 funds for those in addition to prohibiting the use of those funds             
 for work on endangered species or nongame species.  He noted the              
 department does a small amount of that now but mostly on species              
 that are either endangered, threatened or being petitioned to be              
 threatened.  The reason they do that is that most of the time once            
 they start doing the research, they find there are more animals               
 than what people thought and the department feels the decisions on            
 listings should be based on the best data available so they try to            
 collect it.  He thought the department had a good record of keeping           
 lots of species that were petitioned to be listed or actually                 
 started through the process to stop them, like the goshawk in                 
 Southeast.                                                                    
                                                                               
 Number 1992                                                                   
                                                                               
 REPRESENTATIVE OGAN asked if Mr. Regelin's discomfort would be                
 eased somewhat if the language on page 2, line 7, regarding                   
 biological emergency was changed to biological basis?                         
                                                                               
 MR. REGELIN responded it would certainly make it better in that               
 section about replacing the one for one.  He would still have                 
 concerns about the guaranteeing of access to hunt and no                      
 restrictions on access by any kind of methods and means.  He was              
 proud of some of their trophy areas and the walk in areas for                 
 trophy management and quality hunting experiences where access is             
 restricted by various means and he would hate to lose those.  Those           
 are areas were put in by hunters working in conjunction with the              
 department and he felt it was something that Alaska should continue           
 to offer to the hunting public.                                               
                                                                               
 Number 2055                                                                   
                                                                               
 REPRESENTATIVE OGAN asked if it was Mr. Regelin's contention that             
 they would lose controlled use areas?                                         
                                                                               
 MR. REGELIN said, "When it guarantees access to hunting and you               
 guarantee something in statute, and then I say that only 10 people            
 can go or 100 people - or the Board of Game does - you're no longer           
 guaranteeing and the one hundred and first person can sue us, the             
 way I read it."                                                               
                                                                               
 Number 2077                                                                   
                                                                               
 REPRESENTATIVE OGAN said if it's managed on a biological basis and            
 then determined for biological reasons that only 10 people can go             
 in there, then that's a legitimate restriction.  He asked if that             
 was correct.                                                                  
                                                                               
 MR. REGELIN replied that was a completely separate part of the bill           
 and the lawyers would need to explain whether that was a                      
 possibility.  He thought controlled use areas are used as a tool              
 for the Board of Game to help spread out pressure and for a whole             
 variety of reasons to protect the local users and give them more              
 opportunities in places.  He thought those would go away.                     
                                                                               
 CO-CHAIRMAN GREEN asked if the committee had any other questions of           
 Mr. Regelin.  Hearing none, he called on Kevin Saxby to testify.              
                                                                               
 Number 2126                                                                   
                                                                               
 KEVIN SAXBY, Assistant Attorney General, Natural Resources Section,           
 Department of Law, said he was assigned to both represent the Board           
 of Game and in Anchorage does most of the work for the Division of            
 Forestry, also.  He stated, "I want to assure you that we haven't             
 yet spotted all the legal issues on this bill yet, but there's a              
 few important ones that the department thought that members might             
 want to be aware of as they engage in final debate on this.  The              
 first one, probably the most important one we've spotted so far is            
 this public trust issue that Wayne has just talked about a little             
 bit.  The public trust doctrine is that an established - it's a               
 term of art in the law and when you buy into that language, you're            
 buying into - just by the fact of using it, you're buying into                
 many, many decades of jurisprudence on that issue.  There's already           
 a lot of law on the public trust doctrine.  Being the person who              
 both defends timber sales that are planned by the Department of               
 Natural Resources (DNR) and who defends the decisions of the Board            
 of Game, I can tell you that I'm uniquely (indisc.) to explain to             
 you some of the ways that the public trust doctrine might be                  
 popping up in the future."                                                    
                                                                               
 Number 2196                                                                   
                                                                               
 MR. SAXBY continued, "One of the ways that we've often seen it in             
 litigation in the past is when anti-development proponents want to            
 halt, say a timber sale or some other commodity use of resources,             
 they'll come in and argue that the wildlife in that particular area           
 or some other resource on the land in that particular area must,              
 under our constitution, be managed as a public trust and that the             
 (indisc.) agency hasn't given sufficient consideration to the                 
 public trust value - the higher values that are implicated if you             
 have a public trust there.  (Indisc.) the Department of Law has               
 successfully defended against that kind of an argument by arguing             
 that the public trust doctrine historically applies only in                   
 navigable waters.  It doesn't apply on the land.  To my knowledge,            
 this is the first time that the public trust doctrine would be                
 exclusively applied on the land.  So the point is I guess, I think            
 that you need to be aware that if you decide to use this kind of              
 language and for the first time take the important step of applying           
 the public trust doctrine on land, you'll be taking a tool away               
 from the Department of Law that we've used to defend disposals of             
 resources in the past and handing a tool to those who would want to           
 delay government action or prohibit it."                                      
                                                                               
 Number 2279                                                                   
                                                                               
 MR. SAXBY stated, "The second issue is, as Wayne pointed out, this            
 issue about some of the definitions and he pointed out the                    
 biological implications of the maximum sustained yield and                    
 harvestable surplus and highest level of human harvest definitions.           
 I just want to add to that that because these will be viewed as               
 implementing the sustained yield clause of Article VIII, Section 4            
 of the State Constitution, there's a pretty strong chance that                
 these will eventually be interpreted as what sustained yield                  
 management means for game resources.  And that's really an                    
 important step to take and given that the record is that this isn't           
 what managers have in the past thought of sustained management as,            
 it's a really narrow definition of sustained yield management.  It            
 will have very broad implications.  To the extent that these                  
 definitions are equated with sustained yield management, they could           
 have very broad implications requiring severe re-thinking of most             
 game management (indisc.) that appear to have been accepted as                
 appropriate."                                                                 
                                                                               
 Number 2306                                                                   
                                                                               
 MR. SAXBY further stated, "The third issue I wanted to point out              
 very quickly for you is the citizen suit provisions.  There are two           
 -- I realize I may be looking at a version of the bill that perhaps           
 has changed recently, although I think they just tried to get me              
 the most current draft -- but as I read it, there are two citizens            
 suit provisions both of which allow suits to be brought against               
 public officials other than members of the Board of Game to enforce           
 the other provisions of the bill.  There are some problems in that.           
 The first citizen suit provision on - in my version, it's on page             
 2, beginning at line 8, authorizes citizens to sue public officials           
 other than members of the Board of Game for an injunction to compel           
 compliance with the preceding section.  The preceding section says            
 that the Board of Game and other state agencies, if they close                
 areas, must open other areas.  Well, I'm (indisc.) this provision             
 authorizes is a suit against someone for action that the Board of             
 Game has taken - someone who is powerless to change the action of             
 the Board of Game.  That problem could possibly be fixed by                   
 changing language somewhere.  But the underlying problem is still             
 there which is that's it's generally the Board of Game that adopts            
 means and methods, seasons, bag limits, all the restrictions                  
 applicable to hunting and it's just inappropriate to authorize suit           
 against other state officials when it's the Board of Game itself              
 that's (indisc.).  Of course, I'm not recommending that you change            
 the language and allow suit against the Board of Game.  I think if            
 that were the case, you'd have major problems recruiting and                  
 keeping good Board of Game members.  The second citizen suit                  
 provision has basically the same problem."  In an attempt to keep             
 his testimony brief, he reiterated that he hadn't identified all              
 the issues.  He offered to answer any questions the committee might           
 have.                                                                         
                                                                               
 REPRESENTATIVE RAMONA BARNES joined the meeting at 8:55 a.m.                  
                                                                               
 Number 2388                                                                   
                                                                               
 CO-CHAIRMAN GREEN asked if there were any questions of Mr. Saxby.             
                                                                               
 Number 2392                                                                   
                                                                               
 REPRESENTATIVE DAVIES said, "Under these -- the possibility of                
 bring suit against public officials -- just suppose that an area              
 was closed or a method of access to an area was restricted and then           
 somebody sued to open up an equivalent area and the cognizant                 
 public official could not find an area to open that was equivalent            
 in size.  What would then ensue?"                                             
                                                                               
 Number 2419                                                                   
                                                                               
 MR. SAXBY replied, "We'd be faced with a couple of problems.  First           
 of all, there'd be so much - depending on which public official was           
 sued, let's say it's Wayne as he was talking earlier, one of the              
 first points that would be made, I guess is that Wayne doesn't have           
 authority to open and close areas except in cases of biological               
 emergency, like he earlier testified.  So it (indisc.-coughing) to            
 sue him, although there'd be a lot of confusion because this                  
 statute purports to authorize people to can sue him.  The next                
 issue raised would be if we're dealing with the right person -                
 someone who does have authority to open an area and we still can't            
 find an area large enough, it becomes a question of reconciling a             
 constitutional sustained yield management mandate with this                   
 statutory mandate to open up areas and we'd have to do some real              
 work in preparing the defense of that case and get the department             
 and perhaps the board and perhaps others to look at establishing a            
 record proving that there is no where else in the state that can be           
 opened up to the use that was closed down for biological....                  
                                                                               
 TAPE 96-73, SIDE B                                                            
 Number 001                                                                    
                                                                               
 MR. SAXBY continued..."I'm kind of saying this off the top of my              
 head, but that would be the first place I would advise the decision           
 makers to look - at reconciling the Constitution with the statute."           
                                                                               
 Number 015                                                                    
                                                                               
 REPRESENTATIVE DAVIES inquired given the complexities discussed by            
 Mr. Saxby, is it his opinion that if this bill were to be enacted             
 into law that it would invite numerous lawsuits and they would be             
 fairly expensive to defend.                                                   
                                                                               
 Number 026                                                                    
                                                                               
 MR. SAXBY said he agreed with that.  He thought the citizen suit              
 provisions in this bill are among the strongest that he's ever seen           
 in statute and as others have mentioned, that is essentially an               
 invitation to sue.                                                            
                                                                               
 Number 044                                                                    
                                                                               
 CO-CHAIRMAN WILLIAMS asked Mr. Saxby to explain how this might                
 affect the timber industry in Southeast or anywhere else for that             
 matter and how this might affect a challenge on the timber sale.              
                                                                               
 MR. SAXBY responded that he was currently defending (indisc.)                 
 decision to conduct salvage logging on the Kenai Peninsula.  A                
 number of different organizations have challenged the entire five-            
 year schedule and also each individual timber sale that was                   
 proposed last year - a total of, he thought 10 or 11 sales to try             
 to deal to some extent at least with the bark beetle infestation              
 that's ongoing there.  He pointed out, "That the bark beetle                  
 infestation is the worst or one of the worst places and one of the            
 places where a lot of those sales have been proposed and have                 
 actually been initiated, is in the southern part of the Kenai                 
 Peninsula adjacent to or actually within the Rich Creek critical              
 habitat area.  Of course, this bill deals a lot with what gets to             
 happen in critical habitat areas."  He noted that one of the                  
 arguments made by the environmental organizations and other groups            
 who want to halt the timber sale or perhaps halt a proposed mine or           
 some other commodity use is that the Department of Natural                    
 Resources has failed to consider other uses or failed to adequately           
 consider other uses or failed to adequately allow for other uses.             
 Their hand in making that argument is greatly strengthened to the             
 extent that those other uses are recognized as coming within the              
 rubric of the public trust doctrine.  In the past, these groups               
 have argued that these were public trust type concerns and we've              
 defeated them by and large by saying the public trust doesn't apply           
 here; it's never been applied here and it shouldn't be applied here           
 now and it doesn't (indisc.-coughing) apply here by any law or by             
 our Constitution.  What this would change is that this now                    
 explicitly does apply public trust principles to what many would              
 view as competing uses to logging or mining or some of the                    
 commodity uses.  It strengthens their arguments.                              
                                                                               
 Number 147                                                                    
                                                                               
 REPRESENTATIVE DAVIES referred to page 4, line 15 which is a new              
 instruction to the Board of Game to adopt regulations that would              
 guarantee access to and for continued consumptive use and asked Mr.           
 Saxby to comment on the possibilities for lawsuits under that                 
 language with respect to trophy areas and other areas where for               
 some reason there exist restrictions at the present time.                     
                                                                               
 MR. SAXBY replied that he agreed with Mr. Regelin that it certainly           
 raises questions about the continued validity of areas that have              
 limited access regardless of the way that access is limited.  He              
 pointed out that in many, if not most of the trophy areas, the                
 restriction was not entered based on a biological justification or            
 at least not solely a biological justification.  Often it was an              
 allocation decision not solely based on biology but based also on             
 managing competing types of allocated uses.  He said that's also a            
 reason for a lot of controlled use areas.  For example, providing             
 reasonable opportunity for subsistence as opposed to sport hunting            
 where the board finds that one or the other of those uses is more             
 important in that particular area.  He agreed that it would                   
 increase the likelihood of lawsuits.  He commented there was                  
 another problem with that provision and that is that it's always              
 been thought that the Board of Game doesn't have authority over               
 most state land to guarantee that anything happens on that state              
 land.  The Board of Game has authority to control means and methods           
 of hunting but this language that says the Board of Game shall                
 adopt regulations to guarantee access to land would throw a wrench            
 into the works when they're trying to decide whether it's DNR, the            
 Board of Game or what agency has the authority to decide what                 
 happens in this particular area.  He recommended that some thought            
 be put into some qualifying language in that area.                            
                                                                               
 CO-CHAIRMAN GREEN noted that Steven Daugherty from the Attorney               
 General's Office was present to testify.                                      
                                                                               
 Number 270                                                                    
                                                                               
 STEVEN DAUGHERTY, Assistant Attorney General, Natural Resources               
 Section, Department of Law, testified that he is the lead attorney            
 for the Alaska Board of Fisheries and wanted to point out that                
 there are a few fisheries implications of this bill as well as game           
 implications.  He said, "The Board of Fisheries allocates between             
 competing user groups and this includes non-consumptive as well as            
 consumptive sport uses.  The Board of Fisheries also closes areas             
 to fishing and these are not always on a biological emergency                 
 basis.  This is sometimes on a habitat basis trying to protect the            
 habitat for the long term conservation of the stock.  The Board of            
 Fisheries recently adopted regulations allowing the closure of                
 areas along the Kenai River and they felt these regulations were              
 critical to the long-term preservation of king salmon in the Kenai            
 River.  This bill would have definite negative implications for               
 that.  A lot of those areas along that river might fall into some             
 of these areas.  They've been purchased - some of this Exxon Valdez           
 restoration funds have been used to purchase areas and with the               
 goal of defining these areas as critical habitat just so they can             
 protect the habitat, protect spawning areas for salmon."                      
                                                                               
 Number 329                                                                    
                                                                               
 MR. DAUGHERTY continued, "The Board of Fisheries has a number of              
 catch and release trophy type fisheries where you can only keep a             
 trout if it's above 30 inches or under 12 inches, where the                   
 majority of the trout fall into the 12 to 30 inch range and you               
 cannot retain them for consumptive use because in these areas the             
 Board of Fisheries is trying to promote trophy fishing.  It's a big           
 draw for sportsmen to come to Alaska to fish and for Alaska                   
 sportsmen to get out and get a trophy fish.  Without the ability to           
 do this, there will basically be no trophy fish.  If the board has            
 to regulate for consumptive use, they won't be able to regulate to            
 allow the development of these trophy fish that have to stay in the           
 system for years in order to reach that size."                                
                                                                               
 Number 369                                                                    
                                                                               
 MR. DAUGHERTY said, "Kevin Saxby has touched on most of the issues            
 with the public trust doctrine; however, I would note that the                
 public trust doctrine is being applied to a fund here as well as              
 just applying it to land and you're implicating all these funds               
 that come in for our sport fish and this might - I can't say right            
 now - the public trust doctrine is such a fuzzy issue that's out              
 there.  There's so much case law on it; it can be applied in some             
 many different ways, but it's possible that if you were saying that           
 there's a public trust to support fish funds, this could have                 
 negative implications for commercial fisheries.  The Board of                 
 Fisheries might be required as a result of some lawsuit that might            
 arise to restrict commercial fisheries in order to protect that               
 public trust that is being assigned to the sport fish funds."                 
                                                                               
 Number 400                                                                    
                                                                               
 MR. DAUGHERTY remarked, "I also wanted to touch on one other point.           
 It's not relating to the Board of Fisheries but to the biological             
 emergency clause.  The Alaska Supreme Court does look very narrowly           
 on what constitutes an emergency and that language does present               
 problems."  He offered to entertain questions from the committee              
 regarding the Board of Fisheries.                                             
                                                                               
 Number 415                                                                    
                                                                               
 CO-CHAIRMAN GREEN commented that Representative Ogan had indicated            
 there might be a change on page 2, line 7, which would change                 
 "emergency" to "basis" and asked if that would alleviate the last             
 problem discussed by Mr. Daugherty?                                           
                                                                               
 MR. DAUGHERTY said, "That would help with the emergency thing.  I             
 don't think that particular clause would apply to management of               
 fisheries; however, I can say that it would prohibit - if you were            
 doing things on a biological basis that would not allow you to                
 develop these trophy fish.  That would be something that would be             
 ruled out because that's not something that is biologically                   
 necessary in order to promote maximum sustained yield.  It is                 
 something that would actually decrease the pounds of fish that are            
 harvested when you manage for trophy fish."                                   
                                                                               
 Number 451                                                                    
                                                                               
 CO-CHAIRMAN GREEN said it appears that other than the fact that               
 there may not be lands, river banks or types of lands available to            
 go along with this, most of the problems that have been raised are            
 of a legal nature.  Inasmuch as the next committee of referral for            
 this bill was the Judiciary Committee, he thought that would be the           
 appropriate place to address the legal problems that have been                
 raised.  He asked Mr. Daugherty what would happen in a situation              
 where River A is a fantastic fishing area but because it's being              
 over fished, you restrict or maybe even close and you would make              
 another area and there isn't another area like that.  What happens            
 when you cannot do what is physically do what is required?                    
                                                                               
 MR. DAUGHERTY wasn't sure what the courts would do in that                    
 situation.  He added that in the fisheries area, nearly every area            
 in the state is open to fishing.  The Board of Fisheries only                 
 closes areas traditionally when there is a problem in that area and           
 since most of the waters in the state are open to fishing, there              
 isn't any other area that can be opened up because everything is              
 already open that can permissibly be open without threatening the             
 stocks.                                                                       
                                                                               
 Number 520                                                                    
                                                                               
 REPRESENTATIVE OGAN stated, "On that point, I believe that - you              
 mentioned that I was considering - I'd like to move an amendment              
 when it's time to delete that "emergency" word from Section 1 and             
 then if there was a biological basis for closing an area through              
 the depletion of stocks or whatever, then they wouldn't be forced             
 to open another area in the same geographic area if there wasn't              
 another area to open.  It would give them a little bit more of a              
 management tool.  I think the intent of the bill is simply to try             
 to keep no net loss for hunting areas unless there's a biological             
 reason to close an area.  That's simply the intent.  I think it's             
 a laudable goal.  If we soften that language somewhat, it would               
 give them some more latitude.  Whenever you're ready for an                   
 amendment, I'll be moving that amendment."                                    
                                                                               
 CO-CHAIRMAN GREEN remarked that an amendment at this point might be           
 helpful.                                                                      
                                                                               
 Number 574                                                                    
                                                                               
 REPRESENTATIVE OGAN made a motion to amend page 2, line 7, delete             
 "emergency" and insert "basis".  Page 2, line 7 would then read               
 "does not apply to a temporary closure based upon a biological                
 basis."                                                                       
                                                                               
 CO-CHAIRMAN GREEN asked if there was discussion or objection.                 
                                                                               
 Number 666                                                                    
                                                                               
 REPRESENTATIVE DAVIES objected for the discussion purposes.  In               
 conjunction with that, he inquired what "temporary" means.                    
                                                                               
 Number 676                                                                    
                                                                               
 REPRESENTATIVE OGAN said "I would interpret temporary as - for                
 example to get into a situation, let's use the Nelchina Caribou               
 Herd - it's a rather well known situation.  They've gone into a               
 tier-2 hunt, but if there's a depletion of a particular game or               
 fish, they can temporarily close an area to let the stocks                    
 replenish for a biological basis.  This clause gives them the                 
 ability - they don't necessarily have to reopen an area in another            
 area immediately if it's a biological reason they're closing it.              
 If there's another reason - political reason or special interest              
 pressure group, ecotourism or whatever - that wouldn't be allowable           
 but if it was simply for a biological basis, they would not have to           
 reopen another area of equal size under this clause and hopefully,            
 allow them to replenish the stocks and manage the game and fish or            
 whatever, and when it's back to a level that can harvested again,             
 then open it back up."                                                        
                                                                               
 CO-CHAIRMAN GREEN thought that whatever the biological basis was              
 for closure would determine how temporary, temporary is.                      
                                                                               
 Number 695                                                                    
                                                                               
 REPRESENTATIVE DAVIES asked how that is different from what the               
 department is doing right now.                                                
                                                                               
 REPRESENTATIVE OGAN said there are some areas that are being closed           
 by the Board of Game not for biological reasons.  For example, the            
 Paint River area for brown bear hunting.  There's been a long                 
 history of three bears in that area for decades.  There's an                  
 abundance of bears there and no biological reason to close that               
 area; it was simply for political reasons and ecotourism reasons.             
                                                                               
 REPRESENTATIVE DAVIES inquired if ecotourism would not be a valid             
 reason to take any particular Board of Game action.                           
                                                                               
 REPRESENTATIVE OGAN remarked it is Board of Game, not Board of                
 Tourism.                                                                      
                                                                               
 REPRESENTATIVE DAVIES said, "Suppose that the residents of an area            
 came and asked to have the means of access altered for their own              
 economic reasons, but it turned out it was not a biological reason;           
 it was an economic reason.  Would that be prohibited under this?"             
                                                                               
 REPRESENTATIVE OGAN commented that he is not an expert on this, he            
 didn't write this legislation.  He commented there had been a lot             
 of areas closed in Alaska.  He thought there was 40 million acres             
 off limits for tourist reasons and various other reasons and the              
 hunters are saying enough is enough.  If an area is going to be for           
 any reason other than a biological reason, then another area of               
 equal size should be opened up.  It noted it was originally three             
 times bigger, but was softened to one for one.  He asked if that              
 area for example, in Paint River was not closed, would it affect              
 the number of bears and the quality of experience there?   He                 
 didn't think it would; there's still a lot of bears in that area.             
 It hasn't affected it in the past.  It's become an incredibly                 
 attractive tourist attraction, which he felt was a good thing.                
 There has been hunting in there for many years and it hasn't                  
 affected it.  He asked is there a biological reason to close that             
 area down?  If the bear population takes a crash, then absolutely             
 it should be closed down and the tourists will benefit from that.             
                                                                               
 Number 813                                                                    
                                                                               
 REPRESENTATIVE DAVIES asked if Mr. Regelin could come forward to              
 answer some additional questions.                                             
                                                                               
 CO-CHAIRMAN GREEN invited the assistant attorney general to join              
 Mr. Regelin.                                                                  
                                                                               
 Number 843                                                                    
                                                                               
 REPRESENTATIVE DAVIES asked Mr. Regelin to explain the effect of              
 the word "temporary" and how would it differ from the present                 
 management?                                                                   
                                                                               
 MR. REGELIN responded that he considers every action taken by the             
 Board of Game is temporary in a way, because the next board can               
 change it.  There is nothing that is permanent versus temporary and           
 it's not defined.  The next Board of Game as it changes, can review           
 the action and it's done on a schedule of every other year.  He               
 didn't think the word "temporary" meant a whole lot.                          
                                                                               
 Number 888                                                                    
                                                                               
 CO-CHAIRMAN GREEN inquired if on that basis, his earlier statement            
 that "temporary" as it relates to page 2 would be dictated by                 
 whatever the biological concern was.                                          
                                                                               
 MR. REGELIN said that was correct.  He thought the board could                
 change it as soon as (indisc.) changed or it could just be a                  
 different philosophy of the board, also.                                      
                                                                               
 Number 905                                                                    
                                                                               
 REPRESENTATIVE DAVIES commented that with respect to biological               
 issues, this would probably have no effect then on the way the                
 board makes decisions.  He asked Mr. Regelin if that was correct.             
                                                                               
 MR. REGELIN said, "Temporary versus...                                        
                                                                               
 REPRESENTATIVE DAVIES interjected, "In other words, if we change              
 this wording so it reads `This subsection does not apply to a                 
 temporary closure based on a biological basis.'"                              
                                                                               
 MR. REGELIN replied, "I think what it would do is it would remove -           
 if you make the decision for a biological basis, then you would not           
 have to open another area equal in size somewhere else.  If you               
 made that closure for other reasons - social, political or whatever           
 - then you'd have to find another area to open.  And again, I guess           
 the only area that I -- I think we're coming back to McNeil River             
 and all the time I've worked on the Board of Game, they've closed             
 an area to hunting that had been opened -- the Board of Game did --           
 and that was at the McNeil River area.  That was not done for                 
 biology and we talked about it at great length with the board.  It            
 had been before them, I think, three consecutive meetings and it              
 became a real divisive issue and an issue that was very harmful for           
 hunters, in our opinion, throughout the Nation and the state                  
 because it was being exploited as making it look like hunters were            
 really up there shooting bears at the falls.  It wasn't happening,            
 but that's the reason the board took that action.  In that case,              
 they'd have to find another area to open.  The board did that.                
 After they took that, they passed the no net loss policy of the               
 Board of Game and instructed us to review all closed areas in the             
 state and come back to them to open whichever ones we could.  We've           
 started doing that - that's why the Delta closed area was reopened            
 at the last board meeting."                                                   
                                                                               
 Number 1013                                                                   
                                                                               
 CO-CHAIRMAN GREEN commented the committee had an amendment that               
 should be acted on and most of the questions could be more                    
 appropriately addressed in the Judiciary Committee.  He asked if              
 there was other discussion relating to the proposed amendment.                
                                                                               
 Number 1030                                                                   
                                                                               
 REPRESENTATIVE NICHOLIA requested the amendment be read again.                
                                                                               
 Number 1035                                                                   
                                                                               
 REPRESENTATIVE OGAN explained the proposed amendment was on page 2,           
 line 7, delete "emergency" and insert "basis."                                
                                                                               
 CO-CHAIRMAN GREEN asked if all committee members understood the               
 amendment and if there was further objection.                                 
                                                                               
 REPRESENTATIVE DAVIES withdrew his objection.                                 
                                                                               
 CO-CHAIRMAN GREEN announced that Amendment 1 was adopted.                     
                                                                               
 Number 1056                                                                   
                                                                               
 REPRESENTATIVE NICHOLIA said she had a proposed amendment on page             
 3, line 7, insert "except for controlled use areas" after the word            
 "game."  She explained this addressed the concern she had raised              
 earlier that this bill would wipe out the use of the controlled use           
 areas which are used in her district to rebuild the big game                  
 population.  She noted there have been moose population problems in           
 her area and they have used the controlled use area to bring the              
 population back up.                                                           
                                                                               
 CO-CHAIRMAN GREEN asked if there was discussion or objection to the           
 amendment.  Hearing none, Amendment 2 was adopted.                            
                                                                               
 CO-CHAIRMAN GREEN inquired if there were other amendments or                  
 discussion.                                                                   
                                                                               
 Number 1119                                                                   
                                                                               
 REPRESENTATIVE NICHOLIA referred to page 2, line 8, and asked if a            
 person couldn't bring a civil action suit against a state agency or           
 a public official already?                                                    
                                                                               
 Number 1139                                                                   
                                                                               
 MR. DAUGHERTY replied that a member of the public already has the             
 ability to bring an action if a state official is doing something             
 that is ultra vires; that is something that is not within their               
 statutory authority.  However, he thought this provision was                  
 widening and inviting suit where it may even be a person who does             
 not have the authority to do anything about the issue in question             
 or it may be something that is within their authority and someone             
 would have the ability under this provision to bring a suit.  They            
 probably would not have had the ability or been encouraged to bring           
 that suit if this provision was not there.                                    
                                                                               
 Number 1886                                                                   
                                                                               
 CO-CHAIRMAN GREEN said, "If that were the case and a person were              
 not directly involved with this particular issue, would that be               
 considered deleterious?  I mean if you were going to sue the                  
 commissioner of health for something that -- there was a closure              
 and this is actually talking about closure and opening another area           
 -- would that actually hold then if they weren't in a position --             
 I mean, that's all this says is that it's that particular narrow              
 issue.  Or does it invite suit to other areas?"                               
                                                                               
 Number 1217                                                                   
                                                                               
 MR. DAUGHERTY said he wasn't certain if there's any situation where           
 someone involved in the health area would be sued under this.  He             
 was certain there were cases in which state agencies that affect              
 lands would be sued even though they do not have the direct                   
 authority to manage the game.  If there's some type of land action            
 that closes an area or closes an easement to access, that type of             
 thing could result in a suit even though that person would have no            
 authority to do anything about the game issues.                               
                                                                               
 CO-CHAIRMAN GREEN asked, "So would the suit then say that - you,              
 person A don't have any authority under this bill but you litigated           
 anyway, does that render it kind of neutral though.  What would he            
 lose and what would he be required to do because he doesn't have              
 the authority to act under this legislation."                                 
                                                                               
 MR. DAUGHERTY responded that anyone who sues under this would                 
 probably claim that they're a public interest litigant.                       
                                                                               
 CO-CHAIRMAN GREEN said he understood that, but he was talking about           
 the person who doesn't have any authority to change it.                       
                                                                               
 MR. DAUGHERTY replied basically the state would defend that person            
 and it would just be an expense to the state in defending that                
 suit.  The person who was suing would not bear any responsibility             
 for attorney fees if they are public interest litigants, so they              
 have no incentive to not bring suit while the state is going to be            
 put to great expense in defending these officials even if the judge           
 does dismiss it as soon as a motion is filed.                                 
                                                                               
 CO-CHAIRMAN GREEN commented these issues should be addressed in the           
 Judiciary Committee and asked if there were other questions.                  
                                                                               
 Number 1310                                                                   
                                                                               
 REPRESENTATIVE DON LONG referred to page 2, lines 11 and 12, and              
 said it appeared to him that if this legislation is passed, we're             
 inviting lawsuits, but if the legislation isn't passed, there won't           
 be the lawsuits.                                                              
                                                                               
 CO-CHAIRMAN GREEN remarked that issue should be addressed in the              
 Judiciary Committee.  He agreed that it does invite litigation and            
 while it may be dismissed as frivolous or even carried on, the                
 person can't respond and couldn't be held accountable for any kind            
 of damages.  It's just that it's an expense that's incurred by the            
 state.                                                                        
                                                                               
 Number 1358                                                                   
                                                                               
 REPRESENTATIVE RAMONA BARNES made a motion to unanimously move CSSB
 262(RES) as amended out of committee with individual                          
 recommendations with accompanying fiscal note.                                
                                                                               
 REPRESENTATIVE DAVIES objected.                                               
                                                                               
 CO-CHAIRMAN GREEN asked for a roll call vote.  Voting in favor of             
 the motion were Representatives Barnes, Kott, Ogan, Williams and              
 Green.  Voting against the motion were Representatives Davies, Long           
 and Nicholia.  Co-Chairman Green announced that HCS CSSB 262(RES)             
 moved from the House Resources Committee with individual                      
 recommendations and accompanying fiscal note.                                 
                                                                               
 CO-CHAIRMAN GREEN noted the committee would take a five minute at             
 ease.                                                                         
                                                                               
 CSSB 199(FIN) - ENVIRONMENTAL & HEALTH/SAFETY AUDITS                        
                                                                               
 CO-CHAIRMAN GREEN called the meeting back to order at 9:35 a.m.  He           
 announced the committee would next hear CSSB 199(FIN) and asked               
 Senator Loren Leman, Sponsor, for his remarks.                                
                                                                               
 Number 1519                                                                   
                                                                               
 SENATOR LOREN LEMAN, Sponsor, said, "I was hoping that the other              
 members of the committee would be here to hear this because I think           
 it's really important that they are.  But since you're short on               
 time and so am I, I'll take this opportunity.  This is an                     
 opportunity to do some proactive work to help improve the                     
 responsibility of Alaskan businesses, of Alaska individuals in                
 meeting their environmental responsibilities and health and safety.           
 Unfortunately, a lot of people have misrepresented what the bill              
 does and quite frankly, a lot of people still misunderstand it.               
 Notwithstanding the headline article in yesterday's Anchorage Daily         
 News, this bill does not create loopholes for environmental                 
 polluters.  In fact, it does just the opposite.  Unfortunately,               
 people in the copy room, who want to establish headlines to get               
 people drawn to an article will often do that and will totally                
 misrepresent what the bill does."                                             
                                                                               
 SENATOR LEMAN continued, "We have worked with the subcommittee to             
 try to create some greater comfort for those who believe that                 
 additional sideboards are necessary.  I believe the bill that came            
 from the Senate, as is, provides that adequate protection.  It does           
 not protect bad actors; it doesn't do these things that the U.S.              
 Attorney for Alaska all of sudden seems to have such great interest           
 in protecting Alaska even though he claims he came here as a                  
 private citizen.  What this is, is a national campaign to discredit           
 a movement among states to begin taking on their own responsibility           
 and dealing with these issues in a very positive way.                         
 Unfortunately, there's a lot of effort and even in this                       
 Administration, while we began in the very beginning of the                   
 session, in a very constructive, positive way, got unanimous                  
 endorsement for the concept, there's been nothing but foot dragging           
 a long the way from these people.  I will say that in the time that           
 it's taken us to move from the Senate to the House, I've learned              
 that two more states have adopted legislation similar to this;                
 bringing that total up to 20.  I believe that we'll see several               
 more states by the time this legislative session has concluded who            
 are added to that list.  Alaska should be on that list and I would            
 support that."                                                                
                                                                               
 Number 1680                                                                   
                                                                               
 SENATOR LEMAN stated, "In response to the subcommittee's work, one            
 of the major changes is deleting the health and safety audits from            
 the bill.  I believe that's a step backwards because I believe that           
 workers are also entitled to have safe work places and we ought to            
 be taking a proactive approach for businesses to identify the                 
 health and safety aspects in the workplace also.  But if this                 
 committee believes that we shouldn't be providing that benefit so             
 businesses will practically be seeking that through audits, then I            
 will accede to the wishes of the committee.  I just would urge you,           
 however, to not diminish the benefits from this because we know               
 there are many industries in Alaska that are unsafe and we need to            
 be doing what we can to protect workers."  He invited questions               
 from the committee.                                                           
                                                                               
 Number 1743                                                                   
                                                                               
 CO-CHAIRMAN GREEN noted the committee was on a very short time                
 schedule and would be recessing in a few minutes.                             
                                                                               
 CO-CHAIRMAN GREEN stated, "One of the questions that has been                 
 pretty prevalent - that I've heard lots of hall talk about is the             
 concern that has permeated most of the conversation is the immunity           
 portion of this.  That that does seem like `Boy, anybody feels like           
 they're in jeopardy of being found out, they'll rush in and claim             
 they found this leak and now want immunity while it takes time to             
 fix it.'  Would you care to just kind of gloss over -- I know                 
 there's a lot more detail to it than that and it is covered in the            
 bill, but just for the record would you kind of give us your view             
 on that."                                                                     
                                                                               
 Number 1814                                                                   
                                                                               
 SENATOR LEMAN said, "Let me respond to it - there's at least two              
 ways the bill addresses it.  One is that this - there is no                   
 protection for anybody who knowingly violates law.  This bill                 
 doesn't provide any immunity and the privilege doesn't apply to               
 that.  The second element is that there is no privilege for any               
 substantial environmental damage offsite.  So if you're off your              
 own property and cause environmental damage, it doesn't apply.                
 That's all that these writers and these naysayers would have to do            
 is read the bill.  It doesn't apply.  I don't know how much more I            
 need to say than that.  The bill addresses that.  There is                    
 protection against the bad actors.  That is not the intent of the             
 bill and that is not what the bill does."                                     
                                                                               
 CO-CHAIRMAN GREEN asked if there were other questions of the                  
 sponsor.                                                                      
                                                                               
 Number 1906                                                                   
                                                                               
 J. DAVENPORT testified offnet in support of CSSB 199(FIN).                    
                                                                               
 CO-CHAIRMAN GREEN asked if he was testifying for himself or on                
 behalf of some organization.                                                  
                                                                               
 MR. DAVENPORT said, "I do represent clients that are interested in            
 it, but primarily I am testifying on behalf of myself as a person             
 that's been active in audit policy and audit privilege bills.  I do           
 represent MAPCO in a number of cases.  I don't represent anyone               
 else in this particular matter."                                              
                                                                               
 Number 1957                                                                   
                                                                               
 MR. DAVENPORT continued, "I do support the bill.  I've been                   
 involved both with the ABA (ph) focus group in Washington that work           
 with the Environmental Protection Agency (EPA) on developing their            
 policy which does focus more upon the penalty side.  You had                  
 indicated there was a concern about the immunity portion.  That is            
 the area that was dealt with by the EPA in their policy that was              
 promulgated December 22.  I worked with the Oklahoma Department of            
 Environmental Quality in developing their environment policy which            
 also worked on the penalty side.  I've been involved in auditing              
 and overseeing audits.  Essentially, when an audit is performed, it           
 is a very expensive procedure.  We need to bring in knowledgeable             
 people to review the number of regulations that are involved.                 
 Typically, with the federal regulations, there's over 13,000 pages            
 and there's a sense in the regulating community that it is                    
 virtually impossible to stay in compliance."                                  
                                                                               
 Number 2054                                                                   
                                                                               
 MR. DAVENPORT stated, "When an audit is performed, typically the              
 findings include primarily reporting violations where records were            
 not kept as required by specific regulations or reports are not               
 filed as required by specific regulations.  These are not findings            
 of pollution.  They're not problems that involve environmental                
 impact but they are difficult to keep up with and it is very                  
 helpful in maintaining a high level of compliance to have outside             
 auditors come and review them.  The difficulty with that, of course           
 is that reporting violations must in fact be reported.  I've had              
 occasion with other clients who have reported violations who have             
 then been penalized for seeking out problems and trying to correct            
 them in bringing them to the state's attention.  This is the area             
 which is very vexing to managers and an area that this bill needs             
 to address.  Those who actually audit are not the companies who are           
 trying or regulated entities that trying to avoid regulations.                
 They are the ones who are seeking to stay in a high level of                  
 compliance.  What they are seeking with this bill is to avoid being           
 punished for acting proactively to stay in a high level of                    
 compliance.  We think the bill does that."                                    
                                                                               
 MR. DAVENPORT further stated, "It encourages companies.  It only              
 provides penalty relief for those that do not have knowing                    
 violations and do actively undertake efforts to achieve compliance.           
 And that is probably the strongest and most important from a policy           
 standpoint - from a state standpoint - that aspect of the bill as             
 it encourages early and active efforts to comply.  Secondly, those            
 who find problems must cooperate with the appropriate agency in               
 investigating and correcting the claim.   This gets the state                 
 involved and provides for a cooperative partnership in resolving              
 the issues.  Whether it's an audit privilege, the audit privilege             
 while it is provided in the bill, it certainly cannot provide a               
 shield for a company to avoid reporting those things that are                 
 otherwise reportable.  No responsible person would recommend that             
 any company audit without being prepared before they know what they           
 (indisc.) to actively deal with any findings that they come up                
 with.  This bill provides the carrot to encourage companies to seek           
 out their problems and to correct them and does not inhibit the               
 state in any way from using the stick as it needs to, to punish               
 those companies that are not willing to take those proactive                  
 steps."                                                                       
                                                                               
 Number 2330                                                                   
                                                                               
 MR. DAVENPORT commented, "We do feel this bill provides a balance             
 in encouraging cooperation with the state.  It encourages in a time           
 of short budget resources, the encouragement for companies and                
 regulated entities to go out and seek their problems.  When I say             
 regulated entities - two types of companies or entities that are              
 strongly affected by this are governmental (indisc.) and                      
 municipalities, both of which have extensive environmental health             
 and safety requirements that are imposed upon them.  In fact, under           
 the Oklahoma policy, the first two entities that took advantage of            
 the voluntary disclosure policy were two air force bases in the               
 state, both of which are very important to the economy."  He                  
 offered to answer questions for the committee.                                
                                                                               
 Number 2402                                                                   
                                                                               
 CO-CHAIRMAN GREEN thanked Mr. Davenport for his testimony.  He                
 said,"You are in a state that has enacted this and I know your                
 border state has been very, very much on the forefront of this kind           
 of self-audit.  Can you tell us, do you have a problem between....            
                                                                               
 TAPE 96-74, SIDE A                                                            
 Number 001                                                                    
                                                                               
 MR. DAVENPORT..."environmental law section of the Oklahoma Bar                
 Section with the representatives of the Oklahoma DEQ, and the state           
 is very supportive of this type of program.  I just talked to the             
 general counsel and his only regret is that more companies have not           
 availed themselves of it.  They're in favor of it for a couple of             
 reasons.  They want the companies to go out and find the problem.             
 We don't have extra money here in Oklahoma to fund the inspectors             
 to go out and find problems.  They want to encourage companies to             
 come in and -- seek out their problems and come in and work with              
 the state in solving them.  Secondly, frankly it frees the agency             
 up of some complaints they occasionally get from - even from the              
 legislative side where a large employer may be enforced again and             
 they contact their legislator to ask why they're being picked at.             
 The agency has, with this policy, provided every opportunity to the           
 regulated community to voluntarily come into compliance and there's           
 no sympathy at that point for companies that don't avail themselves           
 of that.  They're very supportive of this concept.  In Texas, the             
 bill was put together by working together between the industry and            
 Texas Natural Resources Conservation Commission (TNRCC).  At the              
 Senate committee, Mr. John Riley of TNRCC testified that in the               
 first six months, over 170 reports had been made to the agency of             
 intended audit.  I thought that was simply remarkable and a sign of           
 the success of this group."                                                   
                                                                               
 Number 213                                                                    
                                                                               
 REPRESENTATIVE DAVIES inquired if Mr. Davenport had done some                 
 practice in Alaska.                                                           
                                                                               
 MR. DAVENPORT responded that he had.                                          
                                                                               
 REPRESENTATIVE DAVIES asked if Mr. Davenport could cite one or more           
 instances where a company had been penalized for engaging in an               
 environmental self-audit?                                                     
                                                                               
 MR. DAVENPORT replied, "No, I cannot.  I can from other states for            
 those companies that do operate in more than one state, they're               
 concerned wherever they do business."                                         
                                                                               
 Number 256                                                                    
                                                                               
 REPRESENTATIVE OGAN remarked, "You stated that 170 violations were            
 found in these audits that -- what would the same amount of                   
 violations would be found in that same time period before the law             
 was enacted."                                                                 
                                                                               
 MR. DAVENPORT responded, "The testimony was not concerning the                
 number of violations but concerning the number of companies that              
 notified the TNRCC that they intended to undertake audits and would           
 bring them in when they were completed."                                      
                                                                               
 Number 306                                                                    
                                                                               
 REPRESENTATIVE NICHOLIA said she was confused when Mr. Davenport              
 introduced himself and asked if he represented MAPCO or himself?              
                                                                               
 CO-CHAIRMAN GREEN remarked that Mr. Davenport had said he was                 
 representing himself but that he had done work for MAPCO.                     
                                                                               
 CO-CHAIRMAN GREEN announced the committee would stand in recess               
 until 5:00 p.m.                                                               
                                                                               
 Number 338                                                                    
                                                                               
 CO-CHAIRMAN GREEN reconvened the House Resources Committee at 5:08            
 p.m.  Members present were Representatives Kott, Davies, Long,                
 Williams and Green.  A quorum was present to conduct business.                
 He said that discussion would resume on CSSB 199(FIN).   He noted             
 there was a new Committee Substitute, Version W.                              
                                                                               
 CO-CHAIRMAN WILLIAMS made a motion to adopt Committee Substitute,             
 Version W, 9-LS 1312\Lauterbach dated 5/1/96 as the working                   
 document.                                                                     
                                                                               
 CO-CHAIRMAN GREEN asked if there was any objection.                           
                                                                               
 REPRESENTATIVE DAVIES objected and asked if someone would explain             
 the changes.                                                                  
                                                                               
 Number 435                                                                    
                                                                               
 REPRESENTATIVE PETE KOTT said, "Essentially, as I understand it,              
 the difference between Versions U and W is that in Draft U during             
 the exercise in the subcommittee, we removed criminal intent from             
 the immunity section and when it was conveyed to the drafter, they            
 removed it throughout the entire bill, in the privilege section as            
 well.  That's the only difference.  We went back in and put it back           
 in to the privilege section of the bill.  That's the difference               
 between the two.  I'll go through both drafts and do a comparison,            
 if you like."                                                                 
                                                                               
 CO-CHAIRMAN GREEN asked Representative Davies if he removed his               
 objection.                                                                    
                                                                               
 REPRESENTATIVE DAVIES withdrew his objection.                                 
                                                                               
 CO-CHAIRMAN GREEN said, "Without objection then, we are on Version            
 W."                                                                           
                                                                               
 REPRESENTATIVE KOTT remarked, "Mr. Chairman, what I'm going to do             
 is I have the original CS that we had in the committee that we had            
 before us when this was sent to subcommittee.  It was Version O.              
 It's my understanding as I was not here for that afternoon session,           
 that Version O was not adopted by the subcommittee - by the main              
 committee - what we did in subcommittee was to adopt Version O as             
 the working document.  So, that is the document I will reference as           
 far as the changes go as it is laid out in the new Version W."                
                                                                               
 CO-CHAIRMAN GREEN inquired if there was any objection from the                
 committee.                                                                    
                                                                               
 CO-CHAIRMAN GREEN noted for the record that Representatives                   
 Austerman, Ogan and Barnes were in attendance.                                
                                                                               
 REPRESENTATIVE KOTT said, "Again, I appreciate the indulgence of              
 the subcommittee members who sat through this laborious task - we             
 had four meetings.  We did make some headway.  I hope we have                 
 improved the bill.  I'll start off by referring you to Version O              
 and in Version O on page 8, line 9, the phrase "on or after the               
 effective date of this Act....                                                
                                                                               
 REPRESENTATIVE BARNES interjected that she did not have Version O.            
                                                                               
 CO-CHAIRMAN GREEN said, "We just passed out the W, O was in your              
 packet before.  It's a prior version.  And what Representative Kott           
 is doing is comparing what the committee did with what we got from            
 the Senate."                                                                  
                                                                               
 REPRESENTATIVE AUSTERMAN said, "So, O is what we got from the                 
 Senate; W is what we just....                                                 
                                                                               
 REPRESENTATIVE DAVIES explained that Version W was just adopted.              
                                                                               
 REPRESENTATIVE KOTT commented, "Actually, Mr. Chairman, I'm not so            
 sure even that is correct.  I think what we got was a different               
 version from the Senate.  We had the CS before us when we sent this           
 to a subcommittee.  I think Version O was not adopted by the                  
 committee.  That was the document we had before us when we went to            
 subcommittee and we adopted Version O as the working document.                
 Again, I wasn't here that afternoon so I'm kind of....                        
                                                                               
 CO-CHAIRMAN GREEN said, "I believe you're right, Representative               
 Kott.  We had Version M - you're right."                                      
                                                                               
 Number 728                                                                    
                                                                               
 REPRESENTATIVE KOTT explained, "We had another amendment - number             
 2 which was superseded by number 3, so I won't cover 2.  Page 8,              
 line 9, we just deleted the language, `on or after the effective              
 date of the Act' so there's no inclusion insertion in the new                 
 draft.  The next amendment which is an effective amendment -                  
 operative amendment - would be number 3.  Page 8, line 16, we                 
 deleted starting from the words `in order to be considered' to `or            
 property' at the end.  Starting on line 16, `in order to be                   
 considered' through the end of line 18 - that was additionally                
 deleted.  There is no inclusion in the new version."                          
                                                                               
 Number 784                                                                    
                                                                               
 CO-CHAIRMAN GREEN questioned, "Then the bill drafter has...."                 
                                                                               
 REPRESENTATIVE KOTT said, "Yeah, everything else is - actually,               
 we're okay there.  We just deleted part of that sub-parenthesis               
 (2).  So parenthesis (2) on line 8 now reads, `Not attempting to              
 bring the facility, operation or property into compliance so as to            
 constitute a pattern of disregard of environmental or health and              
 safety laws.'"                                                                
                                                                               
 REPRESENTATIVE DAVIES asked him to repeat that.                               
                                                                               
 REPRESENTATIVE KOTT responded, "I just repeated what I mentioned              
 earlier.  On line 16.... starting with the words, `in order' on               
 page 8, line 16, working under Version O - we haven't done anything           
 yet with Version W - these are the terms that we had excluded.  You           
 won't find them in the new version W.  We've taken these words out            
 of the bill.  There's nothing to refer to yet in Version W.  The              
 next amendment number 4 was an insertion and that is in Section 1             
 of the bill, Version W, the Findings and Intent is all new                    
 language.  That was brought to us by the council (indisc.) and the            
 Alaska Oil and Gas Association (AOGA) folks.  All of new Section 1            
 is new."                                                                      
                                                                               
 CO-CHAIRMAN GREEN asked, "In that new Section 1, in essence that is           
 what - just...                                                                
                                                                               
 REPRESENTATIVE KOTT interjected, "It's just intent language.  The             
 sponsor objected to the intent language going in primarily because            
 the sponsor never puts intent language in bills.  It makes it a               
 little more clearer as to what direction we're really heading here.           
 No one else objected, as I recall - none of the departments or Law            
 and they were active participants at the table - we just had a                
 round table discussion that involved the Department of Law, the               
 Department of Environmental Conservation (DEC), Department of                 
 Labor, Sara Hannan was there and members of the committee as well             
 as a member from the (indisc.) Council and a member from AOGA,                
 representing them."                                                           
                                                                               
 Number 981                                                                    
                                                                               
 REPRESENTATIVE KOTT went to on explain, "The next amendment is on             
 page 5, line 22, and this is inclusion  - excuse me, on Version W,            
 page 6, lines 19-21, Section (c) is new and reads, `An audit report           
 is not privileged and is admissible as evidence and subject to                
 discovery if the report was commenced after the owner or operator             
 knew of an impending inspection or investigation by a regulatory              
 agency.'"                                                                     
                                                                               
 Number 1035                                                                   
                                                                               
 REPRESENTATIVE KOTT said, "Amendment 6 on page - going back to                
 Version O - we're making a deletion here on page 5, lines 25-26.              
 Basically, what we have done in this particular area was to delete            
 `criminal penalty' from that section and essentially it is a                  
 conforming amendment throughout the section dealing with voluntary            
 disclosures and immunity.  This is what I was referring to                    
 earlier."                                                                     
                                                                               
 REPRESENTATIVE BARNES inquired if it was lines 25 and 26 being                
 discussed.                                                                    
                                                                               
 REPRESENTATIVE KOTT said, "It's the term or the concept of                    
 `criminal penalty.'  That term was removed so now we're applying              
 this only to administrative or civil.  And that has been changed              
 throughout this particular section of the bill."                              
                                                                               
 CO-CHAIRMAN GREEN asked, "So there are several places under                   
 voluntary disclosure where `criminal penalty' has been removed from           
 the O Version?"                                                               
                                                                               
 REPRESENTATIVE KOTT confirmed that.  Just as a reference to show              
 you where that would have fell into place, on page 7, line 26,                
 that's one area that reflects this - we've taken out the criminal.            
 This just says, `administrative or civil penalty may be imposed...'           
 we've taken out the criminal.  We felt that should be removed from            
 that particular area.  We didn't want to reward bad actors."                  
                                                                               
 CO-CHAIRMAN GREEN asked if Representative Kott was referring to               
 page 6, line 26 on the O Version.                                             
                                                                               
 REPRESENTATIVE KOTT responded affirmatively and added, "Again,                
 that's conforming language.  The next amendment that was adopted on           
 page 7, line 31 of the O Version - we've deleted, `an extension is            
 approved by the governmental entity with regulatory authority over            
 the regulated facility, operation or property based on reasonable             
 grounds'".                                                                    
                                                                               
 REPRESENTATIVE DAVIES questioned what lines Representative Kott was           
 referring to.                                                                 
                                                                               
 REPRESENTATIVE KOTT replied, "That's right at the bottom - 31.                
 Last two words on page 7, line 31, and then the subsequent two                
 lines on page 8.  That is what was in fact deleted."                          
                                                                               
 CO-CHAIRMAN GREEN clarified that Representative Kott was referred             
 to Version O, the last two words on page 7 and the first two lines            
 on page 8....                                                                 
                                                                               
 REPRESENTATIVE KOTT said, "...were deleted.  They were replaced               
 with - turn to the new Version W, page 8, lines 30 and 31 are where           
 the changes start and commences on page 9, line 1.  So we replaced            
 that earlier language with `except that the audit period may be               
 extended for up to 60 days if the facility gives notice of the                
 extension and its duration to the appropriate regulatory agency by            
 certified mail before the original time period expires.'  That's              
 what we've done there - we've offered an opportunity for an                   
 extension, basically."                                                        
                                                                               
 Number 1254                                                                   
                                                                               
 REPRESENTATIVE KOTT stated, "The next amendment on page 10 of the             
 old bill - we deleted lines 1-8 in their entirety."                           
                                                                               
 CO-CHAIRMAN GREEN noted that takes out all of parenthesis (2).                
                                                                               
 REPRESENTATIVE KOTT confirmed that.  He added, "Subsection 2                  
 parenthesis (a) and (b), that was replaced in the new version, page           
 10, (2), starting on line 26 where it defines environmental audit."           
                                                                               
 CO-CHAIRMAN GREEN inquired if that went over to page 11, line 2.              
                                                                               
 REPRESENTATIVE KOTT said, "Actually line 4."                                  
                                                                               
 REPRESENTATIVE KOTT commented, "The last substantial amendment and            
 you'll have to take my word for this - it was in the O Version, we            
 deleted all references to occupational safety and health.  I can go           
 through the O Version based on the amendment that was turned in to            
 us by the department - it was a two page -- primarily, it just                
 deletes the words `occupational health and safety' from the bill              
 with the exception of the title - as I mentioned, we did not want             
 to cause alarm with a title change so we had the drafters, in the             
 definition section of the audit, include the words `health and                
 safety' which retains the title in legitimate terms."                         
                                                                               
 CO-CHAIRMAN GREEN commented, "We can see that the title hasn't                
 changed, but you said there is a reference within the W Version,              
 near the end someplace.  He inquired if it was on page 11, line 25,           
 where it talks about self-audits and environmental audit."                    
                                                                               
 REPRESENTATIVE KOTT stated, "On page 11, line 19 of the new bill --           
 see that on line 22, we've included the words `occupational health            
 and safety' - that's what was added to ensure that the title would            
 conform to the bill and thus would not need a title change.                   
 Otherwise, if we did not do that, the safety and audit aspect of it           
 would be removed from the bill throughout and it would require a              
 title change because the title does not refer to occupational                 
 safety and health in any respect once it's removed.  We checked               
 with the drafters on this."                                                   
                                                                               
 Number 1427                                                                   
                                                                               
 REPRESENTATIVE DAVIES commented, "I appreciate what they've done              
 there but I don't think that that's required as long as the title             
 covers what's in the bill, that's sufficient."                                
                                                                               
 REPRESENTATIVE KOTT said, "It was basically a concurrence with the            
 drafters in ensuring that a title change would not be required....            
 Mr. Chairman, that's basically the areas that were identified as              
 being changed.  I think we came a long ways - probably still some             
 concern within the - perhaps the Department of Law.  I hope we have           
 quelled, for the most part, the Department of Labor's concern.  I             
 think we've taken them out of play.  I think we've taken the                  
 Department of Health & Social Services out of play.  I'm not sure             
 if we've taken DEC out of play or not.  And obviously, I think the            
 Department of Law still has some problems.  We did at the                     
 conclusion of our work session before we agreed to move the bill              
 back before the parent committee here, we did agree to allow the              
 Department of Law to bring forth an amendment that would conform to           
 the Reichhold decision which is a federal case that has been                
 resolved.  Whether or not the committee wants (indisc.- tape                  
 garbled) amendment remains to be seen, but I assured her that we              
 would allow for that to come forth because it was pretty complex at           
 the time rather than to hold this up another day or so."                      
                                                                               
 CO-CHAIRMAN GREEN inquired what the Reichhold decision was.                 
                                                                               
 REPRESENTATIVE KOTT said it was basically an environmental audit              
 case, he believed.                                                            
                                                                               
 Number 1546                                                                   
                                                                               
 CO-CHAIRMAN GREEN commented, "So, as I understand this fairly                 
 significant redraft then is to try and keep this from having a                
 problem legally as well as re-directing it under the Department of            
 Labor and so this version now is, in your opinion, has cleaned up             
 all that."                                                                    
                                                                               
 Number 1571                                                                   
                                                                               
 REPRESENTATIVE KOTT said, "Mr. Chairman, we've come a long ways to            
 remedy some of the problematic areas.  But we think it's still a              
 test tube for litigation based on just some general terms, I would            
 suspect.  Of course, any thing is subject to litigation but when              
 you have some very liberal terms and speak in generalities, it                
 leaves some openness as to where you're really going and where                
 you've really come from, I think that potential still could be                
 there, especially in this kind of an area - environmental cleanups            
 and waste disposals - we've seen a lot of that in the past and I              
 suspect it will continue in the future.  But we have, I think, made           
 some headway.  I know there's still concerns out there."                      
                                                                               
 Number 1606                                                                   
                                                                               
 CO-CHAIRMAN GREEN inquired, "Will we get some discussion then of              
 the fact that we have changed this significantly from what has been           
 indicated to us by the sponsor to be a similar type bill that is              
 used in now up to 20 states - will that be discussed by...."                  
                                                                               
 REPRESENTATIVE KOTT responded, "I think, Mr. Chairman, that that's            
 a good point.  During the subcommittee hearings and I think maybe             
 before us, it was brought out that 18 states had passed something             
 and two more had it on the governor's desk.  It was brought out in            
 subcommittee that 24 states have rejected it - I don't know where             
 that came from - if that's an outright rejection or if it's a bill            
 still sitting in somebody's committee.  If that's what we're                  
 considering a rejection, I would submit that's probably going a               
 little bit to the extreme but if someone as far as a governor has             
 vetoed a bill, then I would say it was rejected or if there was a             
 vote in either body and it failed to pass, that would, I believe              
 construe to be rejected.  As far as the other 20 states and my                
 understanding - and again, it's a very narrow understanding that I            
 have - many of the states that have passed this kind of legislation           
 includes either privileges or immunities or a combination thereof -           
 a little mixed bag or they might include both.  We took out the               
 OSHA portion of it because in the testimony that we heard, Texas              
 was the only state that included OSHA and their plan is a little              
 bit different than our plan - it was conveyed to us that we have              
 what's called a state plan, where the feds convey in excess of $2             
 million to us and we essentially implement the OSHA regulations               
 under the guidance, if you will, of the federal government.  And              
 several discussions surrounding that issue - the department                   
 basically confesses that they're already doing what the bill was              
 required to do.  They are already providing consultation.                     
 Privileges and immunities are already there for those that are                
 involved in investigations and if my understanding is correct, the            
 enforcement division does not have access to those records - at               
 least, if I get this right - so that was the main reason why we               
 took the Department of Labor out of play."                                    
                                                                               
 Number 1747                                                                   
                                                                               
 REPRESENTATIVE AUSTERMAN said, "Just to reinforce what                        
 Representative Kott's saying (indisc.-tape garbled) health and                
 safety issues and OSHA, Texas was the only state that had those set           
 of criteria in here - that's what we were told and because the                
 Department of Labor is basically the only department that was there           
 that said they actually go out and do consultations with these                
 different companies to help them get through some of these audits             
 and make sure they're doing everything correctly.  The DEC didn't             
 have it and the rest of them didn't.  That was kind of what sold me           
 on removing OSHA and health and safety (indisc.).  I think one of             
 the things we'll probably hear from the Department of Law is on the           
 privilege section, starting on page 2, in Section 2, line 20 -                
 whether privileges should be in this bill or whether the immunity             
 should just be in here and I think it was after either the second             
 or third meeting of the Department of Law saying privileges are not           
 a good thing to have in here that we finally said if you don't have           
 anything in writing, let's move onto something different because we           
 didn't have anything.  All they were doing was talking about it.              
 Maybe tonight they'll have some amendments in writing that will               
 address some of their concerns about the privilege being too broad.           
 We discussed the different type of privileges that the Department             
 of Law had dealt with - confidentiality like an attorney which is             
 fairly narrow, while this is a little bit more broad than they                
 wanted to see.  Maybe this other court case that they were talking            
 about might cover some of those things.  Those are really the two             
 biggest issues."                                                              
                                                                               
 Number 1827                                                                   
                                                                               
 CO-CHAIRMAN GREEN noted that Mr. Davenport from Oklahoma had                  
 indicated in his testimony that the self-audit was in place in                
 Oklahoma and it was working.  He questioned if Oklahoma had the               
 privileges portion.                                                           
                                                                               
 REPRESENTATIVE AUSTERMAN said he assumed they have the privilege              
 aspects and the immunity aspects of it but not the health and                 
 safety OSHA because as he understood it, Texas was the only state             
 that has that.  Again, it was a different type of program.                    
                                                                               
 CO-CHAIRMAN WILLIAMS asked if the sponsor had been at the meetings.           
                                                                               
 Number 1876                                                                   
                                                                               
 REPRESENTATIVE AUSTERMAN said a representative of the sponsor was             
 there.  He noted the sponsor does not agree with all the changes              
 that were made in the subcommittee meetings.  Neither do the                  
 Departments of Environmental Conservation and Law, nor did he, but            
 there had to be some give and take to come up with the best                   
 possible bill.                                                                
                                                                               
 CO-CHAIRMAN GREEN announced that John Riley, Director, Litigation             
 Support, Texas Natural Resources Conservation Commission would be             
 testifying next via teleconference.                                           
                                                                               
 CO-CHAIRMAN GREEN asked Mr. Riley to inform the committee how the             
 self-audit was working in Texas.                                              
                                                                               
 Number 1918                                                                   
                                                                               
 JOHN RILEY, Director, Litigation Support, Texas Natural Resources             
 Conservation Commission, said he hadn't seen the latest draft of              
 the legislation before the committee but Texas had passed similar             
 legislation which became effective May 23, 1995.   The Texas law              
 does incorporate and include health and safety laws, so his agency            
 is not specifically involved with the administration of the                   
 statute.  From listening to the discussion in the committee                   
 meeting, he gathered that Alaska administers the federal OSHA                 
 standard.  He noted the health and safety aspects of Texas' law               
 would not extend to the federal enforcement (indisc.).   He said              
 since March 23, 1995, they've had 165 notices of intent to audit              
 from various and diverse groups of regulated entities.  Texas law             
 requires that in order to avail oneself of the immunity provision,            
 there must be a notice of intent to audit.  He thought that was               
 evidence of some of the level of interest in the regulated                    
 community for this type of legislation.  Anyone seeking the                   
 immunity is required to report any violations detected in their               
 audit process.  It's completely voluntary - giving notice and then            
 later if a company later decides they either didn't find anything             
 or didn't care to report what they did find, but if you go to the             
 next step there are several requirements for immunity under the               
 Texas statute.  He believed that so far what they've found is a               
 pretty beneficial effect in terms of enhancing the enforcement                
 functions of his agency.  They have a huge regulated community and            
 as with most state agencies, they have limited resources to                   
 actually do on-site inspections and respond to complaints.  They've           
 had about 30 disclosures under the immunity provision since the               
 inception of the law.  The disclosures have been somewhat                     
 interesting ranging from relatively small companies of about 50               
 employees to large multinational companies.  They have found that             
 many of these violations that are revealed in the (indisc.) process           
 are types of violations that the agency would not ordinary have               
 discovered in a routine inspection or a response to a complaint.              
 Texas law requires that after discovery, the company must disclose            
 whatever information they generate and cooperate with the agency              
 toward the remediation.  Texas law does not require them to give up           
 their (indisc.) authority.  He said, "And all you're really talking           
 about what we talk in the terms of immunity,  is the penalty                  
 mitigation or penalty elimination might be more appropriate.  And             
 that's the trade, I supposed.  We can still re-contemplate in                 
 longer term, technical fixes or remedial projects that we will                
 actually enter into like traditional enforcement order (indisc.).             
 But for the ones that we think that fixes are in place or can                 
 quickly be put in place or not too long before they're in place, we           
 probably would not pursue it any further from an enforcement point            
 of view."  He offered to answer questions from committee members.             
                                                                               
 Number 2131                                                                   
                                                                               
 REPRESENTATIVE AUSTERMAN asked Mr. Riley to repeat how many self-             
 audits had been turned in since the law was enacted.                          
                                                                               
 MR. RILEY replied, "We've had - (indisc.) measures the numbers of             
 audits being conducted because our bill gives opportunity for                 
 privilege so an audit can be conducted and the agency would not               
 necessarily know about them.  But in terms of the immunity section,           
 we received notice of intent to audit from 165 companies.  Of that            
 165, approximately 30 have come in with disclosure, seeking the               
 immunity for the violation."                                                  
                                                                               
 REPRESENTATIVE AUSTERMAN commented that it hasn't turned out to be            
 something where everybody just files an intent to audit to cover              
 themselves.                                                                   
                                                                               
 MR. RILEY said not as far as he could tell.  He thought there had             
 been some pretty positive results in terms of the people who are              
 coming in and exposing their violations and working toward                    
 solutions that ordinarily they may not reach in their traditional             
 enforcement process.                                                          
                                                                               
 Number 2180                                                                   
                                                                               
 REPRESENTATIVE AUSTERMAN asked if Mr. Riley had been sent a copy of           
 the original draft of SB 199.                                                 
                                                                               
 MR. RILEY replied yes, he did have a copy.                                    
                                                                               
 REPRESENTATIVE AUSTERMAN asked how similar the privilege statutes             
 as compared to those passed by the state of Texas.                            
                                                                               
 MR. RILEY recalled they were very similar in the original draft.              
                                                                               
 REPRESENTATIVE AUSTERMAN inquired if it had created a problem for             
 the state of Texas.                                                           
                                                                               
 MR. RILEY responded not so far.  He added there has been some                 
 confusion in implementation with some of their regional offices as            
 to what information they may receive and under what circumstances             
 they may receive it.  But that has been very limited.  There's been           
 a couple of occasions where a company was not asserting the                   
 privilege and the confusion at the regional level resulted in the             
 agency refusing to discuss certain aspects.  That has been cleared            
 up.                                                                           
                                                                               
 Number 2224                                                                   
                                                                               
 REPRESENTATIVE AUSTERMAN noted the law had been on the books in               
 Texas about 11 months and wondered if there were things they were             
 contemplating changing in statute to make it a better concept.                
                                                                               
 MR. RILEY said there were a couple of things in their law that                
 could use some clarification.  They have provisions for overcoming            
 the privilege and there's two sections in the Texas law; one                  
 relating to civil or administrative proceedings which provides for            
 an in camera review and the other section in criminal context also            
 provides for in camera reviews.  He noted there had been some                 
 confusion but he didn't believe it was ambiguous or as unclear as             
 some people think it is.  He thought that some standards could be             
 inserted that would make it clear on what basis the tribunal may              
 make a decision on whether the information can be disclosed and               
 used in the proceeding.  He believed the law was pretty tight                 
 except for that area.                                                         
                                                                               
 Number 2275                                                                   
                                                                               
 REPRESENTATIVE AUSTERMAN thanked Mr. Riley for his comments and               
 input.                                                                        
                                                                               
 CO-CHAIRMAN GREEN asked if committee members had any questions of             
 Mr. Riley.  He said, "So, I guess the overall response, with a                
 slight difference since we have federal OSHA acting here, is that             
 so far it seems to working in Texas."                                         
                                                                               
 MR. RILEY replied he believes it's working very well.  He added               
 that Texas has taken the position under their law that both the               
 notice of intent to audit as well as the disclosures made in                  
 initial form, are public.                                                     
                                                                               
 Number 2317                                                                   
                                                                               
 CO-CHAIRMAN GREEN noted that Mr. Riley had indicated there was a              
 way to overcome the immunity portion.                                         
                                                                               
 MR. RILEY said there are several requirements through their                   
 immunity section.  One is the threshold requirement providing                 
 notice before the audit is conducted of the intent to conduct an              
 audit and then there are seven other criteria that he believed were           
 reflected in SB 199.  He said essentially, it amounts to the                  
 disclosure is made promptly, there's cooperation with the agency in           
 investigation of the aspect of the violations that are disclosed,             
 that remedial measures are taken within a reasonable time.  There             
 is no immunity for violations that cause harm to humans on-site or            
 harm to people, the environment off-site.  He thought the most                
 important aspect is the solution within a reasonable time and that            
 applies to both the privilege and immunity.  So both the privilege            
 and immunity can be overcome if there isn't swift, remedial action.           
                                                                               
 Number 2390                                                                   
                                                                               
 CO-CHAIRMAN GREEN inquired, "Let's say Company A comes to Texas and           
 says `We intend to do the audit, we've found this issue' and you go           
 through this litany of conditions and then you can't reach                    
 agreement as to what needs to be done or in what time it needs to             
 be done.  Now the company has exposed themselves, but it sounds               
 like you have this either time to do or what effect would happen --           
 where does that place the company that has come forward?"                     
                                                                               
 MR. RILEY responded that essentially the company has taken that               
 risk of coming forward and the benefit they'll retain if an                   
 agreement can't be reached on remedial measures, is that they will            
 still retain the penalty.  He noted there were some questions as to           
 whether they would consider to have been cooperative in the                   
 investigation, but he's assuming in Co-Chairman Green's question              
 that this is a good faith disagreement as to what's necessary and             
 the state would still retain their ability to seek the injunctive             
 provision so they could proceed with their normal enforcement                 
 action.  They could go ahead and bring an enforcement action                  
 against the company, go to a hearing, each party would put on their           
 evidence and eventually reach a decision, hopefully.                          
                                                                               
 Number 2448                                                                   
                                                                               
 CO-CHAIRMAN GREEN asked if there had been any problems working this           
 out with the various agencies within the state.                               
                                                                               
 MR. RILEY said he had spoken with other agencies, but he could only           
 speak to the experiences within his agency.  He added he is not               
 aware of any problems with any other agencies.                                
                                                                               
 TAPE 96-74, SIDE B                                                            
 Number 001                                                                    
                                                                               
 CO-CHAIRMAN GREEN thanked Mr. Riley for his testimony and called              
 Sara Hannan to testify.                                                       
                                                                               
 Number 027                                                                    
                                                                               
 SARA HANNAN, Representative, Alaska Environmental Lobby, Inc.,                
 applauded the subcommittee for their work.  She said, "I've spent             
 a lot of hours reading and dialoguing about this bill for several             
 months, both on the other side and while this bill has been on the            
 House side.  As much as I would say that the bill that you see                
 today in Version W is substantially different than the original               
 version and substantially different and improved over the version             
 you first got before you, I don't have anything good to say about             
 this bill because I believe it creates a fundamental shift in                 
 judicial procedures and policy that is major.  You've heard that              
 and my statistic that I threw out in the subcommittee was                     
 referenced when the subcommittee chairperson gave their report,               
 that many states have sponsored this bill into law and many states            
 have rejected it.  My study comes from a community study and they             
 had done a Price Waterhouse audits and coverage of this legislation           
 across the country as referenced and I wasn't able to quickly flip            
 through my footnotes to find - from their study that this                     
 (indisc.), but that 1995, 24 states rejected this legislation.  So            
 across the country it's being talked about at legislatures and it's           
 being constructed and in every state, local laws are different."              
                                                                               
 Number 097                                                                    
                                                                               
 MS. HANNAN continued, "Texas may be the state with the most closely           
 paralleling legislation to what we've proposed or what's being                
 proposed here, but there's some fundamental differences.  They're             
 not a state OSHA state, primacy.....that's not a current issue, but           
 there are other fundamental differences.  First, I want to talk               
 about privilege and what that means because when the attorneys talk           
 about it, it's fairly complex and it's something they study clearly           
 and there's something - there's 250 years of judicial precedent               
 about, but the clearest example that I recall through four months             
 of listening to this debate, came in the other body when one of the           
 attorneys talking about it said, `Here's what privilege means.                
 Privilege is when you go to your attorney and you say I shot my               
 husband and here's the handgun I used and I was pissed off and                
 drunk and there you go' and your attorney extends to you the                  
 privilege - the attorney-client privilege that we hear mentioned on           
 every cop show and they turn to the police and say here's the gun             
 and the police say where did you get it and the answer is I invoke            
 my attorney-client privilege and I can't tell you anymore and I               
 don't have to tell you any more.  Now the police have to prove that           
 that's my gun and that I killed my husband.  But what I said to my            
 attorney is privileged.  The evidence that the attorney has is not            
 privileged.  It is one example of when the judicial privilege is              
 extended, it's fairly specific and it's fairly limited."                      
                                                                               
 MS. HANNAN further stated, " One of the problems with this bill all           
 along has been that the privilege is very broad and I believe the             
 Department of Law will probably talk to you in more detail about              
 why it's broad.  When we look at the Texas bill, it's much broader            
 than the Texas law because there is a way that the Texas law, the             
 privilege can be overcome if the judicial tribunal says that they             
 haven't in a swift and reasonable fashion, remedied the solution.             
 Our law still does not have a way to overcome the privilege unless            
 it's criminal."                                                               
                                                                               
 Number 168                                                                    
                                                                               
 MS. HANNAN explained, "But in a civil proceeding, as in the case of           
 most white collar crime, the evidence that's important to prove the           
 case whether it's civil damage or civil neglect, is the paper trail           
 - what did you know, when did you know it, who knew it, who's                 
 responsible for knowing it, who had the authority to remedy it if             
 they knew it.  Who's the guy that the buck stops at?  And many of             
 the problems with this bill apply in audit and privileges - who               
 conducts the audit, how are they conducted, who's notified and who            
 has the authority to remedy the situation if they know about it,              
 and is the audit credible.  If you were being audited by the IRS,             
 the guy who comes in and audits you is a CPA.  And when you say               
 you're a CPA, that means very specific things all across the U.S.             
 There's certain education and certain licensure.  When you say I'm            
 doing an environmental self-audit of my corporation that's                    
 regulated by the state of Alaska, we don't have any other terms               
 defined in statute except for what's in this bill and they're still           
 fairly broad about what the means.  Who can come in and do it, what           
 credentials do they have to have, what do they have to know about             
 the regulations, who are they responsible to, did I get hired by              
 the owner, did I get hired by the operator, did I get hired by the            
 landowner, did I get hired by the incinerator operator who may not            
 own the land who may be on a public leasehold and may decide that             
 he goes bankrupt during the middle of his audit and the state who             
 is the leaseholder never knows what that sludge was when we come to           
 clean it up.  And we may never know because privilege was involved.           
 Maybe there was no crime committed but maybe there's something we             
 need to know because we have to remedy the situation.  So where               
 privilege is invoked, how it's applied, and who holds the bag are             
 important things to define when you're establishing this new very             
 broad privilege."                                                             
                                                                               
 Number 252                                                                    
                                                                               
 MS. HANNAN stated, "When you're giving immunity and we think that             
 privilege is something very specific and it's probably where the              
 greatest heartburn about this comes from, because what paper trail            
 do you get access to and who gets access to it and when is very               
 important.  Now immunity is a separate section and that is if I               
 want to cooperate with you and I want to tell you, the IRS, that              
 I've gone through my books and I've cooperated and we've gotten               
 along and you have evidence and information about me that's pretty            
 important to our company's doing business.  Am I liable for what              
 you find?  Now Joe Hazelwood got immunity for doing something that            
 we know when we put those federal laws in place that provided Joe             
 Hazelwood immunity from reporting, it was because we wanted to give           
 people in a certain environmental regulatory position - if they               
 spilled oil - an incentive to come forward, come clean as soon as             
 they knew they spilled oil because we want compliance with the law;           
 we built an immunity into that and that's what we're doing with               
 this law at the state level.  We're building an immunity into it              
 but we're not specifying where narrowly that immunity is going to             
 be granted.  We're saying, you self-audit, you're immune unless               
 it's criminal.  Now this version has taken out criminal and we've             
 narrowed it.  No longer work place safety or health issues; it's              
 purely environmental.  Maybe that's the right incentive.  But now             
 I'm going to drag you back to the very onset of this bill."                   
                                                                               
 Number 343                                                                    
                                                                               
 MS. HANNAN continued,  "We don't have a problem in Alaska.  The               
 Department of Environmental Conservation cannot come into your                
 plant, walk through it, find something that you're non-compliant              
 with, and say you have been a bad operator and I'm going to fine              
 you a million dollars today because we don't like the way you've              
 acted and if you come forward with information and say we've been             
 a bad operator - gosh, yesterday I walked in the plant and there              
 was something green and oozy coming out - I shut it off - we've               
 remedied it, we've cleaned it up, we've sent it to the chemist and            
 we're gonna take care it - they can't come in a week later and say            
 `bad operator - million dollar fine.'  They don't have the penalty            
 authority.  They have to go to court to do that.  The rhetoric from           
 other states about why we have to do that is because sometimes                
 state agencies have the authority to do that and it's created a               
 hostile environment for companies to work in their states.  We                
 don't have that in Alaska.  We have not had much civil tort                   
 precedent where companies who are auditing or confidentially doing            
 compliance orders, reviewing their operations have said, `we're               
 trying to comply, we're working with it and you're using our tools            
 against us - you're making it difficult for our employees to talk             
 to us about what's going on in our plants.'  We don't have a                  
 problem in Alaska.  In some other states there have been some huge            
 civil tort damages between workers and operators where the                    
 operators have revealed information or the employees have sought              
 information and found out that the reason that they're sick is                
 because at work the ventilation system wasn't keeping the air clean           
 enough."                                                                      
                                                                               
 Number 362                                                                    
                                                                               
 MS. HANNAN concluded, "Immunity and privilege are very, very                  
 significant issues and when you're giving them broadly, there are             
 ramifications.  I think this is a bad law.  I don't think it's a              
 road we can go down and as much as this bill is vastly improved               
 over where it started in January, I don't think it can be improved            
 enough to be an important statute change in Alaska.  If we have               
 problems with our civil laws regulating companies, if we've got               
 laws on the books that shouldn't be there, let's repeal them.  But            
 I don't think we have them.  I'd be happy to give you the citation            
 about the states that have rejected it.  I think that there's much            
 controversy about whether this provides a significant incentive to            
 benefit of businesses in Alaska and I think that it would be unwise           
 for you to pass this into law."                                               
                                                                               
 Number 395                                                                    
                                                                               
 CO-CHAIRMAN GREEN asked Ms. Hannan to give the committee the                  
 citation for the record.                                                      
                                                                               
 MS. HANNAN responded, "It's from a report that I'm happy to leave             
 with Jeff - a copy of."                                                       
                                                                               
 CO-CHAIRMAN GREEN asked if the committee had any questions of Ms.             
 Hannan.  Hearing none, he asked Dwight Perkins to come forward and            
 present his testimony.                                                        
                                                                               
 Number 411                                                                    
                                                                               
 DWIGHT PERKINS, Special Assistant, Office of the Commissioner,                
 Department of Labor, testified that Version W before the committee,           
 does remove the health and safety audits from the bill.  He said              
 the committee had heard today from the states of Oklahoma and Texas           
 as well as numerous other testimonies from outside the state of               
 Alaska about this bill and he submitted that to date, no employer             
 or shop owner has come forward and said the Department of Labor was           
 causing them great problems.  He pointed out the committee had                
 heard that somewhere between 18-24 states have this legislation.              
 That may be so, but every state that has it is only in the                    
 environmental audit side with the exception of Texas.  Mr. Riley              
 from Texas couldn't speak on behalf of OSHA there but as                      
 Representative Kott mentioned, the Department of Labor in the state           
 of Alaska has been given the authority to run as an effective plan            
 as the federal OSHA and receives revenue in excess of $2 million to           
 run the state plan.  To put it in perspective, Mr. Perkins                    
 mentioned the concerns and problems the Department of Fish & Game             
 is experiencing with the federal government threatening to take               
 back that plan and he noted it could very well happen with this.              
 The Department of Labor thinks it is in the best interest for the             
 state to handle their own matters.  Even though there is a movement           
 nationwide, we don't care how they do it "Outside."  He noted the             
 Department of Labor is already doing a lot of what is addressed in            
 the bill.  For example, he distributed a pamphlet "Free,                      
 Confidential Consulting Services" which goes to employers                     
 explaining how it works.  As Representative Kott had indicated                
 earlier, it is confidential and it does not go to the enforcement             
 side and companies are given the opportunity to make sure it's a              
 safe environment for workers.  He said, in addition, the department           
 promotes safety and well-being in the work place by giving courses,           
 tapes, videos and information to companies for their employees.               
                                                                               
 Number 643                                                                    
                                                                               
 MR. PERKINS stated,  "In the trying to keep with this timely and              
 your indulgence with this, what has come before you today is - the            
 Department of Labor feels that this is in the best interest."  He             
 thanked committee members for placing the legislation in a                    
 subcommittee to allow them time to work on it.  He believed it was            
 very valuable and the Department of Labor agrees with the product.            
 With respect to the health and safety issues he urged committee               
 members to concur with the draft that was before them.  He                    
 commented the department wants to ensure this is a clean bill and             
 perhaps it's something that should be worked on during the interim.           
 He had committed to working with the bill sponsor during the                  
 interim and the sponsor's office could be the conduit to the                  
 companies to enhance communications.  He reiterated that to date no           
 company has come forward to express a problem with the Department             
 of Labor, Alaska Occupational Safety & Health.                                
                                                                               
 Number 714                                                                    
                                                                               
 CO-CHAIRMAN GREEN noted that a prior testifier had indicated that             
 Alaska doesn't have the punitive effect that some states may have.            
 He asked if that applied also with OSHA violations as it does in              
 environmental violations?                                                     
                                                                               
 MR. PERKINS responded yes.  The consultation section of Alaska OSHA           
 performs confidential audits for employers and the audit results              
 are not shared with the enforcement side.  The employer is not                
 fined for violations found in the course of consultation audits.              
 A consultation survey in process can stop an enforcement inspection           
 from being initiated.  When enforcement does an inspection and                
 penalties do arise, they can be reduced as much as 97.5 percent               
 based on good faith, size of employer and the history.                        
                                                                               
 Number 796                                                                    
                                                                               
 REPRESENTATIVE AUSTERMAN asked Mr. Perkins to explain what the                
 enforcement side referred to.                                                 
                                                                               
 MR. PERKINS pointed out that when complaints have been generated or           
 an accident has happened, the enforcement side goes in, checks and            
 finds violations.  Because of certain violations, there are certain           
 fines attached to each violation of occurrence, depending on what             
 it is and severity of it.  He added, "So, on the enforcement side,            
 if you will, that is going in and doing the audit because of                  
 complaint matters or checking to make sure the safety of the                  
 workers are protected.  Then those fees can be reduced up to 97.5             
 percent."                                                                     
                                                                               
 Number 842                                                                    
                                                                               
 REPRESENTATIVE AUSTERMAN followed up, "So, when the enforcement               
 side of the Department of Labor goes out and inspects a seafood               
 processing plant - which is what I'm most familiar with - and finds           
 the settling tanks too close to oxygen tanks, railings that are               
 under repair and not roped off property, the normal process then is           
 for the enforcement officer to write all this stuff up and then six           
 months down the road somebody goes in and says, `Here's your                  
 violations and here's what your fines are and now let's sit down              
 and negotiate what the fine is really going to be.'  That's                   
 basically what happens."                                                      
                                                                               
 MR. PERKINS responded that was basically correct but he believed              
 that somewhere in the process, the employer has the opportunity,              
 with OSHA, to remedy the problem.  If the problem isn't remedied,             
 then they're into the fine section.                                           
                                                                               
 Number 892                                                                    
                                                                               
 REPRESENTATIVE AUSTERMAN stated that was the aspect of the problem            
 that he would like the department to take a look at.  It appeared             
 to him that in the instances he had been involved with OSHA                   
 inspections in Kodiak, enforcement comes in and inspects but then             
 it takes the department about six months to go through the                    
 paperwork before they get back to the employer.  At that time, it's           
 negotiating over what the fine is going to be rather than "please             
 remedy the problem."                                                          
                                                                               
 Number 920                                                                    
                                                                               
 MR. PERKINS said he'd look into that.  With respect to inspections,           
 he read, "The safety and health compliance officer will present his           
 credentials before inspecting a place of employment.  The purpose             
 of an inspection is to determine the work place is in compliance              
 with Alaska's Occupational Safety and Health standards and regs.              
 Both the employer and the employee shall be given the opportunity             
 to accompany the compliance officer during his inspection of the              
 work place, opening and closing conferences will be held, but                 
 advance notice of inspections will not be given to an employer                
 prior to the time of actual entry upon property except in the                 
 following situations:  In cases of apparent eminent danger to                 
 enable an employer to abate the danger as quickly as possible."  So           
 if it is a life threatening situation, they will not issue a notice           
 that they're coming, but normally they do.                                    
                                                                               
 Number 977                                                                    
                                                                               
 REPRESENTATIVE AUSTERMAN asked if the fines were called program               
 receipts?                                                                     
                                                                               
 MR. PERKINS wasn't sure if they go into the general fund or back to           
 the federal government.                                                       
                                                                               
 Number 1003                                                                   
                                                                               
 REPRESENTATIVE LONG inquired if the last two committee substitutes            
 had been reviewed by OSHA?                                                    
                                                                               
 MR. PERKINS replied yes, they had been.  He stated, "The concern              
 that the federal Department of Labor has is that we have to be as             
 stringent or as effective as the federal plan.  And that's the                
 difference again, where Texas has put it into safety and health               
 issues, the feds can come in and those people will stand down --              
 Texas stands down, while the feds collect their information.  They            
 cannot be less effective than the federal plan so regardless of how           
 many laws that the Texas Department of Labor - I'll call it because           
 I'm not sure or OSHA - however that falls in that category -                  
 regardless of how many laws they put in that safety and health                
 audits can be addressed this way as we're talking, the federal                
 government supersedes them and goes in and they get the information           
 they need.  So, it's a law with no teeth.  They can walk right in             
 and get that information - and they do, because the federal OSHA              
 does not allow any plan to have privileges and immunities."                   
                                                                               
 Number 1103                                                                   
                                                                               
 CO-CHAIRMAN GREEN asked if there were additional questions for Mr.            
 Perkins?  Hearing none, he asked Marie Sansone to present her                 
 testimony.                                                                    
                                                                               
 Number 1130                                                                   
                                                                               
 MARIE SANSONE, Assistant Attorney General, Natural Resources                  
 Section, Department of Law, said the department has been following            
 this bill through the entire process and appreciated the changes              
 that have been made up to date.  However, the department does have            
 serious concerns with the privilege and she had drafted some                  
 language that would codify the privilege that's recognized in                 
 federal case law.  Discussions were still underway as to whether              
 that approach could be agreed upon or not.  She feels it has some             
 very important advantages.  She said, "There are two federal cases,           
 one in the Ninth Circuit that describe and set out all the                    
 requirements for the privilege known as the `self-evaluative                  
 privilege.'  Those requirements are fairly succinct and clear.                
 There are limitations and the cases where they have been applied              
 are basically reacting to about 25 years of the development of this           
 privilege of evaluating your own conduct.  So, I feel that there's            
 a body of law there, examples you could look at and information               
 that you could use to make sense out of this privilege.  So to my             
 thinking, it's a very logical way to proceed.  It has some other              
 important advantages in that we would not get into a federal versus           
 state law conflict.  If we had a case involving environmental laws            
 and this bill applies to federal, state and local environmental               
 laws, and there was a question what's the evidence and where are              
 you going to proceed - in federal court or state court - the                  
 lawyers and parties in that case would have to struggle long and              
 hard with this question of `Should I apply the federal privilege              
 law or should I apply the state privilege law' and by using the               
 federal privilege law, it eliminates that conflict - that dispute             
 and that would tend to probably -- if we enacted the privilege as             
 it is in this state law and there was a federal law that was                  
 different and people perceived it was a more narrow, workable                 
 privilege, that would probably tend to force litigants into federal           
 court where they had something defined and workable.  It just seems           
 to me that this is a good way to preserve our state law - keep                
 people in having access to state court - not force them into forum            
 shopping and not get (indisc.) up in lengthy disputes over what               
 comes into evidence and what doesn't."                                        
                                                                               
 Number 1280                                                                   
                                                                               
 MS. SANSONE said, "It also has another advantage in that agencies             
 like the EPA that are tracking the audit privilege legislation have           
 indicated they will scrutinize the privilege very carefully.  The             
 federal government does not -- the federal Justice Department and             
 the Environmental Protection Agency are on record as being strongly           
 opposed to any statutory audit privilege legislation and they've              
 stated they will scrutinize our federally delegated programs.  So             
 if we had a privilege law that matched federal law, that wouldn't             
 create a problem there because we could simply point to the federal           
 case law and say, `Well, the remedy or the privilege really is no             
 different than if you went to federal court and so our program                
 stays fine - it stays consistent with what you can do at a federal            
 level.'  So we feel those are important advantages.  I think the              
 reason for concern maybe is that this privilege operates more like            
 a normal attorney-client privilege or a trade secret privilege                
 where if you are the party asserting the privilege, you have the              
 obligation to assert it to keep the communication confidential -              
 that's your responsibility, you can't shift that off to someone               
 else to try to disprove it or enter into confidentiality agreements           
 and get into trouble if you break those - it keeps the burden where           
 it belongs on the party that feels that information is highly                 
 sensitive, that it is not the kind of information they want out in            
 public or need to have out in public - if they keep that                      
 confidential, then that's how it stays.  It also has the feature              
 that if you do evaluate your own conduct, you find problems and               
 then you don't act on that, that privilege ceases.  You have to act           
 on your knowledge of violations and correct your problems to keep             
 the information privileged.  So that's an important feature to us.            
 So we will work some more with the other parties on that to see if            
 it's acceptable.  It differs from the bill and perhaps it won't be            
 so..."                                                                        
                                                                               
 Number 1419                                                                   
                                                                               
 MS. SANSONE further stated, "There's a couple other points I'd like           
 to make.  I was very interested in the testimony from J. Davenport,           
 the environmental auditor from Oklahoma.  I checked - I believe I             
 have copies of all the state audit privilege laws and I do not have           
 a copy and I believe Oklahoma does not have an audit privilege law.           
 He described working on Oklahoma with an audit policy and that is             
 an alternative to the type of legislation that's before us - is an            
 agency policies or, particularly maybe with immunity, and he                  
 informed us that was working well.  We do have state programs that            
 do work well where people evaluate their own conduct.  Within the             
 DEC, within the Department of Law, we allow people to - if they did           
 get into trouble with violations, we have incorporated audits into            
 settlement agreements to resolve their problem.  So that would be             
 an alternative to the bill.  He also mentioned though that these              
 audits - in Oklahoma, he referred to them as external audits - that           
 has been an important concern to us.  The bill we have before us              
 refers to internal audits or audits -- a person could audit their             
 own conduct not necessarily hire someone independent or external,             
 and we felt that for a long time that has a problem that the                  
 auditor in an internal setting, if there are not appropriate                  
 controls in place, that bias, conflict of interest or perhaps fear            
 of retaliation or retribution might enter into play and affect the            
 auditor's work.  Another concern has also been that if it's an                
 internal audit and there's no standard as to who can authorize that           
 audit and who can conduct it, that there's no assurance that the              
 auditor will be trained or qualified or have the appropriate                  
 experience.  And we still feel those features are really missing              
 from this bill.  That there be some assurance of accountability.              
 The auditor from Oklahoma mentioned he always made sure the owner             
 or operator had the wherewithal to conduct and complete the audit             
 and make the corrections and that's a feature we would like to see,           
 too.  That it really does not help environmental compliance very              
 well if you can audit but you don't have the money or the authority           
 to make the corrections.  That is critical to us; that the owner or           
 operator of the facility be the party that is authorizing the audit           
 and will carry through with it.  That's very important."                      
                                                                               
 Number 1592                                                                   
                                                                               
 MS. SANSONE remarked, "He also mentioned the EPA policy.  The EPA             
 policy is another alternative that we feel is very good.  It sets             
 out conditions and requirements that protect the public.  So those            
 are alternatives that would not necessarily have to be in a law               
 that could achieve the same results.  In the bill, we have taken              
 out the occupational safety and health penalties section completely           
 and then we've also removed criminal penalties from the                       
 environmental violations.  The consequence of that for the                    
 Department of Environmental Conservation is that DEC does not have            
 administrative penalty authority, so if someone were to audit and             
 come to DEC and say, `Here's my audit, here's my corrections.  I'd            
 like the immunity from administrative penalties,' they can't get              
 anything.  There's nothing - there is no penalty to immunize them             
 from, so in a way that's kind of false advertising as far as DEC is           
 concerned.  That would raise the question in my mind, `Is this                
 really an incentive if you can't get the remedy you want?'"                   
                                                                               
 MS. SANSONE continued, "There's a similar problem with the civil              
 penalties.  The DEC can go to court to get civil penalties for                
 catastrophic oil spills, well they would not be covered by                    
 immunity.  The DEC can also get civil penalties in the area of                
 hazardous waste although I think Ms. Adair can probably inform you,           
 most of the hazardous waste enforcement is handled at the federal             
 level by the EPA under the (indisc.) scheme, so even though that's            
 theoretically possible, it's not a very great reality.  The only              
 other area where there's a civil penalty is air quality and that's            
 been in connection with the new Title V permit program.  So the               
 civil penalties are also extremely limited.  And the concept then             
 of giving someone an incentive to come forward and getting immunity           
 from penalties, there's nothing much to get immunity from and I               
 guess I see that as a problem to put a lot verbiage in the books              
 that might lead people to believe they're getting a benefit when              
 there really isn't that possibility there."                                   
                                                                               
 Number 1766                                                                   
                                                                               
 MS. SANSONE said, "Sara Hannan indicated some of the states with              
 the audit privilege had strict penalties.  That is true.  This                
 whole idea commenced in the state of Oregon.  They dramatically               
 increased their criminal penalties for environmental violations               
 raising them in all areas to felonies and expanding the number of             
 misdemeanors.  So when they created the audit privilege, it was               
 part of a compromise in that legislation.  It was part of a package           
 deal that if we dramatically increase the penalties, we need some             
 mechanism to help people not get into a punitive situation.  We               
 just don't have that there to negotiate with or to give away.  So             
 it does raise the question in my mind, `Is the immunity provision             
 really necessary?  Is it really an incentive?'"                               
                                                                               
 MS. SANSONE said, "We had offered in the Senate Finance Committee             
 that even our criminal division would consider audits as a                    
 mitigator.  That seems to make more sense.  I don't think we need             
 all the detailed provisions to achieve that but I would just really           
 question is the immunity necessary.  It just doesn't seem it is."             
                                                                               
 MS. SANSONE concluded, "I do think the privilege would hurt the               
 state in our cost recovery cases where we're trying to recover                
 money for contaminated properties whether it's through DEC trying             
 to recover money expended from the cost recovery fund or from the             
 Department of Natural Resources (DNR) or perhaps the Department of            
 Transportation, Fish and Game or any of the departments that have             
 property or manage property, they would be at a disadvantage.  And            
 I think the privilege would hurt us in enforcing the law when we              
 really do need to take those official steps."                                 
                                                                               
 Number 1902                                                                   
                                                                               
 REPRESENTATIVE LONG asked, "Will the federal government still                 
 oppose, you know these immunities to the privilege (indisc.) will             
 fulfill the federal requirements, you know under OSHA and stuff?"             
                                                                               
 MS. SANSONE responded, "The federal government has indicated that             
 if the immunities were constructed in such a way as to reduce the             
 effectiveness of an enforcement program, that they would oppose               
 that and where they have a delegated program, consider withdrawing            
 the delegation.  The federal government also has the option in that           
 circumstance of bringing its own enforcement action.  So it is                
 possible that if the immunity does interfere with what is a fair              
 enforcement policy, they would step in and take their action."                
                                                                               
 Number 1985                                                                   
                                                                               
 REPRESENTATIVE LONG inquired if this bill as it is written would              
 interfere with the federal law.                                               
                                                                               
 MS. SANSONE said, "It potentially interferes in the area of air               
 quality because that is one area where the legislature gave DEC               
 statutory authority to go to court to collect civil penalties for             
 violations of the air regulations.  And it also potentially would             
 undermine the underground injection control program in the Alaska             
 Oil and Gas Conservation Commission.  That commission has a                   
 delegation from the EPA to regulate pollution - or disposal of                
 waste into underground injection wells.  So that would be another             
 area.  It's potentially more serious for the Oil and Gas Commission           
 because they do have administrative and civil penalty authority, I            
 believe.  So they need to be as effective."                                   
                                                                               
 Number 2073                                                                   
                                                                               
 REPRESENTATIVE NICHOLIA said that Ms. Sansone had made reference to           
 Oklahoma not having privilege and asked how she felt about the                
 privilege being in the legislation before the committee.                      
                                                                               
 MS. SANSONE stated, "What I was referring to was that Oklahoma had            
 not enacted a program into statute.  They apparently - according to           
 the earlier witness, have a policy.  Oklahoma would have probably             
 on its books some privileges to protect evidence like the attorney-           
 client privilege and the work product doctrine, trade secret                  
 privileges.  These are pretty widely consistent throughout the                
 United States.  So they probably do have some privilege that a                
 person could assert to protect highly sensitive information,                  
 although they don't have an audit privilege, per se."                         
                                                                               
 Number 2164                                                                   
                                                                               
 REPRESENTATIVE NICHOLIA again asked how Ms. Sansone felt about                
 having the privilege in this legislation.                                     
                                                                               
 MS. SANSONE replied, "We do not support the privilege as it's                 
 drafted and incorporated into this document.  We feel it is very              
 broad and subject to abuse.  And even though we have a number of              
 conditions that have been put into this bill to try to guard                  
 against abuse, that there is so much opportunity for litigation and           
 dispute over what those terms mean.  There's also a problem with              
 the provision in the bill about how to get disclosure through an in           
 camera proceeding if we believe there's been fraud or if someone              
 has not acted in good faith.  In that exception, the burden of                
 proof would be on the state to come into the judge's chambers and             
 try to prove that a party had engaged in a fraud or was protecting            
 -- engaged in audit and was protecting information for a fraudulent           
 reason or basically acting in bad faith.  But to do that, we do not           
 get access to the documents that we would need to prove that we               
 essentially -- we would be in front of the judge and the judge                
 would have the documents and be able to review them, but we would             
 be arguing about something that we could not see or evaluate.  We             
 don't feel that that is very realistic or that that would work."              
                                                                               
 Number 2291                                                                   
                                                                               
 CO-CHAIRMAN GREEN thanked Ms. Sansone for her testimony and asked             
 if there were any questions from the committee.                               
                                                                               
 Number 2317                                                                   
                                                                               
 NANCY WELLER, Medical Assistance Administrator, Division of Medical           
 Assistance, Department of Health & Social Services, testified the             
 division supports the subcommittee's recommendation to take out               
 health and safety because it eliminates the department's concerns             
 with this bill.  She concluded that it was never anyone's intent              
 that this bill apply to the Medicaid program in the way they saw it           
 would have with the definition of environmental and health and                
 safety audit that had been in all the previous versions of the                
 bill.  She explained they guarantee that health care provided in              
 facilities is safe and try to guarantee that the federal and state            
 dollars that are spent to pay for health care for Medicaid                    
 recipients is paid appropriately.  She stated the immunity and                
 privilege make absolutely no sense when it comes down to these                
 functions because she couldn't believe that anyone would want to              
 give an individual the right to provide health care that was not              
 done in a safe manner or hide from their responsibility to pay back           
 funds that were inappropriately paid to them by the state and                 
 federal government for the Medicaid program."                                 
                                                                               
 Number 2422                                                                   
                                                                               
 MS. WELLER concluded they could only see that this bill as it                 
 applied to their functions would allow people who wanted to be                
 dishonest to take money they were not entitled to.  She reiterated            
 the Department of Health and Social Services supports the                     
 subcommittee proposal.                                                        
                                                                               
 TAPE 96-75, SIDE A                                                            
 Number 026                                                                    
                                                                               
 JANICE ADAIR, Director, Division of Environmental Health,                     
 Department of Environmental Conservation, thanked members of the              
 subcommittee for their hard work but the department still has                 
 problems with the privilege.  She thought the immunity is closer to           
 what the department currently does, particularly with the criminal            
 provisions being deleted.  She hoped that in a couple of years,               
 they wouldn't be trying to back track from the privilege because              
 something had been kept a secret from the people of Alaska and                
 there has been a bad result that came from that.  She stressed that           
 is really the department's concern.  They deal not only with the              
 good operators, but operators who are less than honorable, so they            
 come at this with a full range of experience.  It isn't                       
 supposition, it's real stuff.  She has strong concern that a                  
 privilege will complicate that even more than what's currently                
 happening.  Testimony from other individuals and on other bills has           
 indicated that DEC's enforcement authority is really very limited.            
 They don't have administrative penalty authority, they only have              
 civil penalty authority for two different programs, so they often             
 have to take people to court.  This just takes it back one more               
 step and it's the people of the state that end up suffering from              
 that, which is the department's concern.                                      
                                                                               
 Number 235                                                                    
                                                                               
 CO-CHAIRMAN GREEN inquired, "If you had an organization that was              
 burning refuse and for some reason they were in violation - they              
 come to you under this immunity and privilege system and then begin           
 to drag on and on about correction.  Would this bill even as it's             
 modified give them some sort of a hedge against acting like a good            
 operator?"                                                                    
                                                                               
 MS. ADAIR responded she thought that it could.  She stated, "There            
 is a provision in here that says that we can still have injunctive            
 relief.  We can still do what we can but they can hide things and             
 that is really -- the immunity presumes that all your cards are on            
 the table - we're all looking at the same things and we're saying,            
 `Okay, we see what you're dealing with here and we won't take any             
 action against you so long as you do these things.'  But the                  
 privilege allows people - and the folks that you have heard from              
 are not the ones that we're concerned about.  The ones that we're             
 concerned about aren't here - they can take that stuff, call it an            
 audit, hide it and we won't be able to.  And years from now someone           
 ends up or a community ends up with a problem and we may never be             
 able to figure out what happened.  And there have been cases like             
 that in this state.  Many of them have involved the military, but             
 I think that we've seen the problems that the kind of a secrecy               
 that the military shields things with and we get mad about that and           
 now we're kinda gonna do that."                                               
                                                                               
 Number 395                                                                    
                                                                               
 REPRESENTATIVE OGAN referred to page 6 of Version W which lists the           
 things that are not privileged and asked Ms. Adair if she was                 
 familiar with that list.                                                      
                                                                               
 MS. ADAIR responded affirmatively.                                            
                                                                               
 Number 395                                                                    
                                                                               
 REPRESENTATIVE OGAN commented that as he reads the list of things             
 that aren't privileged materials, it appears to him the department            
 still has a great deal of authority in these areas.  He brought up            
 the issue of paranoia and thought that as a business owner he would           
 feel a whole lot better if he did an environmental audit for his              
 own health and safety if he was around chemicals and things of that           
 nature.                                                                       
                                                                               
 MS. ADAIR commented, "One of the things that we're trying to do in            
 sort of a government reduction - because we're out of room for all            
 the paper - is try not to ask people to give us everything in the             
 world.  That has been our department's operating procedure over the           
 years - we want to look at everything you've got and then we'll               
 tell you what we think.  What we're moving to now is we're trying             
 to get away from that because we're trying to develop that better             
 good neighbor policy with the people that we regulate in                      
 understanding that their documents are open to us now so that we              
 can look at them.  Instead of giving us everything, it will be only           
 when we need to see it.  So yes, there is a laundry list here and             
 we certainly appreciate that list, but there's a lot of things that           
 we don't require and we don't require them on the premise that we             
 can access them if we need them.  That's particularly the case                
 where there's a problem with compliance.  People typically don't              
 keep records that would indicate noncompliance, it takes putting              
 together sort of a case."  She referred to the paranoia issue that            
 was brought up by Representative Ogan and said the immunity gets to           
 the situation Representative Ogan brought up.  If a business owner            
 knows he/she could look at their operation, find a problem, report            
 that problem to DEC and be immune from the department's "storm                
 troopers," that's really what Representative Ogan was talking                 
 about.  But the privilege is separate and distinct from that.  She            
 explained the privilege says that you may or may not report it to             
 the department, but you can take the documentation that you find              
 and stamp it privileged and no one will ever see it again.  She               
 said, "That's one of the fallacies here is that those things work             
 separately.  So you have the documentation - we'll use somebody               
 else as an example - that finds a violation and you mark it as                
 privileged and it goes away.  You don't ever report the violation             
 to us, so immunity isn't even a question.  Because you've not                 
 reported it to us, we can't go back and get that documentation that           
 shows the violation.  Perhaps through an observation, we find a               
 problem and we come to this operator and say, `We've observed this,           
 can you give us some documentation on your discharges' and they               
 say, `I'm sorry, that was part of an audit and it's privileged.'              
 Then we're stuck with having to go back perhaps and re-create                 
 information if we can or do a separate investigation to uncover               
 what we might have been able to more easily obtain through the                
 documents that were part of the audit."                                       
                                                                               
 Number 811                                                                    
                                                                               
 REPRESENTATIVE OGAN said, "On that point, but you said that if you            
 find something by observation and the violator said, `I'm sorry               
 that was privileged' however, under this section it's not                     
 privileged and it would seem to me that if there were things --               
 that you could require things by regulation that would not be                 
 privileged by simply maybe adjusting some of the things that are              
 required."  He believed that's what it said in the legislation.               
                                                                               
 MS. ADAIR said, "We read this and I could certainly be reading this           
 wrong as well, but the information that we gather wouldn't be                 
 privileged but that the person we are inspecting doesn't have to              
 give us information that was done as part of their audit - that               
 that still says privileged but to the extent that we gather it or             
 we observe it, that there's a distinction made there.  That's how             
 I read it and if I am incorrect, then Ms. Sansone can correct me.             
 And yes, we could amend our regulations to require people give us             
 a bunch of stuff.  It just kind of goes against what we've been               
 trying to do which is not be so anal-retentive about this and                 
 understand that there's going to be a whole lot of information in             
 people's files that we can get to when we need it but they don't              
 need to give it to us, report to us and have it be in our files and           
 in their files.  We were just trying to get away from that whole              
 mode of doing business."                                                      
                                                                               
 Number 911                                                                    
                                                                               
 REPRESENTATIVE OGAN commented, "It seems to me that what you just             
 said is that if you discover the information somehow or a problem             
 somehow, that that information is not privileged, but their audit             
 is.  But you still have the ability to inspect and discover and do            
 this stuff anyway.  It's just that if they went ahead and did it,             
 they don't have to give you the information."                                 
                                                                               
 Number 951                                                                    
                                                                               
 CO-CHAIRMAN GREEN said, "Perhaps, quite often there has to be shown           
 that there has been - it's not just a one time shot - and what I              
 think Ms. Adair is saying is that if you go in and make this audit            
 just ahead of a normal inspection by DEC, all the monitoring that             
 you may have been doing suddenly becomes privileged and so now                
 you're kind of handcuffed as to what you could say.  We saw a - a             
 black smoke incident or something - that's not the same as saying,            
 `Well ya, there have been black smoke incidents every week for the            
 last five years' because that's all now privileged information."              
                                                                               
 MS. ADAIR remarked that would be one example, but that is the                 
 distinction.  She added, "What we see, we can use but we can't get            
 the information that might back it up.  We'd have to re-create that           
 in some fashion."                                                             
                                                                               
 Number 985                                                                    
                                                                               
 REPRESENTATIVE NICHOLIA recalled that a person had died from                  
 drinking water that was contaminated with chlorine and asked what             
 would have happened in that case if this legislation had been in              
 effect.                                                                       
                                                                               
 MS. ADAIR didn't believe that case would have been impacted by this           
 legislation.  Drinking water systems are legally required to                  
 monitor for different constituents in the drinking water.  If                 
 chlorine is used, that is one that has to be monitored.  She didn't           
 know all the details of the case that may have been impacted by               
 this bill.                                                                    
                                                                               
 Number 1125                                                                   
                                                                               
 MS. SANSONE added, "In a case like that, DEC would have a lot of              
 required records in its file that they had been submitting.  They             
 may not have other records that indicated what the owner/operator             
 of that system really knew about the management of the system.                
 That is a type of record that you would be concerned about in that            
 incident - are there audits or reports that indicate the operator             
 or owner should have been on notice that the chlorine was being put           
 in at an excessive rate and didn't act - that would be a question             
 the state would want to ask and the victim's family would want to             
 ask just what was going on at that facility.  That information DEC            
 probably would not have the full spectrum of that - it's not all              
 required.  So I don't know that it did impact that case.  It could            
 impact a similar case."                                                       
                                                                               
 REPRESENTATIVE NICHOLIA said she was wondering if this bill passed,           
 would it have a negative impact on a case like that?                          
                                                                               
 Number 1145                                                                   
                                                                               
 MS. SANSONE replied, "This bill would have a negative impact on               
 cases like that because the evidence that you conducted an audit              
 and you found you had a problem or series of problems and the                 
 auditor told you what you needed to do to fix those problems, if              
 years go by and the problem is not fixed and then a person is                 
 injured or dies as a result, that audit report is probably the most           
 valuable evidence of negligence that the business was not                     
 fulfilling its obligations to maintain safe operations.  That they            
 knew they had a problem, the auditor told them what needed to be              
 done to fix it and then they don't fix it.  That is extremely                 
 valuable evidence - that is crucial evidence.  And the audit                  
 privilege in this bill is drafted so broadly that it could exclude            
 that evidence."                                                               
                                                                               
 Number 1184                                                                   
                                                                               
 REPRESENTATIVE AUSTERMAN inquired, "Doesn't this bill come back to            
 knowingly and this kind of stuff where you're actually committing             
 a crime basically when you do that and somebody dies that you're              
 exempt from this."                                                            
                                                                               
 MS. ADAIR responded the privilege applies to criminal proceedings.            
 The immunity doesn't, but the privilege does and what Ms. Sansone             
 was talking about was keeping evidence privileged that could                  
 indicate negligence and the department wouldn't be able to obtain             
 that.                                                                         
                                                                               
 Number 1224                                                                   
                                                                               
 MS. SANSONE added, "The conditions that are in the bill about                 
 immunity not being available if you had knowingly committed a                 
 violation or intentionally or recklessly, those provisions are                
 found beginning on page 7 in Section 475 of the bill which is the             
 immunity provision and this is a concern that we've had throughout            
 - they don't carry over to the privilege.  The limitations and                
 restrictions all kick in for immunity - the privilege is still wide           
 open as to whether you truly are a bad actor, whether you're                  
 intentionally engaged in wrongful conduct.  And that is the major             
 problem with the privilege that we see.  The limitations are all              
 built in for immunity but they don't carry over to the first part             
 of the bill - the privilege."                                                 
                                                                               
 Number 1283                                                                   
                                                                               
 CO-CHAIRMAN WILLIAMS commented that from what he was hearing, the             
 department would rather not see the privilege in the bill at all.             
                                                                               
 MS. ADAIR responded that was correct.                                         
                                                                               
 CO-CHAIRMAN WILLIAMS asked if the department could live with the              
 other portion of the bill?                                                    
                                                                               
 MS. ADAIR believed the department could live with the other portion           
 of the bill, as currently drafted.                                            
                                                                               
 CO-CHAIRMAN WILLIAMS remarked he would like to hear comments from             
 the bill sponsor.                                                             
                                                                               
 Number 1351                                                                   
                                                                               
 MIKE PAULEY, Legislative Administrative Assistant to Senator Loren            
 Leman, said, "Let me start with the question of privilege.  You               
 know, it's an interesting thing that as this bill has moved through           
 the legislature, the element of privilege has been the most                   
 controversial element of it.  There have been concerns raised on              
 the immunity and whether it reaches too far in certain areas or               
 not, but at least conceptually no one has had as much problem with            
 the immunity as they have with the privilege.  The reason I find              
 this interesting is that we've had a lot of discussion about the              
 other states that have passed these laws and in the other states              
 the privilege is the more uniform element that has been included in           
 the other incentive laws in the other states.  The 17 states that             
 have enacted these laws so far, 16 of the 17 provide privilege.               
 Only South Dakota has enacted a law which does not grant privilege.           
 Their bill is immunity only.  So it is the privilege that has been            
 the unifying factor in the self-audit incentive bills and it's been           
 the immunity that has kinda gone 50/50 in the other states.  Ten of           
 the 17 states provide privilege and immunity and, of course, the              
 Alaskan legislation is in that spirit.  In addition, there's two              
 other bills - Ohio and South Carolina where the legislatures have             
 approved them; they're sitting on the governor's desk and are                 
 expected to be signed.  To be honest, I do not know - I can't tell            
 the committee how those 2 bills stand with regard to privilege and            
 immunity but at least of the 17 that I'm informed about, all but 1            
 include the privilege.  We think the privilege is an essential                
 thing.  If you look at the Constitution and read the Fifth                    
 Amendment, there is a sense in which it is almost in that spirit -            
 you know - the right not to incriminate oneself."                             
                                                                               
 Number 1476                                                                   
                                                                               
 MR. PAULEY continued, "When we talk about audit reports, we're                
 talking about things that are not required by the law and I would             
 refer the committee to the section of the bill that Representative            
 Ogan read from that anything that you're required to report already           
 - anything that you already do in the course of a normal business             
 activity, such as inventory records - you know, things that aren't            
 required by law but that you just do anyway as a normal business              
 activity - that is not protected by privilege.  So when we talk               
 about what is protected by the privilege, we're talking about a               
 very narrow thing that where you're going, you're going above and             
 beyond what the law minimally requires.  You're being a good                  
 citizen, you're taking money out of your business profits and                 
 valuable time and having a compliance audit done that no agency is            
 requiring you to do - no one is forcing you to do it - but you're             
 being proactive to try to evaluate your operations and see if                 
 you're in compliance with the law.  Off the documents to be used in           
 essence, as a rope to hang you with.  A lot of companies think                
 that's exactly what will happen.  You know, the Price Waterhouse              
 survey which I referred to in my testimony last week - 369                    
 companies polled nationwide and 10 percent of the companies that              
 are doing audits now reported that those documents had been used in           
 enforcement actions against them; 15 percent of them reported that            
 their audit documents had successfully been obtained from hostile             
 third parties in litigation actions.  So, it is a perception.  The            
 critics say, `Give us some examples in Alaska.'  The fact of the              
 matter is, is that we're talking about an issue of perceptions.  As           
 Mr. Davenport stated this morning, many of the companies that                 
 operate in Alaska, operate in other states.  The experiences                  
 they've had in other states color their attitudes about their                 
 operations up here and you know, I used the example earlier of the            
 Internal Revenue Service.  I think if we were to go out on a                  
 sidewalk and just do the man-on-the-street interview and ask people           
 if you discovered - you're going through your files and you                   
 discovered you did a little bit of short-term work last year - you            
 earned $2,000 and forgot to report that to the IRS - when you ask             
 the average citizen, `Do you think that if you voluntarily report             
 to the IRS that you unknowingly forgot to disclose this income, do            
 you think they are just going to say okay fine, pay the money and             
 the interest that you owe and no penalty since you were a good                
 citizen in turning yourself in.'  I think you would find most                 
 people - you know 90 percent probably - would say no way, they're             
 going to nail me and I'm just going to pretend that I never saw               
 this and that unfortunately is what a lot of people in the                    
 regulated community are doing.  It's the old adage that no good               
 deed goes unpunished and what the sponsor of this legislation is              
 trying to do is turn that adage on its head and say that we aren't            
 going to punish good deeds, we're going to nail bad actors but we             
 are not going to take conscientious people and punish them."                  
                                                                               
 REPRESENTATIVE AUSTERMAN inquired, "To the points you were just               
 making, Mike - in reference to what was stated by DEC and the                 
 Department of Law a few minutes ago in reference to immunity versus           
 privilege in reference to committing an act - knowingly committing            
 an act and then trying to cover it up with the privilege.  How do             
 you respond to the fact that you can't get in then if they've done            
 their self-audit and use any of their stuff that they could tie up            
 under the privilege."                                                         
                                                                               
 MR. PAULEY replied, "There's a couple of different levels.  First,            
 again we have to start with the exceptions for non-privileged                 
 materials and you'd have to ask the question of `What is it that an           
 agency ordinarily has access to in its enforcement actions that are           
 going to be denied under the privilege law, given the fact that we            
 have this very long list of exceptions.'  That's one issue.  The              
 second issue is that to the extent that this bill encourages                  
 regulated entities to be performing audits that would not otherwise           
 exist, you have to ask yourself, `If the documents weren't there in           
 the first place, you know they wouldn't be there for the agency to            
 even be attempting to subpoena them or confiscate them in the first           
 place.'  That's the second issue.  The third issue is that we have            
 a section in the bill that provides for an in camera review where             
 if an agency believes - if they have grounds to suspect that an               
 audit is being asserted for a fraudulent purpose or that the audit            
 was being used to cover up documents that were in response to an              
 investigation that was ongoing or if the audit report shows                   
 evidence that there is non-compliance and that attempts to bring              
 the entity into compliance were not taken - if any of those things            
 can be demonstrated in an in camera review, the privilege is                  
 jeopardized."                                                                 
                                                                               
 Number 1719                                                                   
                                                                               
 CO-CHAIRMAN GREEN announced that due to time constraints, the                 
 committee needed to wrap up.  He thanked the subcommittee for an              
 exemplary job.                                                                
                                                                               
 Number 1740                                                                   
                                                                               
 REPRESENTATIVE OGAN remarked that the clearest testimony he had               
 heard was that of Mike Pauley.  He made a motion to move Amendment            
 1, Revised W.                                                                 
                                                                               
 CO-CHAIRMAN GREEN asked if there was objection to Amendment 1?                
 Representative Kott objected for discussion purposes.                         
                                                                               
 MR. PAULEY commented, "When we first introduced this bill, from the           
 beginning it was our intent to have the broadest possible                     
 application to include not only incentives for environmental                  
 compliance but also for work place safety.  And I do want to                  
 emphasis that in the bill health and safety is defined as                     
 occupational health and safety, so we're only talking about work              
 place safety, not patient care standards or drinking water or blood           
 supply or any of the other number of things that have been raised             
 during the discussion.  The reason why we think it's important to             
 include the occupational safety element to this bill is that                  
 companies that currently conduct compliance audits - it's been our            
 experience that most of them do so for both areas.  I referenced a            
 popular textbook in my last hearing that is used to guide companies           
 in how to do this, this is one that's called `Environmental Health            
 and Safety Audit Handbook.'  You know, companies that do these                
 usually do them together.  I spoke with the person from ARCO Alaska           
 who does their audits and his business card says `Environmental               
 Health Safety Compliance Unit.'  So companies group these things              
 together and I just want to reiterate the argument I made in the              
 subcommittee that if the committee believes that the bill is a good           
 incentive for environmental compliance, then we think the same                
 incentive would be good for worker safety as well and we would just           
 urge that that be included in the bill."                                      
                                                                               
 CO-CHAIRMAN GREEN asked if the objection was maintained.  The                 
 objection was maintained and Co-Chairman Green called for a roll              
 call vote.  Voting in favor to adopt Amendment 1 were                         
 Representatives Ogan and Green.  Voting against the adoption of               
 Amendment 1 were Representatives Austerman, Kott, Long, Nicholia              
 and Williams.  Amendment 1 failed.                                            
                                                                               
 Number 1869                                                                   
                                                                               
 CO-CHAIRMAN WILLIAMS made a motion to pass HCS CSSB 199, Version W            
 from the House Resources Committee with individual recommendations.           
                                                                               
 CO-CHAIRMAN GREEN noted there was an objection.  He asked for a               
 roll call vote.  Voting in favor of the motion were Representatives           
 Austerman, Kott, Ogan, Williams and Green.  Voting against the                
 motion were Representatives Long and Nicholia. CO-CHAIRMAN GREEN              
 announced that HCS CSSB 199(RES) passed out of committee.                     
                                                                               
 CO-CHAIRMAN GREEN announced the committee would recess to the call            
 of the Chair and they would try to hear SB 247 the following day.             
                                                                               
                                                                               

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