Legislature(2021 - 2022)BARNES 124

03/12/2021 01:00 PM RESOURCES

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01:03:19 PM Start
01:04:35 PM HB98
03:00:18 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Heard & Held
-- Invited & Public Testimony --
+ Bills Previously Heard/Scheduled TELECONFERENCED
                    ALASKA STATE LEGISLATURE                                                                                  
               HOUSE RESOURCES STANDING COMMITTEE                                                                             
                         March 12, 2021                                                                                         
                           1:03 p.m.                                                                                            
MEMBERS PRESENT                                                                                                               
Representative Josiah Patkotak, Chair                                                                                           
Representative Grier Hopkins, Vice Chair                                                                                        
Representative Calvin Schrage                                                                                                   
Representative Sara Hannan                                                                                                      
Representative George Rauscher                                                                                                  
Representative Mike Cronk                                                                                                       
Representative Ronald Gillham                                                                                                   
Representative Tom McKay                                                                                                        
MEMBERS ABSENT                                                                                                                
Representative Zack Fields                                                                                                      
COMMITTEE CALENDAR                                                                                                            
HOUSE BILL NO. 98                                                                                                               
"An Act relating to forest land use plans; relating to forest                                                                   
land use plan appeals; relating to negotiated timber sales; and                                                                 
providing for an effective date."                                                                                               
     - HEARD & HELD                                                                                                             
PREVIOUS COMMITTEE ACTION                                                                                                     
BILL: HB  98                                                                                                                  
SHORT TITLE: FOREST LAND USE PLANS; TIMBER SALES                                                                                
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR                                                                                    
02/18/21       (H)       READ THE FIRST TIME - REFERRALS                                                                        
02/18/21       (H)       RES, FIN                                                                                               
03/12/21       (H)       RES AT 1:00 PM BARNES 124                                                                              
WITNESS REGISTER                                                                                                              
BRENT GOODRUM, Deputy Commissioner                                                                                              
Office of the Commissioner                                                                                                      
Department of Natural Resources                                                                                                 
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Introduced HB 98.                                                                                        
TIM DABNEY, Acting Director                                                                                                     
Division of Forestry                                                                                                            
Department of Natural Resources                                                                                                 
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Presented HB 98.                                                                                         
CHRISTOPHER ORMAN, Assistant Attorney General                                                                                   
Natural Resources Section                                                                                                       
Civil Division (Juneau)                                                                                                         
Department of Law                                                                                                               
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Answered  questions and provided information                                                             
on HB 98.                                                                                                                       
ACTION NARRATIVE                                                                                                              
1:03:19 PM                                                                                                                    
CHAIR  JOSIAH  PATKOTAK  called   the  House  Resources  Standing                                                             
Committee  meeting  to  order  at   1:03  p.m.    Representatives                                                               
Hopkins,  Schrage, Hannan,  Rauscher, Gilham,  Cronk, McKay,  and                                                               
Patkotak were present at the call to order.                                                                                     
           HB 98-FOREST LAND USE PLANS; TIMBER SALES                                                                        
1:04:35 PM                                                                                                                    
CHAIR PATKOTAK  announced that the  only order of  business would                                                               
be HOUSE BILL NO. 98, "An  Act relating to forest land use plans;                                                               
relating to forest land use  plan appeals; relating to negotiated                                                               
timber sales; and providing for an effective date."                                                                             
1:05:24 PM                                                                                                                    
BRENT GOODRUM,  Deputy Commissioner, Office of  the Commissioner,                                                               
Department of Natural Resources, read an introduction to HB 98:                                                                 
     Good  afternoon Chair  Patkotak and  committee members.                                                                    
     For the record I  am Brent Goodrum, Deputy Commissioner                                                                    
     of the Department  of Natural Resources.   We thank you                                                                    
     for the opportunity to bring  before you House Bill 98,                                                                    
     a bill  that seeks to  help modernize our  timber sales                                                                    
     processes  and to  make our  decisional processes  more                                                                    
     consistent  with  contemporary   practices.    Proposed                                                                    
     modifications   to  these   statutes  will   help  grow                                                                    
     predictability  and jobs  in Alaska's  timber industry,                                                                    
     an  industry  that has  longed  for  more flexible  and                                                                    
     longer-term  negotiated  sales  necessary to  meet  the                                                                    
     current needs of their intended  markets.  The Division                                                                    
     of  Forestry and  Alaska's  timber  industry have  been                                                                    
     seeking to  find needed resolution to  these challenges                                                                    
     for  several years,  and the  administration was  first                                                                    
     able to  introduce legislation last year  in the Covid-                                                                    
     abbreviated legislative  session and simply ran  out of                                                                    
     time.    The time  is  right  to help  Alaska's  timber                                                                    
     industry   and   our   state   economy,   but   prudent                                                                    
     modifications  to  our   timber  sales  and  decisional                                                                    
     processes statutes.   The benefits  of an  acting House                                                                    
     Bill  98  will  result   in  more  efficient  land  use                                                                    
     planning and more predictable timber  harvests.  Who in                                                                    
     business  today   doesn't  rely   upon  predictability?                                                                    
     Importantly, House  Bill 98 is  a zero fiscal note.   I                                                                    
     am joined  this afternoon  by Tim Dabney,  Acting State                                                                    
     Forester, who will  present House Bill 98 to  you.  Tim                                                                    
     will be  joined by Chris  Orman with the  Department of                                                                    
     Law, who  will be  available to  assist with  any legal                                                                    
     questions  related   to  this   important  legislation.                                                                    
     Again, thank  you for the opportunity  to present House                                                                    
     Bill 98,  and I'll now  hand it off to  Acting Director                                                                    
     Tim Dabney.                                                                                                                
1:07:33 PM                                                                                                                    
TIM DABNEY, Acting Director, Division  of Forestry, Department of                                                               
Natural Resources, presented  HB 98 with a  PowerPoint (hard copy                                                               
in  the  committee  packet).     He  described  the  first  issue                                                               
addressed  by HB  98 as  the matter  of negotiated  timber sales;                                                               
current  law  prohibits  long-term negotiated  timber  sales  for                                                               
1:09:22 PM                                                                                                                    
REPRESENTATIVE  HANNAN asked  for  clarification  on whether  Mr.                                                               
Dabney is referring to foreign exports, or exports from Alaska.                                                                 
MR. DABNEY  clarified that it  is for  export from Alaska  out of                                                               
the state to emerging markets.                                                                                                  
REPRESENTATIVE HANNAN  followed-up with  the question  of whether                                                               
there is  any intention to  differentiate between  foreign buyers                                                               
and buyers within the U.S. market.                                                                                              
MR. DABNEY  said that  he is  not aware  of those  differences in                                                               
this statute  change.   He then  continued the  presentation with                                                               
slide 4, "Background: Negotiated Timber  Sales," which he read as                                                               
follows [original punctuation provided]:                                                                                        
     ? AS 38.05.115: Small-scale sales                                                                                          
     ? AS 38.05.118: Local manufacture sales                                                                                    
     ? AS 38.05.123: Local manufacture sales of high value-                                                                     
     added wood products                                                                                                        
MR.  DABNEY  moved  on  to slide  5,  "Inadequate  Authority  for                                                               
Negotiated Sales,"  which read  as follows  [original punctuation                                                               
      ? Current statutes focus on in-state timber use, and                                                                      
     prohibit negotiated sales for export.                                                                                      
      ? As Alaska's timber market shifts to Asia, industry                                                                      
      needs flexibility and long-term negotiated sales for                                                                      
1:11:58 PM                                                                                                                    
REPRESENTATIVE  RAUSCHER asked  if  any of  the current  statutes                                                               
cover  in-state  personal use  such  as  firewood for  heating  a                                                               
MR.  DABNEY  answered  that  personal use  is  not  addressed  in                                                               
current statute, nor is it included in the proposed legislation.                                                                
MR.  DABNEY  continued his  presentation  with  slide 6,  "Action                                                               
Needed:  Negotiated  Sales,"  which  read  as  follows  [original                                                               
punctuation provided]:                                                                                                          
        ? Consolidate authority for both small and large                                                                        
     negotiated sales into two statutes.                                                                                        
     ? Delete requirement that negotiated sales can only be                                                                     
     for local manufacture.                                                                                                     
      Result: Flexibility in resource development to meet                                                                       
     economic needs; simpler statutes.                                                                                          
1:13:31 PM                                                                                                                    
REPRESENTATIVE HANNAN  asked if the proposed  change would ensure                                                               
any protection for  Alaska buyers.  She talked about  the need to                                                               
protect Alaskan manufacturers  with value-added processing having                                                               
the first  chance to  buy local  timber, instead  of a  small in-                                                               
state business  having to compete  with a large  foreign national                                                               
buyer for the same timber harvest.                                                                                              
MR.  DABNEY  said that  the  commissioner  would be  required  to                                                               
consider  the  local  timber  market to  ensure  that  the  local                                                               
industry and jobs are protected.                                                                                                
MR. DABNEY  continued his  presentation with  slide 7,  "Issue 2.                                                               
Forest  Land   Use  Plans,"  which  read   as  follows  [original                                                               
punctuation provided]:                                                                                                          
     Steps in a Timber Sale                                                                                                     
     Public and agency comment gathered at each step.                                                                           
     1. Regional Planning: Area Plans & State Forest Plans                                                                      
     2. Five-Year Schedule of Timber Sales                                                                                      
     3. Best Interest Finding (BIF)*                                                                                            
     4. Forest Land Use Plans (FLUP)*                                                                                           
     *Subject to appeal.                                                                                                        
MR.  DABNEY moved  on  to  slide 8,  "BIF  vs.  FLUP: What's  the                                                               
difference?,"  which   read  as  follows   [original  punctuation                                                               
     Best Interest Finding                                                                                                      
     Decisional document:                                                                                                       
     ?Should we sell this timber?                                                                                               
     Forest Land Use Plan                                                                                                       
     Implements BIF on the ground:                                                                                              
     ? How should we sell this timber?                                                                                          
MR.  DABNEY explained  further  with  slide 9,  "What  is a  Best                                                               
Interest  Finding  (BIF)?,"  which   read  as  follows  [original                                                               
punctuation provided]:                                                                                                          
      The BIF is the decisional document that ensures the                                                                       
     sale will serve the State's best interest.                                                                                 
       Division of Forestry (DOF) must adopt a final BIF                                                                        
     before selling timber (AS 38.05.035(e)).                                                                                   
MR. DABNEY moved on to  slide 10, "Best Interest Finding:," which                                                               
read as follows [original punctuation provided]:                                                                                
     ? Establishes overall sale area                                                                                            
       ? Determines amount of timber sold and duration of                                                                       
     ? Sets harvest and reforestation strategy                                                                                  
     ? Ensures  sale proposal complies with  sustained yield                                                                    
     ?   Selects   sale   method   (i.e.,   competitive   or                                                                    
     ? Determines  appraisal method  used to  determine sale                                                                    
1:18:19 PM                                                                                                                    
MR. DABNEY continued the presentation with slides 11 and 12,                                                                    
"What are Forest Land Use Plans (FLUPs)?," which read as follows                                                                
[original punctuation provided]:                                                                                                
     ? FLUPs  present detailed information on  the location,                                                                    
     access,   harvest  methods,   duration,  and   proposed                                                                    
     reforestation for each sale.                                                                                               
     ? DOF  must prepare a  Forest Land Use Plan  (FLUP) for                                                                    
     timber sales over 10 acres before harvest can begin.                                                                       
     ?  FLUPs  follow  multiple   use  and  sustained  yield                                                                    
     principles, and consider  non-timber uses and resources                                                                    
     within the sale area.                                                                                                      
        FLUPs  are  subject  to public  comment  and  agency                                                                    
     ? FLUPs may now be  reviewed either during or after the                                                                    
     Best Interest Finding process.                                                                                             
MR. DABNEY continued to slide 13, "Forest Resources and                                                                         
Practices Act," which read as follows [original punctuation                                                                     
     The Alaska  Forest Resources  and Practices  Act (FRPA,                                                                    
     AS 41.17) governs  timber harvesting, reforestation and                                                                    
     access on state, private, and municipal land.                                                                              
     FRPA  protects  fish  habitat and  water  quality,  and                                                                    
     ensures  prompt  reforestation  while providing  for  a                                                                    
     healthy timber industry.                                                                                                   
MR. DABNEY moved onto slide 14, "FLUPs & Appeals," which read as                                                                
follows [original punctuation provided]:                                                                                        
     DOF may sometimes  issue a BIF and award  a timber sale                                                                    
     before all FLUPs for the sale area are completed.                                                                          
     The  BIF and  FLUPs now  can be  appealed at  different                                                                    
     times.  This   delays  the  sale,   interrupts  harvest                                                                    
     operations, and creates uncertainty.                                                                                       
MR.  DABNEY presented  slide  15, "Baby  Brown  Sales; Phase  1,"                                                               
which  he  described as  an  example  of  how the  best  interest                                                               
finding (BIF) and  forest land use plans (FLUPs)  can be appealed                                                               
at different times;  slide 15 illustrated the  BIF appeals, which                                                               
were  denied, and  the contract  was  awarded.   Slide 16,  "Baby                                                               
Brown Sales; Phase  2," showed the same map  area but illustrated                                                               
the   FLUPs,  which   were  appealed,   and   the  contract   was                                                               
subsequently cancelled.                                                                                                         
1:22:27 PM                                                                                                                    
MR. DABNEY  continued to  slide 17,  "A sale  can be  appealed at                                                               
both  BIF  and FLUP  stages,"  which  read as  follows  [original                                                               
punctuation provided]:                                                                                                          
       ? Timber buyers value the steady supply offered by                                                                       
     large, long-term sales.                                                                                                    
     ? DOF cannot easily prepare all required FLUPs before                                                                      
     offering the entire sale.                                                                                                  
     ? DOF prepares 2-3 FLUPs, then more as harvest allows                                                                      
     access to further units.                                                                                                   
       ? Redundant FLUP appeals can interrupt harvest of                                                                        
        long-term sales, even if they repeat objections                                                                         
     addressed in the already adopted BIF.                                                                                      
1:23:02 PM                                                                                                                    
CHAIR PATKOTAK asked about the  process for public engagement and                                                               
whether  there  is  any commissioned  body  involved  within  the                                                               
timber industry for oversight.                                                                                                  
MR. DABNEY replied that he didn't know.                                                                                         
1:24:20 PM                                                                                                                    
REPRESENTATIVE  HOPKINS referred  to slide  7, which  listed four                                                               
steps in a timber sale  and asked whether, under current statute,                                                               
steps one and two are appealable.                                                                                               
MR.  DABNEY  responded  that  those  steps  are  not  appealable,                                                               
although public comment and review is encouraged.                                                                               
REPRESENTATIVE HOPKINS  followed up  to ask if  his understanding                                                               
of a  FLUP is  correct, in  that it  restricts practices  such as                                                               
MR. DABNEY defined  FLUPs as the plan that covers  all of harvest                                                               
activities in the timber sale contract.                                                                                         
REPRESENTATIVE   HOPKINS   asked    for   confirmation   on   his                                                               
understanding that  a timber sale  contract would be  required to                                                               
be in compliance with the FLUP.                                                                                                 
1:27:47 PM                                                                                                                    
MR. DABNEY noted that there is  a Board of Forestry, which serves                                                               
to ensure statutory compliance.                                                                                                 
CHAIR  PATKOTAK asked  Mr. Dabney  to detail  where the  Board of                                                               
Forestry  would be  involved within  the four  steps of  a timber                                                               
sale, as described on slide 7.                                                                                                  
MR. DABNEY said  that the Board of Forestry  meets quarterly and,                                                               
while it's not  directly involved in the steps of  a timber sale,                                                               
it does provide regular oversight.                                                                                              
1:29:01 PM                                                                                                                    
1:29:08 PM                                                                                                                      
MR.  DABNEY  resumed his  PowerPoint  presentation  on slide  18,                                                               
"Example:  Baby  Brown Sale"  which  concluded  that the  appeals                                                               
process highlighted in  slides 16 and 17  forced the cancellation                                                               
of this  large, long-term timber  sale, resulting in  a five-year                                                               
1:29:48 PM                                                                                                                    
CHAIR  PATKOTAK asked  for further  clarification on  the appeals                                                               
process, describing  it as "nimble  enough for  industry growth,"                                                               
yet with  accountability measures  in place.   He also  asked why                                                               
exactly the timber sale was cancelled.                                                                                          
MR.  DABNEY   explained  that   the  FLUP   appeal  was   to  the                                                               
commissioner, who decided to cancel  the sale due to a procedural                                                               
error made by the Division of Forestry.                                                                                         
CHAIR PATKOTAK asked  whether the statute changes  proposed in HB
98 would address a similar situation.                                                                                           
MR.  DABNEY  answered that  this  statute  would "alleviate  that                                                               
particular procedural error."                                                                                                   
1:32:42 PM                                                                                                                    
REPRESENTATIVE  CRONK asked  for examples  of what  BIF and  FLUP                                                               
appeals would be, and who originated them.                                                                                      
MR.  DABNEY said  that  appeals had  been  made by  environmental                                                               
organizations  due  to  the  perceived  negative  impact  on  the                                                               
1:33:53 PM                                                                                                                    
REPRESENTATIVE  HANNAN asked  Mr. Dabney  to explain  the process                                                               
for public notice in the BIF and FLUP portions of the sale.                                                                     
MR. DABNEY said  that the first opportunity is  the public notice                                                               
of upcoming sales in the  five-year schedule of timber sales, and                                                               
after  that the  BIF and  FLUP  plans are  public documents  with                                                               
opportunity  for review  and comment.    He noted  that it's  not                                                               
unusual for a public comment made  at the FLUP stage to result in                                                               
a modification of the sale.                                                                                                     
1:36:47 PM                                                                                                                    
REPRESENTATIVE   HOPKINS  referred   to   Mr.  Dabney's   earlier                                                               
description  of  a  procedural  error made  by  the  Division  of                                                               
Forestry that cancelled a sale.                                                                                                 
MR. DABNEY clarified that, prior  to awarding the sale, there was                                                               
an error made by the Division of Forestry in the documents.                                                                     
REPRESENTATIVE HOPKINS asked for confirmation  that it was not an                                                               
appeal by an  outside entity that cancelled the  sale, but rather                                                               
an error in the Division of Forestry.                                                                                           
MR. DABNEY, over the course  of several subsequent exchanges with                                                               
Representative  Hopkins,  explained  that   the  appeal  was  for                                                               
multiple reasons including this specific procedural error.                                                                      
REPRESENTATIVE  HOPKINS noted  that  the initial  offer for  this                                                               
particular sale was in 2016; he  then asked when exactly the sale                                                               
was cancelled,  and also asked  how many other timber  sales have                                                               
been denied due to appeal by outside entity.                                                                                    
MR. DABNEY  said that the  2016 sale  was cancelled in  2017, and                                                               
that he is not aware of  any other sales that have been cancelled                                                               
as the result of appeals.                                                                                                       
REPRESENTATIVE  HOPKINS  asked  for confirmation  that,  had  the                                                               
Division  of Forestry  not made  the procedural  error, the  sale                                                               
would have been fulfilled.                                                                                                      
MR. DABNEY replied that he does not know.                                                                                       
1:40:54 PM                                                                                                                    
1:40:46 PM                                                                                                                      
MR. DABNEY  returned to his  presentation with slide  19, "Action                                                               
Needed:  FLUPs,"  which  read as  follows  [original  punctuation                                                               
     ? Refocus appeal process at BIF stage                                                                                      
     ? Retain public opportunity to appeal                                                                                      
     ? Avoid redundant FLUP appeals                                                                                             
     Results:   More  predictable   timber  harvests;   more                                                                    
     efficient forestry  planning; no  appeal interruptions,                                                                    
     continued    robust   public    process   and    agency                                                                    
MR.  DABNEY  noted  that  it's  difficult  for  the  Division  of                                                               
Forestry  to get  the  FLUPs done  in advance  of  the BIF,  it's                                                               
preferable to have long-term sales to alleviate that pressure.                                                                  
1:42:35 PM                                                                                                                    
1:42:24 PM                                                                                                                      
REPRESENTATIVE  MCKAY asked  how many,  as a  percentage, of  the                                                               
timber sales get appealed.                                                                                                      
MR. DABNEY answered that there have  been six of seven appeals at                                                               
either the  BIF or FLUP  stage, from multiple appellants,  all of                                                               
which have  been for  sales in  Southeast Alaska.   He  said that                                                               
even  if an  appeal  is  denied, it  slows  down  the process  of                                                               
getting timber to the market.                                                                                                   
1:44:25 PM                                                                                                                    
1:44:21 PM                                                                                                                      
REPRESENTATIVE   SCHRAGE  asked   about   the  appeals   process,                                                               
specifically how it works and how long the process takes.                                                                       
MR. DABNEY answered that the  appeal first goes to the "decision-                                                               
maker," which in this case would  be the Director of the Division                                                               
of  Forestry;   the  appeal   can  then   be  escalated   to  the                                                               
Commissioner of the Department of  Natural Resources, referred to                                                               
as a "request  for reconsideration."  The  process takes anywhere                                                               
from several months to two years.                                                                                               
1:46:00 PM                                                                                                                    
REPRESENTATIVE  HOPKINS,  returning   to  Representative  McKay's                                                               
question,  asked about  the percentage  of applications  that are                                                               
appealed and  the size  (out of  small, medium  or large)  of the                                                               
MR.  DABNEY responded  that  of  the six  appeals  he's aware  of                                                               
during the  last 10 years,  all were  in Southeast Alaska  and he                                                               
said that  the appeals  constituted more than  50 percent  of the                                                               
large timber sales in that area.                                                                                                
REPRESENTATIVE HOPKINS asked about the size of the sales.                                                                       
MR. DABNEY  answered that  he believes that  the sales  were "not                                                               
less than 500,000 board feet."                                                                                                  
1:48:04 PM                                                                                                                    
1:47:57 PM                                                                                                                      
REPRESENTATIVE HANNAN asked,  of those six or  seven appeals, how                                                               
many were for the same plot of timber.                                                                                          
MR. DABNEY said that each appeal was for a unique timber sale.                                                                  
1:49:16 PM                                                                                                                    
1:48:03 PM                                                                                                                      
MR. DABNEY resumed  his presentation with slides 20  and 21, "Why                                                               
is   HB  98   important?",  which   read  as   follows  [original                                                               
punctuation provided]:                                                                                                          
     Streamlines timber sale process                                                                                            
     ? Efficient forestry planning                                                                                              
     ? Retains public & agency participation                                                                                    
      Provides more certainty for businesses and the jobs                                                                       
     they support                                                                                                               
     ? Predictable timber harvests                                                                                              
     ? No appeal interruptions                                                                                                  
     Increases flexibility to meet market demands                                                                               
     ? Supports export market (allows negotiated round-log                                                                      
     ? Protects local markets (retains negotiated sales for                                                                     
     local manufacture)                                                                                                         
1:50:29 PM                                                                                                                    
REPRESENTATIVE CRONK  noted that slide  21 is  a log yard  in Tok                                                               
and that it's  a local employer, and he spoke  about the benefits                                                               
of long-term sales and continuity of harvest.                                                                                   
MR.  DABNEY thanked  Representative  Cronk for  his comments  and                                                               
noted how the proposed legislation would be beneficial.                                                                         
REPRESENTATIVE CRONK  followed up  to speak  about the  amount of                                                               
fire protection that happens in and  around Tok and how that work                                                               
is  good for  the economy,  and he  emphasized the  importance of                                                               
ensuring local loggers have the  protection they need in order to                                                               
continue that work.                                                                                                             
MR.  DABNEY  noted that  the  bill  would  be beneficial  to  the                                                               
development  of fuel  breaks.   After a  brief exchange  with the                                                               
committee in which they acknowledged  availability to go more in-                                                               
depth  on the  benefits of  HB  98 at  a later  date, Mr.  Dabney                                                               
resumed his  presentation on slide  22, "Why is HB  98 important?                                                               
(cont'd),"   which   read   as  follows   [original   punctuation                                                               
     Modernizes statutes                                                                                                        
       ? Consolidates and simplifies confusing negotiated                                                                       
     sales law                                                                                                                  
     Saves money 22                                                                                                             
     ? Zero fiscal note                                                                                                         
1:55:58 PM                                                                                                                    
1:55:50 PM                                                                                                                      
REPRESENTATIVE HANNAN asked whether  this bill would cover Alaska                                                               
Mental  Health  Trust  Authority  (AMHTA)  and/or  University  of                                                               
Alaska (UA) land sales.                                                                                                         
MR.  DABNEY  said that  the  proposed  statute change  would  not                                                               
change anything  about the way  AMHTA operates its  timber sales;                                                               
he then deferred to Christopher Orman for additional comment.                                                                   
1:57:11 PM                                                                                                                    
CHRISTOPHER ORMAN, Assistant  Attorney General, Natural Resources                                                               
Section, Civil  Division (Juneau),  Department of Law,  said that                                                               
AMHTA is  a unique operation  in that  it adopts its  own policy,                                                               
regulations,  and principles.   He  said  the trust  has its  own                                                               
policies regarding  land and timber  disposals, so  this proposed                                                               
legislation would not change that operation.                                                                                    
REPRESENTATIVE  HANNAN asked  to  follow up  regarding the  Brown                                                               
Baby  sale to  get clarification  on  whether this  type of  sale                                                               
would include timber on AMHTA land.                                                                                             
MR. ORMAN  confirmed that,  while he  isn't familiar  enough with                                                               
the specific sale  being discussed to be able to  speak to it, HB
98 would not change the way AMHTA disposes of timber or land.                                                                   
2:00:58 PM                                                                                                                    
2:00:49 PM                                                                                                                      
MR. DABNEY spoke  about AMHTA and UA lands  working together with                                                               
the local forester on timber sales.                                                                                             
2:02:59 PM                                                                                                                    
MR.  DABNEY  resumed the  presentation  with  slides 24  and  25,                                                               
showing the  Sectional Analysis, which read  as follows [original                                                               
punctuation provided]:                                                                                                          
     Section 1                                                                                                                  
     Amends AS 38.05.035(e)(6)(A) to maintain the exemption                                                                     
     of sales of 500,000 board feet of timber or less from                                                                      
     a written best interest finding (BIF) requirement.                                                                         
     Section 2                                                                                                                  
        Adds specific criteria the DNR commissioner must                                                                        
      consider when deciding whether to offer a negotiated                                                                      
     timber sale:                                                                                                               
     ? best interests of the state                                                                                              
     ? local timber market                                                                                                      
        ? specialized or developing foreign or domestic                                                                         
     ? presence of underutilized timber                                                                                         
     ? economic constraints of the intended timber market                                                                       
     ? other benefits to the state and local economy                                                                            
2:05:43 PM                                                                                                                    
CHAIR  PATKOTAK asked  Mr.  Dabney to  talk  about the  specified                                                               
number of 500,000 board feet.                                                                                                   
MR. DABNEY deferred to Mr. Orman.                                                                                               
2:06:54 PM                                                                                                                    
MR.  ORMAN  responded  that  the   size  of  the  timber  harvest                                                               
correlates  with  the  statutes  listed  on  slide  four  of  the                                                               
presentation;  HB  98  would  create  different  negotiated  sale                                                               
provisions.  The proposed legislation  is an effort to streamline                                                               
the scale of timber sales.                                                                                                      
CHAIR PATKOTAK expressed his understanding.                                                                                     
2:08:57 PM                                                                                                                    
2:08:50 PM                                                                                                                      
REPRESENTATIVE HANNAN  asked for clarification on  the difference                                                               
between small, medium, and large  sales vs. board feet; less than                                                               
500,000 board feet is a small  sale, but a larger sale might have                                                               
to  do more  with the  term of  the contract  than the  amount of                                                               
MR. DABNEY  said that there is  no real definition of  a "medium"                                                               
or  "large" sale,  but that  the term  of the  contract could  be                                                               
substituted for board feet, so sales  with terms of three to four                                                               
years  could feasibly  be considered  "medium", while  a contract                                                               
for 10-25 years could be considered "large."                                                                                    
2:10:15 PM                                                                                                                    
2:10:09 PM                                                                                                                      
MR. DABNEY  resumed his presentation  on slide 26, which  read as                                                               
follows [original punctuation provided]:                                                                                        
     Section 3                                                                                                                  
     ? Expands from 10 acres to 20 acres the size of timber                                                                     
     sales exempt from the need for a FLUP.                                                                                     
     ? Requires a FLUP to be adopted before harvest.                                                                            
     ? Allows a single FLUP to authorize timber harvest for                                                                     
     multiple harvest units in a timber sale contract.                                                                          
      ? Allows DNR to award a timber sale contract before                                                                       
     adopting a FLUP.                                                                                                           
2:11:05 PM                                                                                                                    
2:10:59 PM                                                                                                                      
REPRESENTATIVE HOPKINS  asked Mr. Dabney to  reconcile the bullet                                                               
points  on slide  26  that  say a  FLUP  must  be adopted  before                                                               
harvest,  but  DNR  may  award  a  timber  sale  contract  before                                                               
adopting a FLUP.                                                                                                                
MR. DABNEY explained that the  Division of Forestry would award a                                                               
timber  sale contract  based  on  the BIF,  but  timber can't  be                                                               
harvested from the individual units  until the FLUP for that unit                                                               
has been adopted.                                                                                                               
REPRESENTATIVE HOPKINS referred  to the map on slide  25 and used                                                               
it to rephrase his question.                                                                                                    
MR. DABNEY responded that one  of the advantages of this proposed                                                               
legislation is  that some units  can be harvested while  the FLUP                                                               
is being processed for other units.                                                                                             
REPRESENTATIVE HOPKINS asked if, in the  case of an appeal on the                                                               
harvest of  one of the units,  the entire sale stops  or only the                                                               
parts which contains that discrete unit.                                                                                        
2:16:22 PM                                                                                                                    
MR. DABNEY  answered that it  would affect only  those particular                                                               
harvest units subject  to appeal, rather than  the whole contract                                                               
REPRESENTATIVE HOPKINS asked whether  that practice is in current                                                               
statute, or is the proposed statute under HB 98.                                                                                
MR. DABNEY said that under HB  98 the significant change would be                                                               
that  there would  be no  delays associated  with appeals  to the                                                               
2:18:21 PM                                                                                                                    
2:18:18 PM                                                                                                                      
REPRESENTATIVE HANNAN  referred to  the measurement of  volume of                                                               
board  feet in  deciding whether  the sale  is small,  medium, or                                                               
large.   She  noted that  slide 25  changed the  measurement from                                                               
board feet to  acres, and noted that different plots  of land can                                                               
provide different  amounts of  board feet even  if the  plots are                                                               
the same size.                                                                                                                  
MR. DABNEY explained  that Section 3 is  acreage-based, so volume                                                               
is not a consideration in this section.                                                                                         
REPRESENTATIVE  HANNAN  asked  Mr.  Dabney  to  explain  why  the                                                               
measurement switched from board feet-based to acreage-based.                                                                    
MR. DABNEY  said that  for the  most part,  the "small"  sales in                                                               
terms of acreage are for local manufacturers.                                                                                   
2:21:01 PM                                                                                                                    
2:20:52 PM                                                                                                                      
CHAIR PATKOTAK asked  whether the proposed change  in language in                                                               
HB  98,   from  using  measurements   in  board  feet   to  using                                                               
measurements in acres, would change when a FLUP is in effect.                                                                   
MR.  DABNEY  said  that  there  would  be  no  change  in  volume                                                               
requirements in HB  98; volume comes into play  because this bill                                                               
would change the statutes, allowing negotiated timber sales.                                                                    
2:22:30 PM                                                                                                                    
MR. DABNEY resumed his presentation  with slide 27, which read as                                                               
follows [original punctuation provided]                                                                                         
     Sections 4-6                                                                                                               
      Section 4  Removes individual's power to appeal FLUP                                                                      
     decision to the DNR commissioner.                                                                                          
       Section 5     Combines small negotiated sales with                                                                       
        Section 6      Eliminates requirements for local                                                                        
     manufacture of wood for negotiated sales.                                                                                  
2:23:26 PM                                                                                                                    
2:23:19 PM                                                                                                                      
CHAIR PATKOTAK asked for clarification  on Section 4, noting that                                                               
it  "has a  negative  connotation" when  discussing "removing  an                                                               
individual's power."                                                                                                            
MR. DABNEY  said that the FLUP  process would be more  focused at                                                               
the  BIF   stage,  adding  any  additional   points  to  consider                                                               
including public involvement and comment.                                                                                       
CHAIR PATKOTAK  said that his  understanding was that  this would                                                               
focus the power of individuals to  appeal in a previous step, but                                                               
would negate the power to appeal later in the process.                                                                          
2:25:16 PM                                                                                                                    
2:25:08 PM                                                                                                                      
REPRESENTATIVE  SCHRAGE asked  whether  an entity  other than  an                                                               
individual would be able to appeal at the FLUP stage.                                                                           
MR. DABNEY clarified that the  terms "individual" and "group" are                                                               
2:25:58 PM                                                                                                                    
CHAIR PATKOTAK mused aloud that there  is a lot of work that must                                                               
be done  by the  Division of  Forestry in  between each  of these                                                               
steps,  and  that it's  preferable  that  an appeal  which  could                                                               
hinder or  cancel the work  happen earlier in the  process before                                                               
much more work has been done.                                                                                                   
MR.  DABNEY  agreed  with  that  statement  and  said  that  this                                                               
provision in  HB 98 would  remove the risk of  subsequent appeals                                                               
impacting the timber sale.                                                                                                      
2:27:31 PM                                                                                                                    
2:27:26 PM                                                                                                                      
REPRESENTATIVE  HOPKINS described  a hypothetical  scenario of  a                                                               
long-term timber  sale going right up  to the edge of  the Tanana                                                               
Valley  State Forest.   He  speculated  that even  if the  forest                                                               
management plan  specified that there  must be a  500-foot buffer                                                               
from the  edge of  the state  forest, if a  person applies  for a                                                               
timber harvest  to go  [past the  buffer] all the  way up  to the                                                               
edge of  the state forest,  nobody would  be able to  appeal that                                                               
decision and that timber harvest.                                                                                               
MR. DABNEY answered that the BIF  finding stage under HB 98 would                                                               
be aware  of this  restriction, and the  FLUP would  be prepared.                                                               
There  would  also be  public  comment  allowed  and all  of  the                                                               
entities   involved   could  work   together   to   come  to   an                                                               
REPRESENTATIVE HOPKINS clarified that  he should have said "under                                                               
the FLUP it would not be appealable."                                                                                           
MR. DABNEY replied that in  that case, the forest management plan                                                               
for the Tanana Valley State Forest  would already be in place and                                                               
would not be appealable.                                                                                                        
REPRESENTATIVE  HOPKINS  asked  whether  the BIF  would  have  to                                                               
appeal to the forest management plan.                                                                                           
MR.  DABNEY said  that  the  BIF has  to  be  compliant with  the                                                               
management plan, but can still be appealed.                                                                                     
REPRESENTATIVE  HOPKINS asked  for clarification  again that  the                                                               
BIF  would be  required  to comply  with  the already-set  forest                                                               
management plan, but the FLUP would not.                                                                                        
2:32:43 PM                                                                                                                    
CHAIR  PATKOTAK interjected  and talked  about the  steps of  the                                                               
contract and asked whether one  could change the plan between the                                                               
BIF  and the  FLUP; he  referred  to the  forest management  plan                                                               
"having teeth"  at the BIF stage  but not at the  FLUP stage, and                                                               
whether something that  was filtered out in stage  three could be                                                               
re-added in stage four.                                                                                                         
MR.  DABNEY  explained that  the  forest  management plan  itself                                                               
provides a general  plan for the area.   The BIF "hones  in" on a                                                               
small portion  of the  area to  determine whether  or not  a sale                                                               
should  happen, and  the  FLUP determines  how  to implement  the                                                               
2:35:00 PM                                                                                                                    
REPRESENTATIVE  SCHRAGE   referred  to  an  earlier   mention  of                                                               
duplicate appeals and asked whether  Mr. Dabney was talking about                                                               
appeals at  the FLUP stage as  well as the BIF  stage, or appeals                                                               
by multiple entities at one or more  of the stages.  He said that                                                               
he understands  that the  issue of duplicate  appeals was  one of                                                               
the reasons for justifying the changes proposed in HB 98.                                                                       
MR. DABNEY  answered that  typically the appeals  are at  the BIF                                                               
stage, and  those can be  either single  or multiple entity.   He                                                               
said that  in one  case, there  was a repeat  appeal at  the FLUP                                                               
REPRESENTATIVE  SCHRAGE  noted  that  it  seems  that  this  bill                                                               
wouldn't  eliminate the  issue  of multiple  appeals  at the  BIF                                                               
stage, but  it would  remedy the issue  of having  a dissatisfied                                                               
entity appeal at the BIF stage,  be denied, and then appeal again                                                               
at the FLUP stage.                                                                                                              
MR. DABNEY confirmed that HB 98  would focus the attention of the                                                               
public and  avoid redundant appeals,  which are typical  in these                                                               
contracts; currently,  if an appellant  isn't satisfied  with the                                                               
result of  their initial  appeal, he said,  they appeal  at every                                                               
REPRESENTATIVE SCHRAGE  said that he understands  that some FLUPs                                                               
are prepared while others are  still in progress (for other units                                                               
in the same contract), and he  asked whether, if all of the FLUPs                                                               
were ready  at the same time  as the BIF, there  is anything that                                                               
would  prevent an  entity from  appealing on  both levels  at the                                                               
same time.                                                                                                                      
MR. DABNEY explained that if all  of the FLUPs were included with                                                               
the  BIFs for  the  sale, then  there would  be  just one  appeal                                                               
possible,  which  would  need  to  cover  all  of  the  documents                                                               
involved in the FLUPs and the BIF.                                                                                              
REPRESENTATIVE  SCHRAGE  asked what  the  limiting  factor is  on                                                               
having the  FLUPs ready for  every unit  at the same  time rather                                                               
than some prepared later in the process.                                                                                        
MR. DABNEY answered that a  large timber sale would have multiple                                                               
harvest  units, and  it's very  difficult for  the staff  to have                                                               
access to each  unit to be able to prepare  multiple FLUPs at the                                                               
same  time; he  said that  they have  in the  past had  to use  a                                                               
helicopter to access  the units.  He said that  if it's a 25-year                                                               
timber  sale  with  dozens  of   harvest  units,  it's  just  not                                                               
practical to  assess each unit  prior to  the contract.   He said                                                               
the industry  would suffer  under the  process, and  the industry                                                               
prefers to  have FLUPs adopted  as the timber  harvest progresses                                                               
across  the  landscape  and creates  better  and  more  efficient                                                               
2:42:00 PM                                                                                                                    
CHAIR  PATKOTAK mentioned  that he  was planning  on gaveling  in                                                               
public testimony, and that the bill  was noticed, but there is no                                                               
public testimony waiting.                                                                                                       
He then asked  Mr. Dabney to confirm his  understanding that "the                                                               
FLUP is  going to maintain compliance  with the BIF, and  the BIF                                                               
is  going  to  maintain  compliance  with  the  overall  [forest]                                                               
management plan."                                                                                                               
MR. DABNEY  said that  he believes the  question was  whether the                                                               
FLUP "would take teeth out  of the [forest] management plan," and                                                               
he said the answer to the question is no.                                                                                       
CHAIR  PATKOTAK  restated his  understanding  and  said that  the                                                               
purpose  of HB  98  would  be to  strike  a  balance between  the                                                               
public's  opinion   and  the  opportunity  for   industry  to  be                                                               
undertaking these projects.                                                                                                     
MR. DABNEY  said that  the purpose is  to refocus  the decisional                                                               
process at the BIF stage  in order to increase the considerations                                                               
at that stage.                                                                                                                  
2:44:38 PM                                                                                                                    
2:44:29 PM                                                                                                                      
REPRESENTATIVE  HANNAN referred  to slide  7 and  the ability  to                                                               
reconsider  a long-term  contract, addressing  the potential  for                                                               
Alaskans to lose the ability to  develop their own business.  She                                                               
opined  that [it  is  one  thing] to  streamline  a process,  but                                                               
another "to streamline and prevent  anyone else from having a say                                                               
in it for the next 25 years."                                                                                                   
MR.  DABNEY spoke  about  the  BIF stage  and  the importance  of                                                               
striking a balance  between local and export  markets; instead of                                                               
"locking up  an entire forest  for export," local  market changes                                                               
would be considered.                                                                                                            
2:48:03 PM                                                                                                                    
2:47:56 PM                                                                                                                      
REPRESENTATIVE  HANNAN  referred  to   the  shifting  culture  of                                                               
timber, and "who's warring with who  over the use of what trees."                                                               
She said  that it's  difficult to  anticipate what  could develop                                                               
over a  25-year contract.   She said  that it would  be difficult                                                               
for a  small, local  manufacturer to know  its timber  needs over                                                               
the  next  25   years,  and  used  the  hypothetical   of  a  Tok                                                               
manufacturer whose timber  was eliminated in a  forest fire, with                                                               
the only other timber nearby already under contract for export.                                                                 
MR. DABNEY replied  that he understands and  shares that concern,                                                               
but that through this proposed  legislation, the consideration of                                                               
a  25-year contract  would  stipulate an  amount  of surety  that                                                               
Alaska has  enough forest to meet  all of the needs,  rather than                                                               
tying up all of the available timber.                                                                                           
2:51:40 PM                                                                                                                    
REPRESENTATIVE SCHRAGE  asked whether  the state could  limit the                                                               
duration or time period of the appeals at various levels.                                                                       
MR. DABNEY said that he doesn't  have a good answer for that, but                                                               
that  as   far  as  appeals   go,  HB  98  would   "minimize  any                                                               
opportunities for a second bite of the apple."                                                                                  
2:54:46 PM                                                                                                                    
MR.  DABNEY followed  up with  the concern  about 25-year  timber                                                               
sales, and  said that the  term of 10 years  is more likely.   He                                                               
then resumed  the PowerPoint presentation  with slide 28  and 29,                                                               
which read as follows [original punctuation provided]:                                                                          
     Sections 7-8                                                                                                               
     Section   7       Consolidates  all   negotiated   sale                                                                    
     Section  8    Allows  one  large  timber sale  (500,000                                                                    
     board feet)/purchaser/year.                                                                                                
     Sections 9-13                                                                                                              
     Section 9    Allows timber  sales to be  negotiated for                                                                    
     local  manufacture of  both  high-value-added and  low-                                                                    
     value-added wood products.                                                                                                 
     Section  10      Deletes  requirement  that  negotiated                                                                    
     timber sales  must include contract terms  limiting the                                                                    
     sale  to   the  amount   of  timber   the  commissioner                                                                    
     determines  to  be the  maximum  amount  that could  be                                                                    
     commercially practical to harvest.                                                                                         
     Section  11    Clarifies  negotiated  timber sales  for                                                                    
     personal use.                                                                                                              
     Section 12    Consolidates negotiated sale authorities.                                                                    
     Section 13  Establishes an immediate effective date.                                                                       
2:57:42 PM                                                                                                                    
CHAIR PATKOTAK opened public testimony on HB 98.                                                                                
2:58:14 PM                                                                                                                    
Deputy  Commissioner   Goodrum  said  that  he   appreciated  the                                                               
opportunity to share HB 98 with the committee.                                                                                  
2:58:33 PM                                                                                                                    
CHAIR PATKOTAK, after ascertaining that no one was waiting to                                                                   
testify, closed public testimony on HB 98.                                                                                      
3:00:18 PM                                                                                                                    
There being no further business before the committee, the House                                                                 
Resources Standing Committee meeting was adjourned at 3:00 p.m.                                                                 

Document Name Date/Time Subjects
HB 98 Sponsor Statement 2.11.2021.pdf HRES 3/12/2021 1:00:00 PM
HRES 4/14/2021 1:00:00 PM
HB 98
HB 98 Sectional Analysis Version A 2.23.2021.pdf HRES 3/12/2021 1:00:00 PM
HRES 4/14/2021 1:00:00 PM
HB 98
HB 98 Support DNR Timber Sales Briefing Paper 2.11.2021.pdf HRES 3/12/2021 1:00:00 PM
HRES 4/14/2021 1:00:00 PM
HB 98
HB 98 Presentation to HRES 3.12.2021.pdf HRES 3/12/2021 1:00:00 PM
HRES 4/14/2021 1:00:00 PM
HB 98
HB 98 Letter of Support Northland Wood Products 3.12.2021.pdf HRES 3/12/2021 1:00:00 PM
HRES 4/14/2021 1:00:00 PM
HB 98