Legislature(1995 - 1996)
04/19/1995 08:10 AM House RES
| Audio | Topic |
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE RESOURCES STANDING COMMITTEE
April 19, 1995
8:10 a.m.
MEMBERS PRESENT
Representative Joe Green, Co-Chairman
Representative Bill Williams, Co-Chairman
Representative Scott Ogan, Vice Chairman
Representative Alan Austerman
Representative Pete Kott
Representative Irene Nicholia
MEMBERS ABSENT
Representative Ramona Barnes
Representative John Davies
Representative Eileen MacLean
COMMITTEE CALENDAR
Presentation on Major Mining Projects
*HB 256: "An Act authorizing the commissioner of fish and game
to establish free sport fishing days."
HEARD AND HELD
(* First Public Hearing)
WITNESS REGISTER
JERRY BOOTH, Vice President
Energy & Minerals
Cook Inlet Region, Inc.
2525 C Street
Anchorage, AK 99503
POSITION STATEMENT: Introduced Presenters
BILL JEFFERS, Chief of Environmental Services
Fairbanks Gold Mining Company
Fairbanks, AK
POSITION STATEMENT: Gave briefing on the Fort Knox Mine
CHARLOTTE MACCAY, Manager
Environmental Affairs
Cominco-Alaska/Red Dog Mine
P.O. Box 1230
Kotzebue, AK 99752
Phone: 426-9143
POSITION STATEMENT: Gave briefing on the Red Dog Mine
TOM CRAFFORD, Manager
Minerals and Coal
Cook Inlet Region, Inc.
2525 C Street
Anchorage, AK 99503
POSITION STATEMENT: Gave briefing on Wishbone Hill project
PAUL VALENTI, Vice President
USMX
Denver, CO
Phone: (303) 985-4665
POSITION STATEMENT: Gave briefing on Illinois Creek Mine
STEVE BORELL, Executive Director
Alaska Miners Association
501 W. Northern Lights
Anchorage, AK 99503
Phone: 276-0347
POSITION STATEMENT: Made general comments on the mining industry
BRUCE CAMPBELL, Administrative Assistant
Representative Pete Kelly
Alaska State Legislature
State Capitol, Room 513
Juneau, AK 99801
Phone: 465-2327
POSITION STATEMENT: Prime Sponsor HB 256
JOHN BURKE, Acting Director
Sport Fish Division
Alaska Department of Fish and Game
P.O. Box 25526
Juneau, AK 99802
Phone: 465-4180
POSITION STATEMENT: Supported HB 256 and answered questions
regarding HB 256
PREVIOUS ACTION
BILL: HB 256
SHORT TITLE: FREE SPORT FISHING DAYS
SPONSOR(S): REPRESENTATIVE(S) KELLY,Austerman
JRN-DATE JRN-PG ACTION
03/15/95 742 (H) READ THE FIRST TIME - REFERRAL(S)
03/15/95 742 (H) FISHERIES, RESOURCES, FINANCE
03/29/95 (H) FSH AT 05:00 PM CAPITOL 124
04/05/95 (H) FSH AT 05:00 PM CAPITOL 124
04/05/95 (H) MINUTE(FSH)
04/07/95 1172 (H) FSH RPT 3DP 2NR
04/07/95 1172 (H) DP: G.DAVIS, OGAN, AUSTERMAN
04/07/95 1172 (H) NR: ELTON, MOSES
04/07/95 1172 (H) ZERO FISCAL NOTE (F&G)
04/07/95 1172 (H) REFERRED TO RESOURCES
04/19/95 (H) RES AT 08:00 AM CAPITOL 124
ACTION NARRATIVE
TAPE 95-51, SIDE A
Number 000
The House Resources Committee was called to order by Co-Chairman
Green at 8:10 a.m. Members present at the call to order were
Representatives Green, Williams, Ogan, Austerman, and Kott.
Members absent were Representatives Barnes, Davies, MacLean, and
Nicholia.
PRESENTATION ON MAJOR MINING PROJECTS
JERRY BOOTH, VICE PRESIDENT, ENERGY & MINERALS, COOK INLET REGION
INC. (CIRI), stated four different people will present an overview
to give the committee a scope of what is happening in the mining
industry in Alaska.
Number 058
BILL JEFFERS, CHIEF OF ENVIRONMENTAL SERVICES, FAIRBANKS GOLD
MINING COMPANY (FGMC), said the FGMC will do the operating for the
Fort Knox Project. He stated the company just received all the
necessary permits and the project is under construction. He
explained the project is located entirely on state and private
land, covering an area of approximately 7,600 acres. The project
will process about 36,000 metric tons through a mill, with an equal
amount of waste that will be mined every day. Initially, the mine
will produce between 300,000 and 350,000 ounces. The mine life is
estimated at approximately 12 and one-half years, although there is
potential for more.
MR. JEFFERS said the FGMC went through a process the state had set
up called project team. The team comprised of people from
different agencies involved with permitting. He stated the project
team method was very productive to permit a mine and his company
would highly recommend the method for other projects involving
state land. He noted one suggestion he would make is that people
who are appointed to the project team on the state side should be
familiar with mining and permitting processes. The Fort Knox
project permitting process was a three year process.
MR. JEFFERS stated approximately 150 people are working on the
project currently and by mid-summer there will be 500 people
employed. Actual production will begin October 1996 and at that
time, there will be approximately 250 permanent employees.
Number 113
REPRESENTATIVE ALAN AUSTERMAN asked what the normal process time is
for completing the permitting.
MR. JEFFERS stated as a comparison, AMAX Gold purchased a project
in South America approximately three months after the Fort Knox
project was purchased. He said that project has the same
engineering design criteria as Fort Knox but that project has been
in production since November 1993. The Fort Knox project will not
begin production until October 1996. He noted as an American
project, the Fort Knox project has been considered by many to be
fast-tracked. He observed it gives everyone an idea how the
bureaucracy has a choke-hold on resource development in the U.S.
CO-CHAIRMAN JOE GREEN asked if there was a comparison which could
be made to another American project.
MR. JEFFERS replied there are a couple of projects in Nevada which
have been in the permitting process for four or five years.
REPRESENTATIVE AUSTERMAN asked Mr. Jeffers to explain the team
process again.
MR. JEFFERS responded the project team comprised of people from the
Alaska Department of Fish and Game (ADF&G), the Department of
Natural Resources (DNR), and the Department of Environmental
Conservation (DEC).
REPRESENTATIVE AUSTERMAN wondered if the project team helped speed
up the process.
MR. JEFFERS replied it did. He said the team did a thorough
review, covering all the questions and contingencies needing to be
addressed. He stated having a group so clearly focused expedited
the entire process.
Number 174
CO-CHAIRMAN GREEN noted the Fort Knox project has all its permits
in place. He wondered why it was going to take 18 months for the
project to go into production.
MR. JEFFERS responded the project is very large. He stated the
mine will average 36,000 tons per day but will actually have the
capacity to do 50,000 tons per day. He said the size of the
project and the construction time needed due to Arctic conditions
will require 18 months to complete construction.
CO-CHAIRMAN GREEN said it is exciting to see the project going
forward.
CO-CHAIRMAN GREEN noted for the record that Representative NICHOLIA
had joined the committee.
Number 208
CHARLOTTE MACCAY, MANAGER, ENVIRONMENTAL AFFAIRS, COMINCO-
ALASKA/RED DOG MINE, stated the Red Dog mine currently employs 350
people, with 51 percent being shareholders from the NANA Regional
Corporation. The mine is processing between 6,000 and 7,000 tons
of ore which produces approximately 1,700 tons of concentrate per
day. She said at present prices, the mine is still not a
profitable endeavor. She noted the price of zinc did go up but now
is back down again. She told committee members Cominco did expand
to put more concentrate through which is bringing the company
closer to the break even point. She pointed out that when prices
do rise, the company should do much better. She noted the world
stockpiles of zinc metal are decreasing, so prices subsequently
should be going up.
MS. MACCAY noted although the Red Dog mine was on a similar
schedule as the Fort Knox project back when things were easier, the
Red Dog is still encountering permitting problems at the federal
level. She has been in the renewal process on a permit for six
years. There are some state issues associated with that permit
dealing with the state criteria for total dissolved solids, which
strongly affect the mine's ability to discharge water. She has
been working with the DEC for over three years trying to resolve
the issue and a strategy is in place, even though it will take
another year or two before an actual working solution will be in
place, which will allow the mine to discharge the amount of water
accumulated behind the tailings dam. To deal with that, Cominco
had a tailings dam that was to be built over 30 years. However,
all stages had to be built within five years to keep storing the
water they were not allowed to discharge. She stated there
continues to be a permitting problem both at the state and federal
levels and permits can take many years to obtain.
MS. MACCAY said the Red Dog mine is doing well and has a 30-35 year
life expectancy.
CO-CHAIRMAN GREEN wondered which government is contributing the
most problems.
MS. MACCAY replied the worst problems are coming from the
Environmental Protection Agency (EPA) and the second slowest has
been the DEC. She noted that ADF&G has been the most helpful. She
said the Habitat Division has been the driving force, pushing the
DEC and EPA with positive, constructive information.
CO-CHAIRMAN GREEN wondered if the holdups involve delays in getting
the permit or delays in something which a company is required to do
in order to get the permit.
MS. MACCAY replied both kinds of delays are involved. She noted
the permit she referred to earlier sat for a couple of years, as
the EPA wanted an environmental assessment, which was done. After
that was done, the permit writer started to research the project.
She said in regard to state issues with the mixing zone, a better
response is received from the northern office than the Juneau
office. She noted the Juneau office is reluctant to move on
reclassification of stream issues.
Number 293
REPRESENTATIVE AUSTERMAN wondered if the high percentage of hires
from the regional corporation is normal.
MS. MACCAY stated Cominco is in partnership with the NANA Regional
Corporation, who is the landowner for the mine. Part of the
agreement is to work toward Native shareholder hire, eventually
hoping to reach 100 percent. She noted the current 51 percent is
much better than most places.
REPRESENTATIVE AUSTERMAN asked how long the mine has been in
operation.
MS. MACCAY replied the mine has been operating for five years.
REPRESENTATIVE AUSTERMAN clarified the goal is to increase the
Native shareholder hire to 100 percent.
MS. MACCAY said the original goal was to be at 100 percent in about
12 years. She stated there are some positions where there does not
seem to be any shareholders looking into the type of education
needed to fulfill them, so those positions might be difficult to
fill. She noted there is also a turnover issue, as a Native
shareholder stays on an average about one and one-half years. She
pointed out in many cases, they do come back.
CO-CHAIRMAN GREEN asked if Cominco trains its own people or does
the company go to where the talent exists.
MS. MACCAY replied it depends on the position. She said many
positions involve training people on site, others have been trained
at training centers in the region, and some involve hiring people
already having the experience. She stated entry level positions
are Native shareholder positions and those people are trained.
CO-CHAIRMAN GREEN clarified there are certain positions requiring
finite expertise. He wondered if Cominco has to go outside the
state to find people for those positions or is local hire involved.
MS. MACCAY said the hire preference is Native shareholders, then
in-state and finally out-of-state.
Number 342
TOM CRAFFORD, MANAGER, MINERALS AND COAL, CIRI, stated CIRI is one
of the Native regional corporations established under the Alaska
Native Claims Settlement Act (ANCSA). He said there are seven
villages, five groups and one historical village within CIRI.
Although chartered under standard Alaskan business corporation
laws, CIRI is significantly different in that it has 6,700 Native
shareholders and many of the corporation's activities go beyond the
standard business practices in providing various types of benefits
for shareholders. He noted CIRI is the fifth largest of the Alaska
regional corporations, in terms of population.
MR. CRAFFORD stated CIRI's principle lines of business include
natural resource development, real estate in the Lower 48 and
Alaska, broadcast communications in the Lower 48 and oil field
services. CIRI owns and manages 524,000 acres of surface estate
and over 1.6 million acres of subsurface estate. He said within
its natural resources group, CIRI has a mining subsidiary, North
Pacific Mining Corporation (NPMC), which is active in a variety of
mineral projects throughout the state.
MR. CRAFFORD said CIRI's mineral holdings within the state include
the Illinois Creek gold and silver deposit, which is located near
Galena, Alaska. He stated in addition to Illinois Creek, CIRI has
the Johnson River occurrence on the west side of Cook Inlet, which
is a gold, copper, and zinc occurrence. CIRI also has the Red
Mountain Chrome occurrence near Seldovia. He noted that recent
interest has been shown for not only the chrome, but also for the
mineral olivine. CIRI is a 10 percent owner in the Beluga Coal
Company, which has extensive coal holdings at Beluga on the west
side of Cook Inlet.
MR. CRAFFORD stated for some time CIRI has been owner of a small
portion of lands included in the Wishbone Hill coal project being
conducted by Idemitsu Alaska, Inc. He said on April 3, 1995, CIRI
signed a letter of intent with Idemitsu to acquire all the assets
of the Wishbone Hill coal project. He explained the Wishbone Hill
coal project was originally slated for development in 1990. The
project has a small to modest reserve of approximately 14 million
metric tons of recoverable clean coal. He pointed out the Wishbone
Hill coal has the advantage of being very low in sulphur content
and has an additional advantage over other Alaskan coals of having
a higher heating value. He explained Wishbone Hill coals contain
about 11,700 BTUs per pound of coal as opposed to an average of
8,100 BTUs per pound for the Beluga and Healy coals.
MR. CRAFFORD said the development of the Wishbone Hill coal
project, which was originally slated to go into development in
1990, was delayed in large part to the Mental Health Trust lands
dispute. He noted the project was on hold for four years and in
1994, Idemitsu made the strategic decision to sell the project.
CIRI's plans for the project at this point are not well formulated.
He stated CIRI determined that first and foremost, all the work
Idemitsu had done on the Wishbone Hill project needed to be
preserved. He pointed out that Idemitsu has eight coal and various
surface leases and all their permits are in place required to
initiate development on the project, the most important of which is
the federal permit to mine under the Surface Mining Control and
Reclamation Act.
MR. CRAFFORD told committee members if Idemitsu had walked from the
project without anyone taking over the project, that permit would
have lapsed, as would have some of the other permits in place, and
the project would have gone back to square one. He added much of
the potential for the 180 jobs the project could produce would have
disappeared or been delayed for many years. He stated Idemitsu has
over $12 million invested in the Wishbone Hill coal project.
Number 440
MR. CRAFFORD said with recent developments on the international
coal markets, it is widely anticipated that coal prices will rise
substantially this year, perhaps three to four dollars per metric
ton. He stressed things are moving in the right direction to
foster development of the project. He noted that CIRI itself does
not intend to be the operator of the project. However, CIRI has
extensive mining experience and connections with mining
corporations and will be looking for means to partner with other
companies in the development of the project. CIRI hopes to see the
Wishbone Hill coal project in production in the very near future.
CO-CHAIRMAN GREEN asked if the projected four dollar increase per
metric ton is for the quality type coal Mr. Crafford was referring
to or coal across the board.
MR. CRAFFORD replied that projection is for international steam
coal prices in general. He noted coal is a very different market
than other commodities--futures are not traded in coal because each
coal is different from every other coal. He said that projection
is in the general range for steam coals.
CO-CHAIRMAN GREEN recalled Mr. Crafford had mentioned a 3,000 BTU
per pound higher heating value in Wishbone Hill coal. He asked if
that coal also involves low sulphur.
MR. CRAFFORD said the coal has a somewhat higher sulphur content
than the Healy or Beluga coals but to make a comparison, one has to
calculate what the sulphur content is per BTU. He stated the Healy
and Beluga coals are about 25 percent water, which is why the
heating value is so much less.
Number 476
REPRESENTATIVE SCOTT OGAN stated he was excited that CIRI had made
a commitment to the Wishbone Hill project. He noted an area of
great controversy is the coal car train set which received a
capital allocation to the Alaska Railroad. He asked if it would be
prudent to retain the money where it is now and also asked if there
is an international market for this coal requiring the use of the
train set.
MR. CRAFFORD replied one of the logical, if not the most logical,
markets for the coal would be the Asian Pacific Rim economies which
are seeing rapidly increasing demands for electrical power and
clean coal. He thought the anticipated market for the Wishbone
Hill coal would be a foreign market and rail haulage would be
required to get the coal to that market. Therefore, the retention
of the appropriation for the train set could only help the
prospects for development of the Wishbone Hill project.
REPRESENTATIVE OGAN questioned if the Wishbone Hill project looks
like such a good deal, why did the Japanese firm sell.
MR. CRAFFORD stated he could not speak to Idemitsu's reasons for
getting out of the project at this time. He speculated Idemitsu
waited four years and after spending that much time waiting, a sour
attitude may have been developed, particularly in a foreign
country.
CO-CHAIRMAN GREEN said in World War II there was a lot made of the
fact that the oriental mind set was a long-range plan which was
never deviated from. He noted the Mental Health Trust land
uncertainty and the sudden change in the potential price of coal
may have been things not in Idemitsu's decision making.
MR. CRAFFORD stated the decision to get out of the project was made
approximately one year ago. He reiterated that CIRI has a letter
of intent with Idemitsu and hopes to conclude a sales agreement by
June.
REPRESENTATIVE OGAN said he was very encouraged by CIRI's plans.
He told Mr. Crafford if there is anything he can do to help to let
him know.
Number 534
PAUL VALENTI, VICE PRESIDENT OF OPERATIONS, USMX, said the Illinois
Creek property is located in west central Alaska. The property is
approximately 320 miles northwest of Anchorage, about the same
distance west of Fairbanks, and 25 miles east of the Yukon River.
He told committee members the property is on state leased land.
There are two parcels totaling approximately 62,000 acres that are
wholly owned by North Pacific Mining Company, a subsidiary of CIRI.
He explained USMX will be the operator of the property.
MR. VALENTI stated USMX has developed five open pit gold heap leach
operations since 1987 in the Lower 48 and feels well qualified to
undertake the challenges of Illinois Creek. He said the Illinois
Creek property was discovered in 1980 by Anaconda who explored the
property for five years and then withdrew from the minerals
business. The property was subsequently explored by Goldmore North
Pacific Mining Company and Echo Bay Mining. USMX got started on
the property in August 1994. He noted Anaconda spent a lot of
money providing infrastructure to the property, developing living
facilities for exploration personnel and a large airstrip to handle
big aircraft. He stressed that infrastructure has enabled
subsequent developers to explore the property very efficiently.
MR. VALENTI said as a result of the drilling and engineering done
in more recent times, USMX has developed a reserve of approximately
4.5 million tons of ore containing 300,000 ounces of gold and
(indiscernible) ounces of silver. He exhibited photographs showing
the deposit and a map indicating the engineering plan for the
development of facilities for the property. The deposit will be
mined over a five year period and the mining will be conducted on
a seasonal basis--six months out of the year--using conventional
open pit methods. He stated gold and silver will be recovered by
the heap leach process. Ore will be transported from the pit to
the heap leach pad. The heap will be built behind an engineered
dam. The pad will be doubly synthetic lined over compacted sub-
base. Gold will be recovered by (indiscernible) sprinklings dilute
sodium cyanide solution which will percolate through the rock, be
collected behind the dam above the synthetic liner and pumped to a
recovery plant for extracting the gold and silver.
MR. VALENTI stated the wastes will be stored and ultimately
reclaimed adjacent to the pit itself. He said USMX is going
through the engineering process currently and is placing special
emphasis on designing both mining and processing facilities so
there will be no impact or detriment to ground water surface water
quality. He noted the (indiscernible) operations will outlast
mining by two or three years. USMX will need that period of time
to continue to recover gold and silver from the heaps and will need
additional time to rinse out the ore and detoxify the solution so
the facility can be closed in a proper manner. He explained USMX
will be reclaiming the mine concurrently as they operate. He added
that in 1992, USMX received an award from the state of Nevada for
reclamation efforts at its Green Spring Mine and will receive
another award from the state of Utah for reclamation work done at
its Gold Strike Mine in Southwest Utah.
Number 607
MR. VALENTI told committee members the Illinois Creek project will
employ approximately 100 people. Many of the jobs will be seasonal
since mining will only occur during the six month summer season.
USMX will attempt to process throughout the year and plans to
employ 30-40 people during the winter months. He stated last week,
a group representing USMX toured villages along the river and held
six public meetings in three days. The attendance at the meetings
was good and people expressed interest in the jobs which will be
available to them.
MR. VALENTI said USMX is currently going through the permit process
and like Fairbanks Gold, USMX is also using a project agency team
to facilitate the permitting process. The team is being led by the
DNR. USMX hopes to achieve its permits in approximately one year.
He stated if that is possible and if certain logistical issues can
be resolved with transporting equipment to the site, production may
begin by 1996.
CO-CHAIRMAN GREEN asked if USMX will be flying the equipment in and
flying the gold and silver out rather than trying to connect by a
road system.
MR. VALENTI replied USMX is currently reviewing two alternatives
for transporting big equipment to the site. The preferred
situation would be to fly everything in but there is difficulty in
fitting some of the equipment into a C-130. USMX is looking at the
possibility of using a larger aircraft. He said the other
alternative is to transport equipment up and down the Yukon River
by barge to a landing site and bring things into the mining site by
winter trail.
CO-CHAIRMAN GREEN asked what USMX uses to detoxify the wastes.
MR. VALENTI responded when USMX is finished rinsing the heaps,
peroxide will be used to destroy the cyanide.
Number 638
REPRESENTATIVE AUSTERMAN (indiscernible).
MR. VALENTI said after the heap is rinsed out, USMX will recontour,
cover it with topsoil, and revegetate.
REPRESENTATIVE AUSTERMAN clarified a big pit will remain.
MR. VALENTI replied there would be a big pit remaining. He said
the pit is approximately 5,000 feet long by 500 feet wide. He
reiterated the wastes will be stockpiled as mining is ongoing.
REPRESENTATIVE AUSTERMAN asked if the pit could be revegetated.
MR. VALENTI stated USMX will revegetate the wastes, reclaim all of
the roads, and revegetate the roads but there is nothing which can
be done with the pit except ensure there is no water remaining.
Number 660
STEVE BORELL, EXECUTIVE DIRECTOR, ALASKA MINERS ASSOCIATION, said
much of the encouragement and excitement the mining industry has
been given came from three bills that have gone through the
committee. He stated this is the most exciting time for the
minerals industry seen since the early part of the century. He
noted many companies are re-looking at Alaska. In addition to the
projects just described, another project in Representative
Nicholia's district is being constructed currently. It will be a
small high grade underground gold mine.
TAPE 95-51, SIDE B
Number 000
MR. BORELL stated in the Fairbanks district this winter there was
some drilling going on in the cold weather and it is hopeful that
will convince companies they can also explore during the winter
months. He noted another bill, HB 197, will not make or break a
project but provides one more encouragement for mineral companies.
He said there still is a major perception throughout the industry
that Alaska is a bad place to do business and Alaska is all federal
land. He pointed out that trying to convince the industry...the
experience of Idemitsu Kosan, with the Wishbone Hill project, was
a bad piece of press for Alaska.
MR. BORELL passed out an article on the success of airborne
geophysical mapping (may be found in the House Resources Committee
Room, Capitol Room 124, and after adjournment of the second session
of the Nineteenth Alaska State Legislature, in the Legislative
Reference Library). He pointed out as of March 8, 1995, a total of
80.81 square miles of mining claims and upland prospecting sites
were staked in the Fairbanks mining district. He said the
excitement that has caused is quite incredible. He noted the cost
of the Fairbanks airborne geophysical work was $365,000 and more
than that has already been spent by industry, staking claims and
doing some initial drilling. He added one important aspect is that
this has been close to the infrastructure, whereas some of the
others had not been and companies, especially the Fairbanks
district...they have watched the Fort Knox go into construction...a
lot of things are happening in a positive way to encourage the
industry.
Number 102
MR. BORELL showed photos of gold mined last year. One of the
pictures showed a 41 ounce gold nugget mined in 1994 on Nolan
Creek. He stated placer mining continues to be adversely affected
by regulations. He felt the influx of major companies and the
strength they will bring to resource issues is a real positive. He
noted the Governor's budget has only $100,000 budgeted for airborne
geophysical mapping. He said because of the amount of money it
takes to mobilize for the program, a minimum of $600,000 to
$700,000 is needed. He stressed if $100,000 is the final number,
the Division of Geological and Geophysical Surveys will have to
hold the project until next year.
MR. BORELL noted several additional areas have been identified for
mapping, including nine different areas throughout the Mat-Su
borough. He stressed there are many targets in the state that are
very prospective and meet the criteria of being near the
infrastructure. He stated the mining opportunities in the state
are great. He felt there is a lot more that mining can do for the
economy of the state than what is being seen currently.
Number 164
REPRESENTATIVE IRENE NICHOLIA asked where Eureka pit is located.
MR. BORELL stated Eureka pit is the name of the pit at Nolan Creek,
which is right outside Coldfoot.
REPRESENTATIVE NICHOLIA questioned what the industry's relationship
is with the Division of Habitat.
MR. BORELL stated many experiences have been very positive and
noted there are very high quality professionals in the Fairbanks
office, which is not necessarily indicative of the entire habitat
division. He stressed the people in the Fairbanks office should
remain because all of the placer permits have to be evaluated for
Title 16. He noted ADF&G has veto power if any anadromous fish
stream is to be affected. The problem the industry has seen with
the habitat division is historically there has been a reaching for
additional power and an attempt to take authority away from land
managers and the DNR, which has manifested itself in the area
plans. He gave examples.
Number 222
REPRESENTATIVE NICHOLIA asked if the Fairbanks office is closed,
will the closing have a detrimental impact on mining.
MR. BORELL responded it would. He said what is left open or what
is closed is a management decision of the Administration. He would
very much encourage them not to close the Fairbanks office. He
felt there were other places and positions that could be
eliminated.
CO-CHAIRMAN GREEN thanked everyone for the presentation. He said
the information the committee heard was quite encouraging. He felt
perhaps the industry is gaining a little confidence in Alaska's
government and he hoped there was something the legislature could
do to further strengthen that confidence.
REPRESENTATIVE OGAN stated he is very excited about possible
exploration in his district because there is a lot of potential
there. He said he is equally excited about the fact that many
rural areas are beginning to experience economic development.
HB 256 - FREE SPORT FISHING DAYS
Number 262
BRUCE CAMPBELL, ADMINISTRATIVE ASSISTANT TO REPRESENTATIVE PETE
KELLY, PRIME SPONSOR, said HB 256 allows the commissioner of ADF&G
to select one or two days on which an individual can go fishing
without being required to have a fishing license or tag. He stated
HB 256 means that someone could, in conjunction with Fishing Is Fun
Days or other promotional activities for fishing, take the kids
along and the adult would not have to have a license. This would
provide the opportunity to determine if the kids enjoy fishing. He
noted HB 256 is supported by a number of sport fishing groups
around the state. He urged the committee's support for HB 256.
REPRESENTATIVE PETE KOTT felt there should be a substantial fiscal
note attached because revenue will be lost. He noted there is a
zero fiscal note attached.
Number 299
JOHN BURKE, ACTING DIRECTOR, SPORT FISH DIVISION, ADF&G, said the
department supports HB 256. He stated free fishing days offer
people, who do not ordinarily fish, the opportunity to experience
fishing without having to buy a license. He noted a free fishing
day, in conjunction with National Fishing Week activities or winter
fishing carnivals, can bring people into recreational fishing. He
explained free fishing days are used as a centerpiece for the
department's aquatic education activities, which the department
sponsors in schools.
MR. BURKE stressed education depends a lot on motivation. Fishing
for many children in Alaska is a tremendous motivator. He felt any
type of educational activity built around something kids like, they
do well at. He said the department uses fishing as a motivator to
teach people conservation, angling ethics, and sometimes spin-off
activities such as sciences and math.
MR. BURKE said there may be some initial loss of license or king
salmon stamp sales but ultimately sales will be on the plus side.
Over the long term, there will be more recreation fishers and at
that point, there will be more license sales. He stated the only
possible negative aspect of HB 256 is if the free fishing day(s)
turned into a king salmon derby during the height of king salmon
season where people would not fish any other day except for the one
free day. He felt that would not happen.
MR. BURKE showed an aquatic education handbook developed by the
department which gets distributed in schools. He said the
department also runs a pathways to fishing clinic often at the same
time. Mentors are distributed around stations and people pass
through the stations with about ten minutes per station. People
are taught how to fish, how to tie knots, shown where the fish may
be, etc. He showed the committee several textbooks used in the
school systems. He also described several educational tools used.
He showed several pictures of family fishing days which are
presently held throughout the state.
Number 392
REPRESENTATIVE KOTT recalled Mr. Burke mentioned that having free
fishing days would bring families together and provide an outing at
no cost. He thought children do not currently pay for licenses.
MR. BURKE said that is correct. Children get a free license.
REPRESENTATIVE KOTT felt one of the problems with having a free
fishing day for parents who do not ordinarily fish is that those
people may not be familiar with regulations or habitat and could do
more damage than good. He asked when the department is proposing
to provide these days of free fishing.
MR. BURKE replied National Fishing Week occurs every year and large
celebrations are held throughout the state. He said the free
fishing day(s) would occur during National Fishing Week as a
centerpiece for those activities. He stated the activities are
largely for children but the department has found through the
pathways to fishing program, many people going through the program
have never fished before.
REPRESENTATIVE KOTT said his question is when specifically would
the department plan to provide the free fishing days. He asked
would the days be together or would there be two separate days.
MR. BURKE replied the free fishing days would be at the discretion
of the commissioner. He said National Fishing Week is in June. He
was not sure about the time for a winter free fishing day. He felt
the department would probably try to promote some unified day
enabling people to become acquainted with winter fishing. He
stressed HB 256 does not mandate any free fishing days.
REPRESENTATIVE KOTT asked if there were other states who have
similar free fishing days.
MR. BURKE replied 44 states have free fishing days in conjunction
with National Fishing Week activities.
REPRESENTATIVE KOTT questioned why the state would want to provide
the opportunity of free fishing days to nonresidents.
MR. BURKE stated it would be impossible to enforce resident versus
nonresident.
Number 455
REPRESENTATIVE KOTT said in his fishing experience, he would guess
that 60 percent of the fishers are nonresidents and they usually
are the people violating some provision of law regarding fish and
game.
MR. BURKE stated it would be highly unlikely a nonresident, who
came to the state to fish, would fish on one day only. He felt one
free fishing day probably would not preclude nonresidents from
buying a license. He reiterated if there is abuse, HB 256 does not
mandate a free fishing day.
REPRESENTATIVE KOTT felt it would be very difficult to determine if
abuse was ongoing.
REPRESENTATIVE NICHOLIA asked what the impacts of free fishing days
would have on the Kenai River and the Copper River. She noted the
declining runs of king salmon on the Yukon River and the Tanana
River. She wondered if streams having low returns would be off
limits during the free fishing days.
MR. BURKE replied the streams with low returns would not be off
limits. He said he did not know what the impact of free fishing
days would be on the Kenai River. He stated free fishing days
would take place at best during the king salmon fishery, not during
the sockeye salmon fishery. He noted the king salmon fishery is
fairly well controlled, as in order to do it, a person has to have
a lot invested. He did not feel free fishing days would bring any
more people than the number there now, because people fishing on
the Kenai River now already have the gear required. He pointed out
in regard to the Yukon and Copper Rivers, those places are fairly
difficult to get to and he did not feel large groups of people
would go for one specific day of fishing. He did not think free
fishing days would affect those areas.
Number 510
REPRESENTATIVE NICHOLIA noted people are very concerned about
erosion on the banks of the Kenai River. She asked if HB 256 would
have an impact on that problem.
MR. BURKE replied no. He said the king salmon fishery takes place
almost totally from boats. The erosion on the banks is primarily
concerned with the intensive sockeye fishery occurring later in the
season than when the free fishing day would occur. He stressed it
is a matter of timing.
REPRESENTATIVE OGAN asked what the date is for National Fishing
Week.
MR. BURKE replied June 6-12.
REPRESENTATIVE OGAN expressed concern about the free fishing days
because in his area there is a big problem with king salmon. He
said the fishery is heavily fished by road access. He wondered if
the department is projecting a lot of fish being caught during the
free fishing days.
MR. BURKE stated someone who is clearly a king salmon fisherman
would be fishing anyway and have a tag. He said if the free
fishing day ended up being a derby day, the department would either
have to change the date and make the day earlier, or perhaps not
have the free fishing day at all. He pointed out he does not know
any king salmon fishermen who want to go fishing just once a year
but perhaps they might take their family on the free fishing day.
Number 550
CO-CHAIRMAN WILLIAMS noted there was no quorum present. He said
the state has a sport fishery which is very well advertised and
there are many problems with that fishery now.
MR. CAMPBELL stated the sponsor's goal is not to increase problems
but rather provide a mechanism for educating people about the
problems.
ADJOURNMENT
There being no further business to come before the House Resources
Committee, Co-Chairman Williams adjourned the meeting at 9:30 a.m.
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