Legislature(2019 - 2020)BARNES 124
03/06/2019 01:20 PM House RESOURCES
Note: the audio ![]()
and video ![]()
recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.
| Audio | Topic |
|---|---|
| Start | |
| Presentation(s): Outdoor Recreation in Alaska | |
| SJR7 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| += | SJR 7 | TELECONFERENCED | |
ALASKA STATE LEGISLATURE
HOUSE RESOURCES STANDING COMMITTEE
March 6, 2019
1:22 p.m.
MEMBERS PRESENT
Representative John Lincoln, Co-Chair
Representative Geran Tarr, Co-Chair
Representative Grier Hopkins, Vice Chair
Representative Sara Hannan
Representative Ivy Spohnholz
Representative Chris Tuck
Representative Dave Talerico
Representative George Rauscher
Representative Sara Rasmussen
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
PRESENTATION(S): OUTDOOR RECREATION IN ALASKA
- HEARD
SENATE JOINT RESOLUTION NO. 7
Requesting that the United States Department of the Interior
Bureau of Land Management implement an oil and gas leasing
program in the coastal plain of the Arctic National Wildlife
Refuge.
- HEARD & HELD
PREVIOUS COMMITTEE ACTION
BILL: SJR 7
SHORT TITLE: ENDORSING ANWR LEASING; RELATED ISSUES
SPONSOR(s): SENATOR(s) BIRCH
02/20/19 (S) READ THE FIRST TIME - REFERRALS
02/20/19 (S) RES
02/25/19 (S) RES AT 3:30 PM BUTROVICH 205
02/25/19 (S) Moved SJR 7 Out of Committee
02/25/19 (S) MINUTE(RES)
02/27/19 (S) RES RPT 5DP 1NR 1AM
02/27/19 (S) DP: BIRCH, GIESSEL, COGHILL, BISHOP,
REINBOLD
02/27/19 (S) NR: KIEHL
02/27/19 (S) AM: KAWASAKI
03/04/19 (S) TRANSMITTED TO (H)
03/04/19 (S) VERSION: SJR 7
03/04/19 (H) RES AT 1:00 PM BARNES 124
03/04/19 (H) <Bill Hearing Postponed to 3/6/19>
03/06/19 (H) RES AT 1:20 PM BARNES 124
WITNESS REGISTER
LEE HART, Founder
Confluence
Valdez, Alaska
POSITION STATEMENT: Testified during the presentation on the
economic impact of outdoor recreation.
NOLAN KLOUDA, Executive Director
Business Enterprise Institute
Center for Economic Development
University of Alaska Anchorage
Anchorage, Alaska
POSITION STATEMENT: Testified during the presentation on the
economic impact of outdoor recreation.
RHONDA COSTON, Borough Planner
City and Borough of Yakutat
Yakutat, Alaska
POSITION STATEMENT: Testified during the presentation on the
economic impact of outdoor recreation.
MICHELE STEVENS, President
Petersville Community Non-Profit Corp.
Petersville, Alaska
POSITION STATEMENT: Testified during the presentation on the
economic impact of outdoor recreation.
DAN KIRKWOOD, General Manager
Pack Creek Bear Tours
Juneau, Alaska
POSITION STATEMENT: Testified during the presentation on the
economic impact of outdoor recreation.
MIKE HOPPER, Owner
The Lodge at Black Rapids
The Alaska Range, Alaska
POSITION STATEMENT: Testified during the presentation on the
economic impact of outdoor recreation.
SENATOR CHRIS BIRCH
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Speaking as the prime sponsor, introduced
SJR 7.
TREVER FULTON, Staff
Senator Chris Birch
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: On behalf of Senator Birch, prime sponsor,
provided additional information on SJR 7.
FAITH MARTINEAU, Executive Director
Large Project Coordination
Office of Project Management and Permitting
Department of Natural Resources
Anchorage, Alaska
POSITION STATEMENT: Testified in support during the hearing of
SJR 7.
FENTON REXFORD
Kaktovik, Alaska
POSITION STATEMENT: Testified during the hearing of SJR 7.
D.J. FAUSKE, Director
Government and External Affairs
North Slope Borough
Utqiagvik, Alaska
POSITION STATEMENT: On behalf of Mayor Harry K. Brower Jr.,
North Slope Borough, testified in support during the hearing of
SJR 7.
TERESA IMM, Executive Vice President
Resource Regional Development
Arctic Slope Regional Corporation
Utqiagvik, Alaska
POSITION STATEMENT: Testified in support during the hearing of
SJR 7.
PETER NOLAN, Director
Member Services
Alaska Chamber
Anchorage, Alaska
POSITION STATEMENT: Testified in support during the hearing of
SJR 7.
K.K. DAVIS
Fairbanks, Alaska
POSITION STATEMENT: Testified in opposition during the hearing
of SJR 7.
BRAD SNOW
Fairbanks, Alaska
POSITION STATEMENT: Testified in opposition during the hearing
of SJR 7.
SYLVIA PANZARELLA
Anchorage, Alaska
POSITION STATEMENT: Speaking for herself and her husband,
testified in opposition during the hearing of SJR 7.
DAVE HARBOUR
Anchorage, Alaska
POSITION STATEMENT: Testified in support during the hearing of
SJR 7.
CARL PORTMAN, Deputy Director
Resource Development Council
Anchorage, Alaska
POSITION STATEMENT: Testified in support during the hearing of
SJR 7.
LIAM ZSOLT, Director of Technology
ASRC Energy Services
Anchorage, Alaska
POSITION STATEMENT: Testified in support during the hearing of
SJR 7.
EMILY SULLIVAN, Conservation Associate
Alaska Wilderness League
Anchorage, Alaska
POSITION STATEMENT: Testified in opposition during the hearing
of SJR 7,
LOIS EPSTEIN, Engineer; Director
Arctic Program
The Wilderness Society
Anchorage, Alaska
POSITION STATEMENT: Testified in opposition during the hearing
of SJR 7.
GLEN SOLOMON
Kaktovik, Alaska
POSITION STATEMENT: Testified in support during the hearing of
SJR 7.
MALLORY PRIMM
Homer, Alaska
POSITION STATEMENT: Testified in opposition during the hearing
of SJR 7.
ODIN MILLER
Fairbanks, Alaska
POSITION STATEMENT: Testified in opposition during the hearing
of SJR 7.
MICHAEL JESPERSON
Anchorage, Alaska
POSITION STATEMENT: Testified in support during the hearing of
SJR 7.
MATTHEW REXFORD, President
Kaktovik Inupiat Corporation
Kaktovik, Alaska
POSITION STATEMENT: Testified in support during the hearing of
SJR 7.
RYAN MARSH, Arctic Program Coordinator
Northern Alaska Environmental Center
Fairbanks, Alaska
POSITION STATEMENT: Testified in opposition during the hearing
of SJR 7.
RON YARNELL, Guide
Fairbanks, Alaska
POSITION STATEMENT: Testified in opposition during the hearing
of SJR 7.
LISA BARAFF
Fairbanks, Alaska
POSITION STATEMENT: Testified in opposition during the hearing
of SJR 7.
KARA MORIATY, President/CEO
Alaska Oil and Gas Association
Anchorage, Alaska
POSITION STATEMENT: Testified in support during the hearing of
SJR 7.
ACTION NARRATIVE
1:22:50 PM
CO-CHAIR GERAN TARR called the House Resources Standing
Committee meeting to order at 1:22 p.m. Representatives Tuck,
Hannan, Talerico, Spohnholz, Rauscher, Hopkins, and Tarr were
present at the call to order. Representatives Lincoln and
Rasmussen arrived as the meeting was in progress.
^PRESENTATION(S): OUTDOOR RECREATION IN ALASKA
PRESENTATION(S): OUTDOOR RECREATION IN ALASKA
1:23:27 PM
CO-CHAIR TARR announced the first order of business would be a
presentation on the economic impacts of outdoor recreation in
Alaska.
1:24:47 PM
LEE HART, Founder, Confluence, informed the committee she has
represented leading national and international brands in the
outdoor, ski, and adventure travel businesses for 20 years. She
provided a brief background of her experience marketing
adventure travel and said she was speaking for over 500
businesses and organizations in Alaska that hold a vested
interest in Alaska's outdoor recreation economy. Confluence is
a coalition of members of the outdoor industry who believe
outdoor recreation is a powerful economic sector. In September
[2018], the Bureau of Economic Analysis, U.S. Department of
Commerce (COMMERCE), reported $416 billion and 2.2 percent of
the gross domestic product (GDP) was garnered by the outdoor
industry economic sector. Also, the Department of Economic
Development, COMMERCE, and the University of Alaska (UA)
reported on unique products manufactured by Alaskan innovators.
In January [2019], the Alaska Public Health Association adopted
a resolution recognizing the benefits of outdoor recreation to
public health. Ms. Hart described a report provided by trail
organizations to show the value of outdoor recreation
infrastructure such as winter and summer trails and public use
cabins and hut systems. She pointed out every economic
development master plan in the state calls for greater outdoor
infrastructure development; in the past four years voters in the
Anchorage and Matanuska-Susitna (Mat-Su) areas voted in favor of
taxes to fund trail development. Further, benefits of outdoor
recreation help troubled youth and veterans recovering from
injuries of war. Since 2000, residents of Alaska seek access to
public land and waterways, and outdoor recreation is supported
at the federal level as evidenced by the passage of the Natural
Resources Management Act. Ms. Hart closed, noting her
organization has asked the governor to consider ways to provide
new infrastructure and business opportunities in partnership
with the state.
1:29:30 PM
NOLAN KLOUDA, Executive Director, Business Enterprise Institute,
Center for Economic Development, University of Alaska Anchorage
(UAA), informed the committee the Center for Economic
Development (Center), UAA, has been working with stakeholders
and in partnership with the Division of Economic Development,
Department of Commerce, Community & Economic Development, to
study how outdoor recreation contributes to the state's economy.
Although outdoor recreation is not always considered an
industry, outdoor recreation contributes $412 billion to the
U.S. GDP and is a growing economic sector. The Center sought to
determine how many jobs in Alaska are created by participation
in outdoor recreation activities - such as hunting, fishing,
hiking, and boating - and found $3.2 billion are added to the
state economy annually, and about 38,000 jobs are created, which
means about one out of every ten jobs is related to outdoor
recreation. He explained the study included activities by
visitors and residents, and noted Alaska residents exceed the
national average for participation in outdoor recreation.
Another important contribution made by outdoor recreation is to
the quality of life that attracts and keeps a talented
workforce. Mr. Klouda related the ability to hire talent is a
challenge for the Alaska business community; as reported by a
University of Alaska Fairbanks (UAF) survey, many residents came
to Alaska for opportunities for outdoor recreation [document not
provided]. In addition, a report by UAA showed products made or
designed in Alaska, such as 9:zero:7 fat tire bikes and Alpacka
Raft, are nationally and internationally known. He suggested
the state could represent Alaska-based companies and products as
a brand.
1:35:25 PM
RHONDA COSTON, Borough Planner, City and Borough of Yakutat,
said her field of study was outdoor recreation management and
she related her experience as a whitewater river guide and with
the U.S. Forest Service (USFS), U.S. Department of Agriculture,
the National Park Service, U.S. Department of the Interior, the
Alaska Department of Fish and Game, and others. Yakutat is a
fishing, surfing, and adventure outdoor recreation destination
and is the gateway community to the [United Nations Educational,
Scientific and Cultural Organization (UNESCO)] World Heritage
Site comprised of St. Elias National Park and Preserve, Glacier
Bay National Park and Preserve, Kluane National Park and
Reserve, and Tatshenshini-Alsek Provincial Wilderness Park, and
is surrounded by the Tongass National Forest. She said
recreational and improved visitor services create economic
opportunities for remote areas and improve the quality of life
and small business opportunities for residents. Ms. Coston
expressed the city and borough's goal to promote Yakutat as an
outdoor adventure destination; outdoor recreation opens future
opportunities for the community.
1:37:03 PM
MICHELE STEVENS, President, Petersville Community Non-Profit
Corp., asked for legislation to reinstate the Snowmobile Trails
Program, Division of Parks and Outdoor Recreation, DNR. The
program is funded through a self-imposed user tax - a snowmobile
registration fee - and is self-sustaining. The program is a
revenue-neutral program sought by, and funded by, registration
fees. The system of groomed trails assists first responders and
saves lives, promotes safety, stimulates the economy, and
creates winter jobs. She said she was representing 16 clubs, 20
businesses, 39 lodges, 15 dealers, 10 dog mushing races, 24
snowmobile events, and over 60,000 registered snowmobile owners.
1:38:36 PM
DAN KIRKWOOD, General Manager, Pack Creek Bear Tours, informed
the committee Pack Creek Bear Tours is a partnership between
Kootznoowoo, Inc., the corporation for the village of Angoon,
and Alaska Seaplanes. He is also co-chair of the Visitor
Products Cluster Working Group, Juneau Economic Council, which
is a working group that has convened since 2011 to encourage
cooperation between USFS and the visitor industry. Mr. Kirkwood
pointed out statistics for visitor recreation and the increase
in the number of visitors to Southeast Alaska: 1.3 million
cruise ship visitors and air traffic increased by 15 percent
between 2014-2017. Further, employment has increased by 12
percent and earnings have increased by 23 percent. He said
Alaska is a brand known worldwide for its recreational
opportunities on its public lands.
1:40:09 PM
MIKE HOPPER, Owner, The Lodge at Black Rapids, noted the
potential of the resources residents and visitors can enjoy. He
gave a personal story of a long hike in Alaska and said a
presentation [related to his business] is forthcoming.
1:41:18 PM
A video was shown from 1:41 p.m. to 1:44 p.m.
1:44:46 PM
CO-CHAIR TARR observed the outdoor industry presents an
opportunity for a sustainable source of state revenue.
SJR 7-ENDORSING ANWR LEASING; RELATED ISSUES
1:45:34 PM
CO-CHAIR TARR announced that the final order of business would
be SENATE JOINT RESOLUTION NO. 7, Requesting that the United
States Department of the Interior Bureau of Land Management
implement an oil and gas leasing program in the coastal plain of
the Arctic National Wildlife Refuge.
1:46:12 PM
SENATOR CHRIS BIRCH, Alaska State Legislature, reminded the
committee of the importance of the Arctic National Wildlife
Refuge (ANWR) to the future of the state and its economy from
the potential development of oil and natural gas that would
generate revenue, create thousands of jobs, and extend the life
of the Trans-Alaska Pipeline System (TAPS); recent congressional
action has created a path forward for responsible development in
ANWR. Senate Joint Resolution 7 urges the U.S. Department of
the Interior (DOI) to proceed with its leasing program for ANWR
and would serve as the [Alaska State Legislature's] comments on
the related draft environmental impact statement (EIS). Also,
SJR 7 does not choose from the action alternatives outlined in
the draft EIS - but allows the decision to be made by the
responsible agency - and points out responsible development
brings to Alaskans the benefits of jobs and revenue while
protecting the environment.
1:48:23 PM
TREVER FULTON, Staff, Senator Chris Birch, informed the
committee SJR 7 differs from previous versions in that with the
passage of the [Tax Cuts and Jobs Act of 2017], Congress
authorized an oil and gas leasing program for ANWR, thus the
resolution urges the Department of Interior (DOI) to facilitate
its leasing program. He pointed out DOI has the authority to
implement a leasing program but cannot enforce Alaska hire
provisions, how royalties are divided, or other actions related
to ANWR. Mr. Fulton explained the focus of the resolution
remains on the estimated 7.7 billion barrels of oil and 7
trillion cubic feet of natural gas that could be found in ANWR.
Also, SJR 7 highlights the potential benefits resource
development in ANWR means to Alaska and the U.S. in new
revenues, new jobs, additional TAPS throughput, strengthened
national security, a bolstered U.S. economy, and a source of
energy. However, in a manner similar to past versions, SJR 7
also highlights advancements in oil field technology, a record
of safe and responsible oil and gas development on the North
Slope (NS), a commitment to the protection of the Porcupine and
Central Arctic caribou herds, and support from Alaskans in
general and residents of NS. Finally, he restated the primary
goal of SJR 7: to serve as the Thirty-First Alaska State
Legislature's official comment on the DOI ANWR leasing program
draft EIS. Further, as the public comment period closes
3/13/19, timely passage of the resolution is of the essence.
1:51:54 PM
CO-CHAIR TARR opened invited testimony on SJR 7.
1:52:33 PM
FAITH MARTINEAU, Executive Director, Large Project Coordination,
Office of Project Management and Permitting, DNR, said she also
leads the state's participation as a cooperating agency in the
development of the EIS for an oil and gas leasing program in the
coastal plain [area of ANWR]. She expressed DNR's support for
SJR 7, which requests the Bureau of Land Management (BLM), DOI,
to implement an oil and gas leasing program in the coastal plain
of ANWR. Ms. Martineau advised the question of whether oil and
gas activities should occur in the non-wilderness portion of
ANWR was settled by the passage of the [Tax Cuts and Jobs Act of
2017]; however, the question remains on how such activities
should occur. The first step is the development of an EIS, and
divisions within DNR have participated in assessing the indirect
impacts of a leasing program and establishing the necessary
permitting process for future oil and gas activities. Other
cooperating state agencies include the Alaska Department of Fish
and Game, the Department of Environmental Conservation, the
Department of Health and Social Services, the Department of Law,
and the Alaska Oil and Gas Conservation Commission. Included in
the published draft EIS are implementation strategies related to
locations and lease stipulations. The state's collective
interest will be submitted by letter during the draft EIS
comment period; from DNR's perspective, BLM must elect an
alternative that would provide the maximum flexibility to future
decision-makers and that would enable them to rely on new data
and on existing local, state, and federal permitting processes
related to responsible development, production, and
transportation of oil and gas resources to and from the coastal
plain. Further, DNR has contacted organizations representing
resident stakeholders to identify areas of alignment and
partnership, and continues to discuss alternatives presented in
the draft EIS. Ms. Martineau opined SJR 7 would reinforce the
importance of responsible oil and gas development and she urged
for the "final resolution" to include a recommendation to
maximize flexibility for future decision-makers.
1:56:23 PM
FENTON REXFORD informed the committee he was born and raised in
Kaktovik, which is the only community within ANWR and is located
within the area [designated by section 1002 of the Alaska
National Interest Lands Conservation Act (ANILCA)] of the
coastal plain. He provided a short history of the people and
their relationship with their homeland over 11,000 years. In
1970, the government took over 23 million acres of Tribal land
and returned 92,000 acres around the village; however, the land
was part of the refuge and was "locked up, you couldn't use it."
He said residents were unable to access their Native allotment
and holdings, or use traditional subsistence and historic sites.
Today, there are restrictions on the use of their land, and some
outside groups want to increase restrictions on the land under
the illusion they are protecting the pristine original state of
the land; however, there are people who live in the [section
1002 area] who seek to coexist with responsible development and
to protect the indigenous lifestyle. Mr. Rexford said
development and preservation are not an "either/or argument"; in
fact, residents do not need to choose between long-held
traditions and economic security. Inupiat traditional culture
can evolve and adapt to the changing world; the opposing school
of thought is land grabbing in the name of the environment. The
Arctic is a vast area that includes challenges, and also
opportunities to benefit its residents. He expressed confidence
in the North Slope Borough's (NSB's) ability to protect the
natural wildlife and the environment from adverse impact,
especially if the local government can guard the caribou.
Responsible development in the coastal plain means the community
will have access to modern living conveniences and local
schools, health care facilities, public safety, and other
infrastructure.
2:02:56 PM
MR. REXFORD continued, noting children living on NS can now
attend high school at home. The Inupiat consider the resources
of the land to be the greatest gifts, and resources are found
below the ground, such as oil, and above, such as caribou and
berries. He urged for all parties to work together and meet the
common goal of opening ANWR. Mr. Rexford turned to the subject
of property taxation and stated his strong opposition to the
state's attempt to remove the local government's ability to levy
property tax; in fact, [NSB] seeks to continue its partnership
with the state, and he urged the legislature not to align with
the governor in this regard. He reminded the committee he has
been fighting for this issue for over 50 years; indigenous
people have had much taken from them and now there is hope and
opportunity for self-determination.
CO-CHAIR TARR expressed her belief false choices are given under
some circumstances; she assured Mr. Rexford essential
infrastructure such as water, wastewater treatment, and
education are responsibilities obligated by the state
constitution, even though the state may not have fulfilled its
responsibilities in rural communities.
2:07:18 PM
D.J. FAUSKE, Director, Government and External Affairs, NSB,
stated NSB's support of oil and gas activities on NS remains
contingent upon the circumstances that said activities provide
for and benefit NSB residents through the levy of property taxes
on oil and gas infrastructure. Taxation of property is the
inherent power of local government, and tax revenues fund the
borough so it may employ residents, provide crucial services,
and offset the impacts of development on residents, wildlife,
and the land. Turning to SJR 7, he said the [Tax Cuts and Jobs
Act of 2017], provides layers of protection for ANWR by limiting
the footprint of development by the surface-acre occupancy
limitation and by the stipulations and required operating
procedures. However, industry should be able to explore in
areas with the highest potential within ANWR. He stated the
public does not have accurate information concerning the
environmental impacts of oil and gas development in ANWR; in
fact, NSB is confident exploration and development will not
significantly affect wildlife populations, the environment, or
the health and subsistence lifestyle of residents. Mr. Fauske
recalled oil and gas development in Prudhoe Bay was conducted
with less environmental protection and inferior technology than
what is used today. Further, existing infrastructure at Prudhoe
Bay did not result in the significant damage to wildlife or the
environment that was predicted by environmental organizations.
He assured the committee NSB would not support opening the
coastal plain [section 1002 area of ANWR] to leasing if there
were a serious threat to residents' way of life and the Arctic
ecosystem. The village of Kaktovik is the only community
located within ANWR, thus no one understands the controversy
better than the residents of Kaktovik who have been dependent on
the land for thousands of years; the needs and concerns of local
residents should be given greater consideration in the decision-
making process.
MR. FAUSKE explained NSB's jurisdiction reaches from the
Canadian border across NS to the western border of Alaska,
including the coastline along the Beaufort Sea and the Chukchi
Sea. The borough provides to eight communities services
including education, health and social services, roads, water,
sewer, and emergency services. He extended an invitation from
Mayor Brower for members of the committee to visit NSB on
7/31/19.
2:13:19 PM
The committee took an at-ease from 2:13 p.m. to 2:16 p.m.
2:16:18 PM
CO-CHAIR TARR opened public testimony on SJR 7.
2:16:25 PM
The committee took a brief at-ease.
2:16:40 PM
CO-CHAIR TARR reopened invited testimony.
2:17:11 PM
TERESA IMM, Executive Vice President, Resource Regional
Development, Arctic Slope Regional Corporation (ASRC), informed
the committee she has been working with the community of
Kaktovik - the only village located within the coastal plain of
ANWR - regarding oil and gas leasing and regarding BLM's draft
EIS, to ensure the community is involved in the process and to
mitigate impacts to Kaktovik while providing for economic
growth. She said ASRC owns 92,000 acres of land in ANWR and
along with the Kaktovik Inupiat Corporation (KIC), has been
urging for oil and gas leasing for over 40 years. As ANWR is
now open for leasing, ASRC seeks to ensure leasing proceeds with
cultural, subsistence, and Kaktovik's economic needs
incorporated into the leasing documents. Further, ASRC and KIC
seek to ensure the BLM program allows them to develop their own
land to fulfill the intent of the Alaska Native Claims
Settlement Act (ANCSA). The federal land is an extension of
Native land, therefore, communities, agencies, the state, NSB,
and others need to be closely aligned to ensure goals are met
for all parties. Ms. Imm expressed confidence oil and gas
exploration can protect wildlife and the environment; in fact,
oil and gas development on NS has evolved and should be
considered the "gold standard" for oil and gas development. She
strongly encouraged the legislature to continue to support
ASRC's efforts as leasing will provide short-term benefits, and
could provide long-term benefits, to the state. She observed
the search for economic diversity statewide has not found a
solution that provides stable funding for communities. Ms. Imm
urged the committee to pass SJR 7.
2:20:46 PM
CO-CHAIR TARR returned attention to public testimony.
2:21:32 PM
PETER NOLAN, Director, Member Services, Alaska Chamber, informed
the committee the Alaska Chamber (Chamber) is a nonprofit
organization whose members work to promote a positive business
environment in Alaska; the Chamber supports responsible resource
development that brings economic opportunities to Alaskans. The
Chamber strongly supports SJR 7, which would help ensure
America's energy security and allow Alaska and the nation to
benefit from expanding energy production in Alaska. Mr. Nolan
acknowledged renewable energy is growing but will account for a
minority of American energy production through 2040; new oil and
gas from the non-wilderness portion of the coastal plain is an
important part of achieving energy dominance, and the Chamber
encourages the House Resources Standing Committee to pass the
resolution.
2:23:14 PM
K.K. DAVIS informed the committee she has been an Alaska
resident since 1991 and is currently a student at the University
of Alaska Fairbanks (UAF) studying Arctic policy and changes to
the Arctic climate. She also owns a wilderness guiding and
canoeing instruction business which is connected to the use of
wild and scenic rivers. Ms. Davis said her immediate concern
about SJR 7 is the speed at which BLM is processing the EIS.
She urged that the coastline remain intact and pointed out BLM
has 22.1 million acres in the National Petroleum Reserve-Alaska
(NPR-A) adjacent to ANWR. Ms. Davis seeks to explore ANWR
before there are further alarming changes and [oil and gas
exploration] would apply more pressure to a wilderness area.
2:25:45 PM
BRAD SNOW said he has been a resident of Alaska since 1973, and
in 1995 began working as a guide along the Hulahula River
drainage in ANWR, which he described as the most beautiful place
on earth. He expressed his surprise at the abundance of
animals, birdlife, unique scenery and the lack of development
found there. He compared an oil derrick in the wilderness to a
spot of spaghetti sauce on a white shirt. Furthermore, economic
potential for some is not worthy of endangering the livelihood
of a group of Alaska residents, destroying tourist potential,
and losing untouched wilderness. Mr. Snow spoke of guiding
visitors and residents along the Hulahula River for the last
eight years who are amazed and delighted with the pristine
beauty and cautioned it - and the economic benefit of
development - could be gone tomorrow.
2:28:02 PM
SYLVIA PANZARELLA said she and her husband have lived in Alaska
for almost twenty years in Kodiak and Anchorage. She agreed
with previous speakers who have noted the destruction of the
wilderness and wildlife, and the loss of subsistence and
cultural importance. Ms. Panzarella stressed drilling in ANWR
is a poor financial investment decision on the part of the state
because oil production would not begin for ten years, and within
the next ten years there may be new sources of electrical
energy. For example, Kodiak is 99.8 percent powered by
sustainable energy from wind and water energy. She said
Governor Dunleavy is going to give $345 million to oil companies
in the next two years at the expense of Alaska citizens. She
urged the committee to remember the state motto - North to the
Future - and to move away from oil dependence.
REPRESENTATIVE RASMUSSEN asked for an explanation of the $345
million giveaway referenced by Ms. Panzarella.
2:30:52 PM
MS. PANZARELLA explained $100 million is "already set aside" and
she would provide the figures to Representative Rasmussen.
2:31:11 PM
DAVE HARBOUR said he previously provided written testimony to
the committee. He recalled many decades of [Alaska] governors
and [state] legislatures have supported reasonable development
of the [section 1002 area] in ANWR. Furthermore, promises of
proper development in said area [would be] kept and should move
forward. He pointed out the committee and the state House of
Representatives are not alone but are supported by the nation,
as evidenced by his experience serving on the Regulatory
Commission of Alaska, the Western Conference of Public Service
Commissioners, the Gas Committee of the National Association of
Regulatory Utility Commissioners, and the Interstate Oil and Gas
Compact Commission. In fact, written resolutions of support for
ANWR were garnered from the Interstate Oil and Gas Compact
Commission. Mr. Harbour said a study indicated that there was
"a loss to America of not developing these resources" [document
not provided]. He recommended the legislature provide copies of
SJR 7 to certain members of Congress.
2:35:39 PM
CARL PORTMAN, Deputy Director, Resource Development Council,
informed the committee the Resource Development Council (RDC)
has consistently supported opening the [section area] of ANWR to
oil and gas development. The coastal plain has been identified
as America's best onshore prospect for conventional oil and gas
discovery. Alaska is dependent upon development of its natural
resources to support its economy; in fact, the discovery of oil
led to statehood. Oil production is the economic engine of
Alaska; although TAPS is operating at less than capacity, oil
production generated approximately 80 percent of unrestricted
general fund revenues in fiscal year 2008 (FY 08). Oil
production on the coastal plain could increase TAPS capacity to
two-thirds of its capacity. The past 40 years have proven
energy development and environmental stewardship do coexist.
The proposed responsible oil and gas development leasing will
help Alaska fund public services, generate thousands of jobs,
and raise the standard of living on NS. In response to earlier
testimony, he said development will occur in the non-wilderness
part of the coastal plain.
2:38:15 PM
LIAM ZSOLT, Director of Technology, ASRC Energy Services,
informed the committee, from a global perspective, NS oil and
gas industry is a model of environmental responsibility when
compared to other regions; for example, the wildlife on NS "have
the right-of-way." Further, as greenhouse gases rise, producers
are focusing on "lowering footprint and de-carbonizing
operations" by capturing flare gas and waste, and by optimizing
transportation. He said the draft EIS indicates ANWR
development will not materially impact the carbon balance but
will displace oil from declining fields, some of which he said
are "dirtier barrels on the market." Mr. Zsolt concluded the
Alaska state budget needs responsible development in ANWR
executed by corporate citizens of the Alaska oil and gas
industry.
2:40:08 PM
EMILY SULLIVAN, Conservation Associate, Alaska Wilderness
League, said SJR 7 states Alaskans overwhelming support oil and
gas development in ANWR; however, many Alaskans vehemently
oppose said development. Many members of the Alaska Wilderness
League (League) view the ANWR coastal plain as a place of
ecological importance, solace, recreational opportunities, and
where uniquely Alaska resources are protected. She
characterized ANWR as iconic public land. In addition, SJR 7
states 0.01 percent of land would be covered by production and
support facilities, which ignores the fact that the effects of
seismic testing, gravel mining, and pipelines would impact the
entire coastal plain. The resolution estimates the economic
value of the coastal plain but not the ecological value of
migratory birds, musk oxen, wolves, caribou, and polar bears,
and makes no mention of the Gwich'in people and their sacred
relationship with the coastal plain. Ms. Sullivan said the
aforementioned oversights are just a few of the reasons the
League is opposed to SJR 7. Finally, the coastal plain protects
many resources more valuable than oil; ANWR is one of the last
places where people still live in harmony with the land and oil
and gas development on the coastal plain is a travesty.
REPRESENTATIVE RASMUSSEN asked for the League's position on
previous testimony from residents in the region in support of
SJR 7.
MS. SULLIVAN said the requested statement of position would be
provided.
2:43:03 PM
LOIS EPSTEIN, Engineer and Director, Arctic Program, The
Wilderness Society, informed the committee The Wilderness
Society scientists and staff have worked in Alaska since the
1930s to protect ANWR from development because the refuge is
recognized as a place of wildlife, wilderness, and subsistence
value. She said not all places in Alaska are appropriate for
oil drilling and industrialization. The provision supporting
drilling was quietly attached to the [Tax Cuts and Jobs Act of
2017], and thus needed 51 votes to pass the U.S. Senate. She
pointed out SJR 7 indicates 0.01 percent of the entire refuge is
subject to development; however, development would actually
require a system of infrastructure that would cover the entire
acreage of the coastal plain. Further, SJR 7 has many other
problems: it does not acknowledge the interests of the Gwich'in
and Inupiat; it does not recognize the uncertainty of low oil
production; it does not acknowledge the burden to the state to
pay perhaps billions of dollars in oil tax credits to oil
companies used to offset production tax on existing NS oil
production, as revealed by DNR testimony before the House
Finance Committee on 2/27/19 [document not provided]. Ms.
Epstein stressed unlike previous resolutions in this regard, SJR
7 will matter and urged the committee to vote no.
2:45:50 PM
GLEN SOLOMON said he is Inupaiq, a resident, a whaling captain,
a hunter, a husband, a father, and a leader in the community of
Kaktovik. He expressed his support for opening the coastal
plain to oil and gas leasing because the coastal plain can
provide significant future revenue to state and local
governments so that the tax base [from oil and gas activities]
can continue to provide health and safety services to NS
communities. Kaktovik is the only community in [section 1002 of
ANWR] and he urged legislators to listen to residents' comments
regarding SJR 7. Mr. Solomon advised residents currently
balance subsistence activities and those of industry, and with
proper stipulations, exploration can occur that will protect
subsistence resources; like the Gwich'in, residents of Kaktovik
depend on caribou and know that caribou can coexist with
industry. For example, the Porcupine caribou herd and the
Central Arctic caribou herd migrate through oil and gas fields
in Canada and the U.S., and the Gwich'in and Inupaiq are
dependent on both of these herds.
2:48:26 PM
MALLORY PRIMM expressed her strong opposition to SJR 7 for
several reasons: SJR 7 states Alaskans overwhelming support oil
and gas development, but this is a misrepresentation because she
and her community do not support the resolution; SJR 7 narrowly
defines the impact of development in a non-wilderness area of
ANWR, but, in fact, the entire refuge is set aside as a home for
200 species of birds, 77 percent of the coastal plain is
critical habitat for polar bears and caribou, and more than 200
acres will be affected by pipelines, gravel mines, ice roads,
and seismic exploration. The estimates of revenue included in
SJR 7 are inaccurate and she asked to see the origin of the
estimates; BP pulled out of its Arctic program in 2017, which
indicates there is a realistic risk versus the reward of
drilling in the Arctic. Ms. Primm stressed the intrinsic value
of the coastal plain as wild and protected land.
REPRESENTATIVE RAUSCHER asked how Ms. Primm "qualified" the
community for which she was speaking.
MS. PRIMM said she is a community member and the voices of
individual Alaskans should be heard.
2:51:32 PM
ODIN MILLER, speaking as a lifelong Alaskan, said SJR 7 is "an
extremely raw deal for Alaskans ...." The federal government
will get most of the money from development due to the "90:10
royalty split" and development in ANWR will cost the state
millions of dollars in oil tax credits [that would be due to oil
companies]. He questioned whether the state could afford the
aforementioned costs and suggested the legislature should
instead repeal Senate Bill 21 [passed in the Twenty-Eighth
Alaska State Legislature]. Further, SJR 7 would cause food
shortages in certain villages due to declines in the Porcupine
caribou herd that would result from oil drilling. Mr. Miller
expressed his support for expanding subsistence rights on
federal wilderness land and for removing some of the
restrictions burdened upon residents; however, this separate
issue could be addressed by a specific resolution to do so,
instead of SJR 7, which calls for industrial development.
REPRESENTATIVE RASMUSSEN questioned the source of "the 90:10
split, for the federal government and state."
MR. FULTON stated the [Tax Cuts and Jobs Act of 2017] defined a
50:50 split between state and federal [governments].
MR. MILLER agreed with Mr. Fulton's correction.
2:54:3 PM
MICHAEL JESPERSON spoke in support of SJR 7 and noted the
resolution does not ask for the approval of a specific plan of
development or project, either of which would require an EIS.
He observed if a viable energy alternative to carbon fuels was
available today it would require a minimum of 60 years to
achieve production, thus carbon-based fuels will be used as a
primary fuel for a minimum of 60 years, and another 100 years as
a secondary fuel. Because Alaska has strict environmental
rules, any development of carbon-based fuels is best done in
Alaska where it will be done properly. Mr. Jesperson advised
most of the energy for electric cars comes from petroleum. He
cautioned any oil discovered in the [section 1002 area] will
take 20 years to production and SJR 7 will help future
legislators find revenue, will provide jobs, and will protect
the planet.
2:57:04 PM
MATTHEW REXFORD, President, Kaktovik Inupiat Corporation (KIC),
said he is Inupiat and a lifelong resident of Kaktovik. He
stated he is in strong support of SJR 7 because development on
NS will continue to provide the critical public services that
have led to increased life expectancy for residents. Since
development began in Prudhoe Bay, there have been improvements
in health care facilities, public health services, education,
and other benefits such as local schools. Based on the
experience of NS, development and subsistence can coexist in
regard to caribou herds; in fact, KIC does not expect the
[impact] to the Porcupine caribou herd to be different than to
those in other areas. North Slope development allows the state
to fund rural development projects and has some of the highest
environmental mitigation and remediation standards for industry
in the world. Mr. Rexford said the [section 1002 area] of the
coastal plain was set aside for oil and gas development and has
never been designated as wilderness. He restated his strong
support and also reported support from the federally recognized
[Kaktovik Village and the Regional Alaska Native Tribal
government].
2:59:48 PM
RYAN MARSH, Arctic Program Coordinator, Northern Alaska
Environmental Center, recalled a similar resolution passed in
2017; subsequent to the passage of the [Tax Cuts and Jobs Act of
2017], the federal government is pushing the leasing mandate
through and SJR 7 is an endorsement of a rushed process that is
an affront to protections provided by the National Environmental
Policy Act of 1969 (NEPA). He pointed out the [federal
government shutdown from 12/22/18-1/25/19] shortened the public
process; however, strong opposition was heard in the NS region,
Anchorage and Fairbanks that belies the statement that an
overwhelming majority of Alaskans favor [SJR 7]. Furthermore, a
larger majority of Americans seek protection as indicated by
proposed legislation to repeal leasing from the tax act that has
been introduced in the U.S. House of Representatives. He
characterized SJR 7 as a small and greedy action neglectful of
local Native residents, and urged the committee to withdraw the
resolution.
3:02:15 PM
RON YARNELL informed the committee he has guided Alaskans and
visitors from over the world on rivers crossing the coastal
plain of ANWR since 1976. He said the coastal plain is unique
in NS and noted many residents live in Alaska because of
wilderness; he questioned why one would destroy the few
protected areas of national significance. Mr. Yarnell suggested
the industry should look outside the refuge for more oil and to
create jobs, and urged the committee to vote against [SJR 7].
3:03:36 PM
LISA BARAFF recalled [Mr. Fulton] said SJR 7 represents the
legislature's official comment to BLM on the draft EIS; however,
the resolution contains inaccuracies and does not represent the
sentiment of a large percentage of Alaskans. In fact, the
response to the [Alaska Senate Majority 2019 Web Poll] showed 44
percent do not support development in the coastal plain in ANWR,
and thus 55 percent is a small majority. Also, testimony during
scoping hearings on the EIS and on the draft EIS showed many
Alaskans and the Gwich'in nation of Alaska and Canada
unanimously oppose development in the coastal plain. Finally,
referrals to impacts to caribou herds elsewhere do not
acknowledge that the coastal plain is the caribou herd nursery
ground.
3:06:33 PM
KARA MORIATY, President/CEO, Alaska Oil and Gas Association,
said the oil and gas industry and most Alaskans have long
supported a leasing program for the coastal plain. In January
[2019], a statewide poll showed 64 percent of Alaskans support
development of the coastal plain [document not provided]. The
Alaska National Interest Lands Conservation Act (ANILCA)
expanded the refuge to over 19 million acres, 90 percent of
which is protected wilderness. Section 1002 of ANILCA set aside
a portion of the coastal plain for future oil and gas
development, which is known as the 1002 area. Development there
is limited by the [Tax Cuts and Jobs Act of 2017] to 2,000
acres, which is equal to approximately one-half of the acreage
of the Ted Stevens Anchorage International Airport. Ms.
Moriarty reported by 2050, petroleum will be the largest source
of energy consumed in the U.S. and worldwide, thus demand will
continue for at least 30-35 years. Estimated production from
the [section 1002 area] is 10 billion-11 billion barrels of oil
and it is the largest onshore play on federal land in the U.S.;
its production will reduce U.S. reliance on foreign oil and
reduce imports by almost $600 billion. She closed, noting the
industry has a long history of safe, effective, and responsible
development in the Arctic, ensuring continued jobs and revenue
for Alaska.
[SJR 7 was held over.]
3:10:47 PM
ADJOURNMENT
There being no further business before the committee, the House
Resources Standing Committee meeting was adjourned at 3:11 p.m.