Legislature(2003 - 2004)

03/11/2003 06:34 PM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                    ALASKA STATE LEGISLATURE                                                                                  
             HOUSE STATE AFFAIRS STANDING COMMITTEE                                                                           
                         March 11, 2003                                                                                         
                           6:34 p.m.                                                                                            
MEMBERS PRESENT                                                                                                               
Representative Bruce Weyhrauch, Chair                                                                                           
Representative Jim Holm, Vice Chair                                                                                             
Representative Nancy Dahlstrom                                                                                                  
Representative Bob Lynn                                                                                                         
Representative Paul Seaton                                                                                                      
Representative Ethan Berkowitz                                                                                                  
Representative Max Gruenberg                                                                                                    
MEMBERS ABSENT                                                                                                                
All members present                                                                                                             
COMMITTEE CALENDAR                                                                                                            
EXECUTIVE ORDER 107 - TRANSFER OF HABITAT FUNCTIONS FROM ADF&G                                                                  
TO DNR                                                                                                                          
     - HEARD AND HELD                                                                                                           
PREVIOUS ACTION                                                                                                               
No previous action to record                                                                                                    
WITNESS REGISTER                                                                                                              
KEVIN DUFFY, Acting Commissioner                                                                                                
Alaska Department of Fish & Game (ADF&G)                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  During the hearing on EO 107, explained the                                                                
reorganization of ADF&G.                                                                                                        
TOM IRWIN, Commissioner                                                                                                         
Department of Natural Resources (DNR)                                                                                           
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  During the hearing on EO 107, explained the                                                                
role of DNR in the transfer of the habit division.                                                                              
KERRY HOWARD, Acting Director                                                                                                   
Division of Habitat and Restoration                                                                                             
Alaska Department of Fish & Game (ADF&G)                                                                                        
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:   Answered questions  during the  hearing on                                                               
EO 107.                                                                                                                         
CHRIS KENNEDY, Assistant Attorney General                                                                                       
Environmental Section                                                                                                           
Civil Division (Anchorage)                                                                                                      
Department of Law (DOL)                                                                                                         
POSITION  STATEMENT:   Answered questions  during the  hearing on                                                               
EO 107.                                                                                                                         
PAM LaBOLLE, President                                                                                                          
Alaska State Chamber of Commerce                                                                                                
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified in support of EO 107.                                                                            
ALEX WERTHEIMER                                                                                                                 
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:   Testified  in  opposition  to EO  107  and                                                               
offered his perspective as a fisheries biologist.                                                                               
RON WOLFE, Corporate Forester                                                                                                   
Sealaska Corporation                                                                                                            
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:   On  behalf  of  the Sealaska  Corporation,                                                               
testified in support of EO 107.                                                                                                 
CARL ROSIER                                                                                                                     
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:   Testified as  a concerned citizen and  as a                                                               
former commissioner of ADF&G in opposition to EO 107.                                                                           
DAVE HANNA                                                                                                                      
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified in opposition to EO 107.                                                                         
AURAH LANDAU                                                                                                                    
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:   During hearing on EO 107,  pointed out that                                                               
no   authority  would   exist   for  stream-buffer   enforcement,                                                               
protection,  and monitoring  on federal  land, and  explained the                                                               
effects to the state as a consequence.                                                                                          
ERIC LEE                                                                                                                        
Petersburg, Alaska                                                                                                              
POSITION  STATEMENT:   Testified  to explain  why efficiency  and                                                               
streamlining, as  stated goals of  EO 107, are  inappropriate and                                                               
dangerous priorities  for managing  the habitat,  and to  ask the                                                               
committee to overturn EO 107.                                                                                                   
BRUCE BAKER                                                                                                                     
Auke Bay, Alaska                                                                                                                
POSITION STATEMENT:   Testified as  a retired deputy  director of                                                               
the Division of Habitat and  Restoration, urging the committee to                                                               
reject EO 107.                                                                                                                  
FRANK RUE                                                                                                                       
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:    Testifying   on  behalf  of  himself  and                                                               
referring  to  his previous  work  experience  for both  DNR  and                                                               
ADF&G,  explained   why  moving  the  Division   of  Habitat  and                                                               
Restoration  out  of  ADF&G  would  lose  efficiency;  urged  the                                                               
committee to reject EO 107.                                                                                                     
PAULA TERRELL                                                                                                                   
Alaska Marine Conservation Council (AMCC)                                                                                       
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:   Testified in opposition to  EO 107; defined                                                               
single  versus   multiple  permits,  listed  questions   for  the                                                               
committee  to consider,  and stated  a list  of minimum  requests                                                               
intended for the administration through the legislature.                                                                        
GENE HARRISON                                                                                                                   
POSITION  STATEMENT:   Testified on  behalf of  himself regarding                                                               
the loss  of checks  and balances  resulting from  EO 107  and to                                                               
urge the committee not to support it.                                                                                           
LANCE TRASKY                                                                                                                    
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:   Testified as a fisheries  biologist with 30                                                               
years' experience,  asking the committee  not to change  a system                                                               
that is efficient and effective, but to reject EO 107.                                                                          
DOUG HILL                                                                                                                       
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:   Testified on  behalf of himself  to clarify                                                               
the Fraser  [Institute] report, to  describe EO 107 as  a serious                                                               
threat to fish and wildlife, and  to urge the committee to reject                                                               
EO 107.                                                                                                                         
DAN ROSENBERG                                                                                                                   
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:   Testified that he has worked  for ADF&G for                                                               
the past 20  years in what is currently the  Division of Wildlife                                                               
Conservation, and  described EO 107 as  counterproductive to both                                                               
Alaska's economy and its environment.                                                                                           
JOHN STURGEON                                                                                                                   
Koncor Forest Products                                                                                                          
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:   Testified in  support of EO 107,  saying he                                                               
thinks it will bring more efficiency to state government.                                                                       
BILL STEVENS, President                                                                                                         
Cassandra Energy Corporation                                                                                                    
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified in support of EO 107.                                                                            
PAUL SHADURA II, President                                                                                                      
Kenai Fishermen's Association                                                                                                   
Kenai, Alaska                                                                                                                   
POSITION STATEMENT:  Commented on  reports relating to EO 107 and                                                               
suggested ways to strengthen it.                                                                                                
DON CORNELIUS                                                                                                                   
Petersburg, Alaska                                                                                                              
POSITION STATEMENT:   During the hearing on EO  107, testified as                                                               
a  retired ADF&G  biologist  in  regard to  the  role of  habitat                                                               
biologists in  applications for permitting  and the  link between                                                               
MIKE MILLIGAN                                                                                                                   
Kodiak, Alaska                                                                                                                  
POSITION  STATEMENT:     Brought  a  fiduciary   concern  to  the                                                               
attention of  the committee  and said  he is  "somewhat cautious"                                                               
and against EO 107.                                                                                                             
TIM JUNE                                                                                                                        
Haines, Alaska                                                                                                                  
POSITION   STATEMENT:     Testified  as   a  22-year   commercial                                                               
fisherman; urged  the committee to  soundly reject EO 107  and to                                                               
increase the budget to the habitat division.                                                                                    
BILL HAUSER, Ph.D.                                                                                                              
Anchorage, Alaska                                                                                                               
POSITION  STATEMENT:   Testified in  opposition  to EO  107 as  a                                                               
fisheries scientist with over 30 years' experience.                                                                             
WILLY DUNN                                                                                                                      
Homer, Alaska                                                                                                                   
POSITION STATEMENT:   Testified that  he thinks EO 107  will have                                                               
long-term negative impacts on [Alaska's]  fish and wildlife; will                                                               
precipitate lawsuits; and is an issue  that should be taken on by                                                               
the legislature and the public, rather than by executive order.                                                                 
NICKY SCARZI                                                                                                                    
Homer, Alaska                                                                                                                   
POSITION  STATEMENT:   Testified  on EO  107; questioned  whether                                                               
habitat biologists will  be as readily accessible in  DNR as they                                                               
are  in  ADF&G,  and  answered  a  question  regarding  Title  16                                                               
SETH LITTLE                                                                                                                     
Alaska Center for the Environment (ACE)                                                                                         
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:   Testified  on behalf of  ACE to  define the                                                               
missions of  ADF&G and DNR,  to predict the  effect of EO  107 on                                                               
the  existing system  of checks  and  balances, and  to urge  the                                                               
legislature to support the resolution to disapprove EO 107.                                                                     
ERIC KNUDSEN, Ph.D.                                                                                                             
Anchorage, Alaska                                                                                                               
POSITION  STATEMENT:    Testified  as  a  professional  fisheries                                                               
scientist  with   over  20  years'   experience  to   list  three                                                               
scientifically-based  points  that  argue  for  a  resolution  to                                                               
reject EO 107.                                                                                                                  
DALE PIHLMEN                                                                                                                    
Ketchikan, Alaska                                                                                                               
POSITION STATEMENT:   Testified that  he is  against EO 107  as a                                                               
proposal that  would dramatically weaken protection  of the areas                                                               
essential to  the fishing and  tourism industries for  the short-                                                               
term gain of the timber industries.                                                                                             
MATTHEW LaCROIX                                                                                                                 
Wasilla, Alaska                                                                                                                 
POSITION STATEMENT:   Testified as  one of 22  habitat biologists                                                               
and  permitters in  ADF&G's Division  of Habitat  and Restoration                                                               
who  received  a  layoff  notice;   summarized  the  impacts  the                                                               
proposed executive  order will  have and  asked the  committee to                                                               
support the joint resolution rejecting EO 107.                                                                                  
GARVAN BUCARIA                                                                                                                  
Wasilla, Alaska                                                                                                                 
POSITION STATEMENT:  Testified by  citing references to the state                                                               
constitution and asked the committee to reject EO 107.                                                                          
ACTION NARRATIVE                                                                                                              
TAPE 03-21, SIDE A                                                                                                            
Number 0001                                                                                                                     
CHAIR  BRUCE WEYHRAUCH  called the  House State  Affairs Standing                                                             
Committee meeting  to order at  6:34 p.m.   Representatives Holm,                                                               
Dahlstrom,  Lynn, Berkowitz,  and Weyhrauch  were present  at the                                                               
call to order.   Representatives Seaton and  Gruenberg arrived as                                                               
the meeting was in progress.                                                                                                    
EXECUTIVE ORDER  107 - TRANSFER  OF HABITAT FUNCTIONS  FROM ADF&G                                                             
TO DNR                                                                                                                        
[Contains discussion of HB 78]                                                                                                  
Number 0033                                                                                                                     
CHAIR WEYHRAUCH  announced that  the only  order of  business was                                                               
Executive  Order (EO)  107, transferring  habitat functions  from                                                               
ADF&G to DNR.                                                                                                                   
Number 0091                                                                                                                     
KEVIN  DUFFY, Acting  Commissioner, Alaska  Department of  Fish &                                                               
Game  (ADF&G),  referred  to  a  handout  titled  "Reorganization                                                               
Proposal  In  Accordance  With   Executive  Order  No.  107"  [in                                                               
committee packets]  that he said  he'd summarize.  He  noted that                                                               
under  the category  of  functions moving  to  the Department  of                                                               
Natural Resources  (DNR) there are 36  positions, including those                                                               
for Title 16 fish passage and  anadromous fish stream permitting;                                                               
the anadromous  waters catalog,  a regulatory  function; project-                                                               
related  research  and   monitoring;  consistency  reviews;  ACMP                                                               
[Alaska Coastal  Management Program] plan review;  review of 6217                                                               
documents;  the coastal  boundaries atlas;  and Forest  Resources                                                               
and Practices Act ("Forest Practices Act") permitting.                                                                          
ACTING COMMISSIONER DUFFY said within  ADF&G are a certain number                                                               
of habitat  functions maintained  and moved into  other operating                                                               
divisions.    He noted  that  under  the category  of  "functions                                                               
moving to  sport fish"  are 18.5  positions, including  those for                                                               
the  fish stream  surveys  and data  base;  various research  and                                                               
restoration projects;  oil spill  contingency plan  reviews; ACMP                                                               
support to the ADF&G commissioner;  and [not included in the list                                                               
on the  handout] the Kachemak  Bay National History  and Research                                                               
Reserve program.                                                                                                                
ACTING  COMMISSIONER  DUFFY  noted  that under  the  category  of                                                               
"functions moving  to wildlife  conservation" are  5.5 positions,                                                               
including  those for  special areas  permitting; access  defense;                                                               
the "CARA/SWG" program; and the  North Slope grizzly project.  He                                                               
noted  that  the  two  positions   moving  to  the  functions  of                                                               
"community  fish"  are  for  log  transfer  facility  (LTF)  dive                                                               
surveys and mariculture leasing efforts.   He noted that there is                                                               
also  one position  in the  ARLIS [Alaska  Resources Library  and                                                               
Information Services] library in  Anchorage, which will be moving                                                               
under  the   Exxon  Valdez  Oil  Spill   (EVOS)  trustee  council                                                               
structure that will be maintained at ADF&G.                                                                                     
Number 0282                                                                                                                     
ACTING COMMISSIONER  DUFFY referred to  the next set of  pages in                                                               
the handout.   He  explained that the  first flowchart  shows DNR                                                               
and its  area offices.   He pointed out  the chart for  ADF&G and                                                               
one for  Kachemak Bay Research  Reserve.  He indicated  that some                                                               
charts were not included because  they would cause confusion.  He                                                               
pointed out  the wildlife-component chart and  the EVOS-component                                                               
chart, located on the next page of the handout.                                                                                 
ACTING  COMMISSIONER DUFFY  referred to  the fourth  page [after]                                                               
the  cover  page,  which shows  anticipated  layoffs  and  vacant                                                               
positions  to be  deleted.   He said  12 vacant  positions aren't                                                               
going to be  filled, and this streamlining  effort is anticipated                                                               
to  result in  a layoff  of approximately  22 employees.   Noting                                                               
that  36 ADF&G  habitat positions  will move  to DNR,  he said  a                                                               
remainder of 38 positions will move into other ADF&G divisions.                                                                 
ACTING COMMISSIONER  DUFFY referred  to a  flowchart on  the next                                                               
page that  identifies a new  structure under DNR.   The following                                                               
page shows the  positions to be moved into the  Division of Sport                                                               
Fish and  where they  will be  located.  He  noted that  the last                                                               
page  of  the handout  is  a  press  release.   He  reminded  the                                                               
committee   that  he   and  Commissioner   Irwin  did   a  "press                                                               
availability"  last  Friday  afternoon.     He  deferred  further                                                               
comments to Commissioner Irwin.                                                                                                 
Number 0424                                                                                                                     
TOM IRWIN,  Commissioner, Department of Natural  Resources, began                                                               
by giving the committee a background  of the process to date.  He                                                               
said he  feels that a  select team was  put together, made  up of                                                               
representatives from  the habitat  division and  DNR, individuals                                                               
who   have  worked   on  the   "permit   schemes,"  and   various                                                               
representatives from  "the legal  side."  These  individuals have                                                               
been meeting regularly  in order to be prepared.   He thanked all                                                               
those involved for the incredible amount  of work done.  He noted                                                               
that others were available to answer questions.                                                                                 
COMMISSIONER  IRWIN  highlighted   his  experience  in  business,                                                               
permitting,  and natural  resources.   He  emphasized his  belief                                                               
that this change  will work.  He offered the  belief that it's an                                                               
appropriate, comprehensive idea that will  be good for the state,                                                               
for business, and  for the environment.  He said  no one would be                                                               
short-circuited through  the process because  each is vital.   He                                                               
said  [EO  107]  will  facilitate  efficiencies  believed  to  be                                                               
critical.   He added that  he welcomes the significant  number of                                                               
people who will be coming to DNR from the habitat division.                                                                     
Number 0613                                                                                                                     
COMMISSIONER IRWIN  referred to an organizational  chart, the top                                                               
of   which  shows   the  "Office   of   Habitat  Management   and                                                               
Permitting."   He explained that  it has  a direct line  into the                                                               
office  of the  commissioner  and won't  be  "blended away"  with                                                               
another  office  with another  department.    He noted  that  the                                                               
bottom of  the chart shows  seven area offices,  a simplification                                                               
from the  previous system of  having field and  regional offices.                                                               
What dictated the areas was the  amount of work being done; these                                                               
area  offices will  report "into  an operations  manager, into  a                                                               
director."    Commissioner  Irwin   said  he  is  convinced  that                                                               
competent people will  move over and will get  the full attention                                                               
they deserve for protecting the habitat.                                                                                        
COMMISSIONER IRWIN disagreed with  the notion that ADF&G wouldn't                                                               
work with DNR and that there  would be a complete separation.  He                                                               
said he and Acting Commissioner  Duffy will work out a memorandum                                                               
of understanding  (MOU) to  make sure  nothing falls  through the                                                               
cracks.    Stressing   that  there  would  be   no  sacrifice  to                                                               
[Alaska's] environment,  he noted  that he has  three Alaska-born                                                               
grandchildren for whom he wants two  things:  for them to be able                                                               
to  work in  Alaska,  and  for Alaska  to  be as  environmentally                                                               
special for them as it is for him.                                                                                              
Number 0800                                                                                                                     
COMMISSIONER  IRWIN referred  to the  Fraser [Institute]  report.                                                               
He said it  is very sobering to read the  report, which polls the                                                               
major  mining companies  in the  world yearly;  he indicated  the                                                               
results for  2002 have been  published and he is  embarrassed for                                                               
Alaska.   The poll  is in  two parts:   the resources,  for which                                                               
Alaska ranks very well, and  the political perception, based on a                                                               
score of 0-100, with 100 being  the best.  Alaska "ranked" 50, he                                                               
said.   Commissioner Irwin remarked, "Whether  it's perception or                                                               
reality, they  vote with  their pocketbook.   They're  telling us                                                               
now  that the  major mining  companies find  it more  politically                                                               
acceptable  to  do  investment  in both  Russia  and  China  than                                                               
Alaska."  Indicating  Alaska needs to change  that perception, he                                                               
opined  that  [the  state]  can   develop  resources  in  a  very                                                               
responsible   and   effective   manner   while   protecting   the                                                               
Number 0906                                                                                                                     
ACTING  COMMISSIONER DUFFY  said he  and Commissioner  Irwin have                                                               
been working  hard to ease  the reorganization and  transition of                                                               
staff to  DNR.  He  said ADF&G is  very fortunate to  employ many                                                               
talented staff in  its habitat division; their  skills will still                                                               
be available to  maintain and protect the  state's important fish                                                               
and wildlife  habitat resources in  both agencies, under  EO 107.                                                               
He  told the  committee that  Governor [Murkowski]  has said  the                                                               
level of habitat protection will  not be diminished, and "this is                                                               
an expectation that  all of us hold."   He said he  is working to                                                               
ensure  that  those  who  are  moving to  DNR  will  continue  to                                                               
regularly have  contact with ADF&G and  their counterparts there.                                                               
He  noted that  Commissioner Irwin  had referred  to an  MOU that                                                               
will be part of that structure.                                                                                                 
ACTING COMMISSIONER DUFFY said some  employees in ADF&G's habitat                                                               
division feel their  integrity has been challenged  recently.  He                                                               
said, "I want to go on record  as saying that your work speaks to                                                               
your  professionalism   and  your  dedication,   as  professional                                                               
employees for  the State  of Alaska."   He added,  "The important                                                               
work that  these people do  in balancing  responsible development                                                               
with the long-term needs of  fish and wildlife habitats and users                                                               
of  these  resources  will  continue  under  this  new  executive                                                               
Number 1003                                                                                                                     
CHAIR WEYHRAUCH noted  that Sitka doesn't have  a regional office                                                               
or  field office  where biologists  are working.   He  asked, "Do                                                               
they  get  subsumed   in  your  flowchart  here,   to  Juneau  or                                                               
Petersburg, Prince of Wales?  Where do those folks go?"                                                                         
COMMISSIONER   IRWIN   answered,   "The    state   has   a   very                                                               
straightforward bidding; we don't choose  that.  We've chosen the                                                               
positions  that we  need  to accomplish  the work."    He said  a                                                               
prioritization was made with respect  to where the work needed to                                                               
be done;  vacancies are shown on  the charts in the  handout.  He                                                               
mentioned seniority,  the bidding  procedure, and  an opportunity                                                               
to either remain in [ADF&G] or come over into "habitat."                                                                        
CHAIR WEYHRAUCH asked if the Sitka office will close.                                                                           
COMMISSIONER IRWIN answered yes.                                                                                                
CHAIR  WEYHRAUCH  asked  Commissioner  Irwin to  respond  to  the                                                               
     The argument has  been made that with  the state having                                                                    
     a cadre of biologists  in ADF&G doing permitting review                                                                    
     that are now  being transferred to DNR,  ... the state,                                                                    
     ...  particularly on  federally licensed  projects like                                                                    
     hydroelectric  development,  ...  would be  losing  the                                                                    
     expertise   with  [its]   biologists,  or   losing  the                                                                    
     manpower to  do the  analysis, and then  the permitting                                                                    
     review  would  go to  federal  agencies  like Fish  and                                                                    
     Wildlife  Service,  which  would   in  fact  slow  down                                                                    
Number 1090                                                                                                                     
COMMISSIONER  IRWIN  responded that  he  clearly  stands for  the                                                               
state doing everything it can on  its own.  He related his belief                                                               
in  state's rights  and said  he'd like  to see  the state  doing                                                               
more; for  example, he  feels strongly that  the state  should be                                                               
doing  its own  National Pollutant  Discharge Elimination  System                                                               
(NPDES) program.  He deferred to his staff.                                                                                     
CHAIR WEYHRAUCH  reiterated his  question.  He  added that  he is                                                               
particularly  concerned  with   the  Lake  Dorothy  hydroelectric                                                               
Number 1154                                                                                                                     
KERRY   HOWARD,  Acting   Director,  Division   of  Habitat   and                                                               
Restoration, Alaska Department of Fish & Game, responded:                                                                       
     In the group of habitat  biologists that will be moving                                                                    
     to DNR, along  with the Title 16  functions that you've                                                                    
     heard,  they will  be performing  both under  "840" and                                                                    
     "870."    The  same   group  of  biologists  will  also                                                                    
     continue   to  review   land-use  planning   documents,                                                                    
     whether they  are federal or state,  so the expectation                                                                    
     is,  the biologists  at DNR  will  continue to  perform                                                                    
     that function.                                                                                                             
     With hydro projects, the  circumstance will continue to                                                                    
     be  what  we have  right  now.   Under  Federal  Energy                                                                    
     Regulatory Commission,  or FERC, they ...  are required                                                                    
     to seek  the input  of the Department  of Fish  & Game.                                                                    
     That authority  has always been vested  in the Division                                                                    
     of Sport Fish.   That will continue to be  there to the                                                                    
     extent  [that   if]  they   want  input   from  habitat                                                                    
     biologist at DNR, there will  habitat biologists at DNR                                                                    
     that they can continue to work with.                                                                                       
CHAIR WEYHRAUCH stated the following:                                                                                           
     I want  some assurance [that]  we're not going  to slow                                                                    
     down  resource  development  and  permitting  by  this,                                                                    
     because  that's  essentially  what I  understand  is  a                                                                    
     deficiency  to   expedite  permitting   and  permitting                                                                    
     review.    So I  don't  want  to,  by default,  say  we                                                                    
     transfer this  and slow  it down  and defer  to federal                                                                    
     entities to  review what the  state should be  doing in                                                                    
     looking out  for the state's  interest.  That to  me is                                                                    
     not in the state's interest.                                                                                               
Number 1220                                                                                                                     
MS. HOWARD, regarding the spread of functions that are moving to                                                                
DNR, continued as follows:                                                                                                      
     We calculated that it would  take, to do the exact work                                                                    
     with the  same number of  people we  have now, 44.   We                                                                    
     are moving over approximately  37 positions, and of the                                                                    
     group that is being lost,  many [are] in the management                                                                    
     structure  because we're  simply downsizing.   So,  the                                                                    
     office  at DNR  will no  longer sustain  a director,  a                                                                    
     deputy [director],  an assistant, [and]  three regional                                                                    
     supervisors,  who all  have  contributed  time to  that                                                                    
     We're also losing some support  staff at the lower end,                                                                    
     but it's  [hoped] that by  moving to DNR, ...  you gain                                                                    
     some   efficiencies  by   being  able   to  use   their                                                                    
     [administrative] staff  at that end.   So, largely, the                                                                    
     biologists and staff who work  on those reviews will be                                                                    
     moving over and can continue that function.                                                                                
Number 1263                                                                                                                     
CHAIR WEYHRAUCH suggested  that losing some of  the local offices                                                               
results in  loss of a certain  amount of local expertise  such as                                                               
knowledge of areas and habitats.   He said, "I trust you're going                                                               
to be traveling  and not just doing everything by  phone and fax.                                                               
... You've  got to  be on  the ground looking  at these  areas in                                                               
order to do your review.  Is that correct?"                                                                                     
MS. HOWARD said  yes; clearly, part of a  habitat biologist's job                                                               
is  both pre-inspection  and post-monitoring  of  projects.   She                                                               
said "we" know how critical that  is to have projects done right.                                                               
She said the  challenge will be faced in having  two area offices                                                               
close  in Sitka  and Ketchikan.    The workload  from Sitka  will                                                               
likely spill  over to  the Juneau  office, whereas  the Ketchikan                                                               
workload  will probably  be absorbed  by staff  in the  Prince of                                                               
Wales  Island office.   Therefore,  she said,  field visits  will                                                               
continue  to be  on a  list of  things habitat  biologists do  to                                                               
complete their job.                                                                                                             
Number 1353                                                                                                                     
CHRIS   KENNEDY,   Assistant  Attorney   General,   Environmental                                                               
Section,  Civil Division  (Anchorage), Department  of Law  (DOL),                                                               
responded to a  question from Chair Weyhrauch.  He  said the main                                                               
reason  for the  delegation of  habitat-related authorities  to a                                                               
deputy commissioner [in the past]  was to preserve the checks and                                                               
balances of the Forest Practices Act.  He continued:                                                                            
     The assignment  of duties to  a deputy  commissioner or                                                                    
     to the state  forester is consistent with  the way many                                                                    
     other  things are  done in  the  Department of  Natural                                                                    
     Resources, where  a number of duties  are assigned, for                                                                    
     example, to the  director of the Division  of Lands, by                                                                    
     statute.   In  this  case, before  the  EO, the  Forest                                                                    
     Practices Act sets  up a series of  checks and balances                                                                    
     whereby  the Department  of  Natural Resources,  acting                                                                    
     through the state forester, defers  to the expertise of                                                                    
     the Department of Fish & Game on habitat matters.                                                                          
     Since the habitat expertise will  be moving over to the                                                                    
     Department of  Natural Resources,  it was  necessary to                                                                    
     create  two co-equal  positions  in  the Department  of                                                                    
     Natural   Resources   so   that  that   deference   and                                                                    
     consultation could  take place,  so that  the functions                                                                    
     that used  to be assigned formally  to the commissioner                                                                    
     of  natural resources  are now  assigned  to the  state                                                                    
     forester, and the functions that  have come across from                                                                    
     [ADF&G] are  assigned to a  deputy commissioner  in the                                                                    
     Department  of  Natural  Resources.     Each  of  those                                                                    
     individuals will report to  the commissioner of natural                                                                    
     resources,  who can  resolve  any disagreement  between                                                                    
Number 1446                                                                                                                     
CHAIR WEYHRAUCH  asked if  the commissioner of  DNR is  still "in                                                               
the appellate loop, so to speak."                                                                                               
MR. KENNEDY answered that's correct.   In response to a follow-up                                                               
question, he said  the final decision on permitting  is "a little                                                               
bit of a separate question and a little bit more complicated."                                                                  
CHAIR  WEYHRAUCH recommended  that  Mr. Kennedy  not  go into  it                                                               
right now.                                                                                                                      
MR. KENNEDY said  that in forest practices,  the commissioner [of                                                               
DNR] is the ultimate referee.                                                                                                   
Number 1476                                                                                                                     
ACTING  COMMISSIONER   DUFFY,  in  response  to   questions  from                                                               
Representative Berkowitz,  said EO  107 was  the administration's                                                               
REPRESENTATIVE BERKOWITZ  explained the  reason for  his question                                                               
was  because the  transition advisory  group recommended  holding                                                               
the decision  until the  new ADF&G commissioner  is in  place and                                                               
the  new  director  of  the  habitat division  has  had  time  to                                                               
evaluate, which hasn't happened yet.   He asked about the process                                                               
that led  to this decision.   He asked  if ADF&G was  involved at                                                               
the commissioner level or division  director level, if there were                                                               
meetings held, and, if so, what happened in those meetings.                                                                     
ACTING COMMISSIONER  DUFFY replied  that he had  discussions with                                                               
the new administration on this  particular issue, but isn't aware                                                               
of a  whole series of meetings  where DNR participated.   He said                                                               
the governor's office made the call to move forward.                                                                            
Number 1554                                                                                                                     
REPRESENTATIVE   BERKOWITZ   asked  Acting   Commissioner   Duffy                                                               
whether, in his  conversations prior to the  EO, he'd recommended                                                               
for or against this approach.                                                                                                   
ACTING   COMMISSIONER   DUFFY   responded   that   options   were                                                               
considered,  that he'd  had some  options in  mind, and  that the                                                               
decision was made to proceed in  this fashion.  He worked for the                                                               
governor when  that policy call was  made; thus it is  his job to                                                               
follow that decision.                                                                                                           
REPRESENTATIVE  BERKOWITZ   clarified  that   he  is   trying  to                                                               
understand  how  a  decision  was  made  with  such  far-reaching                                                               
implications  if it  were done  over the  recommendations of  the                                                               
acting commissioner.   He  asked what  process was  involved, who                                                               
was consulted, and how far out these decisions were made.                                                                       
ACTING COMMISSIONER  DUFFY responded that  it is not  accurate to                                                               
say  the decisions  were made  "over the  recommendations of  the                                                               
acting  commissioner."     He   reiterated  his   involvement  in                                                               
discussions  on   options  regarding  how  permitting   could  be                                                               
streamlined.   He said,  "Ultimately, this  decision was  made by                                                               
this  administration, and  so I'm  following up,  consistent with                                                               
the details of the Executive Order 107."                                                                                        
REPRESENTATIVE  BERKOWITZ  questioned  the logic  of  this  order                                                               
which  implies,  essentially,  that   ADF&G  poses  obstacles  to                                                               
resource development;  he said it  gives rise to the  question of                                                               
what  is next.      He  asked whether  ADF&G would  ultimately be                                                               
folded  into DNR,  for example,  because, in  essence, any  ADF&G                                                               
decisions that  protect habitat, fish,  or game pose  a potential                                                               
impediment to resource development.                                                                                             
ACTING  COMMISSIONER  DUFFY replied  that  it's  certainly not  a                                                               
policy  direction  he  would encourage  as  a  representative  of                                                               
Number 1672                                                                                                                     
COMMISSIONER  IRWIN   told  Representative  Berkowitz   that  the                                                               
question "sounds like there's some  kind of evil plan to overcome                                                               
the environment."   He said  he strongly  supports [EO 107].   He                                                               
said he has found, in his  career, that when groups of people get                                                               
together - even though they  are defending very different areas -                                                               
communications and  efficiency exist, and people  solve problems.                                                               
Commissioner  Irwin stated  the  need to  work  closely with  the                                                               
federal Environmental  Protection Agency (EPA) and  the U.S. Army                                                               
Corps  of Engineers,  for  example.   He  mentioned having  clear                                                               
methods that blanket "the whole  thing" so that people don't have                                                               
to question  where they're going,  because there are  clear steps                                                               
and  timelines.   He  reiterated  that  the  purpose is  to  keep                                                               
business going and to protect the environment.                                                                                  
Number 1721                                                                                                                     
REPRESENTATIVE  BERKOWITZ  asked  Commissioner Irwin  if  he  was                                                               
supportive of the administration's efforts prior to EO 107.                                                                     
COMMISSIONER   IRWIN  replied   that   when   he  became   acting                                                               
commissioner, he  became supportive  of "anything  you can  do to                                                               
merge groups  together and eliminate  layers" for the  purpose of                                                               
efficiency.  He said he has  experienced this during his 30 years                                                               
of business life and that it applies here.                                                                                      
Number 1751                                                                                                                     
CHAIR WEYHRAUCH reviewed the purpose  of the current committee in                                                               
hearing EO  107.   He said  he is concerned  about the  effect on                                                               
efficient operation  of government;  whether [EO  107] is  in the                                                               
state's interest;  state and federal interaction;  and the impact                                                               
on  public  employees,  for example.    He  asked  Representative                                                               
Seaton, as chair of the  House Special Committee on Fisheries, to                                                               
comment regarding [its focus on EO 107].                                                                                        
REPRESENTATIVE SEATON said that  during an upcoming House Special                                                               
Committee  on Fisheries  hearing on  EO 107,  the committee  will                                                               
consider  the structure  of this  process and  whether it  can be                                                               
counted on to protect habitat and fisheries.                                                                                    
Number 1830                                                                                                                     
REPRESENTATIVE   IRWIN,   in   response  to   a   question   from                                                               
Representative  Seaton, explained  that  the deputy  commissioner                                                               
and  the  commissioner are  represented  in  the "Office  of  the                                                               
Commissioner" title in the chart.                                                                                               
REPRESENTATIVE SEATON said that is  confusing.  He noted that the                                                               
mission of the  commissioner of DNR is  basically the development                                                               
of  [Alaska's]  natural  resources,  and he  stated  his  concern                                                               
regarding  moving  from  ADF&G's  protection  of  fish  and  game                                                               
habitat   to  a   situation  where   the  state   is  under   the                                                               
commissioner's mission  to develop.   He questioned  whether some                                                               
federal  agencies would  be able  to  "take the  permits that  we                                                               
give, coming from  an agency, if that's its mission."   He stated                                                               
his concern  that there be  a separate, identifiable  mission for                                                               
the  deputy  commissioner,  and  that   it  not  be  simply  "the                                                               
commissioner's office," because that's the appellate position.                                                                  
Number 1872                                                                                                                     
COMMISSIONER  IRWIN   responded  that  he  thinks   it  would  be                                                               
appropriate   to   expand  the   chart   for   the  purposes   of                                                               
clarification.  He said ADF&G is  to protect wildlife, and DNR is                                                               
to  develop it  [while still  working to  protect it].   He  also                                                               
commented  that there  are  a lot  of streams  that  ought to  be                                                               
state-owned.     In   response   to  a   follow-up  question   by                                                               
Representative Seaton, he  concurred that there will  "still be a                                                               
director, but that  upper body will be  the deputy commissioner."                                                               
He clarified that the director  will have full authority, as does                                                               
any director within DNR.                                                                                                        
REPRESENTATIVE  SEATON stated  concern, based  upon the  opinions                                                               
received  from  Legislative  Legal and  Research  Services,  that                                                               
there's  no deference  given  to  ADF&G; in  EO  107, there's  no                                                               
requirement that  ADF&G even be notified  of permitting requests,                                                               
for example.  He asked how that is going to be handled.                                                                         
COMMISSIONER  IRWIN  responded that  the  real  priority will  be                                                               
"through  the very  competent individuals  in habitat  working up                                                               
this  line."   He  said  they  have  clear  access to  ADF&G  for                                                               
scientific advice, if  they lack it.  He  indicated the expertise                                                               
is "moving right in under a  separate director."  He continued as                                                               
     We made  a clear  decision not  to blend  this in  to a                                                                    
     different group.   We wanted its own  separate group of                                                                    
     authority so they would have  equal authority and power                                                                    
     to protect the  fish and/or wildlife, just  as it's the                                                                    
     other  side  to  make  sure   we  clearly  provide  for                                                                    
     proficient, proper use of the  land.  And as this melds                                                                    
     together  and  you  have people  working  across  these                                                                    
     boundaries   discussing  [it],   I  am   so  absolutely                                                                    
     convinced  this  works,  because   of  the  success  we                                                                    
     specifically  have  had  at   Fort  Knox  [gold  mine].                                                                    
     Habitat and business and DNR - it worked very well.                                                                        
Number 2040                                                                                                                     
REPRESENTATIVE SEATON  related his understanding that  nothing in                                                               
EO  107  requires  public  notice   of  permits.    He  mentioned                                                               
AS 38.05.945 and  asked if DNR  plans to establish  public notice                                                               
COMMISSIONER IRWIN replied  that he knows of no  shortcuts on the                                                               
DNR procedure  and that he thinks  the public has to  be notified                                                               
of  what's  going  on.     He  mentioned  accountability  of  the                                                               
governor, the  House, and the Senate,  and said, "I took  an oath                                                               
to protect both sides, to represent the people of Alaska."                                                                      
Number 2086                                                                                                                     
REPRESENTATIVE SEATON  mentioned AS 38.05.945 and  noted that the                                                               
legal opinion  he has  says that  those public  notice provisions                                                               
don't  apply  to anadromous  stream  permits  and fish  (indisc.)                                                               
permits.  That may require separate legislation, he suggested.                                                                  
MS. HOWARD,  regarding Representative Seaton's  previously stated                                                               
question  regarding  public notice  on  Title  16 permits,  said,                                                               
currently, at ADF&G, there are  no public notice requirements for                                                               
"840" or "870" permits.  She said:                                                                                              
     To  the  extent  a  project is  undergoing  review  and                                                                    
     requires multiple  agency permits in the  coastal zone,                                                                    
     our part  of the project  covered by the  840/870 would                                                                    
     be a part  of the broader notice; but  right now, there                                                                    
     is no notice requirement  for just simply single-agency                                                                    
     permits issued by [ADF&G].                                                                                                 
Number 2134                                                                                                                     
REPRESENTATIVE  BERKOWITZ   voiced  concern   that  this   is  an                                                               
executive  order,  rather  than  a  statute or  bill.    He  said                                                               
[EO 107] enables  the commissioner of  DNR to deputize  people as                                                               
peace officers,  which he  opined is a  "non-trivial thing."   He                                                               
related his concern that the  legislature might be abrogating its                                                               
responsibility  by allowing  this to  continue as  an EO,  rather                                                               
than a bill.   He said he wonders if any  legal research has been                                                               
done  on that  subject.   He  added, "Certainly,  our revisor  of                                                               
statutes wouldn't  allow us  to make  that kind  of modification;                                                               
it's a substantive change in the law."                                                                                          
MS. HOWARD recommended that Mr. Kennedy address that.                                                                           
REPRESENTATIVE   BERKOWITZ   asked    Ms.   Howard   and   Acting                                                               
Commissioner  Duffy  if  they have  any  reservations  about  the                                                               
proposed move  [of the  habitat division to  DNR].   He clarified                                                               
that he'd  asked that  question to  figure out  how this  came to                                                               
pass and whether there are concerns.                                                                                            
MS.  HOWARD  responded  that  after the  decision  was  made  "to                                                               
organize," she was  asked to be involved on  the interagency team                                                               
to figure  out how to  make it  happen; thus she  wasn't involved                                                               
until the  decision had  been made.   As  acting director  at the                                                               
Division of Habitat  and Restoration, she said  she has concerns.                                                               
She stated her belief that  the reorganization will be disruptive                                                               
to the  normal Division of  Habitat and Restoration  workload and                                                               
will  require many  staff to  do  different types  of jobs,  will                                                               
cause staff reduction, and will  result in some poor staff moral.                                                               
Notwithstanding  that, she  said the  commissioners and  staff of                                                               
DNR  have been  very supportive  of the  reorganization and  have                                                               
reassured her that they want to  do everything they can to ensure                                                               
that the reorganization can work.   Similarly, she stated, Acting                                                               
Commissioner Duffy and  all of the other directors  at ADF&G have                                                               
fully  embraced the  staff who  will be  remaining at  ADF&G, and                                                               
have assured her that they will  do everything they can to ensure                                                               
that the functions remaining at ADF&G continue to function well.                                                                
Number 2263                                                                                                                     
ACTING   COMMISSIONER  DUFFY   said   he   thinks  Ms.   Howard's                                                               
perspective was  laid out  pretty well.   He  said he,  as acting                                                               
commissioner, has been focusing on  trying to minimize impacts on                                                               
the people [in  the department] while still  creating a structure                                                               
that works  and protects the  Title 16 responsibilities  that are                                                               
being transferred to DNR.  He  admitted that he had concerns, but                                                               
said the concerns  he had early on seem to  be being minimized by                                                               
the current  structure being  presented to  the legislature.   He                                                               
added that time will  tell.  He said if EO  107 rolls forward, he                                                               
is  sure that  "we"  will  be held  accountable  for any  adverse                                                               
impacts that are perceived.  He reiterated support for EO 107.                                                                  
Number 2327                                                                                                                     
REPRESENTATIVE  SEATON   asked  if   there  is   a  due-deference                                                               
provision  for   the  deputy  director   of  DNR,  who   will  be                                                               
responsible for habitat, as there currently is in ADF&G.                                                                        
MS. HOWARD responded as follows:                                                                                                
     In  the current  Forest  and  Resources Practices  Act,                                                                    
     [ADF&G] gets deference for fish  passage issues.  Under                                                                    
     the EO,  that deference  would still  be there,  but it                                                                    
     would be to  the deputy commissioner at DNR  and, in my                                                                    
     assumption,  all the  authority  vested  in the  deputy                                                                    
     commissioner  is  going to  be  delegated  down to  the                                                                    
     habitat   biologists  who   are   actually  doing   the                                                                    
     permitting work.                                                                                                           
TAPE 03-21, SIDE B                                                                                                            
NUMBER 2370                                                                                                                     
MS. HOWARD mentioned ADF&G, "where the commissioner delegates                                                                   
his authority down to the habitat biologist."                                                                                   
REPRESENTATIVE GRUENBERG referred to page 18 lines 26-29] of                                                                    
EO 107, which read as follows:                                                                                                  
     *Sec. 34. AS  41.17 is amended by adding  a new section                                                                  
     to read:                                                                                                                   
               Sec.41.17.905. Independent authority.  With                                                                    
          respect to matters governed by this chapter, the                                                                      
          deputy commissioner does not have supervisory                                                                         
          authority over the state forester.                                                                                    
REPRESENTATIVE GRUENBERG asked whether that is at odds with                                                                     
Ms. Howard's previous answer.                                                                                                   
Number 2341                                                                                                                     
MS. HOWARD answered:                                                                                                            
     Right  now, under  the Forest  Resources and  Practices                                                                    
     Act, there's  authority vested  in the  commissioner of                                                                    
     DNR  and the  commissioner of  ADF&G; that's  delegated                                                                    
     down to  their staff who  work on Forest  Resources and                                                                    
     Practices Act  issues in the Division  of Forestry and,                                                                    
     currently, at the Division of Habitat and Restoration.                                                                     
     When you move [the] habitat  division to DNR, to ensure                                                                    
     that  habitat division  will  have  equal footing,  the                                                                    
     authority in the commissioner  that they currently have                                                                    
     for forestry  matters at DNR  is delegated down  to the                                                                    
     state forester,  and then, in  a like manner,  the fish                                                                    
     and  game  authorities  will  be  vested  in  a  deputy                                                                    
     commissioner.   And  that's simply  so the  authorities                                                                    
     are vested  one step  down from  the final  position at                                                                    
     DNR, which  is the  commissioner.  So  no, it  does not                                                                    
     conflict with what  I intended to say  previously.  I'm                                                                    
     sorry if that was confusing.                                                                                               
CHAIR  WEYHRAUCH announced  that Mr.  Kennedy was  available once                                                               
more by  teleconference, and invited Representative  Berkowitz to                                                               
restate his previous question.                                                                                                  
Number 2296                                                                                                                     
REPRESENTATIVE BERKOWITZ said he wants  to know why the matter at                                                               
hand came down as  an EO, rather than a bill.   He said he thinks                                                               
there are  some substantive changes  that the  legislature itself                                                               
would not  be allowed to carry  forward.  He offered  one example                                                               
regarding  granting  authority  to  the commissioner  of  DNR  to                                                               
deputize peace officers.   He said he is curious  as to the legal                                                               
authority that would substantiate that  as an executive order, as                                                               
opposed to a bill.                                                                                                              
MR.  KENNEDY responded  that looking  at the  EO order  can be  a                                                               
little bit  misleading; it looks  as though  it creates a  lot of                                                               
new statutory provisions  "from scratch."  However,  he said that                                                               
isn't  so.   Noting  that  the  example given  by  Representative                                                               
Berkowitz is  the new Section  41.14.165, he explained  that that                                                               
is essentially verbatim, a restatement  of law that is already on                                                               
the books in  AS 16.05.165.  He noted that  that section provides                                                               
enforcement authority that goes  with "840" and "870" permitting.                                                               
In order  to move that permitting  to DNR and keep  the statutory                                                               
structure intact,  he explained,  it was  necessary also  to move                                                               
the ability to enforce those provisions.                                                                                        
REPRESENTATIVE BERKOWITZ noted that Title  16 refers to ADF&G and                                                               
the commissioner  of ADF&G,  whereas Title 41  refers to  DNR and                                                               
the commissioner  of DNR;  those are two  separate entities.   He                                                               
related   his   understanding   that  this   is   a   substantive                                                               
distinction, not just a conforming change.                                                                                      
MR.  KENNEDY   agreed  that  this  transfers   those  duties  and                                                               
functions from  the commissioner of  ADF&G and the  department to                                                               
DNR.   He said that  was the intent of  the executive order.   He                                                               
added,  "We  believe  that  is in  keeping  with  the  governor's                                                               
executive order authority."                                                                                                     
Number 2195                                                                                                                     
REPRESENTATIVE  BERKOWITZ observed  that  Title  16 authority  to                                                               
nominate  peace officers  still  belongs to  the commissioner  of                                                               
ADF&G.  What  EO 107 does is give the  deputy commissioner of DNR                                                               
authority to nominate  peace officers, which is  substantive.  He                                                               
voiced concern that  this isn't just a switch in  the law, but is                                                               
a new law.                                                                                                                      
MR.  KENNEDY respectfully  disagreed.   He  said the  enforcement                                                               
authority  that  is moved  to  Title  41.14 is  only  enforcement                                                               
authority  relating  to  the  "840" and  "870"  permits.    Those                                                               
permits will no longer reside in  Title 16, so the authority will                                                               
no  longer be  with  the commissioner  of ADF&G.    He said,  "It                                                               
simply reappeared exactly  as it was before, but  now assigned to                                                               
a different administrative unit."                                                                                               
CHAIR WEYHRAUCH  highlighted the time constraints  because of the                                                               
large  number  of  testifiers.    He  suggested  that  any  other                                                               
substantive  question   be  submitted   in  writing;   that  [the                                                               
commissioners] answer  any questions expeditiously; and  that any                                                               
MOU between DNR & ADF&G be made available to the committee.                                                                     
Number 2125                                                                                                                     
REPRESENTATIVE GRUENBERG  referred to a legal  opinion written to                                                               
Representative  Seaton,  dated  February  26 [2003].    He  asked                                                               
permission to quote from it and said:                                                                                           
     There are  two provision  in the executive  order where                                                                    
     the governor  appears to  have exceeded  his authority.                                                                    
     First,  in Section  5  of the  executive  order, a  new                                                                    
     section AS 41.14.165  is added to provide  that a peace                                                                    
     officer may issue a citation  for violations of certain                                                                    
     permits.   Included  is a  requirement that  the Alaska                                                                    
     Supreme Court determines  which misdemeanors, under the                                                                    
     new AS  41.14, are appropriate for  disposition without                                                                    
     a court appearance.   Also included in  that section is                                                                    
     a  requirement that  the  court  establish an  advisory                                                                    
     committee  consisting  of  certain  members,  including                                                                    
     judges  and chairs  of certain  legislative committees.                                                                    
     The  governor's   executive  authority  is   a  limited                                                                    
     authority to restructure the  executive branch of state                                                                    
     government.     That  authority  does  not   allow  the                                                                    
     governor to  place duties on either  the legislative or                                                                    
     the judicial branch of government.   In this case, both                                                                    
     the  Alaska Supreme  Court  and  the legislature  could                                                                    
     completely  ignore  the  requirements imposed  by  this                                                                    
     section,  because  the  governor   does  not  have  the                                                                    
     authority  to  impose any  duty  on  them [through]  an                                                                    
     executive order.                                                                                                           
     Second,  in  Section  45  of  the  executive  order,  a                                                                    
     provision   is  added   to   protect  certain   [ADF&G]                                                                    
     employees   from   losing   their   "police   officers'                                                                    
     retirement  benefits" if  they're transferred  to [DNR]                                                                    
     by  the  order.    This  section  does  not  involve  a                                                                    
     reorganization  of functions  of the  executive branch.                                                                    
     Instead,   it  relates   to  the   retirement  benefits                                                                    
     accorded  to  state  employees under  state  law.    No                                                                    
     matter  how  well  intentioned   the  purpose  of  this                                                                    
     section may  be, the governor  does not have  the power                                                                    
     under  an  executive  order to  change  laws  regarding                                                                    
     employee retirement benefits.                                                                                              
REPRESENTATIVE GRUENBERG requested a written response to that.                                                                  
ACTING COMMISSIONER DUFFY  said [ADF&G and DNR]  are committed to                                                               
answering the questions  of the committee members  "to the extent                                                               
Number 1981                                                                                                                     
PAM  LaBOLLE, President,  Alaska  State Chamber  of Commerce,  on                                                               
behalf of  approximately 700 business members  and Alaska's local                                                               
chambers of  commerce, said those  members support of EO  107 and                                                               
believe the governor is doing  what business people do every day:                                                               
increasing the  level of service, speeding  up processes, cutting                                                               
costs, meeting customer needs,  and identifying efficient problem                                                               
solving methods.   She said they believe this will  ensure a high                                                               
standard  of   environmental  protection,  reduce  the   cost  of                                                               
government,  and  encourage  future investment  in  Alaska  while                                                               
maintaining  the high  level  of  environmental protection;  they                                                               
believe   environmental    protection   and    natural   resource                                                               
development  aren't  mutually  exclusive,  but can  and  do  work                                                               
together; and they think reducing  the cost of government through                                                               
this  consolidation is  "something  that we've  all been  looking                                                               
for."  She  reiterated the previous remark  of Commissioner Irwin                                                               
regarding  the future  investment  in Alaska  being  at stake  if                                                               
nothing is  done to  make the  permitting process  more efficient                                                               
and user-friendly and to get business "rolling in Alaska."                                                                      
Number 1886                                                                                                                     
ALEX  WERTHEIMER  testified  that  he  is  a  fisheries  research                                                               
biologist  and  past  president  of the  Alaska  chapter  of  the                                                               
American [Fisheries]  Society.   Over the past  25 years,  he has                                                               
worked on  a variety of  issues involving Alaskan salmon,  and he                                                               
has been  lead author or  co-author of several  papers evaluating                                                               
the  current  status  of  Alaskan  salmon.    Those  papers  have                                                               
documented  the   remarkable  recovery  of  the   resources  from                                                               
depleted  levels at  the time  of statehood  to the  historically                                                               
high levels of recent years.  He continued:                                                                                     
     I  am frequently  challenged by  my  colleagues in  the                                                                    
     Lower 48  to explain  why, in most  of Alaska,  we have                                                                    
     record  abundances of  salmon, in  contrast to  decline                                                                    
     and  endangered species  listings of  salmon throughout                                                                    
     the Pacific  Northwest.  Are  we doing  something right                                                                    
     in Alaska?   Or are favorable  environmental conditions                                                                    
     simply  masking  inevitable   impacts  of  development?                                                                    
     Certainly, Alaska salmon  have benefited from favorable                                                                    
     environmental  conditions in  the North  Pacific Ocean.                                                                    
     In  my  view,  enlightened  fisheries  and  enhancement                                                                    
     management  policies  have   also  been  major  factors                                                                    
     contributing to the health of the resource.                                                                                
Number 1799                                                                                                                     
MR. WERTHEIMER continued:                                                                                                       
     But the  most important factor has  been the systematic                                                                    
     maintenance  of habitat  quality.   Because Alaska  has                                                                    
     the  habitat, management  policies  and enforcement  to                                                                    
     ensure   escapement  have   resulted  in   recovery  of                                                                    
     spawning  populations.   Because we  have the  habitat,                                                                    
     recovered   populations   have   had   the   productive                                                                    
     potential  to respond  to  favorable ocean  conditions,                                                                    
     resulting in record runs.                                                                                                  
     At  statehood, the  Alaska  legislature recognized  the                                                                    
     critical importance  of maintaining habitat  for salmon                                                                    
     production, even at a time  when salmon were in serious                                                                    
     decline.     They  separated   the  task   of  resource                                                                    
     development   and   habitat  protection   between   the                                                                    
     Department  of  Natural   Resources  and  the  [Alaska]                                                                    
     Department of Fish & Game  to create a system of checks                                                                    
     and  balances, and  to ensure  that both  agencies have                                                                    
     the expertise and regulatory  power to accomplish their                                                                    
     task.    This  system  has worked  remarkably  well  as                                                                    
     evidenced by the current status of the resource.                                                                           
     I'm well  aware of the  legitimate need to  develop and                                                                    
     utilize  Alaska's other  natural resources,  to provide                                                                    
     increased  economic  opportunity  in  the  state.    As                                                                    
     development pressure  and scale increase,  however, the                                                                    
     need  for an  effective system  to ensure  that impacts                                                                    
     are  minimized to  the habitat  that sustains  Alaska's                                                                    
     incredible salmon resource also increases.                                                                                 
     I  have  served  on  the biological  review  team  that                                                                    
     evaluated the  status of  Chinook salmon  in California                                                                    
     and  the  Pacific  Northwest  for  listings  under  the                                                                    
     Endangered  Species Act.   I  can assure  you that  the                                                                    
     perceived burdens  of the current system  [are] nothing                                                                    
     compared  to  the regulatory  morass  and  the cost  of                                                                    
     attempting  to   restore  runs  decimated   by  habitat                                                                    
     Why gamble  with one  of the  crown jewels  of Alaska's                                                                    
     renewable  resources?   I  urge you  not  to abandon  a                                                                    
     system that  has been so effective  [in] fulfilling the                                                                    
     mandate set by the  original Alaska legislature, and to                                                                    
     reject EO 107.                                                                                                             
MR. WERTHEIMER,  in response  to a  question by  Chair Weyhrauch,                                                               
confirmed that he  also works with the  National Marine Fisheries                                                               
Service (NMFS).                                                                                                                 
CHAIR WEYHRAUCH  told Mr. Wertheimer  he appreciates his  work in                                                               
the fisheries area.                                                                                                             
Number 1754                                                                                                                     
RON  WOLFE, Corporate  Forester, Sealaska  Corporation, testified                                                               
in support of  EO 107.  He  said his perspective is  based on his                                                               
extensive experience  with a state resource  regulation of Alaska                                                               
forest  resources, through  the  Forest  Resources and  Practices                                                               
Act,  which he  said  continues to  be  one of  the  best in  the                                                               
nation.  He continued as follows:                                                                                               
     But  we  have  experienced  "disconnects"  through  the                                                                    
     years from  what otherwise  is a  remarkably successful                                                                    
     consensus-based   process.     This   transfer  is   an                                                                    
     opportunity  to repair  those  disconnects by  bringing                                                                    
     important  interlocking  affiliations between  resource                                                                    
     disciplines  under  one   commissioner  to  achieve  an                                                                    
     improved administrative process.                                                                                           
     In the  same way that relationships  and communications                                                                    
     are  improved between  operators  and agency  personnel                                                                    
     during field  inspections, this transfer will  create a                                                                    
     closer  nexus between  the  professionals for  improved                                                                    
     organizational relationships.  It  is an opportunity to                                                                    
     recalibrate  agency  perspectives through  exchange  of                                                                    
     information, cross training, and  to establish a closer                                                                    
     physical  proximity so  a higher  degree of  efficiency                                                                    
     can be  attained at a  time when state  government must                                                                    
     be more efficient.                                                                                                         
     While  these opportunities  exist, they  must be  based                                                                    
     upon   competent   field   inspections   that   include                                                                    
     fisheries biologist  representation.  This  process can                                                                    
     create a  foundation to support  and maintain  the high                                                                    
     public confidence  in our  resource projection  that we                                                                    
     in Alaska  enjoy today, while  at the same  time create                                                                    
     the regulatory efficiencies vital  to the rebuilding of                                                                    
     our industries.                                                                                                            
     We look forward to  our continued relationship with the                                                                    
     [Alaska Department] of Fish &  Game, with the functions                                                                    
     that  will be  retained there  for such  things ...  as                                                                    
     science  and  research.    This  transfer  will  likely                                                                    
     improve  our relationship  for  the  efforts after  the                                                                    
     permit   functions  have   been   transferred  to   the                                                                    
     Department of Natural Resources.                                                                                           
Number 1630                                                                                                                     
CARL  ROSIER told  the  committee  that he  was  testifying as  a                                                               
concerned citizen  and former commissioner  of ADF&G.   He stated                                                               
that although he strongly supported  Governor Murkowski's run for                                                               
office,  that  doesn't  mean  he   supports  every  decision  the                                                               
governor   makes.     He   voiced   strong   opposition  to   the                                                               
administration's efforts to gut  the habitat authorities of ADF&G                                                               
through EO 107.  He told members:                                                                                               
     As  the previous  commissioner  of  this department,  I                                                                    
     would  characterize the  removal of  this authority  as                                                                    
     one   demanding   the   commissioner  to   manage   the                                                                    
     department on  a three-legged stool with  only two legs                                                                    
     - habitat being  the third leg that is  critical to the                                                                    
     commissioner    being   able    to   carry    out   his                                                                    
     constitutional and statutory mandates.                                                                                     
     It's not  easy to tell  a friend he's wrong  and oppose                                                                    
     him on  an issue that  was an issue that  was initiated                                                                    
     for  the right  reason of  streamlining government  and                                                                    
     better serving  the public.  Somewhere  along the path,                                                                    
     that original  thought was lost,  and the  [Division of                                                                    
     Habitat and Restoration] became  the object of a witch-                                                                    
     hunt and political vendetta,  by individuals during the                                                                    
     administration,  down a  road that  favored development                                                                    
     expedience over fish and game resources.                                                                                   
     EO 107  is the "cowboy"  action we find  ourselves with                                                                    
     as a  result of  some extremely  poor advice  given the                                                                    
     governor  - the  device that  overrode the  responsible                                                                    
     advice  given to  him by  his own  appointed transition                                                                    
     team for fish and game.                                                                                                    
     [As]  a 48-year  resident involved  with fish  and game                                                                    
     management and a strong interest  in good government, I                                                                    
     want to  assure the  committee I'm  not looking  for my                                                                    
     old  agency to  be excluded  from consideration  in the                                                                    
     governor's   plans   to   streamline   government   and                                                                    
     stimulate  the state's  economy.   There are,  however,                                                                    
     many    critical   state    functions   that    require                                                                    
     professional expertise to protect  the state and public                                                                    
     interest.   The  habitat provision  to Title  16, along                                                                    
     with  the  professional  people [who]  implement  those                                                                    
     statutes, are one of those critical functions.                                                                             
Number 1502                                                                                                                     
MR. ROSIER continued:                                                                                                           
     I would  add that  those farsighted legislators  in the                                                                    
     early days of statehood worked  hard to build that into                                                                    
     the  statutes for  that  reason.   If  fish  are to  be                                                                    
     protected and  flourish, as  they certainly  have since                                                                    
     statehood, in  the face  of development,  anything less                                                                    
     than ADF&G's  involvement increases  risk and  will, in                                                                    
     the long term - despite  all the best intentions - fall                                                                    
     into declines  in abundance,  as has  been demonstrated                                                                    
     so well in so many other states.                                                                                           
     EO  107 transfers  all but  a small  number of  habitat                                                                    
     responsibilities   from   ADF&G   to   a   new   deputy                                                                    
     commissioner in  DNR and the  state forester in  DNR as                                                                    
     well.    The order  removes  ADF&G  from virtually  all                                                                    
     support  functions   such  as   enforcement,  technical                                                                    
     advice to  the Board  of Forestry, and  research needs.                                                                    
     This  new structure  is an  interesting approach,  as I                                                                    
     know no  other state agency [where]  a partially exempt                                                                    
     deputy   position   has   more   authority   than   the                                                                    
     commissioner.    Deputy commissioners  [are]  generally                                                                    
     political  appointees   that  may   or  may   not  have                                                                    
     expertise beyond  administrative, and  partially exempt                                                                    
     positions are not confirmed with the legislature.                                                                          
Number 1450                                                                                                                     
MR. ROSIER continued:                                                                                                           
     EO  170  gives  both  the  new  deputy  and  the  state                                                                    
     forester regulatory authority, and  the deputy is given                                                                    
     "deputization" authority, the way I  read it.  The lack                                                                    
     of legislative  confirmation is, in my  view, extremely                                                                    
     poor  public   policy,  as   this  process   gives  the                                                                    
     legislature the opportunity to make  sure that fish and                                                                    
     game   habitat   is  a   standard   (indisc.--coughing)                                                                    
     commitment for  confirmation.  In this  situation, both                                                                    
     positions     (indisc.--coughing)     occur     without                                                                    
     legislative or  public input.  Despite  this, these two                                                                    
     political positions are  given great decision authority                                                                    
     [over]  habitat,  yet they  may  or  may not  have  the                                                                    
     Delegation authority  is, I  believe, a  delegation for                                                                    
     the  legislator to  the heads  of  departments, who  in                                                                    
     turn  can then  further  delegate  authority to  lower-                                                                    
     level  staffers.   By  setting up  a  structure with  a                                                                    
     deputy as  the head of  a function, it would  seem that                                                                    
     that   individual   would   require   the   legislative                                                                    
     authority in order to effectively  carry out his or her                                                                    
Number 1416                                                                                                                     
MR. ROSIER said numerous areas in  [EO 107] concern him, and he'd                                                               
list only a few  at this time.  For example,  he referred to Sec.                                                               
41.14.165(f) and opined that it  attempts to restrict the courts'                                                               
ability to fine  violators found guilty at trial to  a maximum of                                                               
the established bail  amount.  He asked, "Is it  possible that an                                                               
EO such as this can limit the court system in this manner?"                                                                     
MR.  ROSIER  referred  to  Sec.   41.17.010,  a  "declaration  of                                                               
intent."  He said, "I hope  the legislature looks closely at this                                                               
cleverly worded section, as it  commit[s] to you, the legislator,                                                               
to elevating timber  to one of the most  valuable resources, from                                                               
which all other uses and resources  flow."  He opined that timber                                                               
is important, but  no more so than fishing,  mining, tourism, and                                                               
other uses that play important roles in Alaska's economy.                                                                       
MR. ROSIER referred  to Section 8 [page 9, line  28, through page                                                               
10,  line 4],  which covers  the  research functions  of the  new                                                               
division.   He  said  those needs  are to  be  identified by  the                                                               
division,  DEC [Department  of  Environmental Conservation],  the                                                               
new deputy,  and the timber  industry.  He surmised  that [ADF&G]                                                               
falls in the category of "other  affected agencies."  He said the                                                               
governor, in his  sales pitch, has consistently  said ADF&G would                                                               
continue  in  its   research  role,  but  Mr.   Rosier  said  the                                                               
department certainly has no designated role in EO 107.                                                                          
MR.  ROSIER referred  to  Section  9 [page  10,  lines 5-21]  and                                                               
commented that only  the state forester [and] the  new deputy and                                                               
DEC have  the authority to report  on effectiveness, regulations,                                                               
and best  management practices  adopted under AS  41.   He added,                                                               
"No role for the agency responsible for fish and game."                                                                         
Number 1330                                                                                                                     
MR. ROSIER  posited that there  are significant numbers  of other                                                               
questions that  should be answered before  the legislature allows                                                               
this  transfer  to go  forward.    He said  the  administration's                                                               
justification for this very serious move  has not been shown.  He                                                               
stated, "On the basis of very  poor advice, the governor has been                                                               
put in  the position of  trying to justify  the action of  what I                                                               
would consider false examples of  what has actually transpired in                                                               
ADF&G field offices."  He continued as follows:                                                                                 
     Permit statistics,  while not totally accurate,  show a                                                                    
     tremendous  workload that  is being  accomplished in  a                                                                    
     fairly timely  manner, with very  few total  denials of                                                                    
     permit.   With  all due  respect to  Commissioner Irwin                                                                    
     and his good  assurances to suggest that  fish and game                                                                    
     will  be protected  in the  absence of  ADF&G from  key                                                                    
     functions   and   replace   them  with   the   industry                                                                    
     development influence of DNR,  coupled with dropping 22                                                                    
     positions  from the  permitting process  while claiming                                                                    
     expedited permit  service to the public,  I think truly                                                                    
     challenges the intelligence of all Alaskans.                                                                               
     This  entire matter  is a  management  problem, not  an                                                                    
     issue to tear  up a system that has served  a state and                                                                    
     all the resources well.   Let's don't go about fixing a                                                                    
     system that isn't broken, based  on the flimsy evidence                                                                    
     to date.   ... Please pass the  resolution denying this                                                                    
     action to  the governor,  and perhaps  we can  begin to                                                                    
     look   at   simpler  solutions   involving   management                                                                    
      measures by the new commissioner, regulatory review,                                                                      
       and, perhaps, centralizing for one-stop permitting                                                                       
Number 1247                                                                                                                     
REPRESENTATIVE GRUENBERG  referred to page  8 of EO 107  and said                                                               
the only  change he sees  in the current law  is on page  9, line                                                               
19, where  a couple  of statutory designations  are changed.   He                                                               
offered  his belief  that it  is a  technical change  only, which                                                               
wouldn't do anything  substantive.  He suggested  that Mr. Rosier                                                               
reconsider that section.                                                                                                        
Number 1160                                                                                                                     
DAVE HANNA testified that he  is a lifelong Juneau resident whose                                                               
family  has  been  in  [Alaska]  since the  1870s  and  has  been                                                               
involved   in   mining,   fishing,   timber,   and   construction                                                               
development  during that  time.    Mr. Hanna  noted  that he  has                                                               
worked in the  construction industry for his  entire life, acting                                                               
as  the  lead  person  involved   in  planning,  permitting,  and                                                               
developing various  mining, timber, and  construction development                                                               
work in Southeast Alaska  for the last 25 years.   He said he has                                                               
a fair amount of experience  in dealing with regulatory agencies;                                                               
not a day  goes by when he  does not have a  project that's under                                                               
review by "some government entity."                                                                                             
MR. HANNA said he has watched  the process evolve over the years.                                                               
In the  last 25 years,  he said, he  doesn't believe he  has ever                                                               
failed  to get  an  efficient, fair,  expedient  review from  the                                                               
Division  of  Habitat  [and  Restoration].    He  added  that  he                                                               
believes  the division's  process works  fairly well.   He  noted                                                               
that some of  his projects "have the possibility  of having large                                                               
impacts on  ... major  fisheries that  involve sport  fish issues                                                               
[and commercial] fish  issues."  He said he thinks  the fact that                                                               
habitat personnel  "sit next  door to" and  work with  those same                                                               
divisions is one  reason they work so effectively.   He remarked,                                                               
"They  usually  conclude their  reviews  at  the same  speed  or,                                                               
often, faster than a lot of the other regulatory agencies."                                                                     
MR.  HANNA indicated  he'd had  one problem  with [ADF&G]  in the                                                               
past.    He  explained  that  he is  involved  with  a  nonprofit                                                               
watershed  partnership  group  that  does a  lot  of  good  work,                                                               
including  restoration  projects;  the group  had  a  restoration                                                               
project that  involved some new  technology that "the  folks from                                                               
ADF&G up north"  were not familiar with.  He  said, "It was their                                                               
policy  that  if  they  weren't  familiar  with  something,  they                                                               
wouldn't act on it."  He  said, fortunately, his group had access                                                               
to the  commissioner's office, where [then]  Commissioner Rue and                                                               
his staff considered the project and realized it was a good one.                                                                
MR. HANNA  said the problems  that have been seen  aren't process                                                               
problems  or  system  problems,  but are  policy  problems.    He                                                               
remarked,  "It's very  analogous to  what  goes on  with the  big                                                               
industries that we're  concerned with - the  industries that want                                                               
assurances."    Saying there  are  inconsistencies  in regard  to                                                               
policies, he opined  that the way to change  existing problems is                                                               
by changing the policies.                                                                                                       
Number 1000                                                                                                                     
MR. HANNA  said [the Division  of Habitat and  Restoration] staff                                                               
seems to have a better record  of processing its permits than the                                                               
DNR staff  does.  He  proffered that one  of the reasons  that it                                                               
does work so efficiently is that  it works hand in hand with [the                                                               
Divisions  of  Sport  Fish  and  Commercial  Fisheries].    Under                                                               
[EO 107], offices  and positions will  be lost, resulting  in the                                                               
loss of local  knowledge; the permitting decisions  will be based                                                               
on a  lack of  knowledge, which will  either slow  the permitting                                                               
process  "or  we're really  invalidating,  as  far as  the  other                                                               
agencies are concerned."   Mr. Hanna said "we" are  looking to be                                                               
pro-development  in the  state, that  more projects  require more                                                               
permits, and that  a reduced staff will not get  more permits out                                                               
MR.  HANNA said  this  administration is  capable  of fixing  the                                                               
policy problems  with the current  setup.  He added,  "This would                                                               
be a  short-term fix."   He said industry really  needs long-term                                                               
assurances; therefore,  he opined that the  administration should                                                               
help  get  guidelines  firmly  fixed, perhaps  in  statute.    He                                                               
mentioned  a  long-term  legacy  to  leave  the  state  and  said                                                               
administrations  come  and  go.    He  said  there  has  been  no                                                               
substantiation   from   the   administration   or   commissioners                                                               
regarding how  [EO 107] will work  better.  He said  other states                                                               
that have adopted  this model have lost their  resources and have                                                               
failing economies.   He opined that  it is a fiction  that EO 107                                                               
will  make  things  better.   He  encouraged  rejection  of  this                                                               
concept and EO 107.                                                                                                             
Number 0818                                                                                                                     
AURAH  LANDAU  began by  noting  that  she'd testified  yesterday                                                               
before  the  Senate Resources  Standing  Committee  on behalf  of                                                               
Southeast Alaska  Conservation Council  (SEACC) and  would submit                                                               
that testimony to the current  committee.  However, she specified                                                               
that  she was  currently  testifying  on her  own  behalf.   With                                                               
regard to  EO 107, she said  no authority would exist  for stream                                                               
buffer enforcement,  protection, and monitoring on  federal land.                                                               
The Forest Practices Act only  applies to state and private land,                                                               
and 97  percent of  Southeast Alaska  is in  federal title.   She                                                               
said 80 percent of the  fish caught around Southeast Alaska spawn                                                               
in Tongass National Forest streams;  if there is no authority for                                                               
protecting the riparian  areas, it would have quite  an impact to                                                               
Southeast Alaska communities and the commercial fishing there.                                                                  
MS. LANDAU mentioned the Pacific Salmon  Treaty.  She said one of                                                               
the  foundations of  that  treaty is  the  assumption of  healthy                                                               
fisheries.    She said,  "We  certainly  don't  want to  have  to                                                               
renegotiate an international treaty  just based on the assumption                                                               
of  potentially  having  problems  or   a  major  impact  to  our                                                               
MS.  LANDAU  reported  that  several  years  ago  SEACC  went  to                                                               
Washington,  D.C., to  argue against  the Endangered  Species Act                                                               
listing of several Columbia River  salmon stocks, which helped to                                                               
stop listing  stocks that would have  affected Alaskan fishermen.                                                               
She said  every now and  then, SEACC  gets calls asking  if there                                                               
are  stocks that  people are  interested  in potentially  listing                                                               
under the  Endangered Species Act.   She said the  entire country                                                               
looks at the fisheries [in Alaska],  and if there is no authority                                                               
for protecting fisheries  on national forest land  in Alaska, the                                                               
scrutiny will  be acute, and it  will be difficult for  the state                                                               
to hold up a case that "the stocks are safe."                                                                                   
CHAIR WEYHRAUCH said  he would personally study  the legal issues                                                               
that Ms. Landau raised and report them to the Department of Law.                                                                
REPRESENTATIVE  BERKOWITZ   asked  Ms.  Landau  to   submit  more                                                               
information  regarding the  instance of  her assistance  with the                                                               
Endangered Species Act.                                                                                                         
Number 0570                                                                                                                     
ERIC  LEE  testified  that  he is  a  commercial  fisherman  from                                                               
Petersburg whose  family has been involved  in commercial fishing                                                               
since  his grandfather's  arrival  in 1902;  he also  subsistence                                                               
hunts.   He requested that  the committee overturn EO [107].   He                                                               
said  the fishing  industry is  the  backbone of  the economy  of                                                               
Alaska and  generates more  jobs than any  other industry  in the                                                               
state, including  the oil industry.   Tourism is also a  big part                                                               
of Alaska's  economy and promises to  play a larger role  as time                                                               
goes  on.    Both  industries are  ultimately  dependent  on  the                                                               
quality  of  the habitat;  therefore,  protecting  the future  of                                                               
these  industries by  protecting habitat  is essential  to ensure                                                               
the health of  the state's economy.  He opined  that it should be                                                               
a top priority to ensure  that [Alaska's] habitat is managed with                                                               
the  best possible  science  and an  adequate  staff to  evaluate                                                               
permitting issues.                                                                                                              
MR.  LEE said,  if this  transfer of  the habitat  division takes                                                               
place,  permitting  decisions  made  in  DNR  will  be  prone  to                                                               
mistakes  and oversights.   Overworked  employees  working in  an                                                               
atmosphere  of  expediencies  do  make  mistakes,  and  important                                                               
considerations will not be addressed.  Biologists without site-                                                                 
specific  knowledge  will be  first  to  make decisions.    Site-                                                               
specific knowledge is essential  in Alaska, where conditions vary                                                               
so  greatly, he  emphasized.    Noting that  the  stated goal  of                                                               
[EO 107] is  efficiency and streamlining,  he posited  that these                                                               
are  inappropriate  and  dangerous priorities  for  managing  the                                                               
habitat that is  so important to the state's economy  and its way                                                               
of life.   He concluded,  "Mandated efficiency is simply  not the                                                               
proper priority in this instance.   Our goals in managing habitat                                                               
should always be to manage it in the best possible way we can."                                                                 
Number 1384                                                                                                                     
BRUCE BAKER  testified that he  retired from ADF&G 10  years ago,                                                               
after  serving with  the department  for 11  years as  the deputy                                                               
director  of the  habitat division.   He  urged the  committee to                                                               
bring to  a floor vote  a resolution to reject  EO 107.   He told                                                               
     The  state needs  to maintain  the checks  and balances                                                                    
     between  ADF&G  and DNR  that  have  benefited ...  the                                                                    
     Alaskan   economy  since   ...   statehood.     ADF&G's                                                                    
     fundamental  mission is  to protect  Alaska's fish  and                                                                    
     wildlife resources.   DNR's  fundamental mission  is to                                                                    
     develop  the state's  other natural  resources.   These                                                                    
     two missions  balance each other  in a way  the ensures                                                                    
     adequate   protection  of   the  state's   economically                                                                    
     important  fish and  wildlife  habitats while  allowing                                                                    
     natural  resource development  to proceed  in a  timely                                                                    
     manner.   By  eliminating the  permitting authority  of                                                                    
     one  of   these  two  agencies,  the   executive  order                                                                    
     eliminates these checks and balances.                                                                                      
     The  executive  order  is  a  solution  looking  for  a                                                                    
     problem.    The  timeliness of  ADF&G's  permitting  is                                                                    
     exemplary.   Of 1,926 Title 16  applications that ADF&G                                                                    
     received last  year, over 99 percent  of the applicants                                                                    
     either received  permits or were told  that they didn't                                                                    
     even need  to have  one.   The average  processing time                                                                    
     was only  14 days.   If  there's a  development project                                                                    
     that seems  to be high-centered over  a habitat-related                                                                    
     authorization,   there  is   already   a  process   for                                                                    
     department commissioners to  quickly resolve the issue,                                                                    
     consistent  with  the  policies  of  whatever  governor                                                                    
     happens to be in office at the time.                                                                                       
     What  Alaska  needs in  order  to  promote its  natural                                                                    
     resource development,  without costly permit  delays or                                                                    
     lawsuits, is to increase  rather than eliminate habitat                                                                    
     staffing, and  to leave it  in the department  that has                                                                    
     the bedrock  of fish and wildlife  expertise upon which                                                                    
     to  draw.    The  governor  has  criticized  ADF&G  for                                                                    
     habitat  permits  for  which  he  was  given  incorrect                                                                    
     For  the   record,  I'll  leave  with   you  two  ADF&G                                                                    
     memoranda   that   provide   corrected   and   specific                                                                    
     information that  the governor  did not  have available                                                                    
     to  him  when  he  made  his  public  statements.    In                                                                    
     closing,  EO 107  is  not so  much  about making  state                                                                    
     government  more efficient  as  it is  a thinly  veiled                                                                    
     effort to  lower the habitat-protection bar  for permit                                                                    
Number 0156                                                                                                                     
FRANK  RUE testified  on his  own behalf,  listing his  past work                                                               
experience including  nine years as  a resource manager  for DNR,                                                               
seven years as the director of  the division of habitat in ADF&G,                                                               
and  eight years  as  commissioner  of ADF&G.    He  said he  has                                                               
respect for the professionals at  DNR.  He mentioned working with                                                               
Commissioner Irwin when he was at  Fort Knox on a very successful                                                               
project.    He  said  there  have been  a  number  of  successful                                                               
projects involving "an independent"  ADF&G working with DNR [and]                                                               
DEC.   He indicated  that the  projects are  done while  fish and                                                               
water quality are protected.                                                                                                    
MR. RUE urged  the committee to reject EO 107  and stick with the                                                               
system  that  the  original  legislature  that  set  up  Alaska's                                                               
statutes  provided  for  the  state  to  protect  its  incredibly                                                               
important fish  resources.   He said it  can't be  forgotten that                                                               
sport fishing  is a $600-million-a-year  business.  The  value of                                                               
commercial fishing  last year  he estimated  to be  $250 million.                                                               
He pointed out that subsistence  fishing is also very valuable to                                                               
MR. RUE  said the reason  given for [EO  107] is efficiency.   He                                                               
referred  to the  organizational chart  and said,  "With all  due                                                               
respect,  you  could remove  all  those  layers in  the  existing                                                               
[Division of Habitat and Restoration]  if all you're going for is                                                               
efficiency."   For  example, he  noted that  regional supervisors                                                               
are removed [in EO 107], but  instead could be removed from ADF&G                                                               
and yet leave  the staff and have a director  and a commissioner.                                                               
He said,  "In terms  of efficiency  and removing  layers, there's                                                               
nothing about moving it to DNR that's magic.  You can do that."                                                                 
TAPE 03-22, SIDE A                                                                                                            
Number 0001                                                                                                                     
MR. RUE indicated the discussion  is not about coastal management                                                               
and EO 106, but ADF&G's  permitting authority inside the banks of                                                               
streams that support  salmon, rainbow trout, and  grayling.  Most                                                               
of those permits are single-agency permits:   just ADF&G.  As for                                                               
efficiency, [the permits]  are out in 14 days, and  there are not                                                               
other agencies  to coordinate with  most of  the time.   He said,                                                               
"So you're  not going to get  efficiencies by being next  to DNR,                                                               
and  you're  going  to  lose  efficiencies  by  being  away  from                                                               
commercial fish biologists, sport fish biologists, et cetera."                                                                  
MR. RUE  highlighted myths that  minimize the impact  on Alaska's                                                               
fish.     He  clarified  that   this  has  nothing  to   do  with                                                               
personalities  or individuals,  but  rather  with which  agencies                                                               
have a mission and what that mission  is.  He said the first myth                                                               
is that  the level of  protection will be  the same.   The second                                                               
myth is that Oregon, with its  combined fish and game and natural                                                               
resources  departments, should  be  Alaska's  model for  success.                                                               
Regarding the first myth, Mr.  Rue asked, "If protection is going                                                               
to be the same, why move it?"                                                                                                   
MR. RUE, regarding efficiency, said  the only way to speed things                                                               
up,  given  the  incredible  record  of  ADF&G's  moving  permits                                                               
quickly, is  to "get out a  rubber stamp and just  start stamping                                                               
projects as  they come in  the door."   He said he  doesn't think                                                               
that's a  good way to do  business.  He told  members [ADF&G] has                                                               
been  very  good  about  doing  field  reviews  and  "pre-project                                                               
working with  developers, trying to  design their project  to fit                                                               
that stream reach."   He said, "The standard  of protection won't                                                               
be the  same for this reason."   He said the  anadromous fish Act                                                               
and the fishways Act have  very broad discretionary standards, as                                                               
follows:  what  is important in anadromous fish  habitat; what is                                                               
proper protection  of that habitat;  and when it is  necessary to                                                               
provide a  fishway.  He said  those are about the  only standards                                                               
that exist  in law.  [Through  EO 107], those decisions  would be                                                               
made  by   a  deputy   commissioner  in   DNR,  instead   of  the                                                               
commissioner of ADF&G.                                                                                                          
MR.  RUE  explained   that  the  commissioner  of   ADF&G  has  a                                                               
responsibility  to "get  out  the catch,"  to  provide for  sport                                                               
fishing, commercial  fishing, subsistence fishing,  and personal-                                                               
use  fishing.   He  stated  his  belief  that because  the  legal                                                               
mandate  of the  commissioner of  ADF&G is  to provide  for these                                                               
opportunities, the  standard protection  by that  department will                                                               
be higher  than that of  a deputy commissioner in  the department                                                               
whose  mission is  "to get  out  the cut,  get out  oil, get  out                                                               
mining, gravel, which are all  very legitimate, but it's going to                                                               
be a different standard."  He said:                                                                                             
     We  tried  this  experiment  in Alaska  with  the  U.S.                                                                    
     Forest  Service.   They refused  to get  fish and  game                                                                    
     permits.    They  had biologists  in  the  agency,  but                                                                    
     without authority.   The road engineer  or the forester                                                                    
     made the final  decision on road crossings.   We found,                                                                    
     after years  of persuasion,  the [U.S.]  Forest Service                                                                    
     finally agreed to  work with [ADF&G] and  let us review                                                                    
     their  projects.   We jointly  went  out, reviewed  the                                                                    
     Tongass roads  condition, and found that  70 percent of                                                                    
     the  culverts  that  had  been put  in  by  the  Forest                                                                    
     Service,  without [ADF&G]  review,  blocked or  impeded                                                                    
     fish passage of anadromous fish.                                                                                           
     To their credit,  the Forest Service has  now signed an                                                                    
     MOU  with   [ADF&G,  which]   will  review   all  their                                                                    
     projects,  and   to  their  credit,   they're  spending                                                                    
     millions of dollars to fix  those old problems.  We can                                                                    
     avoid those  problems by keeping our  current system as                                                                    
     it is.                                                                                                                     
Number 0344                                                                                                                     
REPRESENTATIVE  BERKOWITZ  voiced   his  understanding  that  the                                                               
presence of  a vibrant habitat  division was critical  in getting                                                               
NPR-A  [National  Petroleum   Reserve-Alaska]  leases,  with  the                                                               
consent of the  federal government.  He asked Mr.  Rue to explain                                                               
how that  came to pass and  what "elimination of movement  of the                                                               
habitat division would mean."                                                                                                   
MR. RUE  offered his belief  that the Clinton  Administration and                                                               
[then U.S.  Secretary of  the Interior]  Babbitt opened  up NPR-A                                                               
for leasing  in large part  because the  State of Alaska  came up                                                               
with a  position to  support oil and  gas development  there that                                                               
protected key  fish and  wildlife resources.   Because  ADF&G was                                                               
"on  board,"  he  said, he  and  then-Commissioner  Shively  went                                                               
before the Resource Development  Council and were jointly pushing                                                               
the  proposal  for  NPR-A,  as  two  departments  with  statutory                                                               
responsibilities saying, "We can protect fish."                                                                                 
MR. RUE  added that he thinks  this trust is critical  - that the                                                               
public  believes  their fish  are  being  protected if  ADF&G  is                                                               
involved.  He questioned whether  [the public] will have the same                                                               
trust  if  ADF&G  has  no  role in  either  buffer  decisions  or                                                               
instream permit  decisions.  He  added that he also  believes the                                                               
federal agencies  will become  more aggressive  and not  defer as                                                               
much as they have in the past to ADF&G.                                                                                         
Number 0497                                                                                                                     
REPRESENTATIVE  BERKOWITZ  stated  concern  that EO  107  can  be                                                               
interpreted  as a  signal of  retreat from  the level  of habitat                                                               
protection, which may  be critical in Alaska's  ability to secure                                                               
national  cooperation when  it comes  to developing  oil and  gas                                                               
resources.  He  said, "We have to  remember that we do  play on a                                                               
wider stage  than just for  eternal consumption."  He  asked what                                                               
the  biologist do  precisely, and  why they  are so  critical for                                                               
habitat's function.                                                                                                             
MR.  RUE answered  that habitat  biologists who  are involved  in                                                               
permit decisions  do two things.   First, they do  their homework                                                               
so they  understand what's going  on a particular stream  where a                                                               
project is  proposed.  They talk  to the people who  work in [the                                                               
Division of] Sport Fish, who have  a lot of knowledge gained from                                                               
doing research, and  to the people who work in  [the Division of]                                                               
Commercial Fisheries  such as  biologists, "so  they know  from a                                                               
fish value perspective  what's at risk."  Then,  when a developer                                                               
comes  in  and  asks  for  a  permit,  [the  habitat  biologists]                                                               
understand the developer's needs.  He continued:                                                                                
     I  think you'll  see  that this  is  mostly borne  out.                                                                    
     They  go  out  and  they  kick dirt  with  folks.    As                                                                    
     Mr. Hanna said,  they know  what it  takes to  get from                                                                    
     here to  there across  a stream, and  they know  how to                                                                    
     work with  folks and  give them ideas  about how  to do                                                                    
     their job.  [For example],  where's a good place to put                                                                    
     your road; what  if you move it over here;  what if you                                                                    
     have  ... this  kind  of culvert  versus  that kind  of                                                                    
     culvert?   They have  a lot of  in-the-field experience                                                                    
     which they  can bring  to developers  to help  them get                                                                    
     their project  done while protecting  our fish  so that                                                                    
     we have  both roads, for  instance, and fish.   So they                                                                    
     do those two things.                                                                                                       
Number 0612                                                                                                                     
REPRESENTATIVE  BERKOWITZ  referred  to the  biologists  who  are                                                               
losing their  jobs.  He  said, from Mr. Rue's  description, those                                                               
biologists  aren't  interchangeable;  [it  isn't  as  simple  as]                                                               
hiring new people to replace  them, because they have a reservoir                                                               
of knowledge  about particular watersheds and  fish, for example,                                                               
that can't be replaced overnight.                                                                                               
MR. RUE  concurred that there  is a  lot of expertise  that comes                                                               
with  experience.    He  said  a lot  of  good  biologists  will,                                                               
hopefully, stay if [EO 107 is  carried out], and will continue to                                                               
lend their expertise.  He indicated  the need to have a structure                                                               
where new  people are [hired]  and trained.   He opined,  "I also                                                               
think  you'll   lose  that  connection   to  the   experience  of                                                               
biologists  in the  other divisions  and their  expertise; you'll                                                               
have biologists housed in DNR  who will become DNR employees, and                                                               
they will  lose that connection  back to the information  and the                                                               
expertise  of the  other fish  biologists  who know  a lot  about                                                               
those  streams."   He added  that, in  fact, they  may know  more                                                               
about  individual streams  than  a  "habitat" biologist,  because                                                               
they are  often out  there doing surveys  and running  weirs, for                                                               
example.   He said [the  Divisions of] Sport Fish  and Commercial                                                               
Fisheries biologists probably  have more on-the-ground experience                                                               
with a  particular stream,  which they can  then transmit  to the                                                               
habitat biologists.                                                                                                             
Number 0714                                                                                                                     
REPRESENTATIVE   GRUENBERG  said   he   sees   that  the   Alaska                                                               
constitution  requires that  fish shall  be utilized,  developed,                                                               
and  maintained  on the  sustained  yield  principle, subject  to                                                               
preferences among beneficial  uses.  He asked Mr. Rue  if he sees                                                               
any difference between this constitutional  mandate and the other                                                               
constitutional mandates  under which DNR  operates.  He  asked if                                                               
there would  be any potential  conflict if habitat  functions are                                                               
moved to [DNR].                                                                                                                 
MR.  RUE responded  that the  main conflict  he sees  is the  one                                                               
Mr. Rosier  previously stated  regarding the  three-legged stool.                                                               
He  highlighted the  importance of  protecting habitat,  managing                                                               
the  fisheries by  controlling the  catch, having  good research,                                                               
and  having  a good  public  regulatory  process to  set  fishing                                                               
regulations.   He said, "That's my  four legs;, you can  do it in                                                               
MR. RUE said habitat is key  to sustained yield.  He informed the                                                               
committee  Alaska's  salmon  fisheries  were  just  certified  as                                                               
sustainable  by the  Marine Stewardship  Council, an  independent                                                               
certifying agency.   He mentioned  that Europe is starting  to be                                                               
concerned about sustainability, and he  said one key principle to                                                               
sustainable  fish management  is protecting  habitat.   He voiced                                                               
his belief  that if  ADF&G is not  worrying about  salmon habitat                                                               
"in  the banks"  and being  involved with  the buffer  decisions,                                                               
then sustainability will  be at risk over the  long term, perhaps                                                               
in 10-40 years.                                                                                                                 
Number 0860                                                                                                                     
PAULA  TERRELL,   Alaska  Marine  Conservation   Council  (AMCC),                                                               
testified  that  AMCC is  a  statewide  organization with  almost                                                               
1,000   individual  members   including  fishermen,   subsistence                                                               
harvesters,  marine   scientists,  conservationists,   and  small                                                               
business  owners, who  are  linked  by a  desire  to protect  and                                                               
restore  the   ocean  environment  through   sustainable  fishing                                                               
practices, habitat protection, and  local stewardship.  The board                                                               
is made up primarily of commercial fishermen.                                                                                   
MS. TERRELL  said AMCC  opposes EO 107,  which has  only downside                                                               
risks  for fishermen.   She  noted that  the statutes'  moving is                                                               
taking the authority away from ADF&G.   Thus it will be up to DNR                                                               
to decide  whether ADF&G will  be consulted, will be  advised, or                                                               
will have  due deference, for  example.  She said  fishermen have                                                               
looked to  ADF&G's habitat division  for the protection  of their                                                               
fisheries,  and  have  benefited  from the  balance  provided  by                                                               
having both  DNR and  ADF&G involved.   Noting that  the mandates                                                               
differ,  however,  she explained  that  ADF&G  protects fish  and                                                               
wildlife,  whereas  DNR   promotes  development  of  nonrenewable                                                               
MS.  TERRELL remarked  that  Mr. Rue  had  previously alluded  to                                                               
something that  is "a really  large misconception which  needs to                                                               
be addressed."  She pointed  out that habitat-related permits are                                                               
primarily  single  permits,  rather  than  the  multiple  permits                                                               
characterized as the problem by the  governor and DNR.  Thus this                                                               
change won't  get to the  crux of what  the governor and  DNR say                                                               
the problem  is.   She said  multiple permits  are the  ones that                                                               
involve  more  than  one  state agency.    They  involve  federal                                                               
agencies and are  generally for big projects.  Thus  in trying to                                                               
resolve  a  problem  of  multiple  permitting,  moving  Title  16                                                               
permitting is just not going to do it.                                                                                          
Number 1062                                                                                                                     
MS.  TERRELL set  forth several  questions AMCC  would like  this                                                               
committee to ask  the administration.  First, does  EO 107 really                                                               
address the problem the administration  wants to resolve?  If the                                                               
problem is really multiple permitting,  why is the administration                                                               
focusing  on the  instream permitting  process, which  is just  a                                                               
question  of what  is happening  in  the streams?   Second,  will                                                               
DNR's  deputy  commissioner   continue  the  historical  practice                                                               
within [ADF&G]  by the commissioner  of delegating  authority for                                                               
making   the  initial   permitting  decisions   to  the   habitat                                                               
biologists, who  are the  ones that  do the  review and  sign the                                                               
permits?    Would these  decisions  then  become subject  to  the                                                               
process repeals to  the DNR commissioner?  And how  is that going                                                               
to work?  She continued:                                                                                                        
     The other  question is  - [Mr. Rue]  alluded to  this -                                                                    
     the  very   broad  discretion  that  the   now  [ADF&G]                                                                    
     commissioner   and,   if    this   happens,   the   DNR                                                                    
     commissioner  will  have.  ...  The  commissioner  will                                                                    
     determine the  waters in the  state that  are important                                                                    
     for the rearing, spawning,  and migration of anadromous                                                                    
     fish, or the DNR  deputy commissioner would decide what                                                                    
     constitutes  important  habitat.   ...  This  is  broad                                                                    
     discretion, and  it's over there  now in DNR  under the                                                                    
     executive  order.   ... Given  the differing  mandates,                                                                    
     what  safeguards  would  prevent this  discretion  from                                                                    
     becoming unduly conflicted?                                                                                                
Number 1145                                                                                                                     
MS. TERRELL said, at a minimum,  AMCC urges the committee and the                                                               
legislature to request the following  from the administration:  a                                                               
commitment by  the governor  that 1)  the habitat  biologists who                                                               
are being  transferred from ADF&G  would be housed in  this newly                                                               
formed Office of Habitat Management  and Permitting, and 2) that,                                                               
under this  reorganization, the deputy commissioner  of DNR would                                                               
delegate  the authority  for issuing  and signing  the anadromous                                                               
fish Act and  fishways Act permits to the  habitat biologists who                                                               
have been  transferred, and who currently  [have that authority];                                                               
and  a commitment  by DNR  1) to  require the  state forester  to                                                               
grant due deference under the  Forest Practices Act to the Office                                                               
of Habitat  Management and Permitting  on issues relating  to the                                                               
harvest of streams within the  66-foot buffer on private land and                                                               
the coastal  zone, and  2) that  there would  continue to  be the                                                               
same level  of permit monitoring, compliance,  and enforcement as                                                               
has previously existed.                                                                                                         
Number 1223                                                                                                                     
GENE HARRISON  testified in opposition  to EO  107.  He  told the                                                               
committee he has  been an Alaskan resident for over  20 years and                                                               
works as  an artist and naturalist.   He said the  most troubling                                                               
issue regarding EO 107 is  elimination of the checks and balances                                                               
needed to ensure  a healthy environment for fish  and game, which                                                               
is the mission of ADF&G.  The  mission of DNR is to issue permits                                                               
for development.  He  said it is also evident to  him and to many                                                               
of his friends why the governor  wants this transfer and also the                                                               
elimination  of many  positions relating  to habitat,  primarily,                                                               
the biologists.   He characterized  the transfer of  authority as                                                               
putting  the fox  in charge  of  the henhouse.   He  said he  has                                                               
listened  to those  in favor  of  EO 107  testify that  nothing's                                                               
going to change; thus questioned why the change is being made.                                                                  
Number 1341                                                                                                                     
LANCE TRASKY testified in opposition to  EO 107.  He told members                                                               
he is a fisheries biologist who  has worked for both the State of                                                               
Michigan and  the State of  Alaska, with 30 years'  experience as                                                               
both a fisheries research biologist  and a habitat biologist.  He                                                               
stated his  belief that  the change  in EO 107  will result  in a                                                               
long-term  decline of  fish habitat  in  Alaska; it  dramatically                                                               
changes the existing balance between  protecting the fish habitat                                                               
and the activities that have  historically impacted fish habitat.                                                               
He said the First Alaska  State Legislature established ADF&G and                                                               
gave it the statutory responsibility  to ensure that fish passage                                                               
is maintained  on all  streams and that  the productivity  of all                                                               
lakes and  streams supporting  salmon, steelhead,  whitefish, and                                                               
other anadromous fish is preserved.                                                                                             
MR.  TRASKY said  the anadromous  fish Act  and the  fishways Act                                                               
were designed  to provide  balance between  nonrenewable resource                                                               
development and the public's interest  in maintaining the state's                                                               
fisheries  resources.   He mentioned  support of  Alaska's sport,                                                               
commercial, and subsistence fisheries.   He noted that these laws                                                               
were enacted  and ADF&G was  created because the  legislature had                                                               
witnessed  the final  collapse  of the  salmon  fisheries in  the                                                               
Pacific  Northwest  and  were  well  aware  of  the  reasons  why                                                               
fishermen,  including subsistence  users, lost  their [resource].                                                               
He continued:                                                                                                                   
     The legislators made a conscious  decision to place the                                                                    
     trust  to  maintain  fish  habitat   in  the  hands  of                                                                    
     fisheries professionals  in the new Department  of Fish                                                                    
     &  Game,  rather  than  in   a  Department  of  Natural                                                                    
     Resources,  for fish  and habitat  protection was  just                                                                    
     one consideration  in a department with  many competing                                                                    
     interests.   This  was a  reasonable decision,  because                                                                    
     Alaska's sport, commercial,  and subsistence fisheries,                                                                    
     and the  businesses which support them,  were and still                                                                    
     are  the  largest  non-governmental  employers  in  the                                                                    
     state, a major part of our economy and culture.                                                                            
     I have not seen any  evidence of proper balance between                                                                    
     fish  and  wildlife  habitat protection  and  (indisc.)                                                                    
     economic development has not  occurred over the 40-plus                                                                    
     years  since statehood.    In the  last  25 years,  the                                                                    
     Department of Fish & Game  has reviewed between 40,000-                                                                    
     50,000  applications  for   large  and  small  projects                                                                    
     affecting (indisc.)  streams that were likely  to block                                                                    
     fish paths.                                                                                                                
Number 1462                                                                                                                     
MR.  TRASKY  mentioned the  Brandy  Lake  hydro project  and  its                                                               
culverts.   He said records  show that  more than 99  percent [of                                                               
the permits]  were issued and only  a fraction of a  percent were                                                               
denied.  In 25 years, there  have been only six formal appeals of                                                               
ADF&G Title 16  permit denials for conditions.  He  said the vast                                                               
majority of  people who have  received Title 16 permits  from the                                                               
[Division  of] Habitat  and Restoration  are satisfied  that they                                                               
were  treated  fairly  and  that   the  projects  were  permitted                                                               
efficiently; conversely,  hundreds of decisions in  DNR have been                                                               
repealed and litigated in the same time period.                                                                                 
MR.  TRASKY  said  currently   the  governor's  resource  cabinet                                                               
resolves  instances  when   there  are  unresolved  disagreements                                                               
between  ADF&G and  another state  department  or federal  agency                                                               
over  the appropriate  level  of fish  habitat  protection for  a                                                               
project.  Because these debates  are currently part of the public                                                               
process,  the public  or the  coastal districts  often weigh  in.                                                               
However,  if  all  the  fish   habitat  protection  authority  is                                                               
transferred  to  DNR, any  disputes  will  be settled  internally                                                               
between  a  DNR fisheries  biologist  and  the directors  of  the                                                               
Divisions  of Forestry;  Mining, Land  and Water;  or Oil  & Gas.                                                               
Thus ADF&G will not have a  say in the process, and it's unlikely                                                               
the public will hear about [any such dispute].                                                                                  
MR. TRASKY said incremental habitat  loss is the primary cause of                                                               
the  dramatic   decline  in  wild,  freshwater   anadromous  fish                                                               
populations  in  the  United  States.   By  moving  ADF&G's  fish                                                               
habitat protection statutes  to DNR, the state  would be adopting                                                               
a  resource  management model  that  has  historically failed  to                                                               
maintain  fisheries  habitat.   He  reiterated  that the  Pacific                                                               
Northwest is a  model for that [decline in  fish populations] and                                                               
has consistently failed to protect  fish habitat.  With regard to                                                               
the Oregon  model mentioned by  Mr. Rue, Mr. Trasky  said several                                                               
Pacific Northwest states use the  model that DNR's proposing.  He                                                               
told members:                                                                                                                   
     The  best source  of  empirical  data illustrating  the                                                                    
     inherent  flaws  in  this type  of  system,  where  all                                                                    
     decisions   are  internalized,   is  the   U.S.  Forest                                                                    
     Service.   The  U.S. Forest  Service is  a very  large,                                                                    
     well-funded  agency tasked  with developing  timber and                                                                    
     nonrenewable   resources   and  conserving   fish   and                                                                    
     resources  and   habitat  in  national  forests.     In                                                                    
     addition  to  foresters,  for  many  years  the  [U.S.]                                                                    
     Forest   Service  has   employed   fish  and   wildlife                                                                    
     biologists and hydrologists to  help decision makers in                                                                    
     the [U.S.]  Forest Service balance  competing interests                                                                    
     on forestland.                                                                                                             
     However, a  recent report  by a  governmental colleague                                                                    
     found  that  up  to  70   percent  of  all  the  stream                                                                    
     crossings constructed on federally  managed land in the                                                                    
     Pacific  Northwest over  the  last  four years  blocked                                                                    
     fish  passage.    Fish   (indisc.)  and  production  on                                                                    
     thousands  of miles  of former  fish  habitat has  been                                                                    
     lost,  and this  is a  prominent part  to the  declines                                                                    
     that we've seen.                                                                                                           
Number 1610                                                                                                                     
MR. TRASKY asked  the committee to reject EO 107  and to keep the                                                               
authority  and  responsibility  to protect  fish  habitat  within                                                               
ADF&G, the most  appropriate agency to manage  the state's permit                                                               
system, since it  protects habitat and produces  the fish habitat                                                               
that  benefits so  many  Alaskans.   He  said  the  value of  the                                                               
state's fisheries exceeds  the value of all  the other industries                                                               
in  the state,  except  oil.   He said  fish  habitat [loss]  and                                                               
litigation  (indisc.) are  the  primary  reasons that  anadromous                                                               
fish  populations  have  declined  to disastrous  levels  in  the                                                               
United States.                                                                                                                  
MR. TRASKY told  the committee that habitat loss is  forever.  He                                                               
indicated that's  what's keeping salmon fisheries  in the Pacific                                                               
Northwest from  recovering, even after years  of fishing closures                                                               
and  billions  of  dollars  of   federal  and  state  restoration                                                               
expenditures.     He  said   habitat  protection   is  relatively                                                               
inexpensive compared  with restoration.   He asked  the committee                                                               
not to change a system that's efficient and [effective].                                                                        
Number 1675                                                                                                                     
DOUG HILL told  the committee that he is an  Alaskan resident who                                                               
is 44  years old.   He said he supports  responsible development;                                                               
therefore,  he  strongly urges  the  committee  to disapprove  of                                                               
EO 107, which  he views as  a serious threat to  salmon; resident                                                               
fish;  fish habitat;  wildlife supported  by  fish; habitat  near                                                               
shore  and  inland;  and   subsistence,  sport,  commercial,  and                                                               
personal use fisheries.                                                                                                         
MR.  HILL explained  Alaska's ranking  in the  Fraser [Institute]                                                               
report.   He noted  that during a  March 7,  2003, administrative                                                               
press conference and a March  10, 2003, Senate Resources Standing                                                               
Committee meeting, he'd listened  to Commissioner Irwin cite this                                                               
report as  a justification for EO  107; furthermore, Commissioner                                                               
Irwin has  publicly said,  according to  the report,  that Alaska                                                               
ranks 50  in attractiveness to mining  exploration and investment                                                               
for the past  number of years has decreased  in attractiveness to                                                               
mining  investment.   Mr. Hill  said neither  statement is  true.                                                               
The number 50  is an index number.  He  clarified, "Companies are                                                               
simply asked  to consider 10  factors that determine  the ability                                                               
of select  jurisdictions to attract exploration  investment."  He                                                               
added that companies rate these 10 factors on a scale of 1 to 6.                                                                
MR. HILL noted that the  Fraser [Institute] report provides three                                                               
basic index numbers:  a  policy index, a mineral potential index,                                                               
and  an   investment  attractiveness   index.     The  investment                                                               
attractiveness  index is  a  combination of  the  policy and  the                                                               
mineral  protection indexes.    He told  the  committee that  the                                                               
index  number to  which Commissioner  Irwin referred  was ranking                                                               
only the policy  index for the years 2002-2003.   In those years,                                                               
Alaska's policy  ranking was  rated higher  than those  of China,                                                               
Ecuador, and Russia, for example.   Mr. Hill noted that since the                                                               
report has  been in existence,  Alaska "has increased."   In 2001                                                               
and  2002, 38  out  of 45  government  geographical regions  were                                                               
(indisc.) for investments in Alaska.  He continued:                                                                             
     I'm wondering  why the commissioners  have to  refer to                                                                    
     Chris  Kennedy for  simple  policy procedure  questions                                                                    
     such as,  "At what  elevation will a  contentious issue                                                                    
     be raised."   These are the guys [who]  are supposed to                                                                    
     be  implementing these  policies;  these  are the  guys                                                                    
     [who]  are promoting  and supporting  this policy,  and                                                                    
     they have to  refer to an attorney.   This just doesn't                                                                    
     make sense to me, and it's got me very worried.                                                                            
MR. HILL asked that the fish  and wildlife and humans that depend                                                               
on  it not  be  forgotten.   He  stated  disapproval of  Governor                                                               
Murkowski's executive order [EO 107].                                                                                           
Number 1874                                                                                                                     
DAN  ROSENBERG testified  that he  has worked  for ADF&G  for the                                                               
past  20 years  in what  is  currently the  Division of  Wildlife                                                               
Conservation.   He  mentioned the  importance of  maintaining the                                                               
interdivisional coordination  within ADF&G,  which he  said leads                                                               
to   expedient   permitting   and  sound   resource   management.                                                               
Mr. Rosenberg applauded  the professionalism of the  many habitat                                                               
biologists with  whom he  worked over  the years.   He  said they                                                               
have brought knowledge and experience that belongs within ADF&G.                                                                
MR.  ROSENBERG voiced  hope  that  EO 107  would  be debated  and                                                               
ultimately  dismissed  as   counterproductive  to  both  Alaska's                                                               
economy and  its environment.   He said Alaska has  the mechanism                                                               
in  place to  deal  with  any policy  changes  to the  permitting                                                               
process  that  may  need  addressing.   He  said  the  governor's                                                               
authority  will appoint  a new  commissioner to  ADF&G and  a new                                                               
director to the  habitat division.  Saying the  system has worked                                                               
since  statehood, through  five  governors, he  opined that  five                                                               
former  commissioners [of  ADF&G, who  had come  out publicly  in                                                               
opposition to EO 107] would agree with him.                                                                                     
MR.  ROSENBERG said  different missions  trigger healthy  debate,                                                               
and concepts get elevated to  the director or commissioner level,                                                               
where they are and should be  resolved.  He told members, "If you                                                               
must change the policy - as every  governor has the right to do -                                                               
there's no need  to change the process."  He  said [Alaska] needs                                                               
thoughtful solutions to its  economic and environmental concerns,                                                               
not   scapegoats.     He  said   facts,  not   anecdotes,  should                                                               
precipitate change, and the facts show the current system works.                                                                
MR. ROSENBERG  said Alaska is  the only  state that has  a proven                                                               
track rate of a sustainable  fishery.  Its fisheries and wildlife                                                               
are the  envy of the world  and an economic mainstay  to tourism,                                                               
commercial  and sport  fishing, and  subsistence.   He asked  why                                                               
anyone  would  want to  jeopardize  that  by replacing  a  proven                                                               
system with an  untested one in an agency such  as DNR that can't                                                               
match habitat  efficiency or biological  expertise.  He  said the                                                               
most favorable  term he could  couch this  in is "penny  wise and                                                               
pound foolish."                                                                                                                 
Number 1968                                                                                                                     
MR. ROSENBERG  concluded by reading  from former  Governor Egan's                                                               
State  of  the State  address  to  the  legislature in  1960,  as                                                               
     On January 1 of this  year, Alaska Department of Fish &                                                                    
     Game was handed the depleted  remnants of what was once                                                                    
     a  rich and  prolific fishery.   From  a peak  of three                                                                    
     quarters  of  a  billion  pounds  in  1936,  production                                                                    
     dropped in 1959  to the slowest in 60 years.   On these                                                                    
     ruins  of a  once  great resource  the department  must                                                                    
     refill, our gain is that  we can profit by studying the                                                                    
     destructive practices,  mistakes, and omissions  of the                                                                    
MR. ROSENBERG said this was  the legacy given the state; however,                                                               
ADF&G has rebuilt  and maintained that fishery;  that fishery was                                                               
able to recover  with good management because  the Alaskan salmon                                                               
habitat  was not  diminished.   He concluded,  "Let's not  weaken                                                               
[ADF&G] and make  mistakes that, this time,  may be irreversible.                                                               
Alaska should be the model, not Oregon."                                                                                        
Number 2017                                                                                                                     
JOHN  STURGEON,   Koncor  Forest  Products,  noted   that  he  is                                                               
currently  on  the  board  of directors  for  the  Alaska  Forest                                                               
Association,  the Resource  Development Council,  and the  Nature                                                               
Conservancy.   He said he has  been on the Board  of Forestry for                                                               
18 years and has been state forester under two governors.                                                                       
MR. STURGEON  stated his support of  EO 107, saying he  thinks it                                                               
will bring  more efficiency  to state  government.   He disagreed                                                               
with  testimony   regarding  DNR's  being  strictly   a  resource                                                               
development  agency and  comparing  [the  entrusting of]  habitat                                                               
protection to  DNR as "the  fox guarding  the chicken coop."   He                                                               
offered a  private timber operator's perspective,  saying DNR has                                                               
always been the primary enforcement  agency that has administered                                                               
the  Forest Practices  Act since  1991, and  has been  the agency                                                               
with primary  responsibility for salmon stream  buffers.  Habitat                                                               
has  had  due  deference  on  salmon  streams  and  various  tree                                                               
selections, he asserted.                                                                                                        
MR.   STURGEON   said   the  transfer   of   habitat   permitting                                                               
responsibilities  to  DNR  will further  a  longstanding  concept                                                               
embodied in the  Forest Practices Act:  "one-stop  shopping."  He                                                               
explained that  when a timber  operator complies with  the Forest                                                               
Practices  Act,  it  automatically   combines  the  Coastal  Zone                                                               
Management  Program, the  state's  Clean Water  Act, the  federal                                                               
Clean Water Act, and other statutes.   He said it serves both the                                                               
state and the operators and saves them both time and money.                                                                     
MR. STURGEON  referred to  placement on  "840" and  "870" streams                                                               
and said, "For  these streams we still need two  agencies to tell                                                               
us how to put  in the same exact culvert -  even the most routine                                                               
culvert project."   He expressed hope that under  the new system,                                                               
agencies can  finally get together and  agree on a single  set of                                                               
standards  on a  routine culvert  and how  to place  the culverts                                                               
properly.   Mr.  Sturgeon said,  with a  large state  deficit, he                                                               
doesn't see how the checks  and balances system is justified with                                                               
two agencies traveling  to remote logging operations  to tell the                                                               
timber operator  how to  put in  the same,  routine culvert.   He                                                               
told the committee  the timber industry has  said repeatedly that                                                               
it  has  no problem  providing  adequate  fish passage,  but  has                                                               
"begged and implored"  that it be done in an  efficient and cost-                                                               
effective manner.                                                                                                               
Number 2119                                                                                                                     
REPRESENTATIVE  BERKOWITZ pointed  out  that  Mr. Sturgeon  isn't                                                               
testifying  for  habitat  protection.   He  commended  HB  78  to                                                               
Mr. Sturgeon  as  an  alternative  solution  for  his  permitting                                                               
issue.   That  bill  has a  single  application whereby  whatever                                                               
state  agency first  gets  the permit  would  be responsible  for                                                               
"bicycling it around."   He said he thinks that  would solve some                                                               
of the problems Mr. Sturgeon has  raised; rather than try to move                                                               
all the entities of government under  on roof, [HB 78] would just                                                               
move the permit application itself.                                                                                             
Number 2163                                                                                                                     
BILL STEVENS, President, Cassandra  Energy Corporation, asked the                                                               
committee  to  support  EO  107.    He said  he  has  been  in  a                                                               
"permitting mode"  since October 2000,  which he said  has mostly                                                               
been a federal  situation, rather than a state one.   He asserted                                                               
that the  Division of  Habitat [and  Restoration] cost  him seven                                                               
months of additional permitting  by the federal agencies "because                                                               
of changes  they wanted  made."   He remarked  that he  has heard                                                               
stories about  14-day permit turnarounds,  but said  it certainly                                                               
has nothing to do with any  situation he's been in.  He indicated                                                               
that there  are turf  battles that  draw out  the process  and he                                                               
opined that  the [delays]  are all  basically stem  from [ADF&G].                                                               
He said he  doesn't know if [EO 107] will  solve the problem, but                                                               
something needs  to be done.   He concluded, "I don't  think it's                                                               
putting the  fox in charge of  the chicken coop, but,  frankly, I                                                               
don't think anybody's in charge of the chicken coop right now."                                                                 
Number 2265                                                                                                                     
PAUL SHADURA  II, President, Kenai Fishermen's  Association, read                                                               
from his written testimony [included  in the committee packet] as                                                               
     I would like to incorporate  my remarks from the Senate                                                                    
     Resource Committee in this  testimony and, in addition,                                                                    
     the survey  analysis from the ADF&G  [Division of Sport                                                                    
     Fish].    Tonight  I  would  like  to  comment  on  the                                                                    
     document, "Reorganization  Proposal In  Accordance With                                                                    
     Executive Order  ... 107."  Under  "Functions Moving to                                                                    
     Sport Fish,"  we find various research  and restoration                                                                    
     projects.    The  [Division of  Sport  Fish]  has  been                                                                    
     extremely  controversial in  their habitat  assessments                                                                    
     within the  Kenai River watershed.   It has  been noted                                                                    
     by   area   residents,    sport   fishers,   commercial                                                                    
     fishermen, and  others that the direction  the division                                                                    
     has taken on  use issues on the  Kenai River suppresses                                                                    
     evaluation caused by boat  wakes and other high-traffic                                                                    
     conditions  that  destroy  habitat  for  juvenile  king                                                                    
     salmon and other species.                                                                                                  
Number 2298                                                                                                                     
MR. SHADURA continued:                                                                                                          
     Our legislators in  our district are well  aware of the                                                                    
     department's  conflict of  interests that  are apparent                                                                    
     in  Board of  [Fisheries] decisions  on in-river  guide                                                                    
     activity on the Kenai River.                                                                                               
     In  "Rates of  Participation  in Alaska's  Recreational                                                                    
     Fisheries,"   department  personnel   conclude:     "It                                                                    
     appears  the  division is  not  achieving  its goal  of                                                                    
     increasing  sport fishing  participation  rates."   The                                                                    
     trend in  this report pose[s]  a serious threat  to the                                                                    
     fish  and game  fund.   This fund  provides direct  and                                                                    
     matching money  for Alaska's sport fisheries.   We must                                                                    
     look  to  stabilize  the contributions  to  this  fund,                                                                    
     especially from  the sale  of resident  licenses, given                                                                    
     potential volatility in nonresident license sales.                                                                         
     It is  apparent that the  Division of Sport Fish  has a                                                                    
     conflict in  protecting a habitat that  has a potential                                                                    
     income stream  that funds the  department.  This  is an                                                                    
     inherent  flaw   within  the  division  and   could  be                                                                    
     perceived by the public as  a conflict of interest.  It                                                                    
     is  the one  reason why  habitat assessments  should be                                                                    
     directed  by  a  panel  of impartial  reviewers.    The                                                                    
     Division   of  Habitat   [and  Restoration]   has  been                                                                    
     associated  with  a   non-biased  approach  to  habitat                                                                    
     degradation  that favors  neither  commercial or  sport                                                                    
     divisions  or  their users.    We  do not  support  the                                                                    
     concept of "the fox watching the henhouse."                                                                                
     Our last suggestion to strengthen  our governor's EO is                                                                    
     that  we believe  that it  is possible  to use  Article                                                                    
     III, Section 25, to create  a commission within ... DNR                                                                    
     that will incorporate a review  process that will allow                                                                    
     expertise   and  balance   to  the   regulatory  permit                                                                    
     process.  The  commission would have to  go through the                                                                    
     confirmation and the  administration's appointee review                                                                    
     process, thereby  settling issues  the public  may have                                                                    
     with protection and utilization of our resources.                                                                          
Number 2363                                                                                                                     
DON CORNELIUS testified that he is a retired biologist who                                                                      
worked for the habitat division for 13 years, and for ADF&G for                                                                 
24.5 years.                                                                                                                     
TAPE 03-22, SIDE B                                                                                                            
Number 2367                                                                                                                     
MR. CORNELIUS said it has  become apparent that many people don't                                                               
understand how the division works,  and it has become a scapegoat                                                               
for developers  who don't  like permitting.   He  paraphrased his                                                               
written testimony [included in the committee packet] as follows:                                                                
     First of all, you need  to consider that the reason the                                                                    
     division  was  formed was  to  give  ADF&G a  voice  in                                                                    
     reviewing  developmental activities  which affect  fish                                                                    
     and wildlife.   Without  coordinators, it was  easy for                                                                    
     the  different  divisions  to provide  conflicting  and                                                                    
     thus  confusing comments.   Professionals  within ADF&G                                                                    
     who  understand  the  permitting system  allowed  other                                                                    
     fish  and  wildlife staff  to  focus  on their  primary                                                                    
     duties   while   maximizing    the   quality   of   the                                                                    
     department's input.                                                                                                        
     As   the  division   functions   today,  when   habitat                                                                    
     biologists   receive   applications  for   permits   or                                                                    
     environmental reviews, they serve  as a focal point for                                                                    
     input from the  entire Department of Fish &  Game.  Any                                                                    
     permit or  project is routed  around the  offices under                                                                    
     whose  jurisdiction the  project falls.   Concerns  and                                                                    
     comments  from commercial  fisheries, sport  fisheries,                                                                    
     wildlife  conservation, and  subsistence  staff all  go                                                                    
     into the equation.                                                                                                         
MR. CORNELIUS  highlighted that habitat biologists  also function                                                               
as "point  men" for other agencies  - the U.S. Fish  and Wildlife                                                               
Service,  the   National  Marine   Fisheries  Service,   and  the                                                               
Environmental  Protection Agency  (EPA) -  in responding  to U.S.                                                               
Army Corp  of Engineers permits and  other environmental reviews.                                                               
He explained:                                                                                                                   
     This  is because  of their  local  knowledge and  ready                                                                    
     access  to  input from  other  ADF&G  divisions.   Some                                                                    
     projects  that  might otherwise  be  held  up by  other                                                                    
     agencies  are   cleared  without   controversy  because                                                                    
     habitat staff  answer and resolve concerns  before they                                                                    
     become issues.   Again, this  is ... because  they have                                                                    
     local knowledge.                                                                                                           
     Any  projects that  are held  up are  delayed for  good                                                                    
     reasons.   They potentially have significant  impact on                                                                    
     fish  and   wildlife  resources.    Not   all  proposed                                                                    
     development is benign.  For  every project the governor                                                                    
     claims  has  been  derailed by  habitat  staff,  others                                                                    
     should  have  been  held  up or  even  rejected.    The                                                                    
     political  pressure on  habitat biologists  is intense,                                                                    
     and  Alaskans  now  live with  permanent  impacts  that                                                                    
     could have been mitigated or avoided.                                                                                      
     I  worry that  moving  the division  to  DNR will  only                                                                    
     increase this  pressure.  While  the governor  hopes to                                                                    
     speed  up  permitting,  moving some  functions  of  the                                                                    
     division to DNR  and eliminating the rest  is likely to                                                                    
     have the opposite  effect.  This action  will break the                                                                    
     link  with ADF&G.   No  longer  will "permitters"  have                                                                    
     ready access  to biologists  from the  other divisions.                                                                    
     Just communicating with ADF&G  will become a logistical                                                                    
MR. CORNELIUS, in response to  a request by the chair, summarized                                                               
that  his  primary  concerns  are  regarding  the  break  between                                                               
habitat  biologists working  for DNR,  "the department,"  and the                                                               
loss of  links with other agencies.   He said he  thinks previous                                                               
testifiers have covered  most of his other issues.   He suggested                                                               
the  governor's  justification  to  eliminate  the  division  was                                                               
pretty much unfounded and resembles a lynching in the Old South.                                                                
Number 2226                                                                                                                     
MIKE  MILLIGAN,  testifying on  behalf  of  himself, said  he  is                                                               
"somewhat cautious and against [EO  107]."  He told the committee                                                               
that he was  active in local government for many  years.  He said                                                               
he  has a  fiduciary concern  regarding [EO  107].   Offering his                                                               
understanding that  federal Dingell-Johnson  Act monies  could be                                                               
applied  to an  agency that  manages  fish and  game, which  [the                                                               
Division of Habitat  and Restoration] was using to  pay for "some                                                               
of  this,"  Mr.  Milligan  asked  the  committee  to  investigate                                                               
whether  those monies  could also  be used  by DNR.   If  not, he                                                               
proposed, ADF&G will  still be able to use the  money, but not in                                                               
the habitat  division; in that case,  new money would have  to be                                                               
found in  order for DNR to  run the division.   Mr. Milligan said                                                               
he believes  the monies are  from the sale of  sporting equipment                                                               
and must go to an agency that manages fish and game.                                                                            
Number 2133                                                                                                                     
TIM JUNE testified in opposition to EO  107.  He noted that he is                                                               
currently the  fisheries representative on the  Board of Forestry                                                               
and had  been a special  assistant to former Governor  Knowles on                                                               
oceans and watersheds.   Mr. June urged the  committee to soundly                                                               
reject EO 107  and instead increase  the budget to  [the Division                                                               
of Habitat  and Restoration], not  cut the budget and  the number                                                               
of biologists.   Indicating the  state has been doing  this right                                                               
since 1959,  he highlighted the  successful habitat  and abundant                                                               
fish populations  and suggested  [Alaska] needs to  continue that                                                               
policy in  earnest.  Noting that  California, Oregon, Washington,                                                               
and British Columbia are all  struggling to restore lost habitat,                                                               
he  remarked,  "Under the  gun  of  the Endangered  Species  Act,                                                               
that's not a simple task."                                                                                                      
MR. JUNE  mentioned the 1995  anadromous fish habitat  report and                                                               
explained that  in 1995  a "regime shift"  in the  oceans shifted                                                               
nutrients  down  to  the  Lower  48;  those  nutrients  won't  be                                                               
shifting back  to Alaska  for another  15 years.   He  said, "The                                                               
commission recommended that our charge,  in the next 15 years, is                                                               
to maintain our habitat so when  those nutrients do come our way,                                                               
we'll have  the fish and the  habitat that will be  accessible to                                                               
replace our fish population."                                                                                                   
MR. JUNE told the committee  he is a 22-year commercial fisherman                                                               
and is testifying  as such.  He reminded members  that the salmon                                                               
industry is in deep trouble  [economically] and that a task force                                                               
and a number  of other entities are looking at  trying to improve                                                               
it;  he  expressed  gratitude that  the  major  consideration  is                                                               
market-based.   He encouraged the  committee to  investigate this                                                               
and make the right decision for all Alaskans.                                                                                   
The committee took an at-ease from 9:07 p.m. to 9:09 p.m.                                                                       
Number 2003                                                                                                                     
BILL  HAUSER,  Ph.D.,   testified  that  he  is   in  support  of                                                               
[Alaska's]  fishery  resources,  the  unique  habitats  that  are                                                               
required  to support  them, and  their long-term  sustainability.                                                               
He said he thinks this can  best be accomplished by retaining the                                                               
function of  habitat protection  within a  resource conservation-                                                               
based agency.   Noting that he  is a retired fish  biologist from                                                               
ADF&G  but   has  never  been   a  "permitter,"  he   said,  most                                                               
importantly, that he is testifying  as a fisheries scientist:  he                                                               
holds a  Ph.D. in fisheries,  with over 30 years'  experience; is                                                               
past president  of the Alaska  chapter of the  American Fisheries                                                               
Society, which includes over 400  fisheries scientists in Alaska;                                                               
has been in  Alaska 22 years; and has  past involvement including                                                               
fisheries enhancement  and fish habitat enhancement  projects and                                                               
community  education  regarding  the importance  of  good-quality                                                               
fish habitat to preserve fisheries.                                                                                             
DR. HAUSER said fish is  the most important [resource] in Alaska.                                                               
He remarked,  "If we care about  the legacy of this  resource for                                                               
future  generations, we  must protect  the production  factor for                                                               
that resource:  good-quality fish  habitat for spawning, rearing,                                                               
escape, overwintering, and open  passage and access and migration                                                               
amongst  these  habitats."    In addition,  he  noted,  when  the                                                               
nutrients  from  anadromous  fish   populations  are  reduced  or                                                               
destroyed, other resident fish  populations, birds, wildlife, and                                                               
even streambed vegetation are diminished.  He continued:                                                                        
     We've  heard here  tonight how  the  numbers of  salmon                                                                    
     returning to  Alaska streams  have been  decimated over                                                                    
     time,  but  they've  rebounded  with  good  management.                                                                    
     More  specifically, however,  they have  only rebounded                                                                    
     in areas with healthy, intact  habitat.  If the habitat                                                                    
     is missing, the fish  populations cannot recover.  Lost                                                                    
     habitat  sometimes can  be repaired,  but  the cost  of                                                                    
     repair  is far  greater  than the  cost of  protection.                                                                    
     Even  with repair,  it  can never  be  restored to  the                                                                    
     original condition; there is always a net loss.                                                                            
Number 1920                                                                                                                     
DR. HAUSER continued:                                                                                                           
     Until now,  these important fishery resources  have had                                                                    
     a measure  of protection with equal  consideration with                                                                    
     development,  or  other  important  natural  resources,                                                                    
     through our  open discussion with checks  and balances.                                                                    
     If the  function of habitat  protection is  included in                                                                    
     the  Department  of  Natural Resources,  whose  primary                                                                    
     mission is  resource development,  one can  only assume                                                                    
     that  when decisions  are made  - which  would be  made                                                                    
     internally  and not  publicly, with  a smaller  staff -                                                                    
     ... this system will  favor resource development at the                                                                    
     detriment of  our aquatic  resources.   Sometimes there                                                                    
     may be large-scale losses,  but small-scale losses will                                                                    
     also accrue with each project  and accumulate each year                                                                    
     for a long-term ... loss.                                                                                                  
DR.  HAUSER   said  he  disagrees  with   the  previously  stated                                                               
testimony  of Mr.  Rosenberg, who  suggested that  "this proposed                                                               
new process has not been tested."   He indicated he has been told                                                               
by people in Washington State  that EO 107 resembles the approach                                                               
that's been in place there,  where anadromous fish runs have been                                                               
depleted  to  about  3  percent   of  historic  levels;  this  is                                                               
attributed to the loss of habitat  and degradation in a matter of                                                               
just a  few human generations.   Dr. Hauser said,  "Clearly, this                                                               
system was  tested and did not  work in the state  of Washington,                                                               
and it is  not clear why it  will work in Alaska."   He said this                                                               
isn't the sort  of legacy he envisioned.  He  asked the committee                                                               
to reject  EO 107 and  retain the function of  habitat protection                                                               
within ADF&G.                                                                                                                   
Number 1830                                                                                                                     
WILLY DUNN  noted that  many potential  testifiers [at  the Homer                                                               
Legislative  Information Office  (LIO)]  had to  return home;  he                                                               
expressed hope that members would  read their faxed testimony and                                                               
remember that  many people  around the  state are  very concerned                                                               
about this.   Mr. Dunn  expressed concern  that EO 107  will have                                                               
long-term negative  impacts on Alaska's fish  and wildlife; those                                                               
impacts may  not be seen for  20 to 50  years.  He said  he wants                                                               
his  grandchildren  to  have  jobs  and  enjoy  Alaska,  just  as                                                               
Commissioner Irwin stated.  He  added, "Forty or fifty years from                                                               
now, when  his grandchildren  are in Alaska,  I hope  they're not                                                               
saying, 'What was grandpa thinking when he did this!'"                                                                          
MR. DUNN  said he thinks  EO 107 will also  precipitate lawsuits.                                                               
He said  the [Division  of Habitat and  Restoration] is  in place                                                               
and  works with  industry.   Although  it's not  always easy  and                                                               
straightforward, that's how government is.   Mr. Dunn opined that                                                               
a change  to statute as  broad and far-reaching as  EO 107 really                                                               
needs  to  be taken  on  by  the legislature  through  thoughtful                                                               
deliberation and an  open public process, rather  than through an                                                               
executive order.   He said Alaska is not a  business.  The effect                                                               
will be  upon people's lives  and the  future of wildlife  in the                                                               
state, as well as [Alaskans'] children and grandchildren.                                                                       
Number 1724                                                                                                                     
NICKY SCARZI noted  that she works for ADF&G's  Division of Sport                                                               
Fish,  but is  testifying on  behalf of  herself.   She said  she                                                               
provides local  expertise on the  fisheries that she  is familiar                                                               
with to  habitat biologists when  they are dealing  with permits;                                                               
in return, when  she or a member of the  public needs response to                                                               
an  issue,  she can  talk  with  habitat  biologists.   If  those                                                               
biologists  are moved  to DNR,  she said,  she doesn't  know what                                                               
kind of  responsiveness she  will receive  with regard  to issues                                                               
that  she thinks  are  important.   Ms.  Scarzi  said  DNR has  a                                                               
mission different  from ADF&G's, and  she doesn't know  that they                                                               
will put the same emphasis  on fisheries issues that the Division                                                               
of Habitat [and  Restoration] would put on the same  issues if it                                                               
were to remain in ADF&G.                                                                                                        
REPRESENTATIVE   SEATON,  regarding   Title  16   permits,  asked                                                               
Ms. Scarzi if  she or someone  from the [Division of  Habitat and                                                               
Restoration] visits that stream before giving permits.                                                                          
MS.  SCARZI  answered  that  she doesn't  see  every  permit  the                                                               
division deals with; if someone  from the division isn't familiar                                                               
with that  stream and cannot  go look at it,  she or a  member of                                                               
her staff will visit the site.                                                                                                  
Number 1610                                                                                                                     
SETH LITTLE, Alaska Center for  the Environment (ACE), noted that                                                               
ACE is  Alaska's largest homegrown  public-interest environmental                                                               
organization, with over  8,000 dues-paying members.   He told the                                                               
     We   recognize  the   need  to   develop  our   state's                                                                    
     resources,  but  also  identify the  responsibility  to                                                                    
     conserve and  to protect the state's  fish and wildlife                                                                    
     resources.   Alaska's  economy and  Alaskans depend  on                                                                    
     their unique  fish and wildlife.   Commercial and sport                                                                    
     fishermen,  hunters,  trappers,   hunting  and  fishing                                                                    
     guides,  subsistence users,  and  the tourism  industry                                                                    
     rely on healthy fish and wildlife.                                                                                         
     In order to  fully comprehend and assess  the impact of                                                                    
     the governor's proposal, the missions  of ADF&G and DNR                                                                    
     need  to  be  understood;   they  are  very  different.                                                                    
     [ADF&G's] mission  is to  protect and  develop Alaska's                                                                    
     fish and wildlife resources, while  DNR's mission is to                                                                    
     promote development  of the  state's resources.   These                                                                    
     two missions  balance each other  and work  together to                                                                    
     provide  a  system  of  checks   and  balances  and  an                                                                    
     opportunity for  fish and  wildlife biologists  to work                                                                    
     with developers  through the permitting process.   That                                                                    
     is  why the  First [Alaska]  State Legislature  created                                                                    
     two separate  resource agencies  to manage  the state's                                                                    
     unique and diverse resources.                                                                                              
     By moving  the permitting authority to  one agency, one                                                                    
     agency is given [primacy] in  the process of checks and                                                                    
     balances that have been set  up to manage Alaska's fish                                                                    
     and wildlife  resources and  resource development.   We                                                                    
     believe   that   if   [the]  permitting   function   is                                                                    
     transferred  to DNR,  the balance  will be  tilted away                                                                    
     from habitat  protection to the long-term  detriment of                                                                    
     our fish  and wildlife  resources.  Under  the proposed                                                                    
     executive  order,  for  the   first  time  in  Alaska's                                                                    
     history,   fish  and   game   permitting  and   habitat                                                                    
     protection will  no longer reside in  [ADF&G].  [ADF&G]                                                                    
     will lose  its authority  and the [Division  of Habitat                                                                    
     and Restoration]  will be  eliminated, cutting  22 jobs                                                                    
     and transferring 36 positions to DNR.                                                                                      
     The  executive  order  will   change  the  standard  of                                                                    
     scrutiny.   The system of  checks and balances  will be                                                                    
     gone.   There will be  no need  for DNR or  industry to                                                                    
     work  out problems  with [ADF&G].   The  appeal process                                                                    
     will be entirely through DNR.   This is far more than a                                                                    
     process  change;  this  is a  major,  substantive,  and                                                                    
     statutory change.                                                                                                          
     Without review  of plan  and specifications,  there's a                                                                    
     substantial risk that many  anadromous streams, as well                                                                    
     as  resident  fish  streams,  will  be  blocked  and  a                                                                    
     significant amount of fish production  will be lost, as                                                                    
     has already occurred throughout the Pacific Northwest.                                                                     
     Governor  Murkowski's  plan   prevents  fish  and  game                                                                    
     biologists from  speaking up about  the impact  on fish                                                                    
     and  wildlife  habitat   from  industrial  development.                                                                    
     Under the super DNR, fish  and game biologists and even                                                                    
     ADF&G commissioner  roles would only be  advisory, with                                                                    
     no  power to  prevent the  stressing of  habitat.   All                                                                    
     decisions  would   be  made  by  DNR,   the  department                                                                    
     responsible for development.                                                                                               
Number 1502                                                                                                                     
MR. LITTLE continued:                                                                                                           
     The cost of  this proposal are [borne] on  the backs of                                                                    
     Alaska's fish  and wildlife  and Alaskan  residents and                                                                    
     (indisc.)   who  depend   on  them.     The   Murkowski                                                                    
     Administration contends  that [the Division  of Habitat                                                                    
     and  Restoration]  stands  in  the  way  of  legitimate                                                                    
     projects   for   personal   reason.     When   Governor                                                                    
     Murkowski's examples and  habitat permitting history is                                                                    
     examined in  detail, it is clear  habitat permitting is                                                                    
     timely,  especially in  comparison  with  DNR, and  the                                                                    
     cited  examples   show  how  ADF&G  is   upholding  the                                                                    
     standards required to protect habitat under state law.                                                                     
MR. LITTLE  said if  there are problems  with personal  views and                                                               
actions impeding  projects, then  this is a  management situation                                                               
that should be  handled through proper discipline.   He indicated                                                               
that the facts  relating to issuing permitting don't  point out a                                                               
permanent problem.   He also said it doesn't  appear moving Title                                                               
16 permitting to  DNR will speed up the process.   He said, "With                                                               
less  staff, less  balance, and  less accountability,  it appears                                                               
that project proposals  may lead to litigation  and more delays."                                                               
He  said ACE  urges the  legislature to  bring the  issue to  the                                                               
House  and  Senate  floors  to   be  debated  and  to  support  a                                                               
resolution to disapprove EO 107.                                                                                                
Number 1442                                                                                                                     
ERIC  KNUDSEN, Ph.D.,  told the  committee he  is a  professional                                                               
fisheries scientist with over 20  years' experience in management                                                               
and  research  on  pacific  salmon, trout,  and  other  fish  and                                                               
wildlife.   He has  conducted studies in  Alaska and  the Pacific                                                               
Northwest,  many  of which  focused  on  the effects  of  habitat                                                               
alterations on the ecology and  productivity of salmon and trout.                                                               
He said he  is a member of the American  Fisheries Society and is                                                               
the  current  past president  of  the  western division  of  that                                                               
society.  He mentioned a copy  of [the opinions of] that society,                                                               
which  he  said  he'd  attached  to  his  own  submitted  written                                                               
testimony.  He continued as follows:                                                                                            
     There  are  three  scientifically  based  points  that,                                                                    
     taken  together,  argue  for  a  resolution  to  reject                                                                    
     EO 107.  First, there's  absolutely no scientific doubt                                                                    
     that   healthy  stream   and   riparian  habitats   are                                                                    
     fundamental  to the  amount of  salmon, steelhead,  and                                                                    
     other  related  fish  and   wildlife  produced  in  the                                                                    
     Alaskan watershed.                                                                                                         
     Second, a  combination of solid  science in  Alaska and                                                                    
     elsewhere, together  with a long history  of experience                                                                    
     in the Pacific Northwest,  clearly demonstrate that the                                                                    
     gradual, incremental,  cumulative effects  of numerous,                                                                    
     seemingly  minor habitat  alterations can  lead to  the                                                                    
     destruction   of  the   habitat   base  that   supports                                                                    
     productive salmon and other fisheries.                                                                                     
Number 1382                                                                                                                     
DR. KNUDSEN continued:                                                                                                          
     Third, a  scientific research in the  Pacific Northwest                                                                    
     has  led   to  the  conclusion  that   it's  much  more                                                                    
     difficult  to repair  stream and  riparian habitats  to                                                                    
     their  fully  functional state  than  it  is to  simply                                                                    
     protect  the  natural  stream functions  in  the  first                                                                    
     In  regard  to  the   State  of  Alaska  administrative                                                                    
     procedure that may be [of]  most interest to the [House                                                                    
     State  Affairs  Standing   Committee],  it's  extremely                                                                    
     difficult to disengage the effects  on habitat from the                                                                    
     administrative  process.    The  scientific  basis  for                                                                    
     protecting habitat  is largely  indisputable.   So, the                                                                    
     effectiveness  of  protection  completely  depends  on,                                                                    
     first, the  attitude of the commissioner  or the agency                                                                    
     responsible for  the protection - the  policy attitude,                                                                    
     that  is;  second,  the extent  of  protection  allowed                                                                    
     within  that department  or  organization; and,  third,                                                                    
     the  number  of employees  or  resources  that are  put                                                                    
     toward that protection.                                                                                                    
     It's impossible  to judge how effectively  habitat will                                                                    
     be   protected   if   the  permitting   functions   are                                                                    
     transferred  from  ADF&G  to  [DNR],  but  because  the                                                                    
     stated  purpose   ...  is   to  speed   and  streamline                                                                    
     development,   I   can   only  believe   that   habitat                                                                    
     protection will be less effective.                                                                                         
DR. KNUDSEN suggested  the potential problem perhaps  lies in the                                                               
administration's   policy  of   wanting  to   speed  development.                                                               
Because [Alaska's]  salmon resources  are so important  and solid                                                               
scientific evidence  demonstrates that healthy habitat  is key to                                                               
sustaining  the salmon  fisheries,  he urged  the legislature  to                                                               
reject  EO 107  and  retain  habitat-permitting functions  within                                                               
Number 1260                                                                                                                     
DALE PIHLMEN  told the  committee he is  a long-time  resident of                                                               
Ketchikan and  is against EO  107.  He opined  that it is  a poor                                                               
idea that will  weaken protection of valuable  salmon streams and                                                               
spoil  the aesthetic  of  valuable  wilderness, with  potentially                                                               
disastrous economic consequences.  Mr.  Pihlmen said he has spent                                                               
20  years as  a commercial  fisherman and  20 years  in the  tour                                                               
industry;  both  industries  are   dependent  on  the  biological                                                               
integrity of Southeast  Alaska's ecosystems.  He  said streams in                                                               
Southeast Alaska are  an important element in  the ecosystems and                                                               
are  essential for  the economic  well-being of  both industries.                                                               
Specifically,   protecting  [the   state's]  salmon   streams  is                                                               
essential for future economic viability of the salmon industry.                                                                 
MR.  PIHLMEN indicated  the state  has  had the  benefit of  good                                                               
management  from  ADF&G,  but  pointed  out  that  the  level  of                                                               
abundance  currently being  experienced is  the result  of cyclic                                                               
environmental factors  that affect  ocean currents,  weather, and                                                               
temperatures,  but that  aren't  well understood.    He said  the                                                               
years  of  full  return  prompted major  changes  in  the  salmon                                                               
industry such as limited entry  and a private, nonprofit hatchery                                                               
system.  He warned that Mother  Nature is fickle and the cycle of                                                               
abundance could  quickly change; as  a result, salmon  runs could                                                               
dry  up  dramatically.   He  mentioned  biological  integrity  of                                                               
streams as  well as  support for the  tourism industry,  and said                                                               
streams and  uncut old-growth  timber are the  heart and  soul of                                                               
ecosystems in Southeast Alaska.  He concluded:                                                                                  
     As  wilderness   ...  diminishes  and   the  population                                                                    
     increases,  the  value  with  these  valleys  increases                                                                    
     exponentially.   The value of timber  and their streams                                                                    
     in  Southeast   Alaska  to  tourism  and   the  fishing                                                                    
     industry  far exceeds  its  value  as timber  harvested                                                                    
     every  hundred years.   The  governor's proposal  would                                                                    
     dramatically weaken  protection of  the areas  that are                                                                    
     essential to  the long-term  economic viability  of the                                                                    
     fishing and  touring industries for short-term  gain of                                                                    
     the timber industries.                                                                                                     
Number 1127                                                                                                                     
MATTHEW LaCROIX  testified that  he currently  works in  ADF&G in                                                               
the Division  of Habitat and  Restoration as a  habitat biologist                                                               
and  "permitter."   He  told  the  committee  he  was one  of  22                                                               
employees who  received a  layoff notice last  Friday.   He asked                                                               
the committee to support the joint resolution rejecting EO 107.                                                                 
MR. LaCROIX said  the committee members need  to honestly examine                                                               
the  issue  of   whether  the  proposed  transfer   of  Title  16                                                               
permitting  authority  out of  ADF&G  will  benefit or  harm  the                                                               
state.   He opined that  this is  a question the  legislature has                                                               
the obligation  to answer before  the executive order  is allowed                                                               
to take effect.   Mr. LaCroix said that in  the business world, a                                                               
company reduces its workforce only  if it decreases production or                                                               
if  advances in  technology allow  fewer workers  to produce  the                                                               
same or  more.  Saying  the new habitat  office in DNR  claims it                                                               
will be able to process the  same number of permits with 22 fewer                                                               
employees than it currently takes, he told members:                                                                             
     When  you reduce  permitting staff,  you undermine  the                                                                    
     ability   of  remaining   staff  to   issue  meaningful                                                                    
     permits, regardless  of what department  they've worked                                                                    
     for.  Very  few of the permits that  I personally wrote                                                                    
     were  off-the-shelf.    Just   like  the  fish  habitat                                                                    
     permits  issued to  Fort Knox  that Commissioner  Irwin                                                                    
     has  said such  positive  things about,  most of  these                                                                    
     permits were issued after  hours of background research                                                                    
     and consultation  with applicants and staff  from other                                                                    
     departments and  agencies.  Often,  we need  to conduct                                                                    
     field  visits  or  collect  biological  data  before  a                                                                    
     permit can be issued.                                                                                                      
Number 1045                                                                                                                     
MR. LaCROIX continued:                                                                                                          
     The amount of time that  we can currently spend working                                                                    
     with  applicants  is  characterized by  the  governor's                                                                    
     stalling, but  it means that few  applications are ever                                                                    
     denied.   It also  means that instead  of superficially                                                                    
     reviewing  an  application,   in  either  approving  or                                                                    
     denying it  as proposed,  we can look  for alternatives                                                                    
     that benefit both the applicant and the environment.                                                                       
MR.   LaCROIX   mentioned   the   Glenn   Highway-Parks   Highway                                                               
interchange work  that the governor  has cited as one  case where                                                               
the [Division of Habitat and  Restoration] "stalled" a legitimate                                                               
project.   Mr.  LaCroix said  nothing could  be further  from the                                                               
truth.   He indicated that  staff had worked with  contractors to                                                               
modify  the project  in many  significant ways  that resulted  in                                                               
saving substantial amounts of money.                                                                                            
MR.  LaCROIX summarized  that this  reorganization  will lead  to                                                               
increased  permit backlog,  more permit  denials, less  effective                                                               
permits  with  less  monitoring  and  compliance,  and  permitted                                                               
projects  that  will have  greater  environmental  impact.   This                                                               
transfer of permitting authority  will place the state's valuable                                                               
fish and  wildlife resources  at risk  and open  up the  state to                                                               
lawsuits, while gaining nothing in  exchange.  He said members of                                                               
this committee have an obligation to  act in the best interest of                                                               
their constituents and  the state; in this  case, that obligation                                                               
requires nothing less than the rejection of [EO 107].                                                                           
Number 0957                                                                                                                     
GARVAN  BUCARIA paraphrased  his written  testimony [included  in                                                               
the committee packet] as follows:                                                                                               
     The major  theme that  the governor  has agreed  to ...                                                                    
     under the  constitution is perpetuation  of productive,                                                                    
     healthy stocks  of fish and  wildlife available  to the                                                                    
     people, these are found in Sections  1, 2, 3, 4, and 16                                                                    
     of  our  state   constitution,  Article  VIII,  natural                                                                    
     resources. ... Before now, the  executive branch of the                                                                    
     state delegated  responsibility for  fish and  game and                                                                    
     their  habitat   to  [ADF&G].     Now   the  governor's                                                                    
     promulgation of  EO 107 eliminates the  commissioner of                                                                    
     [ADF&G's]  authority  to  protect  aquatic  habitat  by                                                                    
     deleting   ...    the   [Division   of    Habitat   and                                                                    
     Shifting     responsibility     to     DNR,     "deputy                                                                    
     commissioner/state  forester" raises  serious questions                                                                    
     as  to the  wildlife and  fisheries habitat  oversight.                                                                    
     Public  perception is  important.   It would  convey an                                                                    
     impression  of  subordination   of  fish  and  wildlife                                                                    
     habitat protection for development concessions.                                                                            
     I believe  it is a mistake  to implement EO 107,  and I                                                                    
     ask that  the [legislature] exercise [its]  role in the                                                                    
     government district  roles of checks and  balances, and                                                                    
     reject EO  107 on behalf  of the  people of Alaska.   I                                                                    
     also ask those  members of the legislature  who have to                                                                    
     recuse   themselves,  who   might  have   conflicts  of                                                                    
     interest  concerning  pending   court  cases  involving                                                                    
     permitting  actions   through  [ADF&G]   [Division  of]                                                                    
     Habitat and Restoration [to do so].                                                                                        
     Why change  something that works?   On the  second page                                                                    
     [of the written  testimony] I'll refer you  to items 4,                                                                    
     5,  and   6,  which  may  have   economic  implications                                                                    
     relative  to   the  shift  in  authority   for  habitat                                                                    
[EO 107 was held over.]                                                                                                         
Number 0803                                                                                                                     
The House State Affairs Standing Committee meeting was recessed                                                                 
at 9:36 p.m.  [The meeting was reconvened March 12, 2003, at                                                                    
6:30 p.m.]                                                                                                                      

Document Name Date/Time Subjects