Legislature(2003 - 2004)

03/13/2003 09:05 AM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                              MINUTES                                                                                         
                     SENATE FINANCE COMMITTEE                                                                                 
                          March 13, 2003                                                                                      
                              9:05 AM                                                                                         
                                                                                                                                
                                                                                                                                
TAPES                                                                                                                       
                                                                                                                                
SFC-03 # 20, Side A                                                                                                             
                                                                                                                              
CALL TO ORDER                                                                                                               
                                                                                                                                
Co-Chair Gary Wilken convened  the meeting at approximately 9:05 AM.                                                            
                                                                                                                                
PRESENT                                                                                                                     
                                                                                                                                
Senator Gary Wilken, Co-Chair                                                                                                   
Senator Lyda Green, Co-Chair                                                                                                    
Senator Con Bunde, Vice-Chair                                                                                                   
Senator Robin Taylor                                                                                                            
Senator Ben Stevens                                                                                                             
Senator Lyman Hoffman                                                                                                           
                                                                                                                                
Also  Attending:   NEIL  MACKINNON,  Vice  Chair,  Alaska   Minerals                                                          
Commission,  and President  of Hyak  Mining Co.;  DR. LANCE  MILLER,                                                            
Member, Alaska  Minerals Commission  and Executive Director,  Juneau                                                            
Economic Development Council                                                                                                    
                                                                                                                                
Attending via Teleconference:  From an Offnet Site: STAN FOO, Mining                                                          
Section Manager,  Division of Mining, Land and Water,  Department of                                                            
Natural Resources                                                                                                               
                                                                                                                                
SUMMARY INFORMATION                                                                                                         
                                                                                                                                
SB 79-EXTEND ALASKA MINERALS COMMISSION                                                                                         
                                                                                                                                
The  Committee  heard  from  the  sponsor,  members  of  the  Alaska                                                            
Minerals Commission,  and the Department  of Natural Resources.  The                                                            
bill reported from Committee.                                                                                                   
                                                                                                                                
                                                                                                                                
     SENATE BILL NO. 79                                                                                                         
     "An Act extending the termination date of the Alaska Minerals                                                              
     Commission."                                                                                                               
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
Senator  B.  Stevens,  the  bill's  sponsor,   explained  that  this                                                            
legislation  extends the  termination  date of  the Alaska  Minerals                                                            
Commission  until 2014. He stated  that the Commission is  comprised                                                            
of eleven  members and was  established in  1986. He noted  that the                                                            
Commission's mission  is to provide recommendations  and suggestions                                                            
to  mitigate constraints   on the  development  of minerals  in  the                                                            
State.                                                                                                                          
                                                                                                                                
Senator  B. Stevens  brought  attention  to the  Commission's  seven                                                            
recommendations  on page vii of the 2003 Alaska Minerals  Commission                                                            
report  [copy  on  file].  He  stated  that  these  recommendations                                                             
"resonate the objectives  of the current Administrative in trying to                                                            
find  ways to  develop  the infrastructure  to  have  access to  the                                                            
natural  resources  of  the State  and  bring  them to  market."  He                                                            
encouraged the Committee to support this legislation.                                                                           
                                                                                                                                
Senator  Hoffman asked whether  the Division  of Legislative  Budget                                                            
and  Audit  conducted  an  audit  regarding  the  extension  of  the                                                            
Commission.                                                                                                                     
                                                                                                                                
Senator B. Stevens stated that an audit was not conducted.                                                                      
                                                                                                                                
NEIL  MACKINNON,   Vice  Chair,  Alaska  Minerals  Commission,   and                                                            
President of Hyak Mining Co. spoke in favor of the bill.                                                                        
                                                                                                                                
Senator  Taylor  encouraged  the  industry  and  the  Commission  to                                                            
develop  draft  legislation  to  address  industry's   concerns  and                                                            
further the  Commission's recommendations.  He mentioned  that water                                                            
quality   standards   set  by   the  Department   of  Environmental                                                             
Conservation,  and in particular,  drinking  water regulations  that                                                            
negatively affected placer  miners, could be addressed. He suggested                                                            
a bill  requiring  that State  standards  not exceed  federal  water                                                            
quality guidelines  would be an example of appropriate  legislation.                                                            
                                                                                                                                
Mr. MacKinnon responded  that, historically, the Commission presents                                                            
broad, rather than specific, recommendations to the Legislature.                                                                
                                                                                                                                
Senator Taylor  reiterated that draft legislation  would be welcome.                                                            
                                                                                                                                
Mr. MacKinnon  cited Section 1c) "Water  Quality Standards"  on page                                                            
three  of  the  report   as  follows.  He  relayed  the   Commission                                                            
recommendation that revisions  to the Alaska water quality standards                                                            
be adopted.                                                                                                                     
                                                                                                                                
     1c) Water Quality Standards                                                                                                
     Findings:  When municipal water treatment plants  or industrial                                                            
     projects  require water  discharge permits,  the Department  of                                                            
     Environmental   Conservation  must  insure  that  the  proposed                                                            
     discharge   will  meet  the  State  of  Alaska  water   quality                                                            
     standards for various  parameters. Due to the rapidly advancing                                                            
     science  on both the potential  environmental effects  of these                                                            
     parameters  and the changing technology for detecting  the very                                                            
     low  concentrations,  the most appropriate  numerical  criteria                                                            
     for these parameters keeps advancing.                                                                                      
     In  1999,  the  U.S.  Environmental  Protection   Agency  (EPA)                                                            
     approved  a new  list of water  quality  criteria that  updated                                                            
     many of the  numerical criteria. The EPA also  responded to the                                                            
     environmental  science  that had developed  over the years  and                                                            
     replaced  the old total recoverable  values with new  dissolved                                                            
     criteria.                                                                                                                  
     In  recognition of this  advancing science,  the Department  of                                                            
     Environmental  Conservation  proposed revisions  to the  Alaska                                                            
     water quality  standards on August 2, 2002. The  public comment                                                            
     period  on these  proposed changes  was  completed in  October,                                                            
     2002.  These  revisions   need  to  be  adopted  by  the  State                                                            
     immediately, and forwarded  to the EPA for review and approval.                                                            
                                                                                                                                
     The Commission Recommends That:                                                                                            
     The Governor  should instruct  the Department of Environmental                                                             
     Conservation  to  adopt  the  revisions  to  the  Alaska  water                                                            
     quality standards as proposed on August 2, 2002.                                                                           
                                                                                                                                
Senator Taylor  asked whether the Administration has  acted upon the                                                            
recommendation.                                                                                                                 
                                                                                                                                
Mr.  MacKinnon  responded  that was  unaware  whether  the  recently                                                            
elected  Administration  has  had  an  opportunity  to  address  the                                                            
report's recommendations.                                                                                                       
                                                                                                                                
Senator  Taylor  questioned  whether  regulatory  changes  would  be                                                            
sufficient.                                                                                                                     
                                                                                                                                
                                                                                                                                
Mr.  MacKinnon replied  that  other  recommendations  in the  report                                                            
include  1a)  "Litigation  Reform"  recommendations  that  have,  he                                                            
noted,   been  purposefully   placed   at  the   beginning  of   the                                                            
recommendation   list.  He  noted   that  1b)  "Permit  Efficiency"                                                             
recommendations  are  being  furthered  by  "the  movement"  of  the                                                            
Division of  Habitat and the Division  of Governmental Coordination                                                             
into the  Department of  Natural Resources.  These sections  read as                                                            
follows.                                                                                                                        
                                                                                                                                
     1) Regulatory Reform                                                                                                       
     1a) Litigation Reform                                                                                                      
     Finding:  A critical component  to resource development  in the                                                            
     State  of Alaska is  insuring that  development projects,  once                                                            
     permitted  by  the  appropriate  State  Agencies,  can  proceed                                                            
     without  delay. Unfortunately,  groups  opposed to development                                                             
     routinely  file litigation  with the  sole objective of  either                                                            
     preventing  or delaying permitted development.  Often the basis                                                            
     for  the litigation  is without merit.  Under Alaska's  current                                                            
     law,  such   groups,  regardless  of  financial   resources  or                                                            
     membership  composition,   can  routinely  quality  as  "public                                                            
     interest  litigants",  in  which case  there is  absolutely  no                                                            
     financial  downside to  them if they  lose the litigation  .The                                                            
     net  result is that  there is no disincentive  to these  groups                                                            
     not  to pursue  litigation.  As  a consequence,   the State  of                                                            
     Alaska as well as  industry and developers are forced to defend                                                            
     themselves in lengthy  and costly litigation with little chance                                                            
     of  recovering  any costs  or  attorney  fees woven  when  they                                                            
     prevail in the litigation.                                                                                                 
     The groups  that regularly oppose resource development  are not                                                            
     simply  concerned   citizen  groups  but  more   often  special                                                            
     interest  groups  supported   financially  by  national  and/or                                                            
     international  organizations  whose stated mission is  resource                                                            
     preservation.  The result of these systematic  and orchestrated                                                            
     lawsuits  files  by purported  "public  interest  litigants  is                                                            
     inhibiting  development by escalating  development costs,  both                                                            
     in terms  of real dollars spent on litigation  and lost dollars                                                            
     due   to  delays.   Modifying  Alaska's   existing  rules   and                                                            
     regulations    for   proposals    where   public   input    and                                                            
     administrative  appeal  was  afforded  by  eliminating  "public                                                            
     interest  litigant" status in  Administrative appeal  decisions                                                            
     and  awarding  fees  and  costs  to  the  prevailing  party  in                                                            
     litigation  ensures a level playing field. Likewise,  requiring                                                            
     disclosure  of funding sources by those who seek  to qualify as                                                            
     litigants  and/or  who seek to  file an  Administrative  Appeal                                                            
     allow  those defending the litigation  to know the identity  of                                                            
     those  who  are actually  supporting  the  litigation  and  the                                                            
     amount of that financial support.                                                                                          
     Modification  of Alaska's existing  "public interest  litigant"                                                            
     rules  and regulations  is not  aimed at  preventing  litigants                                                            
     from pursuing administrative  appeals, rather the intent is one                                                            
     of fundamental  fairness- ensuring  that the identity  of those                                                            
     who  initiate the litigation  are know  and that the  potential                                                            
     negative  consequence of such  litigation are borne  equally by                                                            
     all parties to the  litigation .The objective is not to inhibit                                                            
     meritorious   litigation,  but  rather  to  inhibit   frivolous                                                            
     litigation  by ensuring  that there is  a consequence  to those                                                            
     who file and support such litigation.                                                                                      
     If  responsible  resource  development is  to  be promoted  and                                                            
     achieved,  it is imperative that once development  projects are                                                            
     permitted  they are  not delayed, by  individuals, or  entities                                                            
     that choose to pursue  frivolous litigation. Modifying Alaska's                                                            
     existing  rules  and  regulations  regarding  "public  interest                                                            
     litigants"  is critical to promoting and achieving  responsible                                                            
     resource development in the State of Alaska.                                                                               
                                                                                                                                
     The Commission Recommends That:                                                                                            
     1a.1) Public Interest  Litigant Status needs to be limited. The                                                            
          Legislature   should modify  existing  State  Statutes  to                                                            
          specifically   provide  for any  party  bringing  a  civil                                                            
          action  seeking judicial  review of Administrative  Agency                                                            
          decisions,  in which they were afforded an opportunity for                                                            
          public  input and  administrative  appeal, not be  awarded                                                            
          "public   interest  litigant"  status.  Furthermore,   the                                                            
          prevailing  party in such  civil action shall be  entitled                                                            
          to  an award of attorney fees and costs  as in other civil                                                            
          actions.                                                                                                              
     1a.2) Funding Sources need to be disclosed. The Legislature                                                                
          should  modify existing  State Statutes to require  that a                                                            
          condition  of obtaining  litigant status and/or  of filing                                                            
          an  Administrative   Appeal,  under  regulations,  is  the                                                            
          initial  and supplemental  disclosure  of the identity  of                                                            
          those   who provide   funding  to  the  entity  who  seeks                                                            
          litigant  status and/or initiates an Administrative appeal                                                            
          and  the amount of  such funds during  the past two  years                                                            
          and during the term of the Administrative Appeal.                                                                     
                                                                                                                                
     1b) Permit Efficiency                                                                                                      
     Finding:  A key element  in marketing  Alaska as an  attractive                                                            
     and competitive place  to do business is the ability to process                                                            
     permit   applications   in  a   responsible,   consistent   and                                                            
     expeditious manner.                                                                                                        
     In the 2001  legislative session, funding was  provided for the                                                            
     Alaska  Department  of  Environmental  Conservation  (ADEC)  to                                                            
     reconstitute  the qualified  core of  water quality  permitting                                                            
     staff.  Equally  important to  adequate funding,  the  agencies                                                            
     need  the  flexible  management   tools  necessary  to  provide                                                            
     responsive,  effective, and efficient management  of permitting                                                            
     issues.                                                                                                                    
     Permitting delays  negatively impact business in Alaska. Delays                                                            
     are often due to staffing  shortages which creates backlogs for                                                            
     industry project permit review.                                                                                            
     To help  resolve this problem,  ADEC had recently utilized  the                                                            
     Department  of  Natural  Resources  (DNR) authority  for  third                                                            
     party  contracting through the  Large Mine Permit process,  and                                                            
     has contracted directly  with third party contractors to assist                                                            
     with  permit review.  ADEC is  also planning  to select  one or                                                            
     more  individuals/firms  that  would  be available  on-call  to                                                            
     provide  technical assistance  to a  permitting team  regarding                                                            
     risk  assessments  and  monitoring  requirements  for  National                                                            
     Pollutant Discharge  Elimination System (NPDES) discharges, and                                                            
     mixing zones for placer miners.                                                                                            
     Supplementing  permanent staff  during permit development  is a                                                            
     positive step that  will allow agencies to respond more readily                                                            
     to the  intermittent demands  associated with industry  growth,                                                            
     Further, it will support  the limited number of permanent staff                                                            
     personnel  via access  to the varied  technical and  scientific                                                            
     expertise required for responsible permitting.                                                                             
     In some circumstances,  permitting delay has been characterized                                                            
     by industry  as "procedural duress."  Industry recognizes  that                                                            
     permitting  review is an iterative  process through  discussion                                                            
     and  supplementing  of  relative  information,  public  review,                                                            
     comment  and  response  to comment.  However,  an unreasonable                                                             
     extension  of any  of these  elements  can lead  to costly  and                                                            
     unnecessary  delay. At present there are instances  where State                                                            
     requests  for  additional  information,   and  subsequent  time                                                            
     extensions, appear  to be based on a partial or cursory review.                                                            
     This  results   in  additional  time  delay  through   multiple                                                            
     information   requests.   Further  concern   is  often   raised                                                            
     regarding extension  of public review and comment periods. This                                                            
     practice  is detrimental  to the agency,  to the industry,  and                                                            
     ultimately  to economic development within Alaska,  potentially                                                            
     leading  to the  loss of millions  of dollars  in revenue,  and                                                            
     related monetary losses in taxes and royalties.                                                                            
     Permitting agencies  need to ensure that the permitting process                                                            
     is  not unnecessarily  extended. Initial  permit review  should                                                            
     result   in  a  single   and  complete   list  of  information                                                             
     deficiencies.  Additional  requests for  information should  be                                                            
     limited to questions arising out of new information.                                                                       
     The   Alaskan   industries,   agencies,   Administration,   and                                                            
     Legislature  can  work  together  to  provide  responsible  and                                                            
     reliable   permitting  that  ensures  the  protection   of  the                                                            
     environment  and a sound future. For this to  happen, we cannot                                                            
     be  complacent  in  trying  to improve  permitting   efficiency                                                            
     through  funding  alone. All  of the  recommendations  provided                                                            
     must occur  in concert for Alaska to fulfill  its potential for                                                            
     sustainable and attractive resource development.                                                                           
                                                                                                                                
     The Commission Recommends that:                                                                                            
     1b.1) The  Administration must continue to aggressively  search                                                            
          for  and find means to accommodate the  use of third-party                                                            
          contractors  who  will  work under  the core  managers  to                                                            
          provide  permit development supports on an as-needed basis                                                            
          and  extend these  efforts to all  types of environmental                                                             
          and   resource  permitting.   The  Legislature   needs  to                                                            
          encourage and support the Administration in this effort.                                                              
     1b.2) The Legislature should require a periodic permitting                                                                 
          status report accounting for agency staff and management.                                                             
      1b.3) Salary scales for public workers must be improved                                                                   
     relative to the private sector in order to retain competent                                                                
     staff                                                                                                                      
                                                                                                                                
Senator  Hoffman  asked  the  status  of  the  issue  regarding  the                                                            
construction of large permanent buildings at mining sites.                                                                      
                                                                                                                                
Mr. MacKinnon  responded that this  issue has not been addressed  by                                                            
the Commission  "for quite some time." He noted that  the removal of                                                            
cabins and other structures has been discussed.                                                                                 
                                                                                                                                
Senator Hoffman  commented that the issue of constructing  new large                                                            
buildings, particularly  in remote, large project  areas such as the                                                            
developing Donlin Creek mining site, should be readdressed.                                                                     
                                                                                                                                
Mr. MacKinnon professed  that the Commission has addressed the issue                                                            
of cabins  and  other structures  that  present an  obstacle to  the                                                            
development  of a mining site. However,  he continued, buildings  in                                                            
general have been discussed in "a general context."                                                                             
                                                                                                                                
Co-Chair  Wilken  observed  that the  Alaska  Minerals Commission's                                                             
"report  is  laced  with  recommendations."  He  asked  whether  the                                                            
Commission  members,  upon  the  completion  of  the  report,  place                                                            
themselves  in an  advocacy  position or  whether  they present  the                                                            
report  to the Legislature  to act  upon. He  aired that  furthering                                                            
these  recommendations   would  be  "important  to  the   industry."                                                            
Therefore,  he questioned  "the role"  that the  Commission  "plays"                                                            
after the report  is provided to the  Governor and the Legislature.                                                             
                                                                                                                                
Mr. MacKinnon responded  that, historically, the Commission compiles                                                            
the  annual  report  and  conducts  a  formal  presentation  to  the                                                            
Governor  and   the  Legislature.   He  noted  that  oftentimes,   a                                                            
Legislator  "takes an active role"  in furthering a recommendation.                                                             
He qualified that Commission  members have not, historically, played                                                            
a significant role with legislation.                                                                                            
                                                                                                                                
Co-Chair  Wilken  asked whether  the  Commission has  a legislative                                                             
committee that furthers its recommendations.                                                                                    
                                                                                                                                
Mr.  MacKinnon  responded  that  the  Commission's   limited  budget                                                            
provides  funding for  a few  public  meetings and  the Legislative                                                             
presentation.                                                                                                                   
                                                                                                                                
Co-Chair  Wilken  opined  that  Commission  members  are  "a  pretty                                                            
powerful group  of people" who could use their positions  to further                                                            
mining interests in the  State. He suggested that Commission members                                                            
join together to promote the industry.                                                                                          
                                                                                                                                
Mr. MacKinnon  asserted that members  do follow issues. He  exampled                                                            
that he  personally  follows essential  fish habitat  issues on  the                                                            
State  and federal  level, and  that such  things  as water  quality                                                            
issues are followed by other members.                                                                                           
                                                                                                                                
Co-Chair Green  qualified that the stated purpose  of the Commission                                                            
is  to provide  the  Legislature  and the  Governor  with  pertinent                                                            
mining  related   information,  and,   she  continued,  it   is  the                                                            
responsibility  of the Legislature and the Governor  to act upon the                                                            
report. She commended the Commission on a "very good" report.                                                                   
                                                                                                                                
     2b) Restricting the Use of Mining Airstrips                                                                                
     Finding: In many remote  mining camps, the only feasible summer                                                            
     access is by use of  an airstrip on, or adjacent to, the mining                                                            
     operation.   Unauthorized  use   of  these  strips,   often  by                                                            
     commercial   operations,  can  result  in  potentially   unsafe                                                            
     condition,  and the attendant threat of liability,  both to the                                                            
     miner and to the State.                                                                                                    
                                                                                                                                
     The Commission recommends that:                                                                                            
     The Governor and the  Legislature should direct the Division of                                                            
     Mining,  Land & Water  to mend the mining  regulations  so that                                                            
     when an  airstrip is required  for access to a specific  mining                                                            
     operation,  the Plan of Operation will allow  the permit holder                                                            
     to restrict the use of the airstrip.                                                                                       
                                                                                                                                
Co-Chair Green asserted  that the Legislature had previously adopted                                                            
legislation addressing  the use of airstrips. She  asked whether the                                                            
industry  is experiencing  liability  issues concerning  the use  of                                                            
airstrips by non-industry related aircraft in remote locations.                                                                 
                                                                                                                                
Mr. MacKinnon  responded that airstrips are a liability  problem. He                                                            
exampled some  of the situations that  have occurred, and  he stated                                                            
that some  placer miners  are experiencing  difficulty in  obtaining                                                            
insurance  coverage  if they  cannot close  the airstrip  to  casual                                                            
users.                                                                                                                          
                                                                                                                                
Senator Taylor  responded that the Legislature addressed  this issue                                                            
"extensively"  a few years  prior. He stated  that he remembers  the                                                            
adopted legislation "to provide relief" on this issue.                                                                          
                                                                                                                                
Co-Chair  Green  asked  whether  the  State  would  be  required  to                                                            
coordinate  airstrip legislation  with the  Federal Aviation  Agency                                                            
(FAA).                                                                                                                          
                                                                                                                                
DR. LANCE MILLER,  Member, Alaska Minerals Commission  and Executive                                                            
Director, Juneau  Economic Development  Council, explained  that the                                                            
use of an airstrip  is a FAA issue. He continued that  although some                                                            
airstrips  are  private,  access  would  be  required  in  emergency                                                            
circumstances.                                                                                                                  
                                                                                                                                
Co-Chair   Green  requested   follow-up  information   be   provided                                                            
regarding the  use of airstrips, as she stressed,  this issue should                                                            
be pursued.                                                                                                                     
                                                                                                                                
Dr. Miller  commented that it is important  for the "diverse  group"                                                            
of Alaskans  on the  Commission  to address  issues affecting  their                                                            
industry. He  highlighted the economic  importance of mining  in the                                                            
State. He  explained that  this legislation  proposes to extend  the                                                            
termination  date  of the  Commission  another  ten  years  because,                                                            
oftentimes, ten years is  required for mining projects and issues to                                                            
develop.  He  acknowledged  the interest  being  bestowed  upon  the                                                            
Commission's report by the Legislature.                                                                                         
                                                                                                                                
STAN  FOO, Mining  Section  Manager, Division  of  Mining, Land  and                                                            
Water,  Department of  Natural Resources  testified  from an  offnet                                                            
site  to voice  the  Department's  support  of the  legislation.  He                                                            
stated  that  "the  Commission  provides  important  and  meaningful                                                            
feedback,"  which serves as a "reality  check" to the Governor,  the                                                            
Legislature and  the Division on mining industry issues  "as well as                                                            
relevant  land and  water matters."  He stated  that the  Commission                                                            
includes  broad  geographic  representation  from  large  and  small                                                            
miners in the State.                                                                                                            
                                                                                                                                
Senator Bunde  recognized the work  conducted by the Commission.  He                                                            
spoke to recommendations  in the report that seek  appropriations of                                                            
up to $5 million  in State funds. He asked, in consideration  of the                                                            
State's current budget  situation, what the State could expect "as a                                                            
return  to the  general  fund" for  the  State's investment  in  the                                                            
mining industry,  in addition to the jobs and economic  benefits the                                                            
State receives.                                                                                                                 
                                                                                                                                
Mr. Foo  explained that,  in addition to  the job opportunities  and                                                            
economic  benefits, the industry  has annually  contributed  five to                                                            
seven million  dollars in  mining royalties,  mining license  taxes,                                                            
and  mining  claim  rentals.  He  stated   that  these  numbers  are                                                            
reflective  of years in which mineral  prices have been suppressed.                                                             
He  voiced  that the  Division  anticipates  an  increase  in  claim                                                            
staking activities,  particularly in the Denali Block  region, which                                                            
would result in an increase  in industry contributions to the State.                                                            
                                                                                                                                
Co-Chair Green  expressed that interest is being shown  in expanding                                                            
the differing  types of geologic mapping of the State.  She asserted                                                            
that the variety  of mapping types should be centrally  coordinated.                                                            
She asked how the differing mapping approaches interrelate.                                                                     
                                                                                                                                
Mr. MacKinnon  informed that geophysical  and geological  mapping is                                                            
addressed on page nine of the report.                                                                                           
                                                                                                                                
Dr. Miller expressed  that the Geographic Information  Systems (GIS)                                                            
database  contains   a  variety  of  the  differing  databases.   He                                                            
explained  that  geophysical   mapping  is  subsurface;   geological                                                            
mapping  denotes  surface features  such  as rocks;  and  geospacial                                                            
mapping includes  roads and towns. He stated that  while the various                                                            
mappings  are separate,  they  could be  integrated  to better  plan                                                            
development.                                                                                                                    
                                                                                                                                
Co-Chair Green voiced support for "coordinated mapping."                                                                        
                                                                                                                                
Mr. MacKinnon  commented that combining  geological and geophysical                                                             
maps would "put together the pieces of the puzzle."                                                                             
                                                                                                                                
Dr. Miller interjected  that the different State agencies  limit the                                                            
scope of their  individual projects  to specific mapping  and do not                                                            
take   into    consideration,    for   example,    the    subsurface                                                            
characteristics  of an area.  In other words,  he explained  the map                                                            
does not provide the user with an in-depth overview                                                                             
                                                                                                                                
Senator Taylor specified  that Wrangell is the only community in the                                                            
State that has invested  in geophysical mapping. He asserted that as                                                            
a result of this undertaking,  significant mine staking and activity                                                            
has resulted in  the area. He cited the report as  recommending that                                                            
additional mapping  be conducted. He surmised that  if 25 percent of                                                            
the  State funds  appropriated  for  lobbying  efforts  to open  the                                                            
Arctic National Wildlife  Refuge to oil exploration had instead been                                                            
spent on surveying  Alaska's mineral deposits, the  State would have                                                            
experienced  significant growth  in the mining  industry. He  opined                                                            
that the State is "ignorant" of its mineral deposits.                                                                           
                                                                                                                                
Senator Bunde asked whether  the State would conduct mapping efforts                                                            
in conjunction with the United States Geological Survey (USGS).                                                                 
                                                                                                                                
Dr.  Miller confirmed  that  the USGS  and  the Alaska  Division  of                                                            
Geological and  Geophysical Services (DGGS) jointly  conduct mapping                                                            
efforts.                                                                                                                        
                                                                                                                                
Senator Taylor  remarked that  Legislators  often ask the amount  of                                                            
return  to the  general fund  that would  be expected  from a  State                                                            
investment in a project;  however, he opined, this should oftentimes                                                            
not be a  criteria when the  State is making  efforts to enhance  an                                                            
industry. He noted  that when an industry is healthy,  contributions                                                            
to the general  fund could be entertained. He spoke  in favor of the                                                            
Donlin  Creek  mining site  and  noted that  the  Red  Dog Mine  has                                                            
provided  employment   opportunities   and  probably  significantly                                                             
reduced "the drain" on the State's welfare program                                                                              
                                                                                                                                
Co-Chair   Wilken  asked   the  location   of  the  report's   cover                                                            
photograph.                                                                                                                     
                                                                                                                                
Dr.  Miller  identified  the  cover  photograph   as  depicting  the                                                            
airstrip at Donlin Creek.                                                                                                       
                                                                                                                                
Senator   Hoffman,  noting   the  structure   shown  in  the   cover                                                            
photograph,  asked whether it is permanent  rather than a  temporary                                                            
building.                                                                                                                       
                                                                                                                                
Mr.  MacKinnon ascertained  the  structure  could be  a collapsible                                                             
steel building.                                                                                                                 
                                                                                                                                
Senator B. Stevens  offered a motion to report SB  79 from Committee                                                            
with individual recommendations and attached fiscal note.                                                                       
                                                                                                                                
There being  no objections,  SB 79  REPORTED from  Committee  with a                                                            
previous  $9,500 fiscal  note,  dated February  27,  2003, from  the                                                            
Department of Community and Economic Development.                                                                               
                                                                                                                                
ADJOURNMENT                                                                                                                 
                                                                                                                                
Co-Chair Gary Wilken adjourned the meeting at 09:39 AM                                                                          

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