Legislature(2013 - 2014)SENATE FINANCE 532
04/03/2013 09:00 AM Senate FINANCE
| Audio | Topic |
|---|---|
| Start | |
| SB18 | |
| HB77 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 18 | TELECONFERENCED | |
| + | HB 77 | TELECONFERENCED | |
| + | TELECONFERENCED |
SENATE FINANCE COMMITTEE
April 3, 2013
9:09 a.m.
9:09:51 AM
CALL TO ORDER
Co-Chair Meyer called the Senate Finance Committee meeting
to order at 9:09 a.m.
MEMBERS PRESENT
Senator Pete Kelly, Co-Chair
Senator Kevin Meyer, Co-Chair
Senator Anna Fairclough, Vice-Chair
Senator Click Bishop
Senator Mike Dunleavy
Senator Lyman Hoffman
Senator Donny Olson
MEMBERS ABSENT
None
ALSO PRESENT
Suzanne Armstrong, Staff, Senator Kevin Meyer; Daniel
Sullivan, Commissioner, Department of Natural Resources;
Cora Campbell, Commissioner, Department of Fish and Game;
Wynn Menefee, Deputy Director, Division of Mining, Land,
and Water, Department of Natural Resources; Ed Fogels,
Deputy Commissioner, Department of Natural Resources.
SUMMARY
SB 18 BUDGET: CAPITAL
SB 18 was HEARD and HELD in committee for further
consideration.
CSHB 77(RES)
LAND USE/DISP/EXCHANGES; WATER RIGHTS
CSHB 77(RES) was HEARD and HELD in committee for
further consideration.
SENATE BILL NO. 18
"An Act making appropriations, including capital
appropriations and other appropriations; making
appropriations to capitalize funds; and providing for
an effective date."
9:11:13 AM
Co-Chair Kelly MOVED to ADOPT the proposed committee
substitute for SB 18, Work Draft 28-GS1798\O (Martin,
4/2/13).
Co-Chair Meyer OBJECTED for discussion.
SUZANNE ARMSTRONG, STAFF, SENATOR KEVIN MEYER, discussed
the changes in the work draft. She stated that Section 1
contained FY 14 capital projects and grants. Section 1
included the FY 14 agency budget requests, grants to
municipalities, grants to named recipients, and grants to
unincorporated communities. She explained that Section 1
totaled $702.889 million in unrestricted general funds
(UGF), $124.622 million in designated general funds (DGF),
$55.180 in other state funds, and $923.431 in federal
receipts. The total request in Section 1 was $1.8 billion.
She announced that Sections 2 and 3 were fund source roll-
ups, which detailed agency and fund source for the
appropriations made in Section 1.
Co-Chair Meyer queried the page number. Ms. Armstrong
replied that Section 1 began on page 2.
9:14:12 AM
Ms. Armstrong stated that Section 2 was the fund source
roll-up, and Section 3 was the fund source roll-up for
Section 1. She explained that Section 2 began on page 64,
and Section 3 began on page 68. She looked at Section 4,
which began on page 70, and stated that it was the
supplemental capital appropriations for July 1, 2012 ending
June 30, 2013. She stated that Section 4 totaled $137
million including $114 million of UGF, $22 million of other
state funds, and approximately $1 million in federal
receipts. She stated that the fund source roll-up for
Section 4 was on page 72 and 73, which were Sections 5 and
6. Section 7 began on page 74, which were the supplemental
operating appropriations for July 1, 2012 ending June 30,
2013. She stated that Section 7 was a reduction of $16.591
million in total funds; of which $14.955 million was UGF,
$578,000 was DGF, $1.1 million was other state funds, and
$64,800 was federal receipts. Sections 8 and 9 were the
fund source roll-ups for Section 7. Section 8 began on page
80 and Section 9 began on page 82. She explained that
Section 10 was the language section, which began on page
83. Section 10 included items from the FY 03 supplemental
capital. The total for the supplemental capital language
section was $59.5 million in total funds; with $57.5 in UGF
and $2 million other state funds. He furthered that Section
10 also included FY 13 supplemental operating expenditures
that totaled a reduction of $59.9 million in UGF. Section
10 also included the fund capitalization found under
Section 20 on page 87 line 26. She stated that
approximately $25 million would be applied to the Alaska
Gasline Inducement Act (AGIA) reimbursement fund; $2
million into the Emerging Energy Technology fund; $3.4
million into the Disaster Relief Fund; $10 million into a
Knik Arm Bridge and Toll Authority (KABATA) reserve fund;
and $618,000 to the small municipal school fund, which was
contingent on the passage of a bill that opened a criteria
and renames the fund.
Ms. Armstrong looked at Section 21, which was the fund
transfer section that began on page 88, line 6. She stated
that the NPRA impact grant program was established in
Section 23, and listed the projects beginning on page 88.
The section also included reappropriations that had been
requested by the administration for state agencies, and
reappropriations that were requested by legislators. She
stated that Section 43 provided a lapse extension for the
Alaska Arctic Policy Commission to June 30, 2014. She
stated that Section 14 established the contingency language
for appropriations that were contingent on passage of
legislation. She explained that Sections 48 through 51 were
the effective date clauses.
9:19:11 AM
Co-Chair Meyer pointed out that the bill was a
significantly smaller capital budget than what had been
over recent years. He stressed that there was an attempt to
maintain the guidelines to maintain the current assets,
finish some of the phased projects, and look for various
needed projects in various regions throughout the state.
Senator Bishop thanked Ms. Armstrong for her work.
Senator Olson asked what time the amendments should be
submitted. Co-Chair Meyer replied that the amendments
should be submitted the current day by 6:00 p.m.
Co-Chair Meyer noted that the total capital budget was
approximately $2 billion, and remarked that there was
approximately $1 million reduced from the governor's
proposed budget. He pointed out that the previous year's
budget was $2.9 billion with a bond of approximately $450
million. Ms. Armstrong added that the committee substitute
had $1.8 billion in total funds, with a reduction from the
governor's proposed budget of $108 million.
SB 18 was HEARD and HELD in committee for further
consideration.
9:24:48 AM
AT EASE
9:25:54 AM
RECONVENED
CS FOR HOUSE BILL NO. 77(RES)
"An Act relating to the Alaska Land Act, including
certain authorizations, contracts, leases, permits, or
other disposals of state land, resources, property, or
interests; relating to authorization for the use of
state land by general permit; relating to exchange of
state land; relating to procedures for certain
administrative appeals and requests for
reconsideration to the commissioner of natural
resources; relating to the Alaska Water Use Act; and
providing for an effective date."
9:26:54 AM
DANIEL SULLIVAN, COMMISSIONER, DEPARTMENT OF NATURAL
RESOURCES (DNR), introduced himself.
CORA CAMPBELL, COMMISSIONER, DEPARTMENT OF FISH AND GAME
(DFG), introduced herself.
WYNN MENEFEE, DEPUTY DIRECTOR, DIVISION OF MINING, LAND,
AND WATER, DEPARTMENT OF NATURAL RESOURCES, introduced
himself.
Commissioner Sullivan stated that there was a previous
presentation on the efforts that the state had undertook to
make the permitting system more timely, efficient, and
certain; and HB 77 was focused on those goals. He felt that
the permitting reform and modernization was important, and
would maintain the highest environmental standards. He
specifically pointed out that the bill would uphold the
highest standards specifically related to the protection of
fish. He furthered that the goal of broader permitting
reform and modernization was a goal that benefitted all
Alaskans across various groups and individuals. He felt
that DNR had a substantial backlog of permits, with some
extending years backwards. He felt that the backlog was not
helpful with regard to efficiencies, employment, and many
other permit relating factors. He pointed out that
permitting reform was a bipartisan effort that was
occurring in various other states, and remarked that the
bill would make certain changes that would result in a
cumulative effect to serve the public better with more
timely and cost effective decisions. He stated that HB 77
was a continuation of the effort that began the year prior
with HB 361. He remarked that HB 361 had smaller,
incremental changes that provided an important cumulative
effect. He stated that DNR experts had conducted a review
of the permitting system to ensure that it was efficient
for applicants. He explained that the permitting reform had
utilized input from the communities. He stressed that HB 77
reflected the DNR internal review and public input.
9:31:41 AM
Commissioner Sullivan highlighted the areas of importance
that he felt the committee would find relevant. He looked
at the issue of general permit activity. He remarked that
the bill would give the DNR commissioner statutory
authority to issue general permits on certain activities.
He explained that general permits were often issued, so the
bill would provide clear authority from the legislature
written in statute. He stated that land exchange matters
were often issues that could take years to permit. He
stressed that it was important for land exchange processes
to run more efficiently. He stressed that the land exchange
permitting issues had historically taken years to resolve.
He pointed out that HB 77 focused on more flexibility with
regard to land exchanges. He further pointed out appeal
issues. He stated that HB 77 sought to reform the appeals
and administrative review process by encouraging
participants to be involved in the process throughout the
appeal and administrative review process. It would also
tighten the eligibility standards for those appeals. He
pointed out that the statute would focus on amending water
reservation statutes to have the application for water
reservations apply to federal or state agencies, or
political subdivisions of the state. He remarked that the
water reservation aspect was the most controversial aspect
of the bill. He referred to a letter that he had written to
Representative Edgmon that outlined some of the components
of the water reservation aspects of HB 77 (copy on file).
9:35:28 AM
Commissioner Sullivan stated that there were three types of
water authorizations. He explained that the water
reservation, which was the only focus in the bill. He
stated that the water reservation set a specific amount of
water to be retained in a water body to ensure whether that
water is used to maintain healthy fish populations, or
water reservations could be used for other public purposes
such as navigability, recreation, or water quality. The
other two types of water authorizations that were not part
of the bill were temporary water use permits and water
rights. With regard to the amendments suggested in HB 77,
it only affects the statutory responsibilities of DNR with
regard to water reservations. He stressed that the bill did
not change any provision relating to DFG's authority. He
stated that the goal of the proposed change, with regard to
water reservations, was not to stop the placement of water
reservations on Alaskan water bodies or to diminish the
protection of fish habitat. Rather, the goal of HB 77 was
to ensure that water reservations were issued to and held
in perpetuity by public agencies for the protection of
public resources. He remarked that HB 77 would not prevent
private organizations, individuals, or tribes from pursuing
waters reservations; rather it would require them to work
with a public entity to submit the application to DNR. He
remarked that DFG already had an extensive process of
working with the groups. He emphasized that DNR and DFG
were very focused on the water reservation issue, because
of the support from the legislature to reduce the permit
backlog.
9:39:11 AM
Commissioner Campbell explained that her goal was to
provide information about the role that DFG played and its
permitting authority specifically regarding water use. She
also stated that she would discuss the process that DFG
used to partner with nongovernmental agencies that were
interested in securing water reservations. She reiterated
that HB 77 amended the DNR statutes in a very specific and
limited way. That is to limit the application for
reservations of water for maintaining in stream flows to
federal or state agencies, or political subdivisions of the
state. She stressed that the bill did not affect DFG's
title 16 responsibilities and authorities. She also pointed
out that HB 77 did not affect the role of DFG in DNR's
water permitting decisions. She explained that DFG was
guided by title 16 to protect fish resources. Under DFG's
authority, it required a fish habitat permit for water
removal from fish bearing waters to ensure that there was
water for fish passage and proper protection of fish
habitat. She explained that DNR statutes that were not
affected by the bill required DNR to work with DFG to
evaluate the impacts to fish and their habitat when DNR
issued any type of water authorization. She stated that DFG
reviewed every proposed activity that involved taking water
to determine if the activity was located within fish-
bearing waters. The review was conducted in order to
determine if the activity allowed for free passage of fish
and proper protection of fish habitat. She stressed that
DNR placed the restrictions and conditions on water rights
after DFG had conducted its review.
9:42:57 AM
Commissioner Campbell stressed that the existing processes
and protections would not be affected by the passage of HB
77. She reiterated that the statutory requirement for DNR
to work with DFG would remain in place; and DFG separate
permitting authority under title 16 would remain intact.
She remarked that a water reservation was not the only
method to ensure protection of fish and fish habitat. She
stated that both DNR and DFG had a responsibility to
protect fish habitat through the permitting process,
regardless of whether a reservation was in place on any
particular stream.
Commissioner Sullivan stated that he would be willing to
answer any questions from the committee.
Senator Bishop surmised that there were two parts to the
water reservation aspect of the bill. One related to DNR
and one related to DFG. He queried what might happen if a
tribal entity came to DFG to obtain a water reservation. He
assumed that DFG would assist the entity with stream
gauging, water flow rates, and the application process.
Commissioner Campbell replied in the affirmative, and that
DFG would assist in the data gathering in order to further
apply at DNR.
9:46:29 AM
Senator Olson remarked that the permitting issue was
frustrating to the private sector. He wondered how DNR
planned to ensure that the safeguards were in place, while
streamlining the permitting process. Commissioner Sullivan
replied that bill's purpose was to ensure that the backlog
of applications was dealt with in a timely manner. He
stressed that the bill's intent was to balancing the
protection of the public and protection of the environment.
He pointed out that there were many aspects of the bill
that may not seem like significant changes to the current
system, but incrementally the changes would result in more
efficiency. He furthered that the safety issue that Senator
Olson had referred to was a great lesson to the state, and
stressed that the federal government's permitting was an
issue as well.
9:51:11 AM
Senator Olson surmised that there were currently 33
entities that were approved by DNR. Commissioner Sullivan
replied that there were 33 water reservations in the past
three years, and most of those were to DFG.
Senator Olson deduced that the majority of the 33 water
reservations went to another department in the state.
Commissioner Sullivan responded that the majority of the
water reservations went to DFG for fish habitat protection.
He furthered that DNR had been working hard to alleviate
the backlog, which allowed for the administering of more
permits.
Senator Olson commended the DNR for their work on the
backlog of applications.
Co-Chair Meyer wondered if the biggest concern about the
bill was that it did not adequately protect fish in the
streams and waters. Commissioner Sullivan replied that
there was a lot in the bill that was not controversial, but
that the debate had focused on the water reservation
aspect.
Co-Chair Meyer wondered if Commissioner Campbell agreed
with Commissioner Sullivan. Commissioner Campbell replied
in the affirmative.
Senator Olson noted that the controversy was over who was
included and who was excluded from applying for the permit.
Commission Sullivan replied that the water reservation
controversy was related to who could apply for the
reservation.
Vice-Chair Fairclough queried how Alaska compared to other
states regarding its allowance for water rights.
Commissioner Sullivan believed that Alaska was the only
state that did not currently do what the bill proposed.
9:56:53 AM
ED FOGELS, DEPUTY COMMISSIONER, DEPARTMENT OF NATURAL
RESOURCES, stated that the bill was part of a broader
effort. He discussed the Sectional Analysis (copy on file).
Section 1 adds a new subsection (c) to AS 38.05.020 to
allow the Commissioner the ability to issue a general
permit for activity on state land if the activity is
unlikely to result in significant and irreparable harm
to state land or resources except for land covered in:
fish and game habitats (AS 16.20), the Alaska Surface
Coal Mining Control and Reclamation Act (AS 27.21),
forest resources (AS 41.17) and parks and recreational
facilities (AS 41.21).
Section 2 removes the reference to the additional
requirement that the director of the division of
Mining, Land and Water shall consult with other
departments during the negotiation of a land exchange
(AS 38.50.090), as this provision is deleted in
Section 43 of the bill. This provision is replaced in
Section 22 with the addition of language referring to
decision and review procedures established in AS
38.05.035(e).
Section 3 allows the director to execute a contract
for the sale, lease, or other disposable of land or an
interest in land without commissioner approval if the
annual rental is not greater than $10,000 (rather than
$5,000). This section also clarifies that the director
of DMLW may provide a preliminary written best
interest finding and public notice for non-oil and gas
related land disposals.
Section 4 clarifies that only a person who is
substantially and adversely affected by a final
written best interest finding related to the sale,
lease, or disposal of land may appeal a director's
decision. It also adds that the applicant may also
appeal the decision.
Section 5 clarifies that it is considered a denial if
the Commissioner does not act on a request for
reconsideration 30 days after issuance of the final
written finding.
Section 6 states in an administrative appeal to court,
a court can only deal with points presented to the
commissioner in the appeal or request for
reconsideration.
Sections 7 through 9 amend statutes to allow land and
property sales to be purchased by contract or by
payment in full up-front. Sections 8 and 9 remove
references to AS 38.05.065(b) related to sale of land
by lottery, which is repealed in Section 43 as the
newly created Section 7 now includes all land sales.
Section 10 adds a new subsection (f) to AS 38.05.070
that allows a one-time extension by the director of
DMLW for a period of up to two years for an existing
land lease if in the best interest of the state. This
section allows leases to remain active while DMLW
adjudicates a request to renew the lease, a request to
purchase the leased land under a preference right
under AS 38.05.102 or where the lessee plans to
substantially change the operation to the point where
a new best interest finding and decision must be
issued under AS 38.05.035(e).
Section 11 amends AS 38.05.075(a) so that only a
bidder who is substantially and adversely affected by
the issuance of a determination of highest bidder in a
lease sale may appeal for a review of the
determination.
Section 12 amends language related to prequalification
of bidders for a lease to make the time constraints
more easily understood.
Section 13 amends AS 38.05.075(h) so that only a
person substantially and adversely affected by the
department's prequalification decision may appeal or
request reconsideration no later than 5 days after the
decision is released.
Section 14 clarifies that only an applicant
substantially and adversely affected by the
department's decision related to leases for fisheries
development may appeal or request reconsideration no
later than 20 days after the decision is issued. This
section also clarifies that appeals to DNR and
superior court would now be addressed under AS
44.37.01 and therefore the sentence providing appeal
to superior court is deleted.
Section 15 and 16 relate to aquatic farming leases.
Section 15 removes the reference to lease renewals as
Section 16 adds a new subsection related specifically
to renewal of aquatic farm leases. Section 16 allows
the director of DMLW to issue a one-time renewal, for
a period of up to ten years in duration, of an
existing aquatic farm lease if it is determined to be
in the best interest of the state. Section 16 also
provides that the director may extend aquatic farm
leases for up to two years while a renewal application
is pending or where the lessee plans to substantially
change the purpose or operation of an existing lease
such that a new best interest finding and decision
must be issued under AS 38.05.035(e).
Section 17 amends AS 38.05.185(a) to allow the
director of DMLW to make a preliminary written
decision for a mineral order or leasehold location
order regarding availability of land to mineral
leasing or entry. This conforms to amendments made in
Section 19.
Section 18 amends AS 38.05.300(a) to allow the
director of DMLW to make a preliminary written
decision regarding the classification or
reclassification of state land. This conforms to
amendments made in Section 19.
Section 19 amends the public notice statute AS
38.05.945(a) to include public notice for various
preliminary decisions or final decisions if a
preliminary decision is not issued. This section
clarifies that all mineral orders and leasehold
location orders are subject to public notice
requirements of AS 38.05.945, not just mineral closing
orders.
Section 20 clarifies the definition of "state land"
includes shoreland and tideland in AS 38.05.965(21).
Previous definition included "shore" and "tide."
Section 21 adds a definition to include that "public
auction" includes a public oral outcry auction and a
public online auction.
Sections 22 through 27 give DMLW more flexibility in
its authority to exchange land or interest in land
when it is in the best interest of the State. Section
22 is modeled after AS 29.65.090 which provides for
exchanges between DNR and boroughs and municipalities.
Subsequent sections make conforming amendments.
Section 28 revises the statute to exclude the
requirements of AS 38.05.305(e) for alterations of
platted boundaries if all owners approve and no public
easements or rights-of-way are affected.
Sections 29 through 33 amend statutes to allow only
either an applicant or a person who is substantially
and adversely affected, rather than aggrieved, to
appeal or request reconsideration of DNR decisions.
Section 29 clarifies when the requirements of AS
44.37.011 is applicable. Section 32 clarifies that a
person has 20 calendar days after the issuance date of
a final department decision in which to file an appeal
or request for reconsideration. Section 33 adds new
subsections to define what it means to be adversely
affected and outlines additional requirements in the
DNR administrative appeal process.
Section 34 would allow people to carry small
quantities of water from one hydrologic unit to
another without violating the law.
Sections 35 through 37 make minor wording revisions
related to water statutes that preserve the original
intent of the statute.
Sections 38 and 39 continue the changes made to
statutes related to appeals including a requirement
that a person be "adversely affected" as defined in
Section 39 in order to appeal a decision regarding a
proposed sale or application for appropriation or
removal of water.
Sections 40 and 41 amend water reservation statutes to
limit the application for reservations of water to
federal or state agencies, or political subdivision of
the state. Section 41 removes the requirement that the
commissioner review all reservations of water at least
once every ten years and provides that the
commissioner may review reservations of water at any
time.
Section 42 amends AS 46.15.155(a) to clarify that the
commissioner may issue one or more new temporary water
use permits for the same project.
Section 43 repeals certain statutes that have been
modified in other sections of this bill related to
land sale contracts, land exchanges, and water
reservations.
Section 44 provides one year for applicants with
pending applications who do not meet the new
qualifications established in Section 40 to request
the commissioner of DNR to transfer their pending
applications to an entity of their choice that is
authorized to reserve water. If, within two years, the
entity notifies the Department that it will not pursue
the reservation or does not indicate whether it
intends to pursue the same or smaller reservation, DNR
will return the application fee to the original
applicant. If the entity pursues the reservation of
water, DNR will consider the application and if a
certificate of water is issued, the priority date will
be retained.
Section 45 allows the Department to adopt regulations
necessary to implement changes to take effect after
July 1, 2013.
Section 46 instructs the Revisor to change the heading
of AS 44.37.011.
Section 47 establishes an immediate effective date for
Section 45.
Section 48 establishes an effective date of July 1,
2013 for the remainder of the act.
Mr. Menefee looked at the briefing paper. He felt that a
briefing paper would cover more points of the bill.
10:01:46 AM
AT EASE
10:03:13 AM
RECONVENED
Mr. Menefee explained the document "CS HB 77 (RES): Land
Disposals/ Exchanges; Water Rights Briefing Paper; for the
Senate Finance Committee; March 13, 2013" (copy on file):
In 2010, the Governor of Alaska and the Department of
Natural Resources (DNR) embarked on an initiative to
improve the State of Alaska's permitting processes in
order to advance the public interest by ensuring
projects are permitted in a timely, predictable and
efficient manner while safeguarding the environment.
During the 2012 Legislative session, the Governor
introduced HB 361, which included the highest priority
changes related to leasing and disposal programs that
would help reduce the permitting burden on the
applicant and free more time for staff to work on
processing applications. The Division of Mining, Land
and Water (DMLW) in DNR has identified additional
statutory changes that would help streamline
permitting requirements for the public to use and
enjoy Alaska's land and resources.
The bill would accomplish the following primary
objectives:
1) Gives the Commissioner the ability to issue a
general permit for activity on state land if the
activity is unlikely to result in significant and
irreparable harm to state land or resources. (Section
1)
- Standardizes the permitting of certain types of
activities on state land so that the agency may
issue individual permits for that activity
without being required to adjudicate each permit
separately.
- Although there is arguably the authority in
statute to do general permits, it is not
explicitly called out.
- As part of the Governor's Permitting Efficiency
Initiative, the department will be doing general
permits for certain activities that can have
standardized authorizations.
2) Give the Division more flexibility in its authority
to exchange land or interests in land when it is in
the best interest of the State. (Sections 22, 23, 24,
25, 27 and 43)
- Enables DNR to resolve land management issues
with other entities, such as a government agency,
a native corporation or other organization, on a
timelier basis.
- Currently, the process for a land exchange
takes years to occur and is rarely successful due
to the complexity of the current process, the
long lead times to complete some of the current
statutory requirements, and unique timing
requirements involving public noticing, survey,
and appraisal. Continuation of the current
approach will result in unresolved land ownership
patterns and the inability to make state land
patterns more efficient.
- Existing statutes (AS 29.65.090) include a land
exchange provision between DNR and boroughs and
municipalities, which takes only months and have
always been successful. This change in statute is
patterned after this approach.
3) Amend statutes to allow all land and property sales
to be purchased by contract instead of by payment in
full up-front. (Sections 7, 8 and 9)
- Currently, DMLW issues contracts for any
customer requesting financing for any purchase of
state land; however, this practice could be
subject to a legal challenge because the law only
mentions sales at auction. If successful, a
challenge would force DMLW to require all land
purchases, except for those by auction, to be
paid in full at the time of purchase, which would
significantly lower land sales as most people
would be unable to fully finance the cost up-
front. An estimated one-third of all land sold is
by auction. This puts two-thirds of the state's
sales at risk if the state cannot finance the
purchase. The monetary loss is estimated at over
$2 million a year.
- This revision clarifies DMLW's ability to issue
installment contracts or accept payment in full
up-front to a majority of land sales sold through
preference right cases; Public and Charitable
cases; Initial Over-the-Counter Sales; Over-the
Counter sales; and Remote Recreation Cabin Sites.
4) Allow the director of the Division of Mining, Land
and Water to extend, one-time, for a period of up to
two years in duration, an existing land or tidelands
lease if it is determined to be in the best interest
of the state. (Sections 10 and 16)
- Allows leases to remain active for two years
while DMLW adjudicates a request to purchase the
leased land under a preference right under AS
38.05.102 or where the lessee plans to
substantially change the operation to the point
where a new best interest finding and decision
must be issued under AS 38.05.035(e).
- Preserves the lessee's rights from being
extinguished while the state is actively working
to issue a new lease or move to a purchase
contract.
- This statute change covers both regular leasing
(e.g. shoreland, tideland, or submerged land) and
aquatic farm and hatchery site leases.
5) Allow the director of the Division of Mining, Land
and Water to renew, one-time, for a period of up to
ten years in duration, an existing aquatic farm lease
if it is determined to be in the best interest of the
state. (Sections 15 and 16)
- Allows leases to be renewed for up to another
ten years if the lease operations remain the same
and the lessee is in good standing with the
state.
- Preserves the lessee's rights from being
extinguished at the end of the lease and provides
the department with the flexibility to maintain a
productive aquatic farm in place rather than
having to offer a new lease through a competitive
process.
10:08:41 AM
Mr. Menefee looked at point 6:
6) Clarify that the commissioner may issue one or more
new temporary water use permits for the same project.
(Section 42)
- Under current statutes, a Temporary Water Use
Authorization (TWUP) permit may be authorized
"…for a period of time not to exceed five
consecutive years…"
- The proposed change would clarify that
successive Temporary Water Use Authorizations may
be applied for, adjudicated and issued for the
same project.
- TWUPs are not permanent water rights. The
division may change or revoke TWUP as necessary
to protect water right holders or the public
interest, and TWUPs are mainly used by
exploration projects and construction projects
that are not conducive to permanent water rights
because the water use is of a temporary nature
and because water sources, water uses, water use
quantities and water use locations frequently
change.
Senator Hoffman wondered if the provision would give
individuals temporary water authorization. Mr. Menefee
responded that the provision did not change anything about
who could apply for temporary use authorizations, therefore
anyone could apply for a temporary use authorization.
Senator Bishop surmised that the APMA was only good for
five years, because the temporary water use authorization
was only good for five years. Mr. Menefee replied that his
question was one aspect of the issue.
Senator Hoffman wondered there was a process by with the
temporary water authorization could become more permanent.
Mr. Menefee responded that there were two different types
of authorizations: temporary water use authorizations and
water rights. He stressed that both authorizations were
independent from each other. He stressed that an
application for a temporary water use authorization gave no
long term vested interest or long term priority right.
Senator Hoffman wondered what would happen if a person
applied for a permanent water permit, that might usurp a
temporary water use permit. Mr. Menefee replied that
temporary water use authorizations were subject to other
appropriators.
10:13:27 AM
Mr. Menefee highlighted point 7:
7) Amend water reservation statutes to limit the
application for reservations of water related to
maintaining instream flow to federal or state agencies
or political subdivisions of the state and reduce the
mandate to re-evaluate water reservations (Section 40
and 41)
-This revision would prevent non-agency entities
from being able to apply for the reservation of
water; this does not affect holders of, or
applicants for, standard water rights, temporary
water use permits or water removals
-A "person" was added to the statute to allow
miners to apply for and receive a water
reservation for sanitary and water quality
purposes; usually associated with mixing zones.
However, no applications for these reservations
have ever been filed. Mining interests can still
receive TWUPs or water rights for sanitary and
water quality purposes from the department
-No other state allows private persons to reserve
and hold reservations to public water;
-The removal of the word "person" does not
preclude an organization or individual from
working with a municipal government, state or
federal agency, so that the agency can apply for
a reservation. In this manner, the appropriate
policy level review and criteria for each agency
or governmental entity are used. In addition,
these agencies will be able to identify the
funding and technical expertise needed to perfect
these applications
-As of December 31, 2012, there were 371
applications pending for instream water
reservations. Out of those, 35 are applications
that have been applied for by a person (non-
agency). Within one year, if requested by an
applicant who is no longer authorized to apply,
DNR shall transfer pending applications to an
entity identified by a state, Federal agency or a
political subdivision of the state. If, within,
two years, DNR does not receive notice that an
entity intends to pursue the same or smaller
reservation, then the application and fee will be
returned to the original applicant. If a
certificate of reservation is issued, the
certificate will carry the priority date of the
original application.
-Of the 61 issued certificates for Water
Reservations, all are issued to government
entities (DNR, ADF&G, and BLM). No certificates
for Water Reservations have ever been issued to
"persons" in the state of Alaska.
- The commissioner is currently required to
review all reservations of water every ten years
to determine whether the statutory purpose for
which the reservation was issued still apply to
the reservations. Due to the number of existing
and future reservations, and the limited
resources available to the department, this is
beyond the capacity of the department.
Senator Olson wondered how many permits were affected in
order to revise a business plan, because of the current
bill. Mr. Menefee responded that once a person obtains a
certificate for a water right, it was a perpetuity
authorization for the water right. Therefore, nothing in
the bill would change the perpetuity right. He furthered
that temporary water use authorizations were different from
water rights, because it was written in statute that any
other authorization would not diminish the current water
right.
Senator Olson surmised that individuals who had water
rights for small personal use would not be affected by the
bill. Mr. Menefee replied that if the individuals obtained
the authorization that was required by law, those
individuals' water rights would not be affected.
10:19:50 AM
Senator Olson noted that the state regulated all water, but
wondered about the creeks that dry up during the summer
time. Mr. Menefee responded that all water appropriation
for beneficial, regardless of whether it is from a
temporary or full-time stream was required. He furthered
that there was a balance of significant amount of water
written in regulation.
Senator Olson wondered if the water rights also referred to
subterranean rivers and wells. Mr. Menefee replied in the
affirmative. Mr. Fogels furthered that DFG would work with
DNR to be sure that the fish habitats were protected,
regardless of the size of the water body.
Mr. Menefee explained that there was a habitat permit
required, if the individual wanted a use permit for a
fluctuating water body.
Senator Bishop wondered if the water right permits that
were used by one business could drive another business to
go under. Mr. Menefee responded that Senator Bishop's
concern could occur, if one business had a temporary use
permit and the other business had a permanent water right
permit. He furthered that there was an eight-point decision
that DNR was required to perform. One of the points was the
effect of the loss of alternative uses of water that might
be made within a reasonable amount of time.
10:24:07 AM
Co-Chair Kelly understood that the water in Alaska was
reserved for fish and game in the Alaska constitution. Mr.
Menefee responded that the water was reserved for the
people for public use. The reservation referred to the fish
that were referred to the people, and the constitution
clarified that fish could not be impounded for personal use
through a water right. He furthered that the fish were for
the public.
Co-Chair Kelly surmised that the streams were reserved for
public uses, with the first priority being the fish. Mr.
Menefee responded in the contrary, and clarified that the
constitution did not say that the highest and most
important use was fish.
Co-Chair Kelly looked at the commentary on the
constitution, which stated that an appropriation of water,
except for public water supply, shall be limited to state
purposes and subject to preferences of beneficial uses,
concurrent or otherwise as prescribed by the legislature
and to the general reservation of fish and wildlife. Mr.
Menefee stated that the fish were for the public, so a
water reservation could not be used to impound fish for
personal use.
Co-Chair Kelly understood that the water was reserved for
public use, and the fish were protected by reservation, so
the use was limited by the ability for fish to thrive in
the stream. Mr. Menefee responded that the reservation in
the constitution was different than the application for the
reservation. He stressed that the constitution stated that
the waters were reserved for the public use, but the state
was required to determine how it is appropriated.
Co-Chair Kelly remarked that water was reserved for the
fish. He surmised that if someone wanted to use the stream
that someone had the right to use the stream, on a first
come first serve basis, for beneficial use, to the point
that it does not encroach on the general reservation for
fish. Mr. Menefee responded in the negative.
10:29:20 AM
Mr. Menefee explained that the laws gave provision that say
there could be another priority over fish, if it is in the
state's best interest.
Co-Chair Kelly surmised that there was a state's best
interest and a general reservation of fish and wildlife. He
furthered that the next interest was water rights. Mr.
Fogels stated that the reservation issues was DNR's
assignment, the constitution reserves the water for use by
the public. He stressed that DNR made the appropriations
and determinations.
Co-Chair Kelly stressed that the reservation was for the
best interest of the state, and was generally reserved for
fish and wildlife. Mr. Menefee agreed, and explained DNR
must make an interest decision of whether to appropriate or
whether to reserve.
Senator Dunleavy stated that he would wait to offer his
question.
Senator Hoffman queried examples of when a reservation
could be issued that did not pertain to fish, but rather
the best interest of the state. Mr. Menefee responded that
the statutory construction stated that DNR must consider
the fish and wildlife habitat, but it did not say that DNR
was mandated to put it as a priority.
Co-Chair Kelly wondered if the use of a stream was a
reservation or a right. Mr. Menefee responded that the use
of a stream was a "right." He furthered that a reservation
was a form of a "water right." He explained that a
reservation was to keep the water in place and a water
right was to take the water out. Mr. Fogels furthered that
DFG could apply for a water reservation to keep the base
level for even a small number of fish.
10:35:28 AM
Senator Bishop stressed that DFG and DNR were each required
to sign off on the reservation and water right. That was
the main issue.
Senator Olson stressed that there was a complicated
situation with the federal government protecting the
natives. He felt that the bill made the process more
complicated, because there were resources that were not
under state management. If DNR had power over the water, he
wondered if the resources still belonged to the natives.
Mr. Fogel explained that the intent of the bill would
ensure that the reservation was held for the public.
10:37:05 AM
Senator Olson stated that the federal government did not
look at the resources that way, especially pertaining to
subsistence for the natives. Mr. Fogels did not have enough
information to comment on Senator Olson's concerns.
Co-Chair Kelly stated that the constitution did not protect
subsistence rights for only natives, but it protected
subsistence rights for all Alaskans.
Senator Dunleavy remarked that there was no mention of the
federal government, so he wondered if there would be a
layer of the federal government permitting process. He
pointed out that there could even be an issue when moving
water around on private property. Mr. Fogels responded that
the bill would not affect the federal permitting regimes
such as wetlands processes. He said that there was a
separate bill that dealt with the federal permitting
process.
Senator Dunleavy surmised that if both bills passed, the
overall permitting process would be much more streamlined.
Mr. Fogels responded that the bills would make permitting
much more efficient.
10:40:11 AM
Senator Dunleavy wondered who the individual would deal
with if both bills passed the state or the federal
government. Mr. Fogels responded that streams would be
dealt with through the state, and wetlands would be dealt
with through the federal government.
Senator Hoffman noted something in point number 7, and
noted that there was the addition of a miner's ability to
apply for a water right. He furthered that there was also a
removal of the word, "person." He wondered how the
legislation would be reserved primarily for the people. He
specifically wondered why the word, "person", was removed.
Mr. Menefee responded the "person" referred to who could
apply for a water reservation. He explained that it did not
prevent the state from reserving to the benefit of all
people.
Senator Hoffman wondered if the bill applied to individuals
who build wells on their personal property. Mr. Menefee
replied that when someone drills a well, they were dealing
with water rights, so they would not be affected.
Senator Olson looked at Section 40, dealing with political
subdivisions of the state. He wondered if that was the
transition language. Mr. Menefee replied that he thought
the transition language was in Section 44. He explained
that Section 40 was where the word "person" was removed as
an applicant.
Senator Olson wondered if the state considered tribal
governments as one of the political subdivisions. Mr.
Menefee responded in the negative.
Senator Olson asked if communities who did not have access
to state or federal government offices, and only had access
to tribal offices would be excluded from the bill. Mr.
Menefee responded that the bill did not make a statement
regarding whether the tribal office could represent a
people. He furthered that the tribal government could
collect data and apply for a reservation.
10:45:27 AM
Senator Olson felt that the circuitous route was
cumbersome, so the small communities were excluded from the
bill. Mr. Fogels responded that DNR would work closely with
tribal organizations, should they come forward with a
proposal for a reservation. He stressed that the
reservation was a public resource, held by a public entity,
with a definitive geographic boundary that had
representation for all Alaskans within that area.
Senator Olson expressed concern, because Alaska was the
only state with this kind of system. He felt that other
states recognized political subdivisions, and worked on a
government to government relationship. He felt that tribal
entities were put at a disadvantage with the bill. Mr.
Fogels responded that DNR was working towards streamlining
in stream flow reservations. He stressed that DNR had done
more in the three years prior than had ever been
accomplished since statehood. He pledged to work with any
entity with good reason to apply for a reservation.
Senator Olson wondered if DNR would be opposed to amendment
that took out the word "person" and added the word "tribal
organization" to the bill. Mr. Fogels replied that DNR did
not believe that it would be a workable solution to add
tribes to the list.
Senator Olson surmised that DNR would oppose that
amendment. Mr. Fogels responded that he could not take an
official position. He furthered that DNR would not
recommend that amendment.
Senator Olson felt that the bill did not go far enough to
rectify the situation for the communities that had no
federal or state agencies.
CSHB 77(RES) was HEARD and HELD in committee for further
consideration
ADJOURNMENT
10:50:16 AM
The meeting was adjourned at 10:50 a.m.