Legislature(1997 - 1998)
03/02/1998 03:37 PM Senate RES
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SENATE RESOURCES COMMITTEE
March 2, 1998
3:37 P.M.
MEMBERS PRESENT
Senator Rick Halford, Chairman
Senator Lyda Green, Vice Chairman
Senator Loren Leman
Senator Bert Sharp
Senator Robin Taylor
MEMBERS ABSENT
Senator Georgianna Lincoln
Senator John Torgerson
COMMITTEE CALENDAR
SENATE JOINT RESOLUTION NO. 33
Supporting passage of S. 1221, the "American Fisheries Act," by the
United States Congress.
- MOVED CSSJR 33 OUT OF COMMITTEE
SENATE BILL NO. 108
"An Act relating to the disposal of state land by lottery."
- HEARD AND HELD
PREVIOUS SENATE COMMITTEE ACTION
SJR 33 - See Resources Committee minutes dated 1/28/98.
SB 108 - See Resource Committee minutes dated 3/26/97.
WITNESS REGISTER
Senator Jerry Mackie
State Capitol Bldg.
Juneau, AK 99811-1182
POSITION STATEMENT: Sponsor for SJR 33.
Ms. Mel Krogseng, Staff
Senator Robin Taylor
State Capitol Bldg.
Juneau, AK 99811-1182
POSITION STATEMENT: Commented on SB 108 for sponsor.
Ms. Carol Caroll, Director
Division of Support Services
Department of Natural Resources
400 Willoughby Ave.
Juneau, AK 99801-1724
POSITION STATEMENT: Commented on SB 108.
ACTION NARRATIVE
TAPE 98-15, SIDE A
Number 001
SJR 33 - SUPPORT AMERICAN FISHERIES ACT
CHAIRMAN HALFORD called the Senate Resources Committee meeting to
order at 3:37 p.m. and announced SJR 33 to be up for consideration.
SENATOR TAYLOR moved to adopt the proposed committee substitute
(63\B Utermohle) to SJR 33. There were no objections and it was
so ordered.
CHAIRMAN HALFORD explained that the committee substitute simplifies
the legislation and provides some direction as far as maximum
utilization of species taken, reduction of by-catch, minimization
of habitat impacts, and maximization of economic impacts.
SENATOR MACKIE, sponsor, said he supported the changes which key in
on the areas he is concerned with.
SENATOR SHARP noted that it still has the 75 percent minimum
requirement for ownership and asked if there was a size limit.
CHAIRMAN HALFORD answered that it doesn't refer specifically to a
size limit, but it limits the maximum length, tonnage, and
horsepower to 165 ft., 750 tons, and 3,000 shaft horsepower.
SENATOR SHARP asked if they would be grandfathered in if they
reached 75 percent ownership.
SENATOR MACKIE said he thought it was important to remove that,
because it is subject to change or negotiation as the bill moves
through Congress. The statement placing limitations is good and
the new language in the front part of the resolution makes a good
policy statement in terms of what the State of Alaska values as our
management principals and reducing by-catch.
SENATOR TAYLOR moved to pass CSSJR 33(RES) from Committee with
individual recommendations. There were no objections and it was so
ordered.
SB 108 - STATE LAND LOTTERY PROGRAM
CHAIRMAN HALFORD announced SB 108 to be up for consideration.
MS. MEL KROGSENG, Staff to Senator Taylor, said the proposed
committee substitute addresses a lot of the concerns discussed
previously. It no longer offers land under a lottery system, but
instead offers land under two other approaches: a land auction and
an open to entry program patterned after the old remote parcel
program.
Section 1 sets forth the findings as they were in the original
bill, although she pointed out on page 2, line 1 the 1,000,000
acres should have been changed to 500,000 acres.
Section 2 is the meat of the bill and describes the program and the
conditions under which land would be offered for sale. The first
subsection deals with exemptions. Only land that is unclassified
or classed as agricultural, grazing, settlement, or recreational
land will be offered. Certain lands are exempt from the offering
and land offered is also exempt from the requirements of AS 38.04
and AS 38.05, the other statutes dealing with land disposal. The
other exemptions are under AS 16.20, State refuges, critical
habitat areas, sanctuaries, and ranges. AS 41.15.300 - 330 is the
Haines State Forest Resources management area. AS 41.17 is the
Tanana State Forest, AS 41.23 are public use areas and recreational
rivers.
The administrative sites that are exempt are lands that would have
a cabin that's been built for a park ranger or for recreational use
and has not been included under the other recreational use statute.
If land has been sold that has a lease, the lease would go with the
property including grazing leases, mining leases, etc. The
Commissioner may not convey mineral or resource rights of the
State.
MS. KROGSENG said that currently according to statistics from the
Division of Lands, the State has around 580,000 acres.
Number 200
CHAIRMAN HALFORD noted that the disposals are 200,000 acres three
times a year, but the requirement is for only 500,000 for a total
year.
MS. KROGSENG explained that was to give the Division of Lands the
opportunity to develop necessary regulations. They start out with
the existing land bank. Once the land is gone, every fiscal year
the Department would offer not less than 500,000 acres through one
of two methods in the bill which she reviewed. She also reviewed
the financing mechanism in the bill.
She said there is no requirement for school construction in the
bill. The State shall retain a 100-foot right-of-way along each
section line of land sold and does not have a duty to construct or
maintain a road to a parcel of land purchased by a person under
this chapter. Land disposed of is subject to municipal zoning laws
and regulations and there is a 40 acre limit near Willow and a 5
acre limit in Southeast Alaska. She reviewed the sections on
surveys, liabilities, the security deposit, additional terms and
conditions, and the aerial geophysical mapping.
Number 300
MS. JANE ANGVIK, Director, Division of Lands, said the fiscal note
her Department had prepared was on the former bill and doesn't
reflect the committee substitute. If the goal is to increase the
sale of land by the State of Alaska, we have existing programs that
can do that. The principal thing we lack right now is money to do
it. She suggested if they fund the land disposal program and such
a proposal is included in the capital improvement program for this
year, it might address the concerns that motivated this bill.
She suggested just $300,000 to the Capital Improvement Program
(CIP) would allow her to sell approximately 200 of the lots
currently in the land bank disposal and to actualize the remote
recreational program that was created in statute last year. This
would take care of some of the demand. As a result of discussions
at this table last year, the Division of Lands staff has devoted a
lot of time to try to figure out how to meet the needs for land
disposals in the State. One of their challenges is to figure out
how to do it with existing resources.
MS. ANGVIK said that this bill, as proposed, would glut the market
for land very quickly and would probably have a chilling effect on
the real estate market. It would probably undervalue that land
that is held by the University and the Mental Health Trust that was
designed to try to produce income for those programs.
Currently there are about 600,000 acres in the land bank account
that have been previously surveyed and under existing statute it
would have to be appraised before they could be sold. Brief
calculations of the lands in this bill include approximately 6
million acres and there are probably another 8 million acres that
are not classified. That would be a pool for SB 108 of about 14
million acres.
There are some technical issues associated with the bill where it
contradicts itself. In Southeast, you can't have anything over 5
acres, so it's hard to figure out what you would give people in
Southeast an opportunity for. There are concerns about trying to
keep track of every person who ever bought acreage from the State
in order to make sure that when they hit the 160 acre number, they
would stop giving them land. They would also have to keep track of
lands that were returned. It would be a very complicated process
to keep track of the restrictions on lands that were sold, for
instance, when they can cut the trees and when the State gets a 20
percent royalty for them or for the gravel extraction. Another
great concern is the dream of owning land in Alaska would attract
people from other states and countries and large portions of Alaska
would be purchased by people who wouldn't be living here.
MS. ANGVIK concluded her comments saying if the goal is to sell
more land, she recommends using the existing two programs. The
Department intends to have a sale of 70 acres this spring of lands
that exist in the current land depository. If they could get the
CIP funding, they could have another major land disposal like they
had in 1995.
CHAIRMAN HALFORD asked how the remote cabin program works.
MS. ANGVIK explained that people can lease land for 10 years and at
the end, they can buy it for the appraised value and the cost of
the appraisal and survey. There is no requirement to build
anything so the Department doesn't have to check on that.
CHAIRMAN HALFORD asked what the acreage was.
MS. ANGVIK replied that there is no minimum established by law or
regulation. They are open to suggestions, she said, although it
would be reasonable to have a minimum of 10 acres and a maximum
which she didn't specify.
CHAIRMAN HALFORD said there should be something small for Southeast
where there's not much land and at least 40 acres for remote
parcels so someone could have an airstrip and a homesite.
MS. ANGVIK said that the bill sets the minimum price at $100 per
acre and she is concerned that that would quickly become the
standard price for all land. Right now remote parcels that have no
access are selling for $600 per acre up to $3,000 per acre.
Number 421
SENATOR LEMAN asked why $100 has to become the default value and
why can't the Department set the market price.
MS. ANGVIK said the theory is if they put 200,000 acres in the
market every four months, the value of land would become depressed.
CHAIRMAN HALFORD said there is a conflict of interest in getting
land to the people, because most of the people who make decisions
about land disposals already have land that will be worth less, if
they are successful in creating a good land disposal program.
SENATOR TAYLOR said they have already appropriated the money to
have the 600,000 acres currently on the books surveyed and it just
sits there.
CHAIRMAN HALFORD noted that the Department's proposal is to spend
$190,000 to make $2 - $4 million.
SENATOR TAYLOR said he wanted to hear what the Department's plan
really was to get land to Alaskans.
MS. ANGVIK responded that her proposal is the CIP which funds land
disposals. The State gets the opportunity to sell the land and get
some income. They would prefer to use existing programs that have
been set up to sell it. In 1995, they had the first land sale that
had happened since the Mental Health Land Trust froze the whole
thing. They sold 333 parcels and averaged about 10 acres a piece.
There are now a few left of those and she agrees that there is a
continual demand for some land for Alaskans to purchase.
She explained there is some mythology associated with land that
suggests that one can live on the land in a cabin and make a go of
it and another one that many Alaskans would like land for free.
There are other persons in Alaska who want to buy land and her
Department wants to make an opportunity for them to do so. Other
statutes say that they need to get a fair market value. If they
change the conditions of the market, she didn't think it would
benefit any of the private land owners who would find themselves in
competition with the State.
The majority of good land that is near communities has been
conveyed to the boroughs and cities. Land one hour from Anchorage
or Fairbanks on a lake is gone. It has already been conveyed to
governments, about 600,000 acres - 300,000 of which has been
surveyed. One goal of the legislature has been to make sure that
the municipal governments have some opportunity to be able to
provide land to their citizens.
CHAIRMAN HALFORD said that they have 600,000 acres in a disposal
bank that they have paid the money to get ready to dispose of.
MS. ANGVIK responded that they are ready to roll.
CHAIRMAN HALFORD said he has heard that they don't want
nonresidents involved, which is easy to fix in the bill before
them, and the restrictions on use of resources probably isn't worth
putting in there. Now how do they focus the bill on getting the
land disposal program working? The proposal in the fiscal note is
a pretty small proposal.
MS. ANGVIK replied that it pays for appraisal updates so they can
put land on the market.
CHAIRMAN HALFORD said they have had the remote program for a year
and nothing has happened with that.
MS. ANGVIK responded if the CIP was funded, they would do it.
CHAIRMAN HALFORD asked what happened when the bill passed. What
happened to the fiscal note?
MS. ANGVIK answered that the fiscal note wasn't associated with
that; it was associated with the agricultural patents.
CHAIRMAN HALFORD said if a program was created in a bill that she
provided a fiscal note to the legislature on and the legislature
didn't fund it, she could come back to them and say they didn't
fund it, and that's why it didn't happen. But if the Department
submitted a $0 fiscal note or didn't provide them with one, it's
her fault.
MS. ANGVIK said she understood his concern.
MS. CAROL CAROLL, Special Assistant, DNR, said there was a $0
fiscal note.
CHAIRMAN HALFORD said if $0 was submitted by the Department, it was
assumed it would be done within the existing budget authority of
the Department.
MS. ANGVIK said she would find out, but he was correct that they
hadn't pursued the remote program to date.
SENATOR TAYLOR asked why doesn't the phrase, "program receipts"
pass anyone's lips.
MS. ANGVIK answered that they would be happy to fund land sales
with program receipts. She said the fastest and cheapest way to
get land out to the public is to fund the appraisals.
SENATOR TAYLOR said he meant they could have a percentage of the
program receipts.
CHAIRMAN HALFORD asked what would happen if someone came in and
said they would pay for the appraisal on a parcel, if they could
buy it.
MS. ANGVIK said all she has to do is make sure they have
established the price at whatever market value is through
appraisals.
SENATOR TAYLOR moved to adopt the proposed committee substitute to
SB 108. There were no objections and it was so ordered.
SENATOR TAYLOR moved to delete on page 6, lines 5 - 16, the removal
of surface resources.
TAPE 98-15, SIDE B
There were no objections and it was so ordered.
SENATOR TAYLOR moved to change 1,000,000 to 500,000 on page 2.
There were no objections and it was so ordered.
SENATOR TAYLOR moved to delete page 7, lines 13 -19. There were no
objections and it was so ordered.
SENATOR TAYLOR moved to delete page 5, lines 2 - 6. There were no
objections and it was so ordered.
CHAIRMAN HALFORD suggested usable water frontage that didn't exceed
more than 25 percent of the exterior boundary of the parcel which
makes it a little more flexible.
SENATOR TAYLOR moved a conceptual amendment of 1/3 useable water
frontage. There were no objections and it was so ordered.
Number 524
MS. ANGVIK said her surveyors couldn't figure out how to do the
aerial geophysical maps on page 8, because they are for mineral
purposes and are not helpful in locating boundaries, nor can a
G.P.S. locate them with any accuracy.
SENATOR TAYLOR moved to delete the word, "geophysical" from page 8,
lines 15 - 16. There were no objections and it was so ordered.
SENATOR TAYLOR moved to delete lines 24 - 31, page 3, taking care
of how to figure things out, if someone gives land back to the
State. CHAIRMAN HALFORD said they would have to take out, "except
as provided in (b) of this section." There were no objections and
it was so ordered.
Number 430
CHAIRMAN HALFORD suggested changing "shall" to "may" on page 2,
line 8 because when you are saying, "Notwithstanding any other
provision of this title, the commissioner shall sell state land as
provided in this chapter...", the "Notwithstanding" can have the
effect of repealing all other programs in that chapter.
SENATOR GREEN moved to change "shall" to "may" on page 2, line 8
and delete the last half of the sentence. There were no objections
and it was so ordered.
SENATOR GREEN asked if the one-year residency was constitutional.
CHAIRMAN HALFORD said he thought it probably was, because they have
had that language in a lot of land disposals in the past.
MS. ANGVIK asked on page 2, line 22 if it was their intention for
income from the lease payments to go to the purchaser or to be
retained by the State.
CHAIRMAN HALFORD replied that the subsurface is constitutionally
mandated to stay with the State.
SENATOR LEMAN interjected that that could be part of the purchasing
price and could be left to the discretion of the Department.
CHAIRMAN HALFORD said a lease is an existing contract and stays
with the State unless the buyer wants to buy it out.
MS. CAROLL asked how grazing leases, in particular, would work.
CHAIRMAN HALFORD said that grazing leases of any size are reindeer
leases. He said you have to protect valid and existing rights
whether they want to buy out or not.
MS. ANGVIK informed the Committee when municipalities receive lands
that were owned by the State with existing leases on it, they get
the leases and the income.
CHAIRMAN HALFORD added that they have to follow the terms of the
lease - and any renewals.
Number 389
MS. ANGVIK said the term of the lease would have to be continued
until the expiration date. The Committee agreed.
SENATOR LEMAN said on page 7, line 28 they ought to clarify unless
it's the person who caused the contamination they aren't liable for
it.
SENATOR TAYLOR said no one could tell what impact this program
would have on the market price, but it would do something to it.
CHAIRMAN HALFORD assigned Senator Taylor to help the Department
with that section.
CHAIRMAN HALFORD noticed that some Committee members had to leave
and adjourned the meeting at 5:00 p.m.
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