Legislature(2003 - 2004)
04/09/2003 03:34 PM Senate RES
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
SENATE RESOURCES STANDING COMMITTEE
April 9, 2003
3:34 p.m.
MEMBERS PRESENT
Senator Scott Ogan, Chair
Senator Thomas Wagoner, Vice Chair
Senator Fred Dyson
Senator Ralph Seekins
Senator Ben Stevens
Senator Georgianna Lincoln
MEMBERS ABSENT
Senator Kim Elton
COMMITTEE CALENDAR
SENATE BILL NO. 142
"An Act designating the Department of Natural Resources as lead
agency for resource development projects; making conforming
amendments; and providing for an effective date."
HEARD AND HELD
SENATE BILL NO. 164
"An Act extending the termination date of the Board of Storage
Tank Assistance; and providing for an effective date."
MOVED SB 164 OUT OF COMMITTEE
PREVIOUS ACTION
SB 142 - No previous action to record.
SB 164 - No previous action to record.
WITNESS REGISTER
Laura Achee
Staff to Representative Samuels
Alaska State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Presented SB 164 for the sponsor
John Barnett
Executive Director
Board of Storage Tank Assistance
DEC, 410 Willoughby Avenue M/S 1800
Juneau, AK 99801
POSITION STATEMENT: Stated support for and answered questions
about SB 164
Gary Webber
President, Board of Storage Tank Assistance
DEC, 410 Willoughby Avenue M/S 1800
Juneau, AK 99801
POSITION STATEMENT: Stated support for SB 164
Commissioner Tom Irwin
Department of Natural Resources
400 Willoughby Ave.
Juneau, AK 99801-1724
POSITION STATEMENT: Answered questions about and stated support
for SB 142
Cam Leonard
Assistant Attorney General
Department of Law
PO Box 110300
Juneau, AK 99811-0300
POSITION STATEMENT: Answered questions about SB 142
Commissioner Ernesta Ballard
Department of Environmental Conservation
410 Willoughby
Juneau, AK 99801-1795
POSITION STATEMENT: Answered questions about and stated support
for SB 142
Bill Jefferson
Division of Governmental Coordination
Office of the Governor
Juneau, AK
POSITION STATEMENT: Answered questions about SB 142
ACTION NARRATIVE
TAPE 03-26, SIDE A
Number 0001
CHAIR SCOTT OGAN called the Senate Resources Standing Committee
meeting to order at 3:34 p.m. Senators Wagoner, Dyson, Seekins
and Ogan were present. The committee first took up SB 164. Chair
Ogan announced that Senator Stevens had arrived.
SB 164-EXTEND BOARD OF STORAGE TANK ASSISTANCE
MS. LAURA ACHEE, staff to Representative Samuels, explained to
members that SB 164 was introduced by the Senate Rules Committee
at the request of Representative Samuels, Chair of the
Legislative Budget and Audit (LBA) Committee. She told members
that John Barnett, Gary Webber and LBA staff were available to
testify and answer questions.
MR. JOHN BARNETT, a private contractor hired by the Board of
Storage Tank Assistance to act as its executive director, told
members the seven-member board was established in 1990. All
members serve without compensation and he is the only staff
person. The board was established at the request of the Alaska
Tank Owners and Operators Association to act as a forum, to
mediate disputes between tank owners and operators and the
Department of Environmental Conservation (DEC), to oversee
proposed regulations, and to review corrective clean-up plans
and assist in expediting no further action letters on sites. In
addition to those duties, the board is empowered with certain
authorities related to eligible cost for financial assistance
for the Underground Storage Tank Revolving Loan Fund.
MR. BARNETT said this board keeps attorneys out of the picture.
Historically, when disputes between the regulated tank community
and DEC arose, a lot of money was spent by the Department of Law
(DOL) rather than on clean up to protect public health. Since
the board was established, disputes are mediated, clean ups are
expedited and the funds are used where they do the most good: to
protect the public health.
CHAIR OGAN asked Mr. Barnett if his executive director position
is full time.
MR. BARNETT said it is part time.
CHAIR OGAN asked how many disputes are resolved each year for
$50,000.
MR. BARNETT said the number varies from year to year depending
upon the level of involvement, the number of sites, location,
and the condition of the sites. Some years, dozens of disputes
that resulted in formal appeal hearings were resolved. He now
resolves most cases by contacting DEC and the owner. Typically,
the problem is caused by a communication breakdown. At the
present time, the board has a grant program that terminates June
30, 2004. It provides grants for up to $250,000 per facility to
eligible applicants. When the program began, grants for up to $1
million were available. He expects an increased workload when
the new loan program comes on line. He expects more questions
about what repairs are eligible because the tank owner will be
paying for those costs. In addition, an applicant's credit
worthiness will be considered. The state will be fronting the
loan because the banks will not. The board's authorities will be
slightly expanded under the loan program due to the fact there
will be financial records involved with credit applications.
SENATOR WAGONER asked if DEC gave tank owners and operators a
specific date by which buried tanks had to be reported.
MR. BARNETT explained that on December 22, 1988, EPA regulations
took effect. The state program began on September 5, 1990. Tank
owners had until March of 1991 to register with DEC. The board
believes that 97 or 98 percent of all known tanks in the state
are listed in the DEC database. Some of those tanks have been
closed in place in the ground. A great number have been removed.
However, of the over 1,000 active facilities in the state, about
50 sites are undergoing clean up. The program originally had
about 2,000 applicants; over 1,000 have been funded at a cost of
over $40 million. Because of different amounts of annual
appropriations, funding levels varied from $3 to $5 million so
the sites were prioritized based on facility size and location.
For example, a roadhouse with no other fueling facility for 200
miles in all directions was ranked higher than an urban
facility. That ranking system will be used for the loan program
as well.
MR. BARNETT told members that about 5 to 15 facilities were
provided with clean up funds each year. Some of them have just
received their initial grants but they will not have sufficient
time to receive additional grants. Some of the sites have taken
over 13 years to clean. Aside from the grant program, DEC had an
upgrade and closure program that sunsetted this past June. In
1999 and 2000 DEC found some sites to be contaminated. Those
contaminated facilities were unable to undertake the clean up
activities through the grant program. The board essentially acts
as an ombudsman in those cases. He said he expects improvements
in the future due to a new administration at DEC. Many of the
disputes were related to administrative policies. The board has
more flexibility to resolve issues.
SENATOR WAGONER said most of the tanks in the City of Kenai were
above ground storage tanks. The city passed an ordinance
requiring all tanks to be buried underground, a case of being
your own worst enemy.
CHAIR OGAN said although $50,000 is a relatively small amount of
money, the legislature has to look at what services the state
can continue to provide. He said there is a process within the
bureaucracy to try to resolve disputes using hearing officers so
he questions the need to spend another $50,000 to resolve
disputes when DEC employees are paid to do that. He asked for a
more accurate description of the disputes the board resolves.
MR. BARNETT told Chair Ogan that the tank owners have always
felt the registration fees they pay were intended to support the
board. Language was included in SB 153 last year that authorized
those registration fees to go into the Underground Storage Tank
Revolving Loan Fund and to pay for the cost of the Board of
Storage Tank Assistance. He said regarding board oversight of
regulations, an example of the most recent problem was a
regulation that required the tank owner to be onsite 24 hours a
day. This regulation required the tank owner to be available at
all times a fuel delivery might take place. He said that fuel
deliveries often happen in the wee hours of the morning on an
intermittent schedule. That regulation was far more stringent
than the federal requirement. The original intent of DEC was to
ensure that deliveries were made properly and no overflows
occurred. The board worked with DEC to come up with a more
favorable regulation that involved working with their own
employees to ensure that delivery was made properly.
CHAIR OGAN said a whole process for drafting regulations
provides for public comment. He said the legislature can no
longer rubber stamp programs or job descriptions and he is not
sure whether this one needs to continue. He said the state will
see major changes in the next three or four years. British
Columbia cut its budget by 35 percent in one year. States
everywhere have to cut huge amounts. He said that since SB 164
has a fiscal note, he will defer to the Finance Committee on
whether to fund this. He then took public testimony.
MR. GARY WEBBER, President of the Board of Storage Tank
Assistance, told members that when HB 220 was drafted in 1990,
the tank owners volunteered to pay a $1,000 per tank
registration fee to fund this board. When the tanks were
upgraded, the registration fee was reduced to $75 per tank. Tank
owners feel they have been paying for this board all along. The
funds were previously appropriated out of the prevention
account. Since the enactment of the 1999 legislation, the
appropriation now comes from the general fund but tank owners
put money into the general fund to offset that expense. He said
$75 is not much but there are enough tank owners to support the
cost of the board.
MR. WEBBER said the tri-annual inspection is a good one. The
board, tank owners and DEC were involved in putting that program
together; it is one of the best in the country. Regarding the
regulation Mr. Barnett discussed, he said an insurance agent
told him that title to product is not passed to the tank owner
until it has been put in the ground. Prior to that, it is the
truck driver's responsibility to verify the tank contains enough
room to hold the amount to be filled. To require the tank owner
to be there 24 hours per day would make the tank owner
responsible for the delivery, tank truck and equipment. He
emphasized that a third party, seven-person oversight board is
invaluable to tank owners and, since they are paying for it,
they are entitled to have it. He said tank owners no longer run
to their attorneys when they have trouble complying with laws.
CHAIR OGAN announced that Senator Lincoln had arrived.
SENATOR WAGONER moved SB 164 from committee with individual
recommendations and its accompanying fiscal note.
CHAIR OGAN said he would let the Finance Committee make the
policy call on this legislation. He then announced that without
objection, the motion carried.
The committee took a brief at-ease.
SB 142-DNR LEAD RESOURCE DEVELOPMENT PROJECTS
COMMISSIONER TOM IRWIN, Department of Natural Resources (DNR),
introduced Ms. Ernesta Ballard, Commissioner of the Department
of Environmental Conservation (DEC), Mary Siroky of DEC, and
Janet Burleson Baxter of DNR. He noted that Deputy Commissioner
Dick LeFebvre of DNR and Cam Leonard from the Department of Law
(DOL) were available to answer questions.
COMMISSIONER IRWIN stated support for SB 142 and explained that
it is an act designating DNR as lead agency for resource
development projects. The driving force behind this legislation
is the Governor's priority to develop natural resources. The
Governor absolutely believes that priority will provide new
wealth for Alaska. The purpose of SB 142 is to facilitate and
expedite resource development. The bill will specifically
provide the commissioner of DNR with statutory authority under
AS 38.05.020(b) to lead and coordinate all matters related to
the state's review and authorization of resource development
projects. As the state puts more focus on development of
resources, DNR needs clear and explicit authority to carry out
its role to lead and coordinate the state's review and
authorization of these resource projects. Although DNR has and
will continue to serve as lead for mining projects, its
authority to serve as lead agency for other resource development
projects is not as explicit. SB 142 will provide the necessary
clarity for future resource development.
COMMISSIONER IRWIN told members that the primary responsibility
in DNR will rest with the Office of Project Management and
Permitting. This office includes the project management function
and the coastal zone management program. Large resource
development projects are more efficiently reviewed and
authorized using a lead agency to coordinate and integrate the
various permitting processes of the agencies involved using a
project team approach. Smaller projects, normally less complex
and requiring fewer permits, may benefit from lead agency
coordination for review. However, they may not require the
establishment of a project team.
COMMISSIONER IRWIN described a three-phase process that projects
using the lead coordinating agency and project team approach
will undergo. In phase one, the proposed project will be
evaluated to determine if the lead agency project team approach
will best address the review and permitting needs of the
project. The second phase will result in establishment of the
project team, development of an integrated agency review
schedule, delineation of information requirements, and
completion of any necessary agreements. This is where any
misconceptions will be eliminated because all participants will
sit at the table and delineate the required activities for a
particular project. During phase three, the actual project
review and authorization will take place. It includes public
participation and is tailored specifically to the requirements
for permitting the project. Additionally, SB 142 will assist
DNR's efforts to streamline project review and authorization by
facilitating:
· the state's ability to pull together agencies to address
the project's specific concerns
· the review and authorization process
· a more cohesive working relationship among agency
representatives
· better communication
· more efficient permitting and a consolidated public process
where possible
· integration of the state's permitting process with that of
the federal agencies.
COMMISSIONER IRWIN said the laws governing resource development
have proliferated. The state now has more agencies with
permitting authority over resource development projects than
ever. Resource development should not be held up by the sheer
complexity of government. This bill is intended to help
alleviate that problem. He again stated support for SB 142.
SENATOR LINCOLN asked where the definition of "resources" is
located in statute. She expressed concern that the bill contains
the phrase "all matters relating to resource development."
CHAIR OGAN thought "resources" would apply to anything that
falls under the titles of DNR, the Alaska Department of Fish and
Game (ADF&G), and DEC.
SENATOR LINCOLN thought "resources" would include minerals, fish
and game, air and water.
COMMISSIONER IRWIN said the divisions within DNR include oil and
gas, parks, mining, land and water, agriculture, and then there
are the associated issues with DEC and ADF&G. He said he could
not provide the specific statutory definition of "resources" but
they should include the areas for which DNR is accountable and
specifically the areas for which DNR issues permits.
SENATOR LINCOLN commented that she cannot think of anything that
is not a resource, which is why she wants a more definitive
response. She then noted that at least 20 statutes are being
repealed in SB 142 and asked for a brief description of those
statutes.
COMMISSIONER IRWIN deferred to Mr. Leonard for a summary of
those statutes.
MR. CAM LEONARD, Assistant Attorney General, DOL, told members
that most of the sections being repealed in SB 142 are the
provisions in existing law that made DEC the coordinating agency
for purposes of permitting projects. While some of those
sections will remain intact, they are being moved to other
statutes.
SENATOR LINCOLN asked Mr. Leonard to address AS 41.
MR. LEONARD said AS 41 is a cross reference to the permit
coordination act, AS 46.35. It is a housekeeping repeal to
reflect that the cross reference will no longer be valid.
CHAIR OGAN noted Mr. Leonard said most of the statutory
provisions being repealed have never been used. He questioned
whether DEC ever held public hearings.
MR. LEONARD said individual agencies held public hearings. To
his knowledge, what wasn't used was the coordinated approach led
by DEC, which is what AS 46.35 pertains to.
CHAIR OGAN said some portions of the bill need not conform to
the Administrative Procedure Act (APA), such as Section 2, AS
44.62.330(a). He asked if that applies to adjudicatory hearing
procedures.
MR. LEONARD explained that those are provisions from AS 46.35
that are being moved to another place. AS 46.35.090 contains
language exempting the adjudicatory hearing procedures that DEC
uses on its permits from the requirements of the APA. DEC does
offer adjudicatory hearings and they are subject to clearly
detailed regulations. This bill transplants that provision of
law to these other two places.
CHAIR OGAN commented that the language on page 2, line 23, gives
ambiguous but broad authority.
MR. LEONARD said it was intentionally left broad so that DNR
could consider the breadth of the types of projects that might
be covered and implement this authority through regulation.
CHAIR OGAN asked if a fair interpretation is that language would
give DNR the authority to write whatever regulations it deems
necessary.
MR. LEONARD said DNR would be limited because it cannot intrude
upon another agency's legislative authority. For example, DNR
could not write new water quality standards that would trump
DEC's regulations. The regulations he was referring to would be
more procedural as to how DNR would go about performing its
coordination role.
COMMISSIONER ERNESTA BALLARD, DEC, told members coordination can
really improve the prospect for those interested in resource
development, particularly in rural Alaska. In rural areas, it
can be very difficult to know the details and follow the
complexities of multiple agency permitting programs. One benefit
DEC anticipates from DNR's lead role is coordination of the
public hearing process. Interested parties can see how a project
is going to look in its totality at one place at one time. She
said in no way will SB 142 change her responsibilities to do
water quality protection. She believes SB 142 will make a real
improvement, particularly given the rural nature of most of the
projects, so that everyone sees the project moving forward as a
total project.
CHAIR OGAN said he supports that concept. He then asked if DEC
was the coordinator in the past, at least in theory in statute,
and whether DEC ignored that policy.
COMMISSIONER BALLARD said she cannot speak to why DEC never used
its statutory authority to coordinate. She believes AS 46.35 was
passed 30 years ago. The coordination over the last ten years
was achieved through the intent of the commissioners to
coordinate, not through the auspices of that act.
CHAIR OGAN said he wanted to make sure the legislative body
remains the policy setting body. He said as much as he respects
the commissioners, the state now has the most powerful DNR
commissioner in the history of the state. He said this bill
removes several statutes and replaces them with one sentence; he
assumes the authority to implement that one sentence is very
broad, which requires a lot of trust on the part of the
legislative branch.
COMMISSIONER BALLARD said she believes the wisdom of this
approach is that any permitting decision involves making
choices. Those choices are directed to some degree by law and,
in large part, through the discretion provided through rule
making in regulation. She would prefer that those choices be
made in the total context of the project so that all parties
involved, both supporters and opponents, see the entire project.
She and the other commissioners believe this is the preferred
method. SB 142 codifies the commitment made by this
Administration. She believes the permitting issues are
sufficiently complicated so keeping them separate does not serve
the public interest.
CHAIR OGAN said he agrees but wants everyone to be mindful of
the healthy constitutional tension between the legislative and
executive branches so that any delegation of power is made by a
conscious decision rather than by default.
SENATOR BEN STEVENS referred to the three-phase design and asked
Commissioner Irwin to describe how he will formulate phase one.
He asked what agencies will be involved and what the evaluation
criteria will be to determine whether a project is large enough
to require a project team. He also asked Commissioner Irwin to
describe the process for a small project.
TAPE 03-26, SIDE B
COMMISSIONER IRWIN said a company proposes and idea or project
to a state agency. The company may present an idea or an
engineering plan that defines 50 percent of the cost. The
benefit of having a lead agency is its ability to get everyone
with the appropriate expertise to the table at one time. The
company would explain the scope of the project to the group.
Each agency would describe what permits the company will need to
obtain and any other requirements. The company should leave that
meeting with a clear list of requirements and a commitment from
the lead agency. That should quickly lead to a follow-up meeting
to discuss the permit schedule. He said the agencies will also
understand the timeline. DNR will have the authority to get the
right people to the table at the right time and hold people
accountable.
Regarding the determination of whether a project is considered
to be small or large, COMMISSIONER IRWIN said part of that
determination will be made by the company. Certain projects will
obviously be large, but those will be in the minority. However,
many projects will fall into a gray area. DNR does not want to
preclude companies with small projects that want to get into the
three-phase process from doing so. Companies need to understand
there is an associated cost with the three-phase process, which
will be paid for by the companies. The commissioner said at the
first meeting, it should be obvious to team members whether a
three-phase process is necessary. However, the company will be
able to hear what each agency will require. He told members the
public will be giving input so the entire process can be
adjusted if an issue arises.
SENATOR BEN STEVENS asked Commissioner Irwin if he could provide
an estimate of the number of resource development permits DNR
will handle through the Office of Project Management and
Permitting.
COMMISSIONER IRWIN said he could not provide any numbers but DNR
has no desire to deal with simple permits that are under DEC's
purview.
SENATOR BEN STEVENS asked if a project requiring multiple agency
permits would be under the purview of the Office of Project
Management and Permitting. However, a project needing a routine
outfall permit from DEC would not require DNR oversight.
COMMISSIONER BALLARD told Senator Stevens that DEC has an on-
line permit questionnaire. She said if a company is unable to
work through the permit questionnaire online, it probably needs
to get at least an interagency consultation. She said even a big
project can be relatively simple in terms of permitting but, for
example, if several variables could have an effect on water
quality, the online application process will reject it. That is
when everyone will benefit because it is at that point the
project definition can be changed early to get a better
permitting outcome. She gave, as an example, a mining project
proposal that would require a camp and sewage treatment
facility. Fecal coliform in a spawning bed stream will not
affect spawning, but it has other implications if there is a
drinking water system nearby. The earlier DEC knows about the
project, the sooner DEC can help the applicant put a project
together that will move quickly through the permitting process.
SENATOR WAGONER said the only flaw he can see in this system is
that certain people might be absent during the permit review.
COMMISSIONER IRWIN acknowledged that having agency staff present
at a meeting is probably the most important thing DNR can do.
SENATOR LINCOLN said this is the only committee to hear this
bill. She is uneasy with it because it is a new concept and it
puts so much power in one office. She agreed that it may work
with a good commissioner, but if someone wanted to abuse his or
her power, it could be devastating. She said this bill creates a
new office with five employees. She asked Commissioner Irwin the
cost to run the new office each year and what the start-up costs
will be. She asked Commissioner Ballard if DEC's budget will be
decreased as a result. She also wanted to know what the appeal
process will be with the new office. She commented that she
would feel better if the bill contained a sunset provision.
COMMISSIONER IRWIN said he believes it is important to remember
that DNR will lead and coordinate, it will not make decisions
for DEC. The concept is to get people to the table so that a
project team can make decisions. DNR is not doing anything with
the appeal process. Regarding the cost of the new office, the
companies will be paying that cost. He emphasized the importance
of getting the agencies, company, and public together to
understand the complex process that will occur, the areas that
need to be addressed, and what permits will be required so that
nothing goes by the wayside. What will be eliminated are
meetings with absent staff who point out later in the process
what will not work.
COMMISSIONER BALLARD added that this bill does not create any
new power; all of the power to carry out state law vests with
the governor. SB 142 will improve organizational responsibility
and achieve a better result. The power to permit derives from
the law and the underlying state policy to develop natural
resources for the well being of the citizens and to protect the
environment. She said in this complex permitting world, this
approach will be an improvement. DEC's entire budget anticipated
the results of this legislation. DEC assumed it will work hand-
in-hand with DNR. DEC's workload remains identical but by
working hand-in-hand with DNR, DEC believes it can streamline
the permit process and that is reflected in DEC's overall budget
reduction. She said, regarding the appeal process, project
applicants and project opponents know how to appeal the
components that DEC is responsible for. She said the ability of
people in the state to access administrative procedures,
including appeals, are mature. She is not concerned that this
legislation will truncate that process at all.
SENATOR LINCOLN asked the cost of the five-person office.
COMMISSIONER IRWIN replied, "As we roll in DGC - the
efficiencies there, we roll in this combined teamwork that we're
setting up in this project, we see those efficiencies also, we
feel that these costs are adequately reflected in our '04
budget."
SENATOR LINCOLN asked for an amount.
COMMISSIONER IRWIN said he would get her that number.
SENATOR WAGONER said this approach was tried in Kenai but did
not work because the federal agencies would "go sideways on us."
COMMISSIONER IRWIN said DNR cannot make the federal agencies
come to the table but the federal agencies did attend meetings
for the Fort Knox project. He believes federal agency
participation is necessary and should be worked on but he cannot
affirm they will be at the table.
SENATOR WAGONER asked if an invitation will be extended to the
federal agencies.
COMMISSIONER IRWIN replied, "Absolutely, we need to."
SENATOR SEEKINS asked if anyone in state government has the
responsibility now to lead and coordinate in any kind of matter
related to the review and authorization of resource development
projects.
CHAIR OGAN answered the Division of Governmental Coordination.
COMMISSIONER BALLARD said that is a cabinet responsibility and,
from the point of view of this cabinet, it has assumed that
responsibility jointly. Cabinet members have affirmed their
commitments to resource development and have agreed to contact
each other to try to work together whenever an opportunity
arises.
SENATOR SEEKINS asked why, if that is so, this legislation is
necessary.
COMMISSIONER BALLARD said the entire cabinet wants to focus the
responsibility this way. The cabinet feels very strongly that
without working together, it cannot achieve the resource
development goals that the Governor articulated in the time
frame available.
SENATOR SEEKINS said he agrees but was wondering if up until
now, everyone has sworn to work together but no one has taken
the lead.
CHAIR OGAN said that theoretically, discussions about who is
doing what take place at cabinet meetings.
SENATOR SEEKINS said he acts as the coordinator in his business
and that is more cost efficient because without it he would have
to call all of his division managers to keep track of what is
going on. He asked if having one house keep track of the status
will be more cost efficient.
COMMISSIONER IRWIN said that is correct, and he had the
opportunity to experience that with what the state set up for
the Ft. Knox mine.
SENATOR SEEKINS said he is not concerned about funding five
people to do the work because that may result in a decrease from
15 to 5. He then asked if the federal agencies are more likely
to attend if they are invited to the table.
COMMISSIONER IRWIN said DNR has already had very good meetings
with BLM and EPA. Their federal counterparts do not want to
attend numerous meetings either - their time is valuable too.
SENATOR SEEKINS said he views SB 142 very positively and
considers it analogous to how private industry works. He said he
typically holds one person responsible for coordinating any kind
of a project in his organization. He said he has had to get
permits, both state and federal, for projects in the past and
has found that whenever a coordinating agency oversaw a project,
the process was much smoother than if he had to find out what to
do where. He said it seems that part of the objective of SB 142
is to provide a [recipe] for the process.
COMMISSIONER IRWIN said the permit process is not easy to
understand so when everyone is at the table at the same time,
the flow of information is much better and everyone leaves with
the same understanding of how the process will proceed. He said
when agencies act independently, they might provide different
answers but when they act together, the picture changes.
SENATOR SEEKINS said when he looks at the constitutional
authority the legislature has to provide for the utilization,
development and conservation of all natural resources for the
maximum benefit of the people, it is important that be done in a
timely and wise manner and in concert with modern principles of
stewardship. He believes SB 142 moves the state in that
direction and he supports it.
CHAIR OGAN asked if the Division of Governmental Coordination
(DGC) was created by statute or whether it was set up under
administrative policy. He asked if it will continue to exist if
SB 142 is enacted. He said the general idea behind DGC was to
act as a clearinghouse and coordination point for the different
agencies. It was purposely set up independently - it does not
issue permits but acted as "the director of the choir."
MR. BILL JEFFERSON, Director of the Division of Governmental
Coordination, explained to members that DGC was created by
statute but it is narrowly scoped for the Alaska Coastal
Management Program, which is not statewide. SB 142 will cover
the entire state.
CHAIR OGAN asked if Mr. Jefferson's job will be eliminated.
MR. JEFFERSON said he just moved to another division.
CHAIR OGAN asked Mr. Jefferson if the legislature can just pull
that part of the statute out.
MR. JEFFERSON said he believes part of the function of the
executive order was to move that statutory authority to DNR.
SENATOR SEEKINS said regarding the comments about the power of
the DNR commissioner, he believes that in the end the
legislature has authority and oversight of development of
resources. He said he is certain a runaway commissioner would be
the result of a runaway governor.
CHAIR OGAN asked how this will affect agencies that are not in
DNR, DEC or ADF&G when they issue a permit, for example an
agency within DOTPF. He noted that currently to start oil and
gas projects, a company must have all permits in place.
COMMISSIONER IRWIN said all agencies need to be at the table
because when a project involves habitat issues, the company
needs to hear that upfront and design around it. He said changes
can be economical when a project is still in the design phase.
If changes must be made late in the game, everything is turned
upside down, such as bank financing. He said this process will
not cut corners on what is done for the environment, it will let
people know upfront what needs to be done so that projects can
be designed and built with those requirements in mind.
CHAIR OGAN said that sounds great, however in the real world,
after everyone has been at the table they go back to their
jobs and come back with stipulations. He asked if the
commissioner of DNR will have the authority at the end of the
day to expedite a project if another agency comes along with a
stipulation that delays a project.
COMMISSIONER IRWIN said those situations will undoubtedly arise
and will get elevated to the commissioner's level where a
decision will have to be made. He reminded members that
ultimately the commissioner will be accountable to the
legislature.
COMMISSIONER BALLARD told members that the development of the
Red Dog Mine 20 years ago involved multiple state agencies and
depended on a road that brought revenue in. A borough was formed
to get municipal financing for the road so DEC got involved. To
make that project viable and feasible, both from a permitting
point of view and from a resource cost point of view, major
agencies of state government had to work together with everyone
involved. She said non-resource agencies have to be involved in
project design and development in this "vast, far flung,
disconnected state." That project benefited from multiple agency
involvement.
CHAIR OGAN asked if the commissioner will be able to force other
agencies to prioritize a permit if it is holding up a project
and costing money.
COMMISSIONER IRWIN said the project manager should have called
the individual commissioner long before a problem gets elevated
to his level. If necessary, he would make that call.
CHAIR OGAN asked the commissioners to be prepared for another
hearing on SB 142 on Friday. There being no public testimony,
Chair Ogan adjourned the meeting at 5:05 p.m.
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