Legislature(1995 - 1996)

03/11/1996 03:37 PM RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                   SENATE RESOURCES COMMITTEE                                  
                         March 11, 1996                                        
                           3:37 P.M.                                           
                                                                               
 MEMBERS PRESENT                                                               
                                                                               
 Senator Loren Leman, Chairman                                                 
 Senator Drue Pearce, Vice Chairman                                            
 Senator Steve Frank                                                           
 Senator Rick Halford                                                          
 Senator Robin Taylor                                                          
 Senator Lyman Hoffman                                                         
                                                                               
  MEMBERS ABSENT                                                               
                                                                               
 Senator Georgianna Lincoln                                                    
                                                                               
  COMMITTEE CALENDAR                                                           
                                                                               
 SENATE JOINT RESOLUTION NO. 37                                                
 Urging the United States Congress to give an affirmative expression           
 of approval to a policy authorizing the state to regulate,                    
 restrict, or prohibit the export of unprocessed logs harvested from           
 its land and from the land of its political subdivisions and the              
 University of Alaska.                                                         
                                                                               
 SENATE BILL NO. 112                                                           
 "An Act establishing a discovery royalty credit for the lessees of            
 state land drilling exploratory wells and making the first                    
 discovery of oil or gas in commercial quantities."                            
                                                                               
 SENATE JOINT RESOLUTION NO. 38                                                
 Opposing the proposed expansion of the United States Environmental            
 Protection Agency's toxins release inventory program.                         
                                                                               
 SENATE JOINT RESOLUTION NO. 39                                                
 Relating to the U.S. Environmental Protection Agency draft National           
 Pollutant Discharge Elimination System general permit for placer              
 mining in Alaska.                                                             
                                                                               
 SENATE BILL NO. 199                                                           
 "An Act relating to environmental audits and health and safety                
 audits to determine compliance with certain laws, permits, and                
 regulations; and amending Alaska Rules of Appellate Procedure 202,            
 402, 602, 603, 610, and 611."                                                 
                                                                               
 SENATE BILL NO. 262                                                           
 "An Act relating to management of game populations for maximum                
 sustained yield for human harvest and providing for the replacement           
 of areas closed to consumptive uses of game; relating to management           
 of fish and game areas; and amending Rules 79(b) and 82(b)(2),                
 Alaska Rules of Civil Procedure."                                             
 CS FOR HOUSE BILL NO. 212(FIN)                                                
 "An Act relating to the management and sale of state timber and               
 relating to the administration of forest land and classification of           
 state land."                                                                  
                                                                               
 SENATE BILL NO. 283                                                           
 "An Act relating to filing, recording, and indexing of documents              
 with or by the Department of Natural Resources; repealing certain             
 filing requirements concerning property involving nonresident                 
 aliens; and providing for an effective date."                                 
                                                                               
  PREVIOUS SENATE COMMITTEE ACTION                                             
                                                                               
 SJR 37 - See Resources minutes dated 3/8/96.                                  
                                                                               
 SB 112 - See Resources minutes dated 3/6/96.                                  
                                                                               
 SJR 38 - No previous action to consider.                                      
                                                                               
 SJR 39 - No previous action to consider.                                      
                                                                               
 SB 199 - See Resources minutes dated 1/31/96 and 3/6/96.                      
                                                                               
 SB 262 - See Resources minutes dated 2/12/96 and 3/8/96.                      
                                                                               
 HB 212 - No previous action to consider.                                      
                                                                               
 SB 283 - See Resources minutes dated 3/8/96.                                  
                                                                               
  WITNESS REGISTER                                                             
                                                                               
 Mark Rubin                                                                    
 American Petroleum Institute                                                  
 Washington, D.C.                                                              
  POSITION STATEMENT:   Commented on SJR 38.                                   
                                                                               
 Faye Sullivan, Environmental Scientist                                        
 UNOCAL Oil and Gas                                                            
 P.O. Box 196247                                                               
 Anchorage, AK 99519                                                           
  POSITION STATEMENT:   Supported SJR 38.                                      
                                                                               
 Mark Wheeler                                                                  
 Alaska Environmental Lobby                                                    
 P.O. Box 22151                                                                
 Juneau, AK 99802                                                              
  POSITION STATEMENT:   Opposed SJR 38 and SB 199, and commented on HB
 212.                                                                          
                                                                               
 Steve Borell, Executive Director                                              
 Alaska Miners Association                                                     
 501 W. Northern Lights, #203                                                  
 Anchorage, AK 99503                                                           
  POSITION STATEMENT:   Supported SJR 39.                                      
                                                                               
 David Chambers, Mining Analyst                                                
 Sierra Club Legal Defense Fund                                                
 325 4th Ave.                                                                  
 Juneau, AK 99801                                                              
  POSITION STATEMENT:   Opposed SJR 39.                                        
                                                                               
 Mike Pauley, Aide                                                             
 % Senator Loren Leman                                                         
 State Capitol Bldg.                                                           
 Juneau, AK 99801-11182                                                        
  POSITION STATEMENT:   Sponsor of SB 199.                                     
                                                                               
 Dwight Perkins, Special Assistant                                             
 Department of Labor                                                           
 P.O. Box 21149                                                                
 Juneau, AK 99802-1149                                                         
  POSITION STATEMENT:   Opposed SB 199.                                        
                                                                               
 Janice Adair, Director                                                        
 Division of Environmental Health                                              
 Department of Environmental Conservation                                      
 555 Cordova Street                                                            
 Anchorage, AK 99501                                                           
  POSITION STATEMENT:   Opposed SB 199.                                        
                                                                               
 Geron Bruce, Legislative Liaison                                              
 Department of Fish and Game                                                   
 P.O. Box 25526                                                                
 Juneau, AK 99811-5526                                                         
  POSITION STATEMENT:   Opposed SB 199.                                        
                                                                               
 Lynn Levengood                                                                
 931 Vide Way                                                                  
 Fairbanks, AK 99712                                                           
  POSITION STATEMENT:   Supported CSSB 262.                                    
                                                                               
 Bill Perhach                                                                  
 Alaska Environmental Lobby                                                    
 419 6th Street                                                                
 Juneau, AK 99801                                                              
  POSITION STATEMENT:   Opposed SB 262.                                        
                                                                               
 Ken Taylor, Deputy Director                                                   
 Division of Wildlife Conservation                                             
 Department of Fish and Game                                                   
 P.O. Box 25526                                                                
 Juneau, AK 99802-5526                                                         
  POSITION STATEMENT:   Opposed SB 262.                                        
                                                                               
 Senator Torgerson                                                             
 State Capitol Bldg.                                                           
 Juneau, AK 99801-1182                                                         
  POSITION STATEMENT:   Sponsor of SJR 37.                                     
                                                                               
 Cliff Eames                                                                   
 Alaska Center for the Environment                                             
 519 W 8th, #201                                                               
 Anchorage, AK 99501                                                           
  POSITION STATEMENT:   Supported SJR 37.                                      
                                                                               
 Mark Wheeler                                                                  
 Alaska Environmental Lobby                                                    
 419 6th Street                                                                
 Juneau, AK 99801                                                              
  POSITION STATEMENT:   Supported SJR 37.                                      
                                                                               
 Ken Boyd, Director                                                            
 Division of Oil and Gas                                                       
 Department of Natural Resources                                               
 3601 C Street, Suite 1380                                                     
 Anchorage, AK 99503-5948                                                      
  POSITION STATEMENT:   Commented on SB 112.                                   
                                                                               
 Representative Jeannette James                                                
 State Capitol Bldg.                                                           
 Juneau, AK 99801-1182                                                         
  POSITION STATEMENT:   Sponsor of HB 212.                                     
                                                                               
 Jack Phelps                                                                   
 Alaska Forest Association                                                     
 111 Stedman, Ste 200                                                          
 Ketchikan, Ak 99901                                                           
  POSITION STATEMENT:   Supported HB 212.                                      
                                                                               
 Erik Holland                                                                  
 427 1st Ave.                                                                  
 Fairbanks, AK 99701                                                           
  POSITION STATEMENT:   Opposed HB 212.                                        
                                                                               
 Dan Ritzman                                                                   
 Northern Alaska Environmental Center                                          
 218 Driveway St.                                                              
 Fairbanks, AK 99701                                                           
  POSITION STATEMENT:   Opposed HB 212.                                        
                                                                               
 Sharon Young, State Recorder                                                  
 Department of Natural Resources                                               
 3601 C Street, Ste. 1180                                                      
 Anchorage, AK 99503-5947                                                      
  POSITION STATEMENT:   Supported SB 283.                                      
                                                                               
  ACTION NARRATIVE                                                             
                                                                               
  TAPE 96-26, SIDE A                                                           
 Number 001                                                                    
                                                                               
            SJR 38 TOXINS RELEASE INVENTORY PROGRAM                           
   CHAIRMAN LEMAN  called the Senate Resources Committee meeting to           
 order at 3:37 p.m. and announced  SJR 38  to be up for consideration.         
 He explained this is a result of information he and Senator Pearce            
 found at the Energy Council meeting in Washington, D.C.                       
                                                                               
 Mark Rubin, American Petroleum Institute, informed them that the              
 EPA is proposing to expand the TRI Program to include oil and gas             
 exploration and production as well as some other categories.  The             
 downside to this is that it will likely make oil and gas producers            
 the biggest polluters in the state because they are pulling from a            
 formation and treat the oil and the gas and separate it and take              
 the produced water and produced gas and reinject it.  It doesn't              
 make any sense to have to monitor, test, and report that as a toxic           
 release.                                                                      
                                                                               
 Number 44                                                                     
                                                                               
 MARK RUBIN testified that Toxins Release Program currently requires           
 that a number of manufacturing industries report for 651 toxic                
 chemicals.  The EPA is considering whether to put additional                  
 industries into this program including the oil and gas exploration            
 and production industry. They would have to report for about 80               
 chemicals, some of which occur naturally in oil, gas, and produced            
 water, like benzene or tylene.  If they expand this to the                    
 exploration and production (E&P) industry, API estimates about                
 4,700 or more facilities would have to report.  The first year cost           
 to the industry would be about $228 million; annual costs                     
 thereafter would be about $110 million per year.  The average cost            
 for offshore oil and gas would be about $58,000 in the first year             
 and about $8,000 each year thereafter.                                        
                                                                               
 They believe strongly that the TRI Program is not really designed             
 for the E&P industries.  It is designed more for businesses that              
 are in close proximity to communities and most E&P facilities are             
 away from communities or offshore and they have very few releases             
 to the environment.                                                           
                                                                               
 EPA believes that the TRI Program has been a great success and one            
 of the reasons because there was a voluntary reduction in releases            
 from some of the facilities that report.  The largest releases from           
 E&P would be naturally occurring constituents of oil, gas, and                
 water.  Reducing those releases would be close to impossible                  
 without shutting in wells.                                                    
                                                                               
 The industry is not opposed to providing more information to the              
 public, and they have recommended to the EPA that instead of                  
 expanding the TRI Program that they look at what type of                      
 information is really needed by the public working with the                   
 Interstate Oil and Gas Compact Commission, the State Regulators               
 Commission, and include EPA officials.                                        
                                                                               
 Number 128                                                                    
 FAYE SULLIVAN, Environmental Scientist, UNOCAL, said they support             
 SJR 38.  She said the original TRI was established to provide                 
 information to the public about potential chemical releases as a              
 risk of these releases to the local community.  It's not                      
 appropriate to expand TRI reporting to the oil and gas industry               
 which generally operates in remote areas or offshore.  Oil and gas            
 facilities have limited release potential and present a very low              
 risk to the public.  Typical oil and gas reportable releases would            
 include discharges of produced water, underground injection of                
 waste, and air emissions from combustion sources.                             
                                                                               
 All of these activities are currently strictly regulated by                   
 existing federal and state programs.  Use of chemicals can vary in            
 the oil and gas industry from day to day and week to week.                    
 Expanding the TRI Program would force operators to conduct regular            
 expensive waste removal tests with very little environmental                  
 benefit.                                                                      
                                                                               
 Many old fields are marginal now and their expected life is                   
 decreased with each additional regulatory burden placed on them.              
                                                                               
 MARK WHEELER, Alaska Environmental Lobby, said they support free              
 and easy access to information on toxic chemical releases.  They              
 commend EPA's efforts to increase the scope of their reports to               
 include other industries with high potential for toxic pollution              
 including mining facilities, waste management facilities, and                 
 electric utilities.  He urged the legislature to reject this                  
 resolution and to help the public gain more knowledge, not less               
 about toxic releases into our air and water.                                  
                                                                               
 SENATOR PEARCE moved to pass SJR 38 with individual recommendations           
 and a $0 fiscal note.  There were no objections and it was so                 
 ordered.                                                                      
 Number 192                                                                    
                                                                               
          SJR 39 EPA'S NPDES PERMIT FOR PLACER MINING                         
                                                                              
 STEVE BORELL, Executive Director, Alaska Miners Association,                  
 supported SJR 39.  He suggested two potential changes.  He said the           
 resolution references dredge and recreational mining; however, the            
 issue goes far beyond just dredge and recreational mining and it              
 affects any commercial mining operation.  The resolution should               
 address how it affects commercial operators and should give full              
 due deference to the folks that have caused the problem by                    
 litigants being included in addition to their attorneys.                      
                                                                               
 SENATOR LEMAN noted that they had two proposed amendments from the            
 Alaska Miners and he thought they were friendly amendments and                
 would improve the resolution.                                                 
                                                                               
 SENATOR TAYLOR moved to adopt amendment number one.  There were no            
 objections and it was so ordered.                                             
                                                                               
 SENATOR TAYLOR moved to adopt amendment number two.  There were no            
 objections and it was so ordered.                                             
                                                                               
 Number 219                                                                    
                                                                               
 SENATOR TAYLOR moved to pass SJR 39 from committee as amended.                
 SENATOR LEMAN asked him to hold the motion as there were people who           
 wanted to testify.                                                            
                                                                               
 DAVID CHAMBERS, Mining Analyst, Sierra Club Legal Defense Fund,               
 said he is a geophysicist by training, not an attorney.  He was one           
 of the people involved in the settlement agreement that is at issue           
 with this resolution.  He wanted to clear up some of the misleading           
 statements in SJR 39.                                                         
                                                                               
 The first "Whereas" requires all dredges to have a NPDES permit               
 despite the fact that EPA does not have the personnel to process              
 all of the newly required permits.  While the settlement agreement            
 requires small suction dredgers to send their names and addresses             
 to EPA and in turn they receive a one page sheet listing specific             
 practices to follow.  He did not think that was an onerous                    
 requirement.                                                                  
                                                                               
 The second concern was the arsenic level of .18 parts per billion.            
 While that is factually correct and is a requirement of state and             
 federal law, during the course of the year and a half of                      
 negotiations they never once discussed the arsenic level at its               
 numeric limits.  This is just a number EPA is putting in the                  
 permit; it's required to do so by law.  Should EPA change its                 
 standard as is referred to in the next line, to 50 parts per                  
 billion, he assumed that would become a part of this permit as it             
 would all other permits.  He said there were numerous compromises             
 in the agreement and at the end of the discussions, the miners were           
 invited to comment and they chose not to do so.                               
                                                                               
 MR. CHAMBERS said he thought EPA entered into this settlement                 
 agreement because its position under their legal challenge was                
 weak.  He said the settlement agreement was in the best interests             
 of the State.  If the terms of the settlement agreement aren't                
 complied with and we end up in court, they would go back to their             
 original negotiating position and he did not think it best to have            
 a court imposed solution.                                                     
                                                                               
 He said if there are perceived weaknesses in the settlement                   
 agreement the door is open to miners or anyone else.                          
                                                                               
 SENATOR LEMAN noted that there are some things the legislature                
 doesn't agree with and asked why the arsenic level was set a .18              
 parts per billion which is considerably lower than the requirement            
 for drinking water.                                                           
                                                                               
 MR. CHAMBERS explained .18 is just a reflection of what the State             
 and federal standard is.  It is not an element of the settlement.             
 SENATOR TAYLOR asked if the Sierra Club Legal Defense Fund had                
 filed a suit against EPA.  MR. CHAMBERS answered that they                    
 challenged the EPA permit on behalf of their clients, American                
 Rivers and the Northern Alaskan Environmental Center.                         
                                                                               
 Number 318                                                                    
                                                                               
 MARK WHEELER, Alaska Environmental Lobby, said the recent draft               
 NPDA permit for placer mining in Alaska is a result of one and a              
 half years of settlement negotiations between the EPA, the State of           
 Alaska, and the Sierra Club Legal Defense Fund.  It is a good                 
 compromise agreement which seeks to protect water quality in                  
 Alaska.  He encouraged the legislature to support this compromise             
 agreement by rejecting the proposed resolution.                               
                                                                               
 SENATOR TAYLOR asked if .18 parts per billion is a lower standard             
 than the current standard for drinking water.  MR. CHAMBERS replied           
 the current standard is 50 parts per billion, so .18 is quite                 
 lower.  It is based on a human carcinogenic health risk.                      
                                                                               
 SENATOR TAYLOR asked if the 50 parts per billion which municipal              
 water systems use was based on a health standard.  MR. CHAMBERS               
 replied that it was not based on risk of arsenic as a carcinogen;             
 that is what the .18 per billion is based on.  He elaborated that             
 the .18 applies to all discharges in the State of Alaska, not just            
 to placer miners.                                                             
                                                                               
 SENATOR TAYLOR remarked that normal water running off a hillside              
 would be higher than what the number would be.  He asked if someone           
 wanted to extract gravel would they have to set up a filtration               
 system that would take out the normal background levels of arsenic.           
 SENATOR LEMAN answered that he doubted that a filtration system               
 would do that.                                                                
                                                                               
 Number 388                                                                    
                                                                               
 SENATOR PEARCE asked if the administration had a position on this             
 resolution.                                                                   
                                                                               
 SENATOR HALFORD asked if the administration agreed to this                    
 settlement?  MR. CHAMBERS replied that yes, they did.                         
                                                                               
 MR. BORELL disagreed and said the administration, in a letter for             
 Deputy Commissioner Michelle Brown, said if a series of things were           
 met they would look kindly on it, but the details of the letter               
 were not met and they haven't heard if they have withdrawn their              
 support.                                                                      
                                                                               
 SENATOR PEARCE asked how the State became involved.  MR. BORELL               
 replied that the State was questioned during various points during            
 the negotiations and involved by the EPA.                                     
                                                                               
 SENATOR PEARCE asked if the Miners Association was asked what they            
 thought of the new regulations.  MR. BORELL replied that they were            
 asked.  COMMISSIONER BURDEN specifically called on a couple of                
 different occasions asking for comments.  There may have been one             
 occasion when the EPA attorney called, but they did not see a copy            
 of the draft permit until it was put out for public notice.  They             
 were not aware of the multitude of details in that general permit             
 that had never been discussed with EPA, DEC, or with them.                    
                                                                               
 SENATOR PEARCE asked why the Miners did not actually try to inject            
 themselves into the suit?  MR. BORELL said there were two reasons:            
 there was a group of miners at the time who felt they had an                  
 agreement between themselves and EPA that the existing general                
 permit was going to be satisfactory.  With that promise they were             
 not interested in pursuing it.  The other reason is that the                  
 industry was just burned out on being in court.                               
                                                                               
 SENATOR TAYLOR asked if the settlement decision had been given back           
 to the judge, yet, for approval.  MR. BORELL replied that it hadn't           
 been approved by the court.  It depends on this draft of the                  
 general permit going forward and EPA meeting several other                    
 criteria.                                                                     
                                                                               
 SENATOR TAYLOR asked if they would be involved at that point.  MR.            
 BORELL replied that they would like to, but they don't have access            
 at this point because they were not involved at any earlier stage.            
                                                                               
 Number 480                                                                    
                                                                               
 SENATOR TAYLOR commented that this seems to be a pattern that the             
 environmental community files a suit against a federal monitoring             
 agency and by filing that suit they are able to go into a back room           
 with the attorneys on behalf of the federal government who talk               
 with their friends about what kind of a settlement should be                  
 achieved on their litigation.  The settlements that come down,                
 then, establish through court order new standards and new                     
 requirements without any of the effected people being in the room             
 or being allowed to participate.                                              
                                                                               
 SENATOR PEARCE moved to pass SJR 39 am with a $0 fiscal note and              
 individual recommendations.  There were no objections and it was so           
 ordered.                                                                      
                                                                               
          SB 199 ENVIRONMENTAL & HEALTH/SAFETY AUDITS                         
                                                                              
 SENATOR PEARCE moved to adopt the workdraft (f)Lauterback 3/9/96 as           
 their working document.  There were no objections and it was so               
 ordered.                                                                      
                                                                               
 MIKE PAULEY, Staff to Senator Leman, said the new committee                   
 substitute incorporates certain recommendations they received from            
 both the business community and the administration.  Many changes             
 are technical matters.  They have added clarifying language in the            
 area of privilege saying that if one part of an audit report is               
 disclosed for any reason, the privilege still applies to the                  
 remaining portions of the audit report.  This is necessary because            
 some federal courts have adopted a four part test for determining             
 claims of privilege on the basis of self critical analysis.                   
                                                                               
 They have added to the list of nonprivilege materials such                    
 information that is required in order to obtain, maintain, or renew           
 a license and also such information that is required under a                  
 contract with the State.  These changes were made to address                  
 concerns of administration representatives.                                   
                                                                               
 In the area of immunities they clarified that a regulated entity              
 which voluntarily reports instances of noncompliance is not only              
 eligible for immunity for the violations reported, but also                   
 violations that are based on the facts disclosed and which were               
 unknown to the person making the disclosure.  This change was made            
 because of the concern that a person might not be covered by                  
 immunity for violations that were discovered as a result of a                 
 voluntary disclosure, but were not declared as violations in the              
 disclosure.  This possibility could be a powerful disincentive to             
 voluntarily report violations.                                                
                                                                               
 An extra requirement has been added for immunity.  A regulated                
 entity is required to disclose under terms of the confidentiality             
 agreement that part of an audit report which deals with the plan              
 for compliance, but only if the information is requested by the               
 appropriate regulatory agency.                                                
                                                                               
 A new paragraph has been added to the bill clarifying that a                  
 regulatory agency may not initiate an investigation of a regulated            
 entity based solely on the fact that the entity has provided a                
 notice of intent to perform a self audit.                                     
                                                                               
 He said that the circumvention by regulation prohibited regulation            
 was deleted because it is already covered in another part of State            
 law.                                                                          
                                                                               
 SENATOR LEMAN noted that made three major changes that were                   
 requested by DEC.                                                             
                                                                               
 SENATOR LEMAN noted that the circumvention regulation was addressed           
 in AS44.62.030.  He said they wanted to make sure it was covered              
 not only by regulation, but by permit and other administrative                
 action as well.  They do not want to do things that are contrary to           
 statute.                                                                      
                                                                               
 DWIGHT PERKINS, Special Assistant, Department of Labor, said in the           
 hearing on this bill last week Mr. Paul Grossi, Director, Workers             
 Compensation, and Mr. Jeff Carpenter, Occupational Safety both                
 testified why they have concerns.  The Commissioner didn't have a             
 problem with the legislation prior to introduction of the bill.               
 After going through the bill they found that it does significantly            
 change their role in Workers Compensation.  On March 5 they had a             
 letter prepared reviewing their concerns and he noted it was in               
 their packets.  He said they would be happy to work with the                  
 committee.                                                                    
                                                                               
 TAPE 96-26, SIDE B                                                            
 Number 582                                                                    
                                                                               
 SENATOR LEMAN commented he was frustrated that they were notified             
 of concerns after the first hearing when the bill had been out for            
 60 days.  MR. PERKINS responded that during the first hearing the             
 DOL and DEC did speak, but they ran out of time and the Department            
 of Labor didn't go on record.  SENATOR LEMAN apologized.                      
                                                                               
 MR. WHEELER, Alaska Environmental Lobby, commented that none of               
 their concerns had been addressed in this CS.  He said they are               
 worried about the health and safety of the citizens of Alaska.                
 This legislation shows a blatant disregard for the health of the              
 public.  The bill seems to make it harder for DEC and other State             
 agencies to do their jobs by extending the right of privilege to              
 information disclosed in self audits, by allowing industry to get             
 around working toward compliance by excusing persons ignorant of              
 the law and granting immunity for violations which industry hasn't            
 even acknowledged breaking.                                                   
                                                                               
 MR. WHEELER said there was little evidence for protection against             
 bad actors.  There's not much talk about repeat violators.  They              
 are also concerned with interjecting "substantial" when referring             
 to injury on page 4 of the summary of changes.                                
                                                                               
 SENATOR LEMAN said the intent of this legislation was to get people           
 to come in compliance with environmental laws and he thought the              
 bill accomplished that.  He wanted to address some of his concerns.           
                                                                               
                                                                               
 Number 525                                                                    
                                                                               
 JANICE ADAIR, Director , Division of Environmental Health, said she           
 continues to have concerns with the privilege and that immunity is            
 provided for criminal activity, and continue to have concerns with            
 the broad definition of environmental health and safety law.  She             
 also pointed out that in the section regarding substantial harm and           
 substantial injury she had pointed out that there was                         
 inconsistency.                                                                
                                                                               
 SENATOR TAYLOR asked if there was anyone here from ADF&G who wanted           
 to address the $66,500 fiscal note submitted with the bill.  He               
 asked specifically why they would need additional staff to                    
 encourage people to come into compliance.                                     
                                                                               
 GERON BRUCE, ADF&G, said they are looking at their authority under            
 AS16.05.870 which regards anadromous streams, crossing, and other             
 activities in the streams.  Because of the broad application of               
 privilege and immunity to information provided by this legislation            
 they feel they would have to have some increased effort to develop            
 their own sources of information when they suspect violations are             
 occurring.  In the past they have enjoyed good relationships with             
 the companies in the field and they have gone to them for a lot of            
 information, but they don't think that is likely to continue under            
 this legislation.                                                             
                                                                               
 SENATOR TAYLOR countered that the self audit would be an effort to            
 comply and would only impact the law if, in fact, it did.                     
                                                                               
 MR. BRUCE said he thought they were seeing things differently                 
 developing the balance between allowing private industry to conduct           
 their business and our responsibility to protect the public                   
 resources.  They are not eager to prosecute people.  They have very           
 few prosecutions under their authorities to protect anadromous fish           
 streams.  They generally try to work with operators up front to               
 prevent problems and when problems are detected to then work with             
 them to correct them.  Because of the broad nature of the                     
 legislation some operators may not be willing to cooperate the same           
 way they have in past.  The Department may have to develop                    
 independent information where they think violations have occurred,            
 because they will see this as a way to shield themselves from                 
 actions which were not in compliance.                                         
                                                                               
 SENATOR LEMAN noted that the protection of the self audit only                
 applies if the party who does the audit performs immediate                    
 compliance with the law.  He thought the Committee should be seeing           
 negative fiscal notes from all departments.                                   
                                                                               
 SENATOR TAYLOR asked for an example of how this could be used as a            
 shield.  In response MR. BRUCE explained that someone going to                
 engage in some kind of activities in an anadromous fish stream is             
 supposed to notify the Department, supply plans about their                   
 intentions, and then receive a permit from them.  After that, they            
 pretty much operate on their own.  For some reason, if they                   
 deviated from the terms of the permit that resulted in some damage            
 of the stream, they could conduct one of these audits, disclose the           
 information, then perhaps engage in some activity to correct the              
 problem.  The State would be in the position of arguing whether or            
 not their corrective action was actually equal to what they thought           
 it should be.                                                                 
                                                                               
 SENATOR TAYLOR said he thought their department would probably be             
 consulted on what was the best remedial action.  They don't get the           
 shield unless they haven't cleaned up their act.                              
                                                                               
 MR. BRUCE said their fiscal note addresses the cost of collecting             
 information to demonstrate that a violation has occurred since                
 under this legislation they can't get the information from the                
 operator themselves if they have conducted an audit and the                   
 information is then confidential.                                             
                                                                               
 SENATOR LEMAN commented that he thought they had the capacity to              
 put in permit conditions which are not protected under the audit.             
                                                                               
 MR. BRUCE said he thought it would be helpful for his staff to get            
 together with some of their field people to walk them through some            
 other examples.                                                               
                                                                               
 Number 312                                                                    
                                                                               
 SENATOR TAYLOR asked if he had conferred with other States to see             
 if they needed additional funding for self audit programs.  MR.               
 BRUCE said they didn't and one of the reasons they didn't contact             
 the state of Texas is there's so much difference between the two              
 states.  Texas, for instance, doesn't have salmon resources.  He              
 wasn't sure their experience would help us that much with the                 
 unique laws we have on the books to protect our salmon resources.             
                                                                               
 Number 299                                                                    
                                                                               
 SENATOR HOFFMAN moved to adopt the Department of Labor amendment to           
 add "except for worker's compensation proceedings."  There were no            
 objections and it was so ordered.                                             
                                                                               
 SENATOR TAYLOR moved to pass CSSB 199 am from committee with                  
 individual recommendations.  There were no objections and it was so           
 ordered.                                                                      
                                                                               
        SB 262 MANAGEMENT OF FISH/GAME POPULATION & AREA                      
                                                                              
 SENATOR LEMAN announced  SB 262  to be up for consideration.                  
                                                                               
 MARY GORE, Staff to Senator Miller, sponsor, said she had                     
 highlighted the changes for the committee.                                    
                                                                               
 SENATOR TAYLOR moved to adopt the committee substitute to SB 262.             
 There were no objections and it was so ordered.                               
                                                                               
 SENATOR HOFFMAN asked if the Tanana Chiefs supported the                      
 legislation with the current changes.  MS. GORE replied that they             
 do.                                                                           
                                                                               
 LYNN LEVENGOOD, Fairbanks, supported the committee substitute.  He            
 said it was absolutely necessary to reverse the plummeting laws of            
 consumptive use opportunities by politically based closures to                
 their uses.                                                                   
                                                                               
 BILL PERHACH, Alaska Environmental Lobby, commented on the                    
 assumption that game should be managed for the maximum sustained              
 yield by human harvest.  This is assuming that human consumption is           
 the highest and best use.  He said like a lot of people in the                
 Denali Borough he makes his living through tourism.  He has worked            
 for the last 14 years with the packaged tour segment of the market            
 and the last six years with eco-tourism which is just booming.  In            
 over 20 years he has seen tourism growth between 3 - 16 percent               
 every year.  They sell two things at Denali - the Mountain and                
 watchable wildlife.  He said the animals in the park are affected             
 by what happens around the perimeter of the park.  They are looking           
 for some sort of acknowledgement that this wildlife is a product a            
 kind of subsistence activity.  It is the way they make their living           
 - a nonconsumptive use of the wildlife.                                       
                                                                               
 MR. PERHACH said there are two native corporations in the Denali              
 Borough right now which are looking at tourism because they can't             
 continue to live off of resource extraction.  Ahtna, for example,             
 is actively engaged in a project in Broad Pass.  The Doyon Corp.              
 just bought property in Kantishna where subsistence hunting is                
 still allowed (inside the park).  He thought that once Doyon                  
 started trying to make a living from tourism they might also                  
 request some relief from Senator Miller.                                      
                                                                               
 Number 146                                                                    
                                                                               
 SENATOR HALFORD explained one of the conflicts is the source of               
 funding for the management and he asked if it was reasonable for              
 management of these resources to be paid for by the taxes, revenue            
 sharing, and license fees of hunters.  MR. PERHACH said he didn't             
 see why the tourist industry shouldn't contribute.                            
                                                                               
 SENATOR TAYLOR asked if thought that managing for consumptive uses            
 is somehow going to be detrimental to those people who view.  MR.             
 PERHACH said the folks he deals with are not going to get off the             
 road corridor for their experience, so he didn't have a problem               
 with subsistence and recreational hunting.  He helps people who               
 work for their meat.  It's people who hunt in road corridors who              
 are a problem for him and his clientele.  He said this is a very              
 complex issue and the bill is very simplistic.  He didn't think               
 they could predict what the impact would be if they continue to               
 allow this type of access to game.  He sensed that as hunting from            
 the road increases, the game year round disappears.                           
                                                                               
 MR. PERHACH said his most important concern is that he get some               
 acknowledgement that wildlife viewing is just as important as                 
 consumptive use.                                                              
                                                                               
 SENATOR HALFORD asked if he thought he'd win in the battle if                 
 wildlife were managed according to a public mandate.  MR. PERHACH             
 said he thought it would.                                                     
                                                                               
 TAPE 96-27, SIDE A                                                            
 Number 001                                                                    
                                                                               
 KEN TAYLOR, Deputy Director, Division of Wildlife Conservation,               
 said he noticed some changes that weren't mentioned before.  On               
 page 2, line 21 "highest" was substituted for "high" and "greater             
 than" was included at the end of the sentence.  On line 24 "the               
 highest" was substituted for "a high."   The same occurs on page 4,           
 line 1 and line 5.                                                            
                                                                               
 There are three portions of this version of SB 262 that cause the             
 Department concern.  The first is in section 1 which mandates the             
 game population should be managed solely for maximum sustained                
 yield by human harvest.  The definitions which follow would mandate           
 harvest levels that could only be achieved only by reducing wolf              
 and bear populations to extremely low levels and by wide spread               
 establishment of antlerless moose hunts which even are prohibited             
 in AS16.05.780.                                                               
                                                                               
 The second concern is that the bill would prohibit the expenditure            
 of federal aid to ADF&G from management of non-game species.  The             
 fact is that the non-game program was established to meet the                 
 statutory requirements of the Alaska Endangered Species Statute               
 which passed in 1971.  The purpose of that statute is to establish            
 a program for conservation, protection, restoration, and                      
 propagation of species listed as endangered in Alaska.  He said               
 their track record has been excellent in that regard.  If these               
 programs go unfunded and we fail to meet our conservation and                 
 management responsibilities for non-game or endangered species,               
 Alaska's authority to manage these resources will be further                  
 eroded.                                                                       
                                                                               
 Currently ADF&G has a place at the table of the U.S. Fish and                 
 Wildlife Service and the National Marine Fisheries Service on                 
 Endangered Species management.  We are actively involved in                   
 decisions on Goshawks and wolves in Southeast Alaska, eiders and              
 Aleutian Canada Geese, and peregrin falcons in the Arctic (recently           
 delisted).  If funding is eliminated for this small State program,            
 we will be shut out of the endangered species decision making                 
 process, leaving this entirely up to the federal agencies.  Our               
 marine mammal program also focuses on endangered species such as              
 the Stellar sea lion and the bowhead whale.                                   
                                                                               
 MR. TAYLOR said that we fund only two positions to establish                  
 expertise in this area, but we are known world-wide.                          
                                                                               
 Their third concern is that section 2 removes authority from the              
 Board of Game to restrict public access in a variety areas,                   
 including sanctuaries, refuges, and special management areas.                 
 Since statehood the Board has adopted several management areas and            
 controlled use areas that restrict access methods and means to                
 reduce conflicts between user groups, provide for various quality             
 hunting experiences the public has desired, and to maximize                   
 opportunities for participation and hunting.  Without this tool the           
 Board will be forced to shorten seasons, establish additional tier            
 II permit hunts which Alaskan hunters overwhelmingly oppose, or               
 close areas entirely.  The Board has recently taken a regional                
 approach to considering regulatory changes and all areas will be              
 reviewed to determine if they are meeting the objectives for which            
 they were established.                                                        
                                                                               
 The provision in section 1(b) that mandates the Board to open an              
 area at least three times larger than an area closed is really                
 unrealistic.  Nearly all the lands closed to hunting in Alaska are            
 under federal management over which the State has no authority.               
 The Board would essentially be prohibited from passing any                    
 regulations in the future that restrict methods, manner, or means             
 in an area as hunting pressure increases or shifts from one area to           
 another.  Their only options would be to shorten seasons or to                
 close them and be subject to litigation.                                      
                                                                               
 Serving on the Board of Game is a tiring and thankless task.                  
 Subjecting Board members to litigation and personal liability for             
 decisions they make in the interests of Alaskans would likely                 
 result in many of them resigning.                                             
                                                                               
 Section 2(b) would prohibit access restrictions in sanctuaries.               
 This provision is in direct conflict with AS16.20.094 and                     
 AS16.21.62 which specifically authorize the Board to adopt                    
 regulations governing public entry onto these lands.  Without this            
 authority unrestricted public access would soon render these areas            
 useless as sanctuaries.  The cost of this to Alaska's economy,                
 national image, and ultimate authority to manage its resources is             
 impossible to calculate.                                                      
                                                                               
 MR. TAYLOR concluded saying the Department really didn't see a                
 great deal of change in this version from the original version and            
 remains opposed.                                                              
                                                                               
 Number 130                                                                    
                                                                               
 SENATOR TAYLOR asked how all the other managers who are doing work            
 under the Endangered Species Act were being paid.                             
                                                                               
 MR. TAYLOR replied in their Marine Mammal Program there are two               
 positions that are funded in their budget ($163,000).  All of the             
 other positions, projects, and work that's done in marine mammals             
 cost $1.5 - $2 million and are all federal funds.  A sizeable chunk           
 of money comes from the National Marine Fisheries Servey to work on           
 Stellar Sea Lions.  Because of that funding they have been working            
 identifying separate stocks in the stellar sea lion population.               
 The stock in the Bristol Bay area has been declining much more                
 rapidly than the stock in Southeast Alaska.                                   
                                                                               
 SENATOR TAYLOR said he knew the Department was involved in more               
 non-game species management than just the two marine mammal                   
 programs he commented on and asked where the funding for that came            
 from.  MR. TAYLOR replied that they get funding from the Forest               
 Service and the Fish and Wildlife Service to do goshawk and                   
 archipelago wolf research.  They get funding for the peregrin                 
 falcon work through section 7 Fish and Wildlife Service Funds.                
 These are all special project accounts. They aren't part of the               
 permanent budget.                                                             
                                                                               
 SENATOR TAYLOR asked how many employees were being paid mostly from           
 the State budget and just a token amount from federal funds.  MR.             
 TAYLOR replied comparing all the special projects funding to amount           
 of funding that's in their base budget, they will find that what he           
 has said is true.  Most of the funding that goes to both non-game             
 and marine mammal programs comes from other sources.                          
                                                                               
 Number 235                                                                    
                                                                               
 SENATOR HALFORD asked if the Endangered Species Act treats the                
 Stellar sea lions as one population.  MR. TAYLOR answered that he             
 wasn't an expert on the Endangered Species Act, but he thinks the             
 Act treats them as one population.  The Department is arguing that            
 they are two population stocks and there are provisions in the                
 Endangered Species Act that allow for that.                                   
                                                                               
 SENATOR HALFORD asked if the one population that wasn't in trouble            
 is of sufficient strength to carry the population that is in                  
 trouble if they are managed as one species.  He said he was trying            
 to figure out if the State's position was the same as the                     
 congressional delegation's position regarding the reauthorization             
 of Endangered Species Act.  MR. TAYLOR said he didn't know what our           
 delegation is doing on that issue and he wasn't an expert.  He said           
 that the population has declined overall in Alaska from 120,000               
 stellar sea lions in the 1950's to 30,000 statewide which is why              
 they are listed as threatened.  He didn't know if 30,000 was                  
 sufficient to carry the population.                                           
                                                                               
 Number 306                                                                    
                                                                               
 SENATOR HOFFMAN asked if the Board of Game was the public official            
 he was referring to when he said they might not be able to get                
 people to serve if they are going to get sued.  MR. TAYLOR replied            
 yes and the reason he brought it up is because the Board of Game              
 makes the decisions on which areas are going to be open or closed.            
 They are the only public officials who do make those decisions, so            
 the penalty clause will apply to them alone.                                  
                                                                               
 SENATOR HALFORD said regarding the access provision - the public              
 trust would be breached by restricting public access to State game            
 refuges, etc. and he didn't agree with the concern that the animals           
 move away and don't come back.  Some access methods do provide some           
 pretty significant impacts that stay there for a long time and may            
 have some negative impact on tourism and he thought they should add           
 an exception that might read, "except where such restrictions are             
 solely for the purpose of protecting habitat from direct damage due           
 to the method of access."  SENATOR LEMAN said he wouldn't object to           
 such an amendment.  SENATOR TAYLOR said his only concern was that             
 it would be misused as well as it was used and withdrew his                   
 objection.                                                                    
                                                                               
 SENATOR HALFORD moved to insert on page 3 "except where such                  
 restrictions are solely for the purpose of protecting habitat from            
 direct damage due to the method of access."  There were no                    
 objections and it was so ordered.                                             
                                                                               
 SENATOR HOFFMAN moved on page 2, line 10 to delete "or public                 
 official" and on line 11 delete, "a public official is not immune             
 from suit under this section."  His primary concern was being able            
 to get competent people to serve on the Board of Game.  SENATOR               
 TAYLOR objected; he said he believed people needed to be                      
 accountable.  SENATOR HOFFMAN repeated his concern that they                  
 wouldn't be able to get people to service.  SENATOR TAYLOR agreed             
 that it was a bit harsh, but he thought the point needed to be made           
 that someone had to be accountable.                                           
                                                                               
 SENATOR HALFORD said he thought there might be two questions where            
 on line 10 the public official could be the Commissioner acting on            
 an emergency closure or something else.  He thought it wasn't just            
 Board members and he thought it could be drafted in a way to                  
 exclude the Board members.                                                    
                                                                               
 SENATOR TAYLOR withdrew his objection.                                        
                                                                               
 SENATOR HOFFMAN amended his motion to just Board members, not                 
 public officials.  There were no objections and the amendment to              
 the amendment was adopted.                                                    
                                                                               
 SENATOR LEMAN asked if there was any objection to SENATOR HOFFMAN'S           
 amended amendment.  There were no more objections and it was                  
 adopted.                                                                      
                                                                               
 SENATOR TAYLOR moved to pass CSSB 262 (res)(am) from committee with           
 individual recommendations.  There were no objections and it was so           
 ordered.                                                                      
                                                                               
          SJR 37 PRIMARY MFG OF PUBLICLY OWNED TIMBER                         
                                                                              
  SENATOR TORGERSON, sponsor,     said he understood there is curre        
 legislation to give Alaska this exemption and one of those bills              
 was vetoed by the President.  So there is nothing before Congress             
 that would give them this authorization.  This approach includes              
 municipal lands and also the University of Alaska lands.  The                 
 reason for the legislation is because in the City of Seward there             
 was a saw mill that shut down because of a lack of material to be             
 processed resulting in them auctioning off all the equipment.  A              
 year ago there was a sale and it was purchased by an outfit from              
 Oregon.  The chances are now that this raw material will be                   
 exported to Oregon.  The exemption asked for has been granted to 11           
 other western states.  So they can come up here and export, but               
 Alaskans are prohibited from doing the same down there to                     
 supplement our timber supply.                                                 
                                                                               
 Number 425                                                                    
                                                                               
 SENATOR TAYLOR asked if he thought there would be any exceptions to           
 this legislation.  He said the U.S. Forest Service has had a                  
 restriction on round log export in Southeast Alaska for many years.           
 As a consequence it did develop the local economy.  During the                
 entire time there has been an exemption on cedar logs.                        
                                                                               
 SENATOR TORGERSON responded that this proposal asks Congress the              
 authority for the State of Alaska to regulate, restrict, or                   
 prohibit.  We could decide to prohibit entirely.                              
                                                                               
 SENATOR TAYLOR said he was pointing out that this is not a complete           
 ban on the exportation of logs, but merely provided the State with            
 some working tools.                                                           
                                                                               
 SENATOR FRANK commented that it would be helpful to have an                   
 additional whereas expressing that it would be just a tool to help            
 local development.                                                            
                                                                               
 SENATOR TORGERSON said he thought that was what he thought the                
 resolution was saying.                                                        
                                                                               
 Number 490                                                                    
                                                                               
 CLIFF EAMES, Alaska Center for the Environment, noted the committee           
 had a letter from him supporting SJR 37.                                      
                                                                               
 MARK WHEELER, Alaska Environmental Lobby, strongly supported SJR
 37.  He said when timber is harvested on State land it makes sense            
 to maximize the number of jobs from each tree cut.  Exporting logs            
 in the round sends jobs out of state and hurts the future of a                
 sustainable timber industry in Alaska.  They respectfully ask that            
 other trust lands be included in the resolution and urge passage in           
 a timely manner.                                                              
                                                                               
 SENATOR TORGERSON commented that lands held in trust have been                
 determined by the higher courts as having a higher fiduciary                  
 responsibility to the trust than they do to the residents of the              
 area in which the trust has effect.                                           
                                                                               
 Number 503                                                                    
                                                                               
 SENATOR PEARCE moved to pass SJR 37 from committee with individual            
 recommendations and a $0 fiscal note.  There were no objections and           
 it was so ordered.                                                            
                                                                               
                SB 112 DISCOVERY ROYALTY CREDIT                               
                                                                              
 SENATOR PEARCE moved to adopt the F version Chenoweth 3/9/96 work             
 draft for SB 112.  There were no objections and it was so ordered.            
                                                                               
 ANNETTE KREITZER, Staff to the Senate Resources Committee,                    
 explained the changes in version F.  The substantive change begins            
 on page 2, line 30.  She worked with the administration to create             
 language acceptable to the committee regarding definition of pools.           
                                                                               
 SENATOR PEARCE moved to adopt amendment #1.  MS. KREITZER explained           
 that AS38.05.134 speaks to the exploration licensing program that             
 was passed by the legislature a couple of years ago.  The Cook                
 Inlet Basin is a very large sedimentary basin and some of the area            
 especially in the northern part is open to licensing and they                 
 didn't mean to exclude that part of the basin.                                
                                                                               
 KEN BOYD, Director, Division of Oil and Gas, said it was unlikely             
 that they would have any objection to it unless it had some strange           
 definition of the Cook Inlet Sedimentary Basin.                               
                                                                               
 There were no objections to amendment #1 and it was adopted.                  
                                                                               
 MS. KREITZER explained the second proposed amendment which                    
 clarified which production is actually getting the royalty                    
 reduction.                                                                    
                                                                               
 TAPE 96-27, SIDE B                                                            
 Number 580                                                                    
                                                                               
 SENATOR LEMAN noted that this amendment was Mr. Boyd's suggestion.            
 MR. BOYD agreed and said it eliminated ambiguity. The way the                 
 language is now, for instance he said, if the pool was on all six             
 of the leases, their intention was to reward the initial discovery            
 on that one lease in that pool.                                               
                                                                               
 MS. KREITZER noted to be consistent the same change would have to             
 be made on page 3, lines 5 and 6.                                             
                                                                               
 SENATOR PEARCE moved to adopt amendment #2, there were no                     
 objections and it was adopted.                                                
                                                                               
 MR. BOYD had a concern with "commercial quantities," but he said              
 the last amendment had changed the absolute need for a dimension              
 and he wanted to work with the committee on that issue.  He said              
 the point was that the well had to be capable of producing                    
 commercial quantities.                                                        
                                                                               
 SENATOR PEARCE asked when they certify a well producable what                 
 language to they use.  MR. BOYD replied they certify capable of               
 production in paying quantities.  SENATOR PEARCE asked if they                
 should just use that language.  MR. BOYD replied no, that he                  
 thought it was a different standard.  In paying quantities does not           
 really say that it will be produced.                                          
                                                                               
 SENATOR LEMAN asked if line 8 would have to be changed also.  MR.             
 BOYD answered that it would have to be changed anywhere "commercial           
 quantities" appeared would have to have "capable of producing"                
 added.                                                                        
                                                                               
 SENATOR PEARCE moved to adopt that amendment.  There were no                  
 objections and it was so ordered.  MS. KREITZER noted that language           
 was used throughout amendment #1 and on page 3, lines 1 - 12.                 
                                                                               
 SENATOR TAYLOR moved amendment #4.  SENATOR LEMAN objected for                
 purposes of explanation.  SENATOR TAYLOR explained the effect of              
 this amendment would be to set it up so that current lease holders            
 in the Cook Inlet Basin would fall within this royalty bill.                  
                                                                               
 SENATOR HALFORD asked if the royalty was being made retroactive               
 with regard to investment decisions that were made five years ago             
 and rewarding those decisions with the credit?  He said that any              
 kind of a credit bill is supposed to encourage marginal activity.             
 Going back in a lease term so they can put the money in now is                
 still a prospective reward for activity that might not otherwise              
 occur.  But going back and picking up activity that occurred in               
 1992 and applying that to the terms the effect is a retroactive tax           
 credit and it's hard to argue that that credit has encouraged                 
 marginal activity retroactively.                                              
                                                                               
 SENATOR TAYLOR agreed and explained that without doing so this                
 would be applicable against new leases.                                       
                                                                               
 SENATOR HALFORD said there are two questions; one is going back to            
 the leases is the right thing to do; the second question is are               
 they talking about investments made from the time of the effective            
 date of the bill forward on leases that were already held before              
 that or are they talking about going backward in both cases.                  
                                                                               
 SENATOR TAYLOR replied that his desire would be to go backward on             
 those leases already held for new discoveries, but he thought this            
 goes beyond that.  However, he would rather err in going beyond               
 that than in not accomplishing it at all.                                     
                                                                               
 SENATOR LEMAN said he was concerned with how they recover those               
 lease payments that have already been made and whether that's done            
 as a credit to future royalties.                                              
                                                                               
 SENATOR FRANK asked if they considered that in the formation of               
 their committee substitute.  SENATOR LEMAN answered they considered           
 it and there is one other approach, Senator Halford's, which he               
 thought merited discussion.  Applying it to leases that have not              
 been explored would create an incentive and the down side of that             
 is that you change the value of leases.  SENATOR FRANK commented              
 that the value of a lease changes every time the price of oil goes            
 up or down, as well as every time they pass a law concerning                  
 worker's compensation or the environment.  He supported Senator               
 Taylor's concept and Senator Halford's desire to fine tune it.  He            
 thought Senator Taylor's amendment went a little too far.                     
                                                                               
 SENATOR HALFORD said he didn't think retroactive credits worked the           
 way they are intended to work.  But he didn't think they should               
 exclude leases because they were already out there.  He wanted                
 those leases to be eligible.                                                  
                                                                               
 SENATOR LEMAN asked if there was any objection to incorporating the           
 conceptual amendment.  There was no objection and it was so                   
 ordered.  SENATOR LEMAN noted that the bill would be back in                  
 committee on March 13.                                                        
                                                                               
         HB 212 TIMBER MANAGEMENT & STATE LAND CLASSIF.                       
                                                                               
  SENATOR LEMAN announced  HB 212  to be up for consideration.                
                                                                               
 REPRESENTATIVE JEANETTE JAMES, sponsor, said she filed this bill at           
 the request of timber industry constituents in Fairbanks.  These              
 are small lumber businesses in the local communities whose lives              
 have been impacted by the overly complicated procedures through               
 which they have to go to secure timber.  It wasn't the lack of                
 timber; it was the inability of the DNR to allow the harvesting of            
 the resource.                                                                 
                                                                               
 SENATOR TAYLOR asked what the comma on page 1, line 14 meant.                 
 REPRESENTATIVE JAMES replied that the comma was added in the House            
 Resources Committee and the emphasis makes a difference in the way            
 the sentence reads.  The comma refers to the best available data              
 and then describes the best available data as opposed to the                  
 agencies describing it.                                                       
                                                                               
 SENATOR TAYLOR said he would like to delete the comma and asked her           
 to comment on using "use" instead of "consumption."  REPRESENTATIVE           
 JAMES explained that there was a concern with a number of people              
 that there is human use other than consumption.                               
                                                                               
 JACK PHELPS, Alaska Forest Association, said they continue to                 
 support this legislation and thought it would make some positive              
 changes for the forest industry particularly in the interior and              
 possibly southcentral.                                                        
                                                                               
 SENATOR TAYLOR asked if the negotiation on the House side included            
 the administration.  MR. PHELPS answered that was correct; he added           
 that public comment was also part of the negotiations.  He asked if           
 he has assurances that this will be signed into law.  MR. PHELPS              
 said they had been given some strong assurances that the bill would           
 be signed in its present form.                                                
                                                                               
 Number 351                                                                    
                                                                               
 CLIFF EAMES, Alaska Center for the Environment, commended the                 
 House, the Administration, and the Board of Forestry for their                
 work; the bill is close to something they can support.                        
                                                                               
 Their concern is with the 160 acre exemption from the five year               
 schedule requirement.  He said in the interior and Kenai there are            
 a number of timber sales off of State lands that are 160 acres and            
 less and they are very important to people in their cumulative                
 affect.  They supported the compromise proposed by the Board of               
 Forestry, recognizing that it is a well balanced Board.  The                  
 present requirement is that sales appear for two years on a five              
 year schedule.  The present bill would exempt the sales of 160                
 acres or less entirely from the five year schedule; the compromise            
 proposed by the Board of Forestry would have those sales appear               
 just one year on the five year schedule.  They believe that would             
 give adequate notice to the public of the full range of sales that            
 are proposed to be offered without burdening the State and without            
 having any undue affect on the actual selling of those sales.  He             
 didn't think the Board of Forestry could make a strong argument               
 that having those sales appear just once on the schedule is going             
 to be any significant obstacle to their management of the sales.              
                                                                               
 He urged the committee to adopt the Board of Forestry's proposed              
 compromise.                                                                   
                                                                               
 ERIK HOLLAND, Fairbanks, said that a number of local loggers have             
 told him that exporting is killing and that the scale of the bill             
 is too large and the part of the bill they like best is the first             
 part where the 10 acres are exempted.  The 160 acre exemption                 
 doesn't seem to help very much.  He suggested exempting two or                
 three parcels a year.  All the loggers have told him that they need           
 the wood yesterday.  He is in support of a truly sustainable local            
 industry.                                                                     
                                                                               
 DAN RITZMAN, Northern Alaska Environmental Lobby, recognized and              
 appreciated the efforts of the House members and Representative               
 James in particular.  He said HB 212 makes substantial changes to             
 Title 38 and 41, statutes which cover the entire State, not just              
 small sales by Interior operators.                                            
                                                                               
 The development of the Forest Resources and Practices Act                     
 represented a lot of work from a variety of interests including the           
 timber industry, the fishing industry, conservation organizations,            
 and many others.  Changes are not needed in the law; changes are              
 needed in the funding, implementation, and regulations that the               
 agency uses to carry out the law.                                             
                                                                               
 This legislation will further stress the Department and put                   
 Alaska's population of fish and wildlife at further risk.  A fiscal           
 note should be required of this legislation which takes into                  
 account the unfunded Forest Practices responsibilities to DNR, DEC,           
 and ADF&G.                                                                    
                                                                               
 Eliminating the five year schedule requirement for sales of 160               
 acres or less would mean that over 70 percent of the sales in the             
 Interior and a fair number of sales on the Kenai would not have to            
 appear on the schedule.  It is nearly impossible to learn about               
 individual sales from their individual announcements which are                
 buried in the legal section of the newspaper.  This does not give             
 a good sense of the overall picture for the region.                           
                                                                               
 MR. RITZMAN reiterated that the Board of Forestry which has                   
 representatives from logging companies, fishing communities,                  
 conservation organizations, recreation, and fish and wildlife                 
 sciences recommended that all sales be listed at least once on a              
 five year schedule.                                                           
                                                                               
 Number 261                                                                    
                                                                               
 Finally, section 11, page 5, lines 20 - 24 is a wildlife issue that           
 shouldn't be a part of the Forest Resources and Practices Act.                
 While it is appropriate to put wildlife protections in the Act,               
 management of wildlife is not a DNR function.                                 
                                                                               
 SENATOR TAYLOR moved to amend page 1, line 14 to delete the comma.            
 There were no objections and it was so ordered.                               
                                                                               
 SENATOR TAYLOR moved to pass SCSCSHB 212(FIN) from committee with             
 individual recommendations.  There were no objections and it was so           
 ordered.                                                                      
                                                                               
 MR. WHEELER, Alaska Environmental Lobby, said they still have a few           
 problems with the bill as drafted.  They would like to see sales of           
 160 acres or less appear at least once in the five year schedule.             
 The Board of Forestry presents a good vehicle for hashing out                 
 language that represents a lot of diverse interests and should be             
 listened to in this matter.                                                   
                                                                               
 Section 11 should be deleted also.  Wildlife management is not a              
 function of DNR and should not be a part of this bill.                        
 The language in section 7 is not a great improvement over the prior           
 language and they would like to see the prior language kept as is.            
                                                                               
         SB 283 DOCUMENT FILING, INDEXING, & RECORDING                        
                                                                              
 SENATOR LEMAN announced  SB 283  to be up for consideration.                  
                                                                               
 SHARON YOUNG, State Recorder, DNR, testified in support of SB 283.            
 She said the recording laws in this state were last visited in 1988           
 when there were comprehensive changes and consolidation.  These               
 were a big improvement, but they have slowly shown some areas of              
 inconsistency and ambiguity.  SB 283 is largely a housekeeping bill           
 and makes minimal substantive changes.  The changes it does make              
 are very beneficial for their staff, the State, and the public who            
 uses their services on a daily basis.                                         
                                                                               
 SENATOR LEMAN asked if anyone who used their services provide any             
 suggestions or testimony in opposition.  MS. YOUNG replied that she           
 had heard of no opposition at all.  She has heard favorable                   
 comments from the major user groups, such as the title industry.              
 It also has a negative fiscal note attached.                                  
                                                                               
 SENATOR TAYLOR asked if they were going to be charging multiple               
 fees for recording the same document if it is to be recorded for              
 different purposes.  MS. YOUNG replied that this seldom occurs, but           
 it is how they currently operate.  It has never been clear in the             
 past, but this clarifies that.                                                
                                                                               
 SENATOR TAYLOR said he wanted to make sure the State would not be             
 losing recorders offices because of streamlining.  He also wanted             
 to see the program receipts go back into the recorders office which           
 has been grossly underfunded.  It actually makes money.                       
                                                                               
 SENATOR TAYLOR invited Ms. Young to work on this with him and                 
 answer a few more questions regarding this program.                           
                                                                               
 SENATOR LEMAN said he would set aside SB 283 and adjourned the                
 meeting at 6:40 p.m.                                                          
                                                                               

Document Name Date/Time Subjects