Legislature(2005 - 2006)BUTROVICH 205
04/18/2005 03:30 PM RESOURCES
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|Confirmation Hearing: || Alaska Oil and Gas Conservation Commission (aogcc) - Cathy Forester|
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE SENATE RESOURCES STANDING COMMITTEE April 18, 2005 3:34 p.m. MEMBERS PRESENT Senator Thomas Wagoner, Chair Senator Ralph Seekins, Vice Chair Senator Ben Stevens Senator Fred Dyson Senator Bert Stedman Senator Kim Elton Senator Gretchen Guess MEMBERS ABSENT All members present COMMITTEE CALENDAR CONFIRMATION HEARING: Alaska Oil and Gas Conservation Commission (AOGCC) - Cathy Forester SENATE BILL NO. 96 "An Act granting certain state land to the University of Alaska and establishing the university research forest; and providing for an effective date." MOVED CSSB 96(RES) OUT OF COMMITTEE SENATE BILL NO. 113 "An Act relating to entry into and management of Gulf of Alaska groundfish fisheries." HEARD AND HELD CS FOR HOUSE BILL NO. 197(RLS) "An Act exempting certain natural gas exploration and production facilities from oil discharge prevention and contingency plans and proof of financial responsibility, and amending the powers and duties of the Alaska Oil and Gas Conservation Commission with respect to those plans; and providing for an effective date." MOVED CSHB 197(RLS) OUT OF COMMITTEE SENATE BILL NO. 170 "An Act relating to the Department of Fish and Game, the Board of Fisheries, and the Board of Game; relating to the taking of big game and to the disposition of a mount, trophy, or part of a fish or game animal; setting fees for certain trapping licenses and certain hunting licenses, permits, and tags; setting fees for the resident combined hunting, trapping, and sport fishing license and the resident combined hunting and sport fishing license; relating to the resident small game hunting license; setting application fees for certain hunting permits and stamps; establishing a surcharge on hunting, trapping, and sport fishing licenses; relating to certain hunting, trapping, and sport fishing licenses, tags, permits, and stamps; relating to the fish and game fund; relating to violations of fish and game laws; relating to state management of wildlife; relating to endangered fish and wildlife; and providing for an effective date." HEARD AND HELD PREVIOUS COMMITTEE ACTION BILL: SB 96 SHORT TITLE: UNIVERSITY LAND GRANT/STATE FOREST SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR 02/07/05 (S) READ THE FIRST TIME - REFERRALS 02/07/05 (S) RES, FIN 04/08/05 (S) RES AT 3:30 PM BUTROVICH 205 04/08/05 (S) Heard & Held 04/08/05 (S) MINUTE(RES) 04/11/05 (S) RES AT 3:30 PM BUTROVICH 205 04/11/05 (S) Heard & Held 04/11/05 (S) MINUTE(RES) 04/18/05 (S) RES AT 3:30 PM BUTROVICH 205 04/18/05 (S) Moved CSSB 96(RES) Out of Committee 04/18/05 (S) MINUTE(RES) BILL: SB 113 SHORT TITLE: GULF OF ALASKA GROUNDFISH FISHERY SPONSOR(s): SENATOR(s) STEVENS B BY REQUEST 02/23/05 (S) READ THE FIRST TIME - REFERRALS 02/23/05 (S) RES, FIN 03/09/05 (S) RES AT 3:30 PM BUTROVICH 205 03/09/05 (S) Heard & Held 03/09/05 (S) MINUTE(RES) 03/16/05 (S) RES AT 3:30 PM BUTROVICH 205 03/16/05 (S) Scheduled But Not Heard 03/23/05 (S) RES AT 3:30 PM BUTROVICH 205 03/23/05 (S) -- Meeting Canceled -- 04/01/05 (S) RES AT 3:30 PM BUTROVICH 205 04/01/05 (S) -- Meeting Canceled -- 04/18/05 (S) RES AT 3:30 PM BUTROVICH 205 04/18/05 (S) Heard & Held 04/18/05 (S) MINUTE(RES) BILL: HB 197 SHORT TITLE: OIL SPILL EXEMPTIONS FOR GAS WELLS SPONSOR(s): OIL & GAS 03/03/05 (H) READ THE FIRST TIME - REFERRALS 03/03/05 (H) O&G, RES 03/15/05 (H) O&G AT 5:00 PM CAPITOL 124 03/15/05 (H) Moved Out of Committee 03/15/05 (H) MINUTE(O&G) 03/16/05 (H) O&G RPT 5DP 1NR 03/16/05 (H) DP: SAMUELS, GARDNER, DAHLSTROM, ROKEBERG, KOHRING; 03/16/05 (H) NR: KERTTULA 03/21/05 (H) RES AT 1:00 PM CAPITOL 124 03/21/05 (H) Heard & Held 03/21/05 (H) MINUTE(RES) 03/23/05 (H) RES AT 1:00 PM CAPITOL 124 03/23/05 (H) Moved CSHB 197(RES) Out of Committee 03/23/05 (H) MINUTE(RES) 03/29/05 (H) RES RPT CS(RES) 2DP 3NR 2AM 03/29/05 (H) DP: ELKINS, SEATON; 03/29/05 (H) NR: OLSON, KAPSNER, LEDOUX; 03/29/05 (H) AM: GATTO, SAMUELS 04/06/05 (H) RLS RPT CS(RLS) 4DP 1NR 04/06/05 (H) DP: KOHRING, HARRIS, COGHILL, ROKEBERG; 04/06/05 (H) NR: MCGUIRE 04/06/05 (H) RETURNED TO RULES COMMITTEE 04/06/05 (H) RLS AT 8:30 AM CAPITOL 106 04/06/05 (H) Moved CSHB 197(RLS) Out of Committee 04/06/05 (H) MINUTE(RLS) 04/07/05 (H) TRANSMITTED TO (S) 04/07/05 (H) VERSION: CSHB 197(RLS) 04/08/05 (S) READ THE FIRST TIME - REFERRALS 04/08/05 (S) RES, FIN 04/18/05 (S) RES AT 3:30 PM BUTROVICH 205 04/18/05 (S) Moved CSHB 197(RLS) Out of Committee 04/18/05 (S) MINUTE(RES) BILL: SB 170 SHORT TITLE: BD/DEPT OF FISH & GAME POWERS & DUTIES SPONSOR(s): SENATOR(s) SEEKINS 04/12/05 (S) READ THE FIRST TIME - REFERRALS 04/12/05 (S) RES, FIN 04/18/05 (S) RES AT 3:30 PM BUTROVICH 205 04/18/05 (S) Heard & Held 04/18/05 (S) MINUTE(RES) WITNESS REGISTER CATHY FORESTER Nominee to the Alaska Oil and Gas Conservation Commission Anchorage AK TIM BARRY Staff to Senator Stedman Alaska State Capitol Juneau, AK 99801-1182 POSITION STATEMENT: Commented on SB 96 for the sponsor. ART NELSON, Chairman Board of Fisheries Department of Fish & Game PO Box 25526 Juneau, AK 99802-5226 POSITION STATEMENT: Commented on SB 113. BRUCE TWOMLEY, Commissioner Commercial Fisheries Entry Commission (CFEC) Department of Fish & Game PO Box 25526 Juneau, AK 99802-5226 POSITION STATEMENT: Commented on SB 113. ED DERSHAM, Vice Chairman Board of Fisheries Department of Fish & Game PO Box 25526 Juneau, AK 99802-5226 POSITION STATEMENT: Supported SB 113. REPRESENTATIVE KOHRING Alaska State Capitol Juneau, AK 99801-1182 POSITION STATEMENT: Sponsor of HB 197. DAN SEAMOUNT Alaska Oil and Gas Conservation Commission (AOGCC) 333 W. 7th Ave., Ste. 100 Anchorage, Alaska 99501 POSITION STATEMENT: Supported HB 197. LARRY DIETRICH, Director Division of Spill Prevention and Response Department of Environmental Conservation 410 Willoughby Juneau, AK 99801-1795 POSITION STATEMENT: Supported HB 197. MATT ROBUS, Director Division of Wildlife Conservation Department of Fish & Game PO Box 25526 Juneau, AK 99802-5226 POSITION STATEMENT: Commented on SB 170. ACTION NARRATIVE CHAIR THOMAS WAGONER called the Senate Resources Standing Committee meeting to order at 3:34:55 PM. Present were Senators Stedman, Guess, Dyson, Elton and Chair Wagoner. ^CONFIRMATION HEARING: ^Alaska Oil and Gas Conservation Commission (AOGCC) - Cathy Forester CHAIR THOMAS WAGONER announced the first order of business to come before the committee was the confirmation hearing for the Alaska Oil and Gas Conservation Commission. MS. FORESTER, nominee for the Alaska Oil and Gas Conservation Commission (AOGCC), said her family taught her to give more than she took and she is excited to have this opportunity to give something back to the state that has been so wonderful to her. "When I think of my experiences and training as a petroleum engineer, I can't think of a better place that I could serve the state of Alaska than in the Oil and Gas Conservation Commission." She said that she has had a variety of assignments from reservoir development to facilities design and has supervised and managed from small highly technical groups of engineers and scientists to really large operations. She highlighted some of her Alaskan experiences contained in her resume'. 3:40:00 PM SENATOR DYSON moved to pass Ms. Forester's name to the full body. There were no objections and it was so ordered. 3:40:38 PM Senator Seekins joined the committee. 3:40:48 PM At ease 3:41:59 PM SB 96-UNIVERSITY LAND GRANT/STATE FOREST CHAIR THOMAS WAGONER announced SB 96 to be up for consideration again. SENATOR SEEKINS moved to adopt CSSB 96(RES), version G, as the working draft. There were no objections and it was so ordered. SENATOR SEEKINS moved to adopt the letter of intent. 3:43:28 PM SENATOR GUESS objected for discussion purposes. She asked what would happen if a not-for-profit wants to buy the land to develop it, because it seems like the letter of intent is for them to not receive the land. SENATOR SEEKINS replied that the intent is that the land is not for conservation purposes; it's for development. SENATOR GUESS asked if that means if the university can get more money for the land, but it's for conservation, it still has to sell it for development. SENATOR SEEKINS replied that would be the practical result and he thought that would be a reasonable handicap. SENATOR GUESS asked what if the land in question couldn't be developed for some reason. SENATOR SEEKINS replied that he didn't think the lands were selected because they are useless. Therefore, they should be used for development. 3:49:23 PM CHAIR WAGONER added that the real meat of the letter of intent is in the next to the last paragraph where the university agrees that the parcel at Coldfoot will not be used to establish a business in direct competition with the one already there. 3:50:56 PM SENATOR ELTON said that some people have testified that land held for conservation purposes does have a strong economic component; it attracts people to lodges in the area. He is worried that this language would preclude that kind of consideration to be made by the university. SENATOR SEEKINS said he understands that concern, but if the land is put into conservation, that lodge owner is precluding anyone else from ever coming in to compete in what could be a two-lodge area. He didn't think that type of situation should be precluded. 3:52:44 PM SENATOR STEDMAN said that remote cabin sites are the highest and best use for a majority of the Southeast parcels, not large scale industrialized logging that might be conducive on other parcels. Most of the land has been held in private hands previous to statehood. He wanted it made clear to the University that the intent is to have land go to individuals. 3:54:10 PM SENATOR ELTON responded that he appreciates the discussion, but again pointed out that there could be an economic benefit to an existing landowner or a new business owner for not developing the land. Not allowing transferred land to be used for conservation purposes could preclude a neighboring lodge owner from purchasing it to keep it in its natural state to enhance or protect his business. 3:54:54 PM CHAIR WAGONER replied that's the reason he favors this letter. If we start taking lands that are meant to be transferred to the University of Alaska or any other area to be developed and all of a sudden we not only take them out of the realm of developable land, but if we put them into 501(c)(3)s or some other tax exempt organization, we then take the ability - if there's boroughs organized - we take the ability of the borough to have that land on the local tax roles to be part of their tax base, too. That's one of the things that I'm more concerned about - especially in some of the areas in Southeastern than any other area. Because that land should always remain on the borough tax roles. I think we've taken enough land out of the private sector and put it in the public sector. I happen to have a lot of land in the Kenai Peninsula Borough that that has happened to just recently and they wanted to have a lot more.... 3:56:16 PM SENATOR ELTON said he understands that argument, but an existing lodge would pay taxes on the land even if it is being held in a conservation state. 3:56:52 PM SENATOR GUESS asked if the university pays taxes on the land it owns. CHAIR WAGONER answered no, but he's concerned about who it transfers its lands to. SENATOR GUESS maintained her objection to adopting the letter of intent. A roll call vote was taken. Senators Elton and Guess voted nay; Senators Seekins, Dyson, Stedman and Chair Wagoner voted yea; and the letter of intent was adopted. 3:58:11 PM SENATOR STEDMAN offered Amendment 1. AMENDMENT 1 OFFERED IN THE SENATE BY SENATOR STEDMAN TO: CSSB 96(RES), version "G" Page 7, line 30: Delete "JU.LM.1001, Lena Creek", and insert "HA.CH.1001, Haines-Chilkoot" Page 8, following line 9: Insert: (p) Notwithstanding (a) of this section, the state land identified in this subsection and described in the document entitled "University of Alaska Land Grant List 2005," dated January 12, 2005, may not be conveyed to the University of Alaska under this section if the land is included in a borough formed before July 1, 2009, that includes Wrangell or Petersburg. If such a borough is not formed before July 1, 2009, the following land shall be conveyed to the University of Alaska on July 1, 2009; or if land within the following parcels is not selected by a borough before January 1, 2013, the following land shall be conveyed to the University of Alaska on June 30, 2013: (1) Parcel Number SD.1001, Beecher Pass; (2) Parcel Number SD.1001, Favor Peak; (3) Parcel Number CS.TL.1001, Three Lake Road; (4) Parcel Number SD.1001, Read Island; (5) Parcel Number SD.1001, Whitney Island; (6) Parcel Number CS.EW.1001, Earl West Cove; (7) Parcel Number CS.OV.1001, Olive Cove; (8) Parcel Number SD.1001, Thoms Place; SENATOR STEDMAN said there is very little private or state property in Southeast Alaska; it's mostly in the middle of a federal forest. This amendment gives the communities an opportunity to possibly pick up the parcels if they organize. It is not as far-reaching as he would like as far as the amount of parcels are concerned and he is concerned over the public process, which he thought needed work with the university. It's nice to go to the communities that are affected and hold public hearings. 4:01:34 PM SENATOR ELTON proposed Amendment 1 to Amendment 1 on page 8, line 3, under subsection (n) to add "(8) MF1002, Idaho Inlet; (9) MF1001 Mite Cove; and (10) Pelican." SENATOR SEEKINS objected for discussion. SENATOR STEDMAN said he wanted to know if it was permanent removal or removal of a time certain to be included into a borough. He would accept it as a friendly amendment if it was similar to the purpose of the original amendment. SENATOR SEEKINS said his objection is based on his reading of the bill; that the amendment would accomplish a permanent withdrawal of those lands. SENATOR ELTON said that Senator Seekins' statement is correct. It adds it to the previously excluded list and does not include language under subsection (p), which is specific to the Wrangell Petersburg area. He said there has been discussion of borough formation in this area and those parcels equal more than 99 percent of the state land that would be available to that borough. He had no idea where borough boundaries would be. SENATOR SEEKINS recalled that Mr. Johnson's (SRES 4/11/05) testimony emphasized that he wanted a specific date for boroughs to be formed so that lands could be left for them to choose from. I am very much in favor of allowing that land selection process to be there, but I think there needs to be some kind of a date in time where either they're faced with those lands being transferred because they don't want to form a borough or they come back to the legislature to extend that period of time to be able to protect those lands if they do intend on forming a borough of some kind. 4:06:12 PM SENATOR ELTON commented that lands can remain available for borough selection only if they remain with DNR. The difficulty in this instance is that you have several different entities like Elfin Cove, Pelican, Gustavus and Hoonah. He suggested that any deadline would guarantee that they will come back at a later date because, "I think that between now and then, it's going to be very, very difficult to get these entities together to try and figure out the governance systems that they might want." SENATOR SEEKINS said he wouldn't mind them coming back at a later date and if there had been some movement toward creating a borough, he would be very sympathetic to extending those deadlines. 4:08:17 PM SENATOR GUESS asked what happens if someone wants to form a borough with this land without Wrangell or Petersburg. Are we giving leverage to Wrangell and Petersburg in discussing borough formation by saying that the land has to be in a borough form that includes Wrangell or Petersburg? SENATOR STEDMAN replied that they are included in one borough under the planned boroughs, but they may decide to create two separate boroughs. Earl West Cove, Olive Cove and Thoms Place would be in the Wrangell area and Favor Peak, Beecher Pass and Three Lake Road would be in the other. The amendment language intends to clarify that those properties can be selected if one or two boroughs are created. If none are created, that's fine, too. 4:10:31 PM SENATOR SEEKINS said he thought Amendment 1 to Amendment 1 permanently removes Mite Cove, Idaho Inlet and Pelican from the list to transfer to the University of Alaska. 4:11:38 PM SENATOR STEDMAN said he opposed Amendment 1 to Amendment 1, "Because if the amendment to the amendment goes forward, I've got a whole list I'd like to add to it." He thought adding a new paragraph, (q), that would address those parcels would be a better way of dealing with it. 4:12:34 PM SENATOR SEEKINS called the question on Amendment 1 to Amendment 1. A roll call vote was taken. Senators Stedman, Seekins, Dyson, and Chair Wagoner voted nay; Senators Elton and Guess voted yea; and Amendment 1 to Amendment 1 failed. 4:13:20 PM SENATOR ELTON moved conceptual Amendment 2 to Amendment 1 that would provide that those three parcels be protected with the same deadlines and in the same way as the parcels listed in (p). 4:14:08 PM SENATOR SEEKINS asked if the conceptual amendment would give Pelican, Idaho Inlet and Mite Cove the same opportunity to form a borough before January 1, 2013. 4:14:58 PM SENATOR BEN STEVENS joined the committee. 4:14:44 PM SENATOR ELTON replied that such a borough would have to be formed before July 1, 2009. If not, those parcels would then be transferred to the university prior to June 30, 2013. 4:15:19 PM There were no objections to conceptual Amendment 2 to Amendment 1 and it was adopted. SENATOR GUESS clarified that in the new section (q) the borough does not have to include Petersburg and Wrangell. SENATOR STEDMAN replied that was correct. CHAIR WAGONER announced that the committee had Amendment 1 amended in front of it. 4:16:22 PM SENATOR GUESS asked what parcel was replacing Lena Creek. CHAIR WAGONER replied Haines-Chilkoot. SENATOR GUESS asked if that had been on the list before or is it a new parcel. SENATOR STEDMAN answered that it was on the list before and was removed. TIM BARRY, staff to Senator Stedman, added that Representative Thomas requested that the parcel be put back. It's in his district. 4:16:55 PM CHAIR WAGONER asked what the difference in acreage is between the two parcels. MR. BARRY replied the Lena Creek parcel is 610 acres and the Haines-Chilkoot parcel is 60 acres. SENATOR SEEKINS asked what the amendment does. MR. BARRY replied that the Lena Creek parcel had been excluded from the transfer list, but it will now be included. The Haines parcel will be excluded. 4:18:06 PM CHAIR WAGONER announced that there were no further objections or questions on Amendment 1 amended; and it was therefore adopted. 4:18:41 PM SENATOR ELTON said he had another amendment, but wouldn't offer it at this time. 4:19:00 PM CHAIR WAGONER asked if the University or DNR had any further discussion. There was none offered. 4:19:13 PM SENATOR SEEKINS moved CSSB 96(RES), version G, from committee with individual recommendations and attached fiscal note. SENATOR ELTON objected. A roll call vote was taken. Senators Dyson, Guess, Seekins, Stedman and Chair Wagoner voted yea; Senator Elton voted nay; and CSSB 96(RES) moved from committee. 4:20:04 PM Recess 4:24:37 PM SB 113-GULF OF ALASKA GROUNDFISH FISHERY CHAIR WAGONER announced SB 113 to be up for consideration. SENATOR BEN STEVENS moved to adopt CSSB 113(RES), version S. There were no objections and it was so ordered. CHAIR WAGONER objected for an explanation. SENATOR STEVENS briefed the committee on the changes in the CS as follows: 1. On page 2, lines 24 and 25, "except for mechanical jigging machine fisheries" is added. This would remove mechanical jigging fisheries within state waters from consideration of a direct access privilege (DAP) program. 2. On page 6, lines 3 - 7, "(2)"Gulf of Alaska groundfish fishery" is added and regards a fishery in which groundfish are taken in a specified administrative or registration area using a specific type of fishing gear that is either pelagic trawl, non-pelagic trawl, pot, or longline gear. "Gulf of Alaska groundfish fishery" does not include mechanical jigging machine fisheries. This clarified what fisheries would be available for consideration of a DAP program. 3. Page 6, lines 17 - 20, adds: "(d) Notwithstanding AS 16.05.815 and AS 16.43.975, the commission or the Department of Fish and Game may release to the owner of a vessel information on the vessel's history of harvests in a fishery that is necessary to apply for a dedicated access privilege issued under AS 16.43.530." SENATOR STEVENS explained that this provision was added so that managers have access to the history of a vessel when a plan is being developed. The information would not be disseminated; it's only in the event that a direct access privileged program is being considered. The Board of Fisheries and the Alaska Commercial Fisheries Entry Commission have a Memorandum of Understanding (MOU) with respect to the Gulf of Alaska groundfish fisheries. ART NELSON, Chairman, Board of Fisheries, said the MOU is a strong statement about how the public process is going to work. BRUCE TWOMLEY, Commissioner, Commercial Fisheries Entry Commission (CFEC), emphasized that the joint public hearings the MOU calls for provide an opportunity to sort through the proposal before it becomes a public proposal. It ties the board together with CFEC during the process so that they can consider testimony together. ED DERSHAM, Vice Chairman, Board of Fisheries, added that the MOU is the end result of a year and a half of work and nine days of public meetings at the Board of Fisheries. 4:34:31 PM SENATOR STEVENS asked if he could elaborate on paragraph 2 and how the process for direct access privilege begins. 4:35:18 PM MR. TWOMLEY explained that limited entry has never been implemented without being asked for by the fishermen in the fishery and that language is intended to reassure the public. 4:36:17 PM CHAIR WAGONER asked what percentage of fishermen would be required for them to consider implementing limited entry. MR. TWOMLEY replied that a statutory duty is set out in the Administrative Procedures Act stating that any time a petition (of one or more people) is submitted, the agency has a duty to respond to it within 30 days. There is no quantitative requirement. The initial step outlined in the MOU will be the Board of Fisheries pointing out fisheries it regards as critical to the CFEC and that will trigger CFEC into doing the basic research to get a good sense of what the fishery looks like and whether or not it would be a likely candidate for a dedicated access privilege program. SENATOR STEVENS asked him to highlight the public comment period and the process for a normal application under existing regulations. 4:39:01 PM MR. TWOMLEY replied in the existing system, the CFEC would receive a petition. In most instances to comply with the statute they say no, but continue to look at the fishery. If the commission can satisfy the constitutional requirements and if a proposal would promote conservation and economic health of the fishery, it has a duty to go forward with it at that point. That proposal has to be reviewed by the Attorney General's office. Then it goes out to the public for comment and that time is often quite generous because you must work around fishing seasons. At the end of the process there is an opportunity to make a decision and that, again, has to be reviewed by the AG's office. 4:40:21 PM SENATOR STEVENS asked how long that takes. MR. TWOMLEY replied a minimum of 90 days, but longer usually. 4:41:42 PM SENATOR STEVENS asked Mr. Dersham how long the public comment period on the Chignik fishery took. MR. DERSHAM replied that the people pursuing the co-op came forward about eight months before the regulatory meeting and informal discussion took place over that period. When the board actually took up the Chignik Co-op for regulatory action, that happened within a nine-day period. The proposal had actually th been on the books from the prior April 10. SENATOR STEVENS asked how the inclusion of a joint hearing process would change their normal hearing process. 4:44:32 PM ART NELSON, Chairman, Board of Fisheries, answered that it could lengthen the hearing process. If the CFEC comes out with preliminary regulations, the board could take exception to them, for instance. Although, he hoped there wouldn't be disagreements between the two bodies. They didn't want to give one agency the power to trump the other in terms of statutory authorities. 4:45:09 PM SENATOR ELTON said that paragraph (5) mandates communication between CFEC and the board on written comments that may be given to CFEC. He anticipated the board would also receive written comments, but nothing mandates that the board's comments need to be shared with CFEC. He asked if that is a structural issue. 4:46:13 PM MR. DERSHAM replied that it is their intent to go back to the work group that had been working for the past year and a half and make additions to that membership for more inclusive public participation in the affected areas. 4:47:17 PM MR. TWOMLEY explained the point is that when the two groups are together, they will be getting all the information at the same time, but because the proposal and notice will come from CFEC, it will have to share its information with the board. 4:47:47 PM SENATOR ELTON said that CFEC commissioners would understand that, but the public might not. 4:48:13 PM SENATOR STEVENS asked Mr. Dersham how efforts on the federal level would impact existing participants on the state level and which fisheries would apply for a direct access program. MR. DERSHAM replied that the board and the department haven't yet defined what a separate fishery is, but the cod fisheries on the south peninsula in Kodiak, and more recently Cook Inlet, and the pollock fisheries from Prince William Sound out through the Aleutians came to his mind first as candidates. 4:51:23 PM SENATOR STEVENS asked how a DAP would the impact the Shumigan Islands pot cod fishery and parallel pollock pelagic trawl fishery. 4:52:00 PM MR. DERSHAM replied: Under current regulations in state waters, if we had a rationalized federal Gulf groundfish fishery next door to those, it would greatly increase the potential for additional pressure during the times when the state waters were opened. So, people's past practices and their past history would be very much at risk with the same set of regulations, because the freed up effort from the federal side could encroach on what's been taking place in the state waters in the past. 4:54:51 PM MR. TWOMLEY agreed, and said the function of DAPs should be to help secure the place of Alaskan fishermen in their fishery. It should also aid enforcement by putting individual limits on their ability to take resources from the fishery. It should also enhance their economic opportunities by excusing them from what would otherwise be a race for the fish. There is more of an opportunity to be rational and to plan. In the absence of that, the fishery would be just as vulnerable as Ed has indicated. 4:55:34 PM CHAIR WAGONER asked him to compare the DAP process to halibut IFQs in terms of its affect on processors in the marketplace. MR. TWOMLEY replied that there are sound opportunities to increase the value of the product simply by being able to fish when it's opportune to do so - when the markets are right, when prices are right and along with the safety benefits of avoiding bad weather. With more marketable fish, it is an opportunity for processors as well. 4:56:20 PM SENATOR SEEKINS asked why the department and the board need to have an MOU. MR. DERSHAM replied that the public needs definitions and a clear understanding of how the process will work. SENATOR SEEKINS said they are not trying to set up an exclusionary process, but to just manage the real resource. MR. DERSHAM replied that is correct. 4:59:38 PM SENATOR STEVENS directed members to page 5, line 5, of the CS that lists the nine key elements that the developers of a program must address. He asked anyone to comment if they saw omissions from the guidelines for development of regulations to implement a program. 5:01:14 PM MR. TWOMLEY commented that these are basic and essential elements of a DAPS program as advised by Lance Nelson, Attorney General's Office. 5:01:57 PM SENATOR STEVENS asked if this list is a product of the hearings held over the last several years. 5:02:21 PM MR. DERSHAM replied yes, definitely. SENATOR STEVENS said that he was trying to highlight that this list is a product of public hearings that have been conducted by the Board of Fisheries and the North Pacific Fisheries Management Council as a joint planning team. 5:02:34 PM MR. DERSHAM added that it was part of the nine days of public hearings the Board of Fisheries conducted over a period of a year and a half with a work group of public panel advisors and input from the general public and participation from representation from the CFEC and the Department of Law. 5:02:59 PM SENATOR STEVENS asked if their work was posted and reviewed. MR. DERSHAM replied yes. 5:04:36 PM SENATOR STEVENS highlighted that the material in this bill is the evolution of an extensive public process among fishing participants and the fisheries managers. He thought there had been adequate public review. 5:05:28 PM SENATOR STEVENS moved to adopt the MOU to be included as a letter of intent with SB 113. There were no objections and it was so ordered. CHAIR WAGONER noted there were no further questions and stated that he would have another hearing on this bill on Saturday. CSHB 197(RLS)-OIL SPILL EXEMPTIONS FOR GAS WELLS CHAIR WAGONER announced CSHB 197(RLS) to be up for consideration. REPRESENTATIVE KOHRING, sponsor of HB 197, explained that its sole purpose is to clarify for Department of Environmental Conservation (DEC) that discharge contingency plans (C-plans) and financial responsibility are not required for natural gas wells. Legislation was passed last year, HB 531, which dealt with coalbed methane that inadvertently placed language in statute that required C-plans for any kind of drilling or exploration activity. That was not the intent. "There should not be an oil spill plan if there is no oil involved in drilling or exploring for natural gas." He said the AOGCC is the entity that would make the determination as to whether or not oil could be encountered before an exemption is given. 5:09:59 PM DAN SEAMOUNT, Alaska Oil and Gas Conservation Commission (AOGCC), supported HB 197. "It allows for better use of geologic information and understanding in determining the needs for such plans...." He explained that the current scope of C-plan exemptions mismatched with the facts of Alaska's geology. Drilling for gas in many areas has no risk of an oil spill at all, because they have no oil-bearing zones. HB 197 provides for a case-by-case geologic evaluation of wells drilled to explore for gas. This would reasonably include shallow and deep non-conventional and conventional gas plays and prospects. It adds no additional cost to the commission's budget since it has basically been doing this for years, and simply corrects the problem with last year's bill. 5:12:40 PM SENATOR GUESS asked what would happen if someone were drilling for gas and encountered oil. MR. SEAMOUNT replied that the AOGCC would order them to immediately stop drilling and would then evaluate the potential for flow. 5:13:11 PM SENATOR GUESS asked if natural gas is liquid at any time and do they have worry about temperatures when it would become liquid and, therefore, be possible to spill. MR. SEAMOUNT replied that that could happen in retrograde condensate reservoirs and those would not get the exemption. 5:13:54 PM LARRY DIETRICH, Director, Division of Spill Prevention and Response, Department of Environmental Conservation (DEC) supported HB 197. 5:15:07 PM SENATOR SEEKINS moved to pass CSHB 197(RLS) from committee with individual recommendations and attached fiscal notes. There were no objections and it was so ordered. 5:16:18 PM At ease 5:17:36 PM SB 170-BD/DEPT OF FISH & GAME POWERS & DUTIES CHAIR WAGONER announced SB 170 to be up for consideration. SENATOR SEEKINS, sponsor, said SB 170 addresses some housekeeping issues and then some substantive ones. It provides for sale of legally taken trophy mounts and certain parts of legally taken game animals and solves the current situation where a person cannot buy a trophy mount in Alaska, but the seller can take the mount to Seattle and conduct the transaction with the buyer there. He said there is no real good reason to prohibit their sale here and allowing it would raise revenues for the fish and game fund. It also provides for a small game-hunting license as differentiated from a general hunting license, which would be sold for $25. Some people don't want to hunt big game, but would like small game - particularly non-residents. It provides for some uniform application fees ($7.50 across the board) for certain hunting permits, drawings and stamps. Right now there are different fees for a musk ox than there are for a caribou. The fees are meant to defer 100 percent of the cost of processing the fees. If the department needed additional fees to do that, he would be willing to look at that number. SENATOR SEEKINS said that SB 170 also establishes a higher degree of accountability for the use of monies within the fish and game fund. This fund is dedicated to uses that directly benefit those who purchase hunting and fishing licenses. The fund currently has only loose internal guidelines as to how it is spent. SB 170 provides for new fees for hunting and trapping licenses and tags and requires that the increases in those fees be used to maximize management for an abundance of animals for human consumption. Hunters have said they are not willing to pay more to harvest less. It provides for certain predator control for bears in areas under intensive management where the Board of Game has determined first that bear predation is a cause of the problem and a reduction in bears would reasonably help cure that problem. 5:24:38 PM SENATOR SEEKINS said the next provision is a brand new concept. It provides for a new deferral fee that is limited to certain areas that are adjacent to or very near state wildlife sanctuaries or national parks. When the board authorizes permits to hunt bear or wolf in these areas, a person could take a permit off the table by paying into the fish and game fund the maximum market value the hunt would otherwise have contributed to the state economy. As an example, he used the McNeil River Sanctuary that has the McNeil River preserve next to it. Part of the reason for the preserve has always been to allow hunting. Because it is next to the McNeil River Sanctuary, people always try to make the preserve part of the sanctuary. This will allow people who don't want bears to be hunted to be able to contribute to the management of the sanctuaries, which are all managed from the fish and game fund, by buying a permit and taking it off the table for the year. 5:27:12 PM CHAIR WAGONER asked how many areas are similar to McNeil River. MATT ROBUS, Director, Division of Wildlife Conservation, Alaska Department of Fish and Game (ADF&G), answered Pack Creek on Admiralty Island, the Katmai National Park and Denali National Park. SENATOR SEEKINS said this provision would apply to areas where the bears have been habituated. 5:28:29 PM SENATOR ELTON asked what the definition of animal parts is as used in section 52. SENATOR SEEKINS replied that its not meant for sale of meat and he wanted to put an amendment in the bill saying that. But he has no objection to saying that a person could sell a gall bladder of a legally taken bear. An affirmative defense would be to show that a bear had been consumed by the same person who took it and sold the gall bladder. CHAIR WAGONER said that he read that the bottom has fallen out of the bear gall bladder market because of Viagra and drugs like it. MR. ROBUS replied that sale of bear gall bladders is legal in some states, but not most. He did not think there was a direct link between sale of Viagra and bear gall bladders, because the bladders have medicinal uses in addition to that. 5:31:11 PM SENATOR ELTON said it is a common practice to trade King salmon, for instance, for a roast of moose. It would be a barter. 5:31:43 PM SENATOR SEEKINS said there is nothing that he knows of that would preclude a barter of that sort. 5:31:48 PM MR. ROBUS responded that he wanted to read the regulations, but he knows that it is a common practice. SENATOR SEEKINS explained that he understands the title to the fish or game animal transfers to the owner at the time of harvest and he would have the right to share it with anyone he wanted to. The law could preclude its sale. 5:32:22 PM SENATOR STEDMAN asked him to talk about the proposed fees. 5:32:41 PM SENATOR SEEKINS responded that the fees were proposed to him by the department, although he may have increased a couple. 5:33:45 PM MR. ROBUS replied that is correct. SENATOR SEEKINS asked him to explain why the amounts were requested. MR. ROBUS explained that his division relies on the one source of non-federal funding that it gets to do all of its work - the fish and game fund, which is pretty much composed of hunting and trapping license fees and hunter tag fees. It has had no increase in the last 13 years. The division's expenses are going up and revenues are static or slightly declining. He can still get federal matching funds, but has run short to be able to do the additional wildlife management work to the extent that the division is running $2 million less this year. He has the increased demands of predator control and intensive management programs. We do have some serious fiscal issues in the division and we put forward a straw man proposal containing a fee increase that we've taken around to advisory committees, the Board of Game, various public groups, individual legislators - tried to put together a package that would once again bring back enough of that state license money to properly fund the wildlife management activities we need to do. That straw man package was the beginning of the evolution for the structure that you see in that portion of this bill today. 5:35:46 PM SENATOR STEDMAN said sheep are highly prized for hunters and Alaska shouldn't be the low-cost producer for out-of-state hunters. He wanted an explanation of why the fees mostly doubled. MR. ROBUS explained that the fees were based on the need to make up at least the $2 million annual shortfall at present plus the desired capability to be able to do more active wildlife management related to the intensive management law and the predator management programs he has going. In terms of the value of their dollars, state residents pay one half of what they paid for a hunting license at statehood. The sustained yield programs must be continued for multiple years to be effective and the department needs to be able to measure the situation before, during and after those predator programs in order to sustain them. The fees were structured to bring in $3.5 million that would restore the division's capabilities to manage wildlife. SENATOR STEDMAN said that some people don't buy licenses anyhow and doubling the fee doesn't encourage them. He asked how the department planned to handle enforcement. MR. ROBUS agreed with his comment, but said adamantly that he needs money for his programs. He explained that enforcement is a split effort between his division and the Department of Public Safety with DPS being the primary enforcers. SENATOR STEDMAN wanted a breakdown of who purchases licenses around the state. 5:42:00 PM SENATOR SEEKINS asked if other areas have asked for increased predator control. MR. ROBUS replied yes; the division has implemented five programs and it's challenging to keep them going. There are numerous desires for intensive management programs elsewhere. SENATOR SEEKINS asked if he agreed that certain predators have been allowed to over-harvest in many areas of the state and needs significant attention paid to it if they want to put moose and caribou on the tables of people in the State of Alaska. MR. ROBUS responded: I might state it slightly differently. I'm not sure that predators over harvest, but the situation we have now is that predators in many places are taking enough prey animals to prevent those prey populations from increasing to levels that can be supported by the habitat, which would provide more animals, more hunting opportunity, more meat in the freezer around the state. SENATOR SEEKINS noted that the section requiring a conservation tag from people who hunt waterfowl on page 14 will be deleted. It will require anyone who fishes who is of legal age or of capability to have a fishing license for the first time. Right now only a hunting license is required. 5:45:12 PM SENATOR STEDMAN asked if this changes the age requirement for having a license from anyone who is over 16 years of age. SENATOR SEEKINS replied that it doesn't change that. SENATOR STEDMAN asked if that isn't the law of the land today. SENATOR SEEKINS replied, "Not for subsistence purposes for fishing." 5:46:06 PM SENATOR ELTON asked if the first section, which is legislative intent, and the last couple of sections plus the sections that change 60 substantive operations in the Department of Fish and Game, could be taken out until they can get the department's take on what it really needs. 5:47:14 PM MR. ROBUS said that would lead into what he has to say. The department has identified the fee increase as a big need. He has talked to advisory committees and the Board of Game about it. "The license fee is a tremendously important aspect of this bill from the perspective of my division and the department." The size and complexity of the bill means that the department is still doing the analysis to figure out what the parts mean. It's clear that it had concerns over two-dozen significant changes to fish and game statutes. The relationship between the Board of Game, the Board of Fisheries and the department has been changed markedly in terms of who has the authority to do what. There is a change in the way wild animals are defined and some animals would not even be under his management jurisdiction until or unless the Board of Game took action to make them part of his business. The fiscal responsibility part of the bill would impose some pretty stringent constraints on both the division and the department and those need to be worked through, although he understands that accountability is something the public and the legislature want and deserve. KEVIN SAXBY, Department of Law (DOL), echoed Mr. Robus' comments saying he hadn't had that much time to look at the bill, but has identified a number of constitutional and statutory concerns that would have to be thought through. SENATOR SEEKINS said he appreciates the fact that the departments have not had a lot of time to look at this, but he wants an accounting of money the Department has spent. When the ADF&G budget was looked at in Finance Committee, the question was asked where the money goes. A statute says that the legislature is to receive a project-by-project analysis of how it was spent. But they were told "project" is not defined in statute. Alaska's Comprehensive Wildlife Conservation Strategy was put together with $600,000 or $800,000 worth of matching funds from the state to obtain $3 million worth of federal money to put into implementing a conservation plan. In this whole plan, there is not a single plan on how to develop a conservation plan for prey animals. There are conservation plans for voles and birds and even eel grass invertebrates. None of the 74 species were nominated by a single consumptive user group; they were nominated by the Audubon Society, Cook Inlet Keeper and other groups across the state. His folks would go along with some increase in fees, but they want some accountability there. "We don't want somebody to establish a conservation strategy for the State of Alaska that hasn't gone through the public hearing process that the Board of Game does." CHAIR WAGONER said he would hold the bill for further work and adjourned the meeting at 5:58:37 PM.