Legislature(2017 - 2018)BUTROVICH 205
03/08/2017 03:30 PM Senate RESOURCES
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| Audio | Topic |
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| Start | |
| Overview: State Litigation on Federal Issues | |
| Adjourn |
* first hearing in first committee of referral
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ALASKA STATE LEGISLATURE
SENATE RESOURCES STANDING COMMITTEE
March 8, 2017
3:30 p.m.
MEMBERS PRESENT
Senator Cathy Giessel, Chair
Senator John Coghill, Vice Chair
Senator Natasha von Imhof
Senator Bert Stedman
Senator Shelley Hughes
Senator Kevin Meyer
MEMBERS ABSENT
Senator Bill Wielechowski
COMMITTEE CALENDAR
OVERVIEW: STATE LITIGATION ON FEDERAL ISSUES
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
JAHNA LINDEMUTH, State Attorney General
Department of Law (DOL)
Anchorage, Alaska
POSITION STATEMENT: Provided an overview of state litigation on
federal issues.
KENT SULLIVAN, Assistant Attorney General
Natural Resources Section
Department of Law
Juneau, Alaska
POSITION STATEMENT: Provided an overview of state litigation on
federal issues.
ACTION NARRATIVE
3:30:27 PM
CHAIR CATHY GIESSEL called the Senate Resources Standing
Committee meeting to order at 3:30 p.m. Present at the call to
order were Senators Coghill, Hughes, Meyer, Stedman, Von Imhof,
and Chair Giessel.
^Overview: State Litigation on Federal Issues
Overview: State Litigation on Federal Issues
3:30:54 PM
CHAIR GIESSEL stated that the business today is to continue a
meeting that was started on February 15 on federal issues that
the State of Alaska is disputing or litigating with regard to
access and use of the state's lands, waters, and subsurface
rights. She said some of the more contentious and complicated
issues were intentionally left until today.
3:31:41 PM
JAHNA LINDEMUTH, State Attorney General, Department of Law
(DOL), Anchorage, Alaska, said she was working from a table
dated January 23, 2017 called "List of Federal Issues and
Conflicts." She recapped that they had already covered navigable
waterways and most of the access to land cases, but left some of
those and the Endangered Species Act cases on pages 4 and 5. The
water, fish and game, mining, and oil and gas cases have already
been covered.
She started with the lands into trust issue and the Akiachak
litigation where several tribes filed a lawsuit against the
federal government saying that the Alaska exemption that
disallowed Alaska tribes from taking lands into trust was
illegal and inconsistent with federal statute. The federal
government fought that and Alaska intervened on the federal
government's side. The federal district court ruled against the
federal government's position, and then the federal government
changed its mind. It complied with the federal order and changed
their regulations to allow Indian tribes in Alaska to take lands
into trust.
The federal decision said there is no basis for treating tribes
in Alaska differently than tribes in the rest of the United
States. In changing sides, the federal government did two things
for Alaska's position. It left no case in controversy because
the original lawsuit had been between the tribes and the federal
government. It also meant that Alaska had a new federal
regulation interpreting federal statute that was contrary to the
position Alaska was taking in that case, a very hard legal
battle to fight.
So, when she became Attorney General last August, the department
was facing a deadline of whether to appeal the Ninth Circuit's
decision that had ruled the case moot and that procedurally
Alaska was out of luck. She talked it over with the governor,
the lieutenant governor, explaining that her approach to
litigation generally is that although the AG may have the
statutory authority to make final decisions, it is something
that you want client involvement in no matter what, and you want
to have consistency.
3:35:27 PM
Her legal advice was consistent with the policy decision that
was made, which was to not fight lands into trust making it an
absolute bar to allowing something in Alaska, but rather to deal
with it on a case-by-case basis. And that is where they are
today.
She explained that in going forward, whenever the federal
government receives an application to put lands into trust it
will give notice and allow both the state and any local
governments to comment. Although it doesn't say this in the
regulation, anyone can comment. It's not limited to states and
local governments. If a Native Corporation is impacted or if
there is a resource project, anyone can weigh in on that
application.
She also explained that lands into trust does not give an
absolute right to any Indian tribe to have any particular parcel
taken into trust; it is something that is completely within the
discretion of the Department of Interior (Interior) and the
Bureau of Indian Affairs (BIA). So, if the BIA says no to a
particular parcel, there is no right to appeal or challenge it,
because it's completely discretionary.
ATTORNEY GENERAL LINDEMUTH said in dealing with this on a case-
by-case basis and actually sitting down with the Department of
Interior, Indian tribes, and all of Alaskans and working openly
and collaboratively through any concerns puts her in a better
position to advocate for what the state wants in any particular
instance.
Often during litigation, parties take very polarized positions
and predict the worst case scenario, and if one loses all the
horror that you predicted will be what you are facing. So, one
of the things to consider in deciding whether to go forward with
litigation or not is that in working through issues more
collaboratively, you can take a more middle ground and have your
absolute issues addressed.
3:38:32 PM
SENATOR COGHILL said the idea of commenting is appropriate, but
for example, if the state and citizens comment, is that
equitable comment? Who has more standing if it's completely
discretionary to the BIA?
ATTORNEY GENERAL LINDEMUTH said her understanding in talking
with the BIA is that they really don't want to end up in
litigation as has happened in the Lower 48 on every parcel.
However, all of her comments thus far are from discussions with
the prior administration, and the big question going forward is
what the new administration does with this. Secretary Zinke and
whatever team he puts in place may take a completely different
view and it's possible that very few allocations may move
forward in the next four years.
SENATOR COGHILL commented then, that it is an open question on
how much our voice counts.
3:40:54 PM
CHAIR GIESSEL said she wondered what the implications were for
resources development in the state - since this is the Resources
Committee.
ATTORNEY GENERAL LINDEMUTH said that issue is at her forefront
and Governor Walker is very pro-resource development. She thinks
this will be a fairly small issue given the amount of land
available for Indian tribes to put into trust as it currently
exists. The big picture is that Alaska has 330 million acres;
approximately 60 percent is federal, 28 percent is state, and 12
percent is owned by the Alaska Native Claims Settlement (ANCSA)
corporations. Less than 1 percent is owned by private parties,
which includes Indian tribes.
She has a long history of working with ANCSA corporations, and
the purpose of providing ANCSA lands to both regional and
village corporations is to provide a source of economic
development, which often leads to resource development on those
lands. The significant legal issue remaining is whether a split
estate could be taken into trust if, for instance, a village
corporation transfers a surface estate to a tribe and the
regional corporation still owns the subsurface estate, which is
the dominant estate, and wants to do resource development.
ATTORNEY GENERAL LINDEMUTH said she actually thinks that ANCSA
runs contrary to allowing lands into trusts. However, she had
talked it through with Interior under the prior administration
and they didn't see split estates as a problem, because it is
done in the Lower 48. But the Lower 48 doesn't have ANCSA and
that makes it completely different. The Ninth Circuit has
authority on the whole subsurface estate and that is a greater
right than the normal mineral assignment or reservation than one
sees in the Lower 48.
In talking with regional corporations, she didn't find a uniform
position on this issue, but most of them also believe that it is
not possible for a split estate to be taken into trust. If
something like that were to be proposed, probably the regional
corporation that is impacted would object and potentially
litigate. The state would weigh in on that issue in favor of
resource development (and creating a situation where some Indian
tribe who has a surface estate could take more off the resource
project through a tax or some other type of fee and that is
inconsistent even with 7i sharing that results from resource
development of subsurface assets).
3:45:04 PM
ATTORNEY GENERAL LINDEMUTH said this is a huge legal issue that
remains, but it may not arise for many years. However, she has
tried to start the discussion on this issue, and if there is
consistent thought on it, a federal regulation could address it
without the need for litigation.
SENATOR STEDMAN said there is concern throughout the Southeast
region as to how taking properties off the tax rolls will work
in cash economy communities. Her synopsis noted a situation that
was worked out between the City of Craig and the tribal
association there. Craig was the first community to do it, but
pretty much every community in Southeast has tribal lands within
it and a significant population of the community are members of
those tribes. What has she seen in that arena?
3:47:23 PM
ATTORNEY GENERAL LINDEMUTH responded that issues needs to be
addressed and is one of those things that local government can
address in its objection. She actually participated in a panel
before the Municipal League in the fall and one of the things
she recommended then that is consistent with what the Department
of Interior is recommending is that tribes should approach local
governments in the state before they actually file an
application and talk through their concerns. And if a local
government hears of a potential application, it should contact
the Indian tribe before it is noticed and under a 30-day
deadline. When a parcel is slated to be taken off the tax rolls
there can be a payment in lieu of taxes beforehand to the local
government. The benefit to the tribe is that the municipal
government doesn't file an objection on that lost revenue basis,
since the payment in lieu of taxes addresses the heart of the
potential objection.
In Craig, that particular parcel wasn't on the tax rolls and the
City of Craig didn't raise it as a concern. They filed an
objection, but it was overruled by the Department of Interior,
because it didn't have a legal basis. It's just that they wanted
more time to figure out how this would impact them.
3:49:05 PM
SENATOR STEDMAN recalled his conversation the Craig
administrator about the parcel not being on the tax rolls, but
Craig had helped a tribal association make a local policy.
Because it would be tough for the tribe to pay taxes on a large
tract of land in the middle of town, and the community didn't
want them to lose it, so they worked with the tribe. All of
these instances are going to be different in each community, but
that is the biggest concern he has heard from all of his
communities on this particular issue.
CHAIR GIESSEL said lots of folks were very concerned the state
did not contest this case and the reason it comes to mind is
because the AG just described talking with the different
departments and the governor about whether to go forward in
contesting the Akiachak ruling. Her question is as the attorney
general for the State of Alaska who she is serving: the governor
or the people of Alaska?
ATTORNEY GENERAL LINDEMUTH replied that her answer is "both,"
and it is certainly the people of Alaska at the end of the day,
but the highest elected official for the people of Alaska is the
governor. Between the two of them they discuss policy, which is
what an elected official should do on a day-to-day basis. For
some cases, like rate cases, she represents the people of Alaska
by statute, and the governor isn't involved at all. She
explained how she represents different interests by assigning
assistants to work with then.
CHAIR GIESSEL pointed out that there are differences between an
appointed attorney general and an elected one.
3:54:23 PM
ATTORNEY GENERAL LINDEMUTH said she brought the comments filed
for the Village of Craig application and a two-page overview of
lands into trust, the document she is using with their client
departments and folks to solicit comments on any impact on any
particular application. She thought it would be useful for the
committee to see, both for purposes of a quick legal analysis of
what lands into trust is and the procedure the state is using to
make sure of full input on any comment given on any particular
application.
3:55:38 PM
She said part of her charge with the governor and the lieutenant
governor was to do outreach to citizens of Alaska, to understand
concerns, to help inform any comments, but also to educate
folks. She has met with the Municipal League, presented to the
Mining Association and the Alaska Federation of Natives (AFN),
and will present to the Resource Development Council (RDC) later
in the year on this and other federal issues that are being
faced right now. Lands into trust is a controversial issue even
for tribes and she didn't see a huge number of them running out
to do it.
ATTORNEY GENERAL LINDEMUTH said her take on this stems from the
many court decisions over the need for tribes to have
jurisdiction over certain matters, like child protection and
civil diversion agreements that would actually need a land base.
As attorney general, she wants to talk with tribes about how to
be a more proactive player in public safety in their communities
by having civil remedies for low level misdemeanor crimes.
3:59:02 PM
CHAIR GIESSEL said lands into trust brings up another issue, the
state's loss of access to resources through RS2477s and the
Klutina Road, and she wanted an update on it.
ATTORNEY GENERAL LINDEMUTH replied there has been some
misinformation and fear over the fact that the state is in
settlement discussions, but there is currently no settlement
with Ahtna on those issues. To put this in context, on February
15, Mr. Sullivan covered the Chicken/Ahtna, an RS2477 case
against the federal government that the state had chosen to
litigate. Ahtna initiated the claim nine years ago saying the
state couldn't access a 24-mile road between Copper Center and
the Klutina Road. They are almost $700,000 into that case and
were looking at going to trial at the end of April.
Often what happens as the trial approaches, parties ask
themselves the risks and benefits of going to trial and that
often leads to settlement talks that work for both parties.
That's what happened. At the end of January they had a full day
with a professional mediator and even though it actually went
until 10 p.m., it still wasn't worked out. So the parties spent
the next two weeks in discussions and came up against the court
deadline for the case. She decided to not release the court date
without a framework of decisions points for getting to a
settlement. That was reached last week, which is when they
jointly asked the court to take it off of the calendar. The
parties have given themselves 90 days to work through the issues
and to get to a settlement document. If they don't get to a
settlement the issues still need to be litigated so she can't
say much about it.
ATTORNEY GENERAL LINDEMUTH said two years ago they lost an
important summary judgement motion addressing scope of use.
Ahtna had challenged the existence of the RS2477, but it also
said even if the state has one, it can't be used for anything
but to drive down the road from point A to point B. So, the
secondary issue is what you can do on an RS2477. Judge Guidi's
order is still standing on that case, and if this were to go
through a six week trial they would still be facing an appeal to
the Alaska Supreme Court.
4:03:55 PM
One of the things they talk about in deciding whether to look at
a settlement is if it is the best vehicle to challenge a
particular issue. So, if the state loses this case in front of
the Alaska Supreme Court, it means that it has lost the ability
to access all RS2477s for fishing, hunting, parking, and
everything else, and she wants to preserve the most access and
the most important rights that she can in a possible compromise.
4:04:46 PM
ATTORNEY GENERAL LINDEMUTH said this particular litigation
involves the Department of Natural Resources (DNR), the
Department of Transportation and Public Facilities (DOTPF), the
Alaska Department of Fish and Game (ADF&G), and the Department
of Law (DOL). So, it is complicated to get client buy-in. She
would be happy to talk through the settlement with the committee
if it actually happens.
4:06:09 PM
CHAIR GIESSEL said the concern is that once the settlement is
reached it is too late for public comment, and they are the ones
who will lose access to these resources.
ATTORNEY GENERAL LINDEMUTH said she didn't know that it should
be framed as losing access until folks see the final settlement.
The required public notices and associated comments will be
followed through the settlement process. She promised to comply
with statutory and constitutional law on these issues.
4:07:30 PM
KENT SULLIVAN, Assistant Attorney General, Natural Resources
Section, Department of Law, Juneau, Alaska, said an important
concern at the time of statehood was whether Alaska would
possess the land and resources necessary to avoid becoming a
ward of the federal government. Consequently, the state gave a
high priority to ensuring that it received what it was legally
entitled to from the federal government pursuant to provisions
in the Alaska Statehood Act, the Alaska Constitution, the
negotiated and bargained for process resulting in statehood, and
the Alaska National Interest Lands Conservation Act (ANILCA).
However, despite its promises, the federal government still owns
over 229 million acres of land in Alaska and occupies roughly
over 60 percent of the state.
4:08:56 PM
Of concern are the on-going disputes with the federal government
involving the Arctic National Wildlife Refuge (ANWR). A high
priority for the Governor and DNR Commissioner Mack is ANWR
boundaries and what the state is entitled to select that is not
part of ANWR. This is what the Commissioner and the Attorney
General addressed as recently as last week in Washington, D.C.
The state is seeking to ensure that it is allowed to select
lands that it is legally entitled to from statehood. The problem
is that the state has determined that the boundary of ANWR is
defined by the ordinary high water mark of the Canning River.
There is no dispute on what creates the legal boundary of ANWR;
both the feds and the state agree that it's a PLO that
originally withdrew the area prior to it becoming a refuge that
basically said it's the western bank of the Canning River. The
dispute is over where that is exactly. The state is confident
about where that line should be drawn, but due to a federal
surveying discrepancy, the federal government defines it as
being part of the Staines River, another tributary entirely that
is actually located many miles to the west and over tundra.
SENATOR VON IMHOF said she is very familiar with that area,
because she has flown it in a super cub and it is a couple
hundred miles.
4:12:04 PM
MR. SULLIVAN presented a map showing the disputed ANWR
boundaries that occupied about 20,000 acres. The Staines River
doesn't have a discernible river channel and the federal
government claims that it is actually part of the Canning River
and therefore, they are using the boundary of the Staines River,
but it is a much shorter body of water that dries up into
virtually nothing. So, in order to make the federal proposal
work, that boundary must go across open tundra for many miles,
which is difficult to do under the PLO definition of going along
a bank of a river.
He said the state is arguing that any competent surveyor should
have been able to determine that boundary easily on the ground
in the 1960s and has filed two cases before the Interior Board
of Land Appeals (IBLA) that are ongoing. The state is arguing
that the area in yellow is outside the boundaries of ANWR, and
therefore the state ought to be able to select those lands as
part of the Statehood land selection process. Once the lands are
in the state's hands, it can do what it sees fit with them.
Hopefully, the issues will be resolved in the not too distant
future.
4:14:55 PM
CHAIR GIESSEL asked if he knew where the single well was drilled
in the 1002 area.
MR. SULLIVAN said he didn't know exactly.
4:15:32 PM
MR. SULLIVAN said the state is addressing one more issue with
regard to ANWR and that is the 1002 area. Section 1002 of ANILCA
set aside the Coastal Plain of ANWR for further investigation of
its oil and gas potential. Back in the mid-1980s the Department
of Interior and others investigated the potential of that area,
but ANILCA provides that oil and gas production can't occur
until approved by an Act of Congress. Based on the
investigations that occurred, the Department of Interior
recommended that the 1002 area be opened to production, but up
to now, Congress has failed to pass a bill implementing those
recommendations. So, Senators Murkowski and Sullivan introduced
SB 49, the Oil and Gas Production Act, on January 5, 2017 that
would allow exploration and production in a portion of the 1002
area, and the administration continues to be very supportive of
those efforts.
4:17:12 PM
SENATOR HUGHES said she hoped that topic came up in their
meeting with the President today.
MR. SULLIVAN said he would follow up on that as everyone is
anxious about it.
4:17:37 PM
ATTORNEY GENERAL LINDEMUTH said she also was in Washington,
D.C., last week for a different reason and met with the
congressional delegation. She gave each of them the same federal
issues list that they have and encouraged them to watch the
hearings on them, because they frame the discussion on many
other important points that the Walker administration is pushing
with the Trump administration. One of them is the Waters of the
U.S. order that is being reconsidered. Another is the Endangered
Species Act (ESA) cases as follows:
1. The Polar bear critical habitat case was filed in 2013. Polar
bears were a designated an endangered species and their habitat
covers 187,000 acres on the North Slope. It's the state's
position that that is far too big of a designation and isn't
supported by science. That was challenged in Ninth Circuit and
the state lost. Working with Arctic Slope Regional Corporation
(ASRC) and the other Native Corporations and tribes involved in
that litigation they filed a petition for certiorari to the
Supreme Court and that is pending. She thinks the Trump
administration is trying to decide what position they are going
to take on appeal.
4:20:26 PM
2. The critical habitat case of Alabama v. National Marine
Fisheries Service (NMFS): In that case Alaska joined Alabama and
18 other states in filing a lawsuit challenging the new rule
that defined critical habitat under the ESA. As with the Polar
bear designation, it was a huge designation in Alaska. Then the
federal government changed the definition of critical habitat
that would grant them greater power to designate even more area
as critical habitat. That is something many other states didn't
take kindly to. It is a multi-state direct action effort in
which Alaska is a plaintiff.
One of the main things achieved by filing in Alabama is that the
Ninth Circuit won't review any particular decision that comes
out of the District Court Case; it will be the Eleventh Circuit.
That case has been stayed by an agreement of the parties to
allow the new administration to get up to speed. She is hopeful
for a similar result to the Waters of the U.S. ruling last week.
4:23:02 PM
3. The last two cases are similar: the bearded seal case and the
ringed seal case. In 2012 the NMFS listed the Beringia distinct
population segment of the bearded seals as threatened. They also
listed four subspecies of the ringed seal as threatened or
endangered. The state is working with the Alaska Oil and Gas
Association and the North Slope Borough and has filed complaints
on both issues. In both cases, the state won at the district
court level. The bearded seal case was overturned at the Ninth
Circuit and the petition for rehearing was filed on January 9.
The ringed seal case is still at the briefing stage before the
Ninth Circuit, but she doesn't hold out much hope given what
happened with the bearded seal case.
4:24:20 PM
The problem with both cases, as the state sees it, is that
neither of them is a threatened population today. What the
federal government is trying to do is use the ESA as a tool to
address climate change, but it is not designed to address that
issue. Federal scientists did climate model projections going
out 100 years of what will happen to these populations. That is
not good science. Nobody would have gotten populations right
predicting today's numbers 100 years ago, and they are hopeful
that the new administration will see more eye-to-eye with Alaska
on this issue.
ATTORNEY GENERAL LINDEMUTH offered to address any other concerns
the committee has.
4:26:31 PM
CHAIR GIESSEL adjourned the Senate Resources Committee meeting
at 4:26 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Agenda 3-8-17.pdf |
SRES 3/8/2017 3:30:00 PM |
|
| 1. Federal Issues as of January 23 2017.pdf |
SRES 3/8/2017 3:30:00 PM |
Fed Overreach |
| 2. FederalLawLitigationReport2017 012317.pdf |
SRES 3/8/2017 3:30:00 PM |
Federal Issues |
| 3. Klutina Road-Partial Court Summary - 5 - 11 - 16.pdf |
SRES 3/8/2017 3:30:00 PM |
Land Issues |
| 4. AK Superior Court Summary RE Right of Way- 1 - 17 - 12.pdf |
SRES 3/8/2017 3:30:00 PM |
Land Issues |
| 5. Vacate Order on Klutina Road- 2 - 24 - 17.pdf |
SRES 3/8/2017 3:30:00 PM |
Land Issues |
| 6. State of Alaska comments on Craig Tribal Association Trust.pdf |
SRES 3/8/2017 3:30:00 PM |
Federal Lands |
| 7. Overview of Trust Lands in Alaska.pdf |
SRES 3/8/2017 3:30:00 PM |
Federal Lands |