Legislature(2013 - 2014)BUTROVICH 205
03/25/2014 01:30 PM Senate TRANSPORTATION
| Audio | Topic |
|---|---|
| Start | |
| SB211 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| += | SB 211 | TELECONFERENCED | |
| += | SB 94 | TELECONFERENCED | |
| += | SB 197 | TELECONFERENCED | |
| += | HJR 10 | TELECONFERENCED | |
ALASKA STATE LEGISLATURE
SENATE TRANSPORTATION COMMITTEE
March 25, 2014
1:30 p.m.
MEMBERS PRESENT
Senator Dennis Egan, Chair
Senator Fred Dyson, Vice Chair
Senator Hollis French
Senator Anna Fairclough
Senator Click Bishop
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
SENATE BILL NO. 211
"An Act providing for the Department of Transportation and
Public Facilities to hold the surface estate of certain state
land; relating to the transfer of certain state land and
materials; relating to the lease, sale, or disposal by the
Department of Transportation and Public Facilities of rights-of-
way, property interests, or improvements; relating to the grant
of certain easements over submerged state land to the federal
government; relating to the conveyance of land for right-of-way
purposes from the Alaska Railroad Corporation to the Department
of Transportation and Public Facilities; and providing for an
effective date."
- HEARD AND HELD
SPONSOR SUBSTITUTE FOR SENATE BILL NO. 94
"An Act vacating a portion of the Copper Center - Valdez right-
of-way; relating to rights-of-way acquired under former 43
U.S.C. 932 that cross land owned by a private landowner; and
relating to the use of eminent domain to realign a right-of-
way."
- SCHEDULED BUT NOT HEARD
SENATE BILL NO. 197
"An Act extending the termination date of the Department of
Transportation and Public Facilities' interim project
authorization regarding naturally occurring asbestos; and
providing for an effective date."
- SCHEDULED BUT NOT HEARD
CS FOR HOUSE JOINT RESOLUTION NO. 10(FIN)
Proposing amendments to the Constitution of the State of Alaska
creating a transportation infrastructure fund.
-SCHEDULED BUT NOT HEARD
REVIOUS COMMITTEE ACTION
BILL: SB 211
SHORT TITLE: STATE LAND AND MATERIALS
SPONSOR(s): TRANSPORTATION
03/07/14 (S) READ THE FIRST TIME - REFERRALS
03/07/14 (S) TRA
03/11/14 (S) TRA AT 1:30 PM BUTROVICH 205
03/11/14 (S) Heard & Held
03/11/14 (S) MINUTE(TRA)
03/18/14 (S) TRA AT 1:30 PM BUTROVICH 205
03/18/14 (S) -- MEETING CANCELED --
03/20/14 (S) TRA AT 1:30 PM BUTROVICH 205
03/20/14 (S) <Bill Hearing Canceled>
03/25/14 (S) TRA AT 1:30 PM BUTROVICH 205
WITNESS REGISTER
DANA OWEN
Staff to the Senate Transportation Committee
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented SB 211 to the committee.
SEAN LYNCH, Assistant Attorney General
Civil Division
Transportation Section
Department of Law (DOL)
Juneau, Alaska
POSITION STATEMENT: Answered legal issue questions related to SB
211 and explained that the Amendment would conform language in
the bill to language in CSHB 371(TRA).
JULIE SMITH, representing herself
Ester, Alaska
POSITION STATEMENT: Expressed concerns with SB 211.
KIM RICE, Deputy Commissioner
Department of Transportation and Public Facilities (DOTPF)
Anchorage, Alaska
POSITION STATEMENT: Supported SB 211 and said the reason for the
bill is to streamline the process.
JOHN BENNETT, Right-of-Way Chief
Northern Region
Department of Transportation and Public Facilities (DOTPF)
Fairbanks, Alaska
POSITION STATEMENT: Supported SB 211.
LISA WEISSLER, representing herself
Juneau, Alaska
POSITION STATEMENT: Noted some issues of concern with SB 211.
JOHN BITNEY, State Governmental Liaison
Office of the Mayor
North Slope Borough
Barrow, Alaska
POSITION STATEMENT: Expressed concern especially with section 15
of SB 211.
ED FOGELS, Deputy Commissioner
Department of Natural Resources (DNR)
Juneau, Alaska
POSITION STATEMENT: Supported SB 211.
WYN MENEFEE, Chief of Operations
Division of Mining land and water
Department of Natural Resources (DNR)
Anchorage, Alaska
POSITION STATEMENT: Answered questions relating to SB 211.
ACTION NARRATIVE
1:30:14 PM
CHAIR MIKE DUNLEAVY called the Senate Labor and Commerce
Standing Committee meeting to order at 1:30 p.m. Present at the
call to order were Senators Dyson, French, Fairclough, and Chair
Egan.
CHAIR EGAN announced that SB 94, SB 197, and perhaps HJR 10
would not be heard today.
SB 211-STATE LAND AND MATERIALS
1:30:37 PM
CHAIR EGAN announced SB 211 to be back up for consideration. He
removed his objection and invited his staff to explain the
proposed Amendment 1, labeled 28-LS1544\U.1...
DANA OWEN, staff to the Senate Transportation Committee, Alaska
State Legislature, said the Department of Transportation and
Public Facilities (DOTPF) suggested some language changes to
Section 16 of the bill. It attempts to clarify some confusion
that arose in discussing Section 16. The amendment would also
bring the bill into alignment with the House companion bill that
passed out of the House Transportation Committee recently. He
invited Sean Lynch from the Department of Law (DOL) to explain
the legal reasoning.
1:32:51 PM
SEAN LYNCH, Civil Division, Transportation Section, Department
of Law (DOL), said this amendment conforms language in SB 211 to
language in CSHB 371(TRA). The amendment clarifies public
comment that expressed concern that Section 16 could be read as
a directive to the commissioner of the Department of Natural
Resources (DNR) to issue any remaining submerged land easements
under the reciprocal easement agreement with the U.S. Forest
Service, which was not the intent of the section. This section
now clarifies that the DNR commissioner has the authority to
remove the 55-year limitations on submerged land easements.
SENATOR DYSON moved to adopt Amendment 1.
28-LS1544\U.1
Bullock
3/25/14
AMENDMENT 1
OFFERED IN THE SENATE BY SENATOR EGAN
TO: SB 211
Page 1, line 5:
Delete "grant of certain easements over submerged
state land to"
Insert "term for certain easements or rights-of-
way that are part of a reciprocal exchange with"
Page 8, lines 12 - 20:
Delete all material and insert:
"TERM OF CERTAIN EASEMENTS TO IMPLEMENT A
RECIPROCAL EXCHANGE. The easements identified on the
map numbered 92337 and dated June 15, 2005, and that
are part of the reciprocal exchange of easements or
rights-of-way and easements enacted into federal law
under 119 Stat. 1177, may have a term of years for a
period of more than 55 years if the commissioner of
natural resources determines the length of the term to
be in the best interest of the state."
SENATOR FRENCH objected for discussion purposes. He referenced a
letter sent to this committee on 3/13 by DOTPF, signed by Kim
Rice, that says Section 16 is constitutional. He questioned the
need for the change in language if Section 16 is constitutional.
1:35:08 PM
SENATOR BISHOP joined the committee.
MR. LYNCH said the concern in public testimony was that the
easements are "granted" to the U.S. Forest Service. That
sentence in the existing bill mirrored the federal law that
authorizes the reciprocal exchange of easements. The comment was
that by saying the easements are hereby granted, they are
granted without public notice and comment and that granting of
the easements would violate the Constitution. So, the provision
was rewritten to not mirror the federal provision by removing
the word "grant."
SENATOR FRENCH said your position is that it is fine as written,
but you are being even more careful now by using this amendment.
MR. LYNCH said that is correct.
SENATOR FRENCH removed his objection.
1:38:10 PM
JULIE SMITH, representing herself, Ester, Alaska, said she
addressed this letter to the Senate Transportation Committee in
the House Resources Committee. This is the third letter she has
written related to SB 211. The first raised several
constitutional questions and provided a list of practical
implementation questions related to the bill. The second letter
attempted to connect the dots of how the flow of money and
management responsibility would change as a result of SB 211. In
some ways this letter is a follow-up as further reflection
helped her recognize that a good deal of confusion related to SB
211 results from the lack of a fiscal note that details the
impacts this legislation would have on the budgets of DOTPF,
DNR, and the state general fund.
1:41:38 PM
She related that the reason she cares enough about this bill to
keep writing about it is that she has many friends and
colleagues who work at both DOTFPF and DNR in Fairbanks who have
earned her respect and gratitude.
She also appreciated DNR's role in ensuring that the complex web
of rights and responsibilities related to land use in Alaska is
protected for the benefit of all Alaskans. In its role of land
manager, DNR's mandate provides an expanded focus that looks
beyond a current project and includes a wide range of multiple
uses and environmental impacts.
She said she was concerned that SB 211 would upset the existing
balance between DOTPF and DNR in ways that would degrade the
constitutional and environmental protections currently embedded
in Alaska's land management system, especially the provisions
that would diminish DNR's management role or transfer title and
best control of material sites to DOTPF. These provisions are in
Sections 3, 5, 8, and 13.
She continued to say that well managed material sites provide a
multitude of benefits to Alaskans; material sites that are not
managed well can diminish private property values and cause
significant economic and environmental harm. This is especially
true in material sites located within rivers and flood plains.
DNR plays an important role in identifying these issues and
finding solutions that provide DOTPF with the gravel it needs to
maintain Alaska's infrastructure while also protecting Alaska's
land and resources for current and future generations.
MS. SMITH said she understands DOTPF's frustration with onerous
levels of oversight, but she is concerned that the pendulum is
swinging too far in the opposite direction. In 2009, DOTPF
acquired authority to conduct its own NEPA reviews for most of
its federally funded projects. In 2011, the Alaska Coastal
Management Program was relieving DOTPF of significant state
oversight of many material sites located in rivers and flood
plains. Now DOTPF is attempting to diminish or eliminate DNR's
management role and this is happening in the wake of significant
statutory changes in 2012 that were specifically designed to
streamline material sales in Alaska. Even with these recent
changes that reduce the role of other agencies in DOTPF's
projects, it seems that SB 211 goes too far.
MS. SMITH said she expressed her concerns in her first two
letters, but she is concerned about the bill itself. She
realized finally that one reason it is so difficult to
understand is that presentation of the bill has not included an
accounting of the fiscal changes that will result to DOTPF, DNR
and the general fund as a result.
For example Sections 3, 5 and 8 of the bill require surveys and
title transfers of the hundreds of parcels of state land
involved in airports, highways, public facilities and material
sites included in the bill. She asked what the expected price is
for obtaining these surveys and conveyances of title. Section 13
changes the fiscal management of material sales in Alaska so
that DNR would no longer charge DOTPF or its contractors for
material. "How much money are we talking about and will DOTPF
simply keep these funds in its own budget, and if so, are they
required to provide an accounting of how SB 211 shifts funding
from DNR and the general fund to DOTPF? If there is some other
fiscal impact that will result from the shift, what is it?"
AS 24.08.035 states that fiscal notes attached to bills must
include, among other things, the fiscal impact on existing
programs in line item details of those impacts. This is not
optional; it's required, she stated.
MS. SMITH said her research related to this bill helped her
glean an understanding of the fiscal impact of SB 211. But the
fiscal notes attached to the bill indicate there will be no
fiscal impact. So, she respectfully requested sending this bill
to the Legislative Finance Division for a fiscal analysis. She
also asked for an opportunity to provide comment on the bill
after that analysis therefore holding the bill in committee
until then.
SENATOR FRENCH said he read her first two letters, but not the
third.
MS. SMITH said she just read the third one now and will send it
to him.
1:46:45 PM
KIM RICE, Deputy Commissioner, Department of Transportation and
Public Facilities (DOTPF), Anchorage, Alaska, said the reason
for the bill is to streamline the disposal processes by reducing
bureaucracy in development of transportation projects. She
explained that land and resource management goes to DNR and
transportation management goes to DOTPF, but there is a great
deal of overlap, because transportation has to access lands to
develop transportation projects.
1:49:10 PM
MS. RICE said she would first explain transportation projects
and the public process. She said the DOTPF is very focused on
projects as opposed to the DNR, which is concerned with managing
massive pieces of land. When DOTPF does a project, despite
popular opinion, even on state-funded projects, they go through
the National Environmental Policy Act (NEPA) process. It is
required on every project because it's hard to miss every
possible impacted resource along the way if anything more than a
repave job is being done. They have check lists for repave jobs,
which tell them which resources they might need and what they
need to consider in getting them.
MS. RICE said they developed a flow chart showing the
differences between a federal highway project and a state-funded
project. NEPA can be done in conjunction with design for state-
funded projects, whereas highway projects are done in a more
linear fashion, which includes public notice and getting input
on which resources are impacted by the project. It does not
address what happens to get an infrastructure project in place
in order for a community to do a project.
1:51:14 PM
State Transportation Improvement Program (STIP) projects are
done first. They go through a public notice process and identify
specific funding. Then, it gets down to the environmental and
preliminary design phase. It's at this phase that they scope the
project with all the resource agencies. This is when they
determine if there are potential resource issues. It depends on
what comes back as to where they go on a project. Alternatives
could be anything from a spaghetti map of alternatives to a
single alternative that only addresses the problem as it's been
defined.
At the end of the process they publish the environmental
document, called the location approval, which shows which
corridor they are going to be on when they start to design a
project. During this time there is a bigger emphasis on talking
to the Division of Mining, Land and Water to make sure that any
applications for land use they might be going across are
included in the NEPA process. He commented that it's really too
late when you get to the end of a project to discover there is
another alternate use suggested. They then go to final design
and get local government approval.
1:54:44 PM
JOHN BENNETT, Right-of-Way Chief, Northern Region, Department of
Transportation and Public Facilities (DOTPF), said he wanted to
follow up more on their proposal to modify the disposal language
across all three of their authorities: aviation, highways, and
public facilities. He explained that they have had recurring
problems with their existing disposal language. One issue they
are trying to resolve is related to the Eureka Lodge on the
Glenn Highway. He explained that DOTPF manages a highway
easement in front of the lodge, but their authority extends only
to the vacation or release of that highway easement. DNR owns
the underlying fee estate. In this situation the adjoining owner
has encroached in the ROW by putting in sewage lagoons, so he
needs to resolve that problem because he can't operate without
them working and neither can he sell the operation.
The department decided it could vacate a small amount of land
that would solve his problem, but by vacating the easement, all
that would happen is that it would become DNR's problem, and
they couldn't solve it because it wouldn't meet the requirements
for a preference right sale. Using the modified language in SB
211 would solve his problem by virtue of the fact that Sections
1, 6, and 9 would vest fee title to the surface estate for
existing highway facilities in DOTPF; that would give them
authority to convey fee estate. Also, language in Sections 2, 4,
and 10, which relate to the disposal language would allow them
to convey title to the private party without having to re-convey
it back to DNR. This is one solution that could be used
appropriately many times.
MR. BENNETT said the other significant problem they have had
started with language in Title 35 relating to public facilities
that says when the department has acquired a piece of property
and then determines that it is no longer necessary to their
needs, they can dispose of it, but title reverts to the persons,
heirs, or successors in whom it was vested at the time of
taking. That may sound like a good idea, but what happens -
using Fort Yukon as an example where they acquired a parcel of
land to build some trooper housing. The troopers moved out, the
use changed and it was no longer necessary and the community
wanted to acquire that land. But because of this restriction,
there was no mechanism by which to convey it to the community
and the original owners were no longer anywhere to be found. So,
that kind of restriction prevents a resolution and it can create
some other unintended consequences depending on how the land was
acquired - if they acquired a strip versus a total parcel, for
instance. They don't want to end up land-locking someone. So,
they believe this modified uniform language will go a long way
to solve their problems as well as the problems of the adjoining
property owners.
1:58:22 PM
SEAN LYNCH, Assistant Attorney General, Department of Law (DOL),
said he wanted to address what they are trying to do in Section
13, an exemption to the Alaska Lands Act for DOTPF's use of
materials owned by the state. He said that with road
construction everyone has seen how you cut from the high points
and fill in the low points. If additional fill is needed you
open a material site. When DOTPF is done with the road
construction, they have an open rock face that is the material
source or site (under DNR statute). Because DOTPF's (material
sources) lands are owned by the state, DNR statute directs them
to issue materials sales contracts for use of its materials.
So, when DOTPF goes to either maintain a road or reconstruct
their roads and they need to get back into their pits, their
first step is to go into DNR under the Alaska Lands Act for a
material sales contract just as if it was another third party
developer. This provision is an exception that is located in AS
38.05.030, which contain the exemptions to the Alaska Lands Act.
DOTPF already has an exemption for its acquisitions and
disposals in subsection (b), and subsection (d) exempts DOTPF
from the material sales requirements.
2:00:22 PM
LISA WEISSLER, representing herself, Juneau, Alaska, said she is
a former state attorney and she believes SB 211 has some issues
that are worth noting. She understands what DOTPF is trying to
do and feels like the bill is written in a way that raises many
questions and that may ultimately cause issues; some are
constitutional questions that may work out or not. She said the
bill is written broadly to solve some very specific problems
identified by DOTPF and maybe there is a better way to go about
it.
One constitutional issue has to do with the disposals. The state
land that goes to DOTPF is still state land. Under current law,
when they no longer need a part of it that goes back to DNR. In
this way DNR can manage it and dispose of it as it should under
the Alaska Lands Act - and of course, the Alaska Lands Act
implements Article 8 of the Constitution. SB 211 will now change
this to where DOTPF "may" transfer the land back to DNR; but
they don't have to.
MS. WEISSLER explained that under the Lands Act, DNR has the
legislation that is needed to implement Article 8, Section 9 of
the Constitution where the Legislature may provide for the sale
or grant of state land and establish sales procedures. Now, when
DOTPF gets this land from the state, they may dispose of it
under terms and conditions established by the commissioner.
That's not a law; that's just whatever terms the commissioner
comes up with. She opined that the legislature still has the
duty to have statutes that provide for the sale of state land.
Right now, DOTPF has authority for private land, but not
necessarily the state land that has been transferred from DNR.
She highlighted multiple use as the other issue, which is also
in Article 8 of the Constitution. She said she was disturbed by
DOTPF's negative response to public comments questioning whether
material sites would be managed for public use. The response was
that they wouldn't because that land use for government purposes
is not included in the public domain. Article 8 says lands and
interests not intended exclusively for governmental purposes
constitute the public domain. The public domain is land that the
state is not using for something else that can be settled. So,
that doesn't let DOTPF out of the constitutional doctrine for
managing for multiple use.
MS. WEISSLER said the other questions she had were in the
drafting: Sections 1, 6 and 9 talk about DOTPF having primary
management authority over state lands. That sounds like DNR
still has the permitting authority, but DOTPF can condition that
permitting authority. She suggested that wording should be
clarified.
2:05:59 PM
JOHN BITNEY, State Governmental Liaison, Office of the Mayor,
North Slope Borough, Barrow, Alaska, said a letter was provided
to the committee expressing concerns relating to the various
disposals and land use process in various sections, especially
Section 15. He said the properties that are in that section are
being transferred from DNR to DOTPF and have been the subject of
municipal entitlement selections for approximately two decades.
As they have had a good working relationship, it was a surprise
that it showed up in the bill. Some aerial photographs seemed to
encompass all the property at those locations and it seems to
overlap with the selections they have made. The letter does
request removal of the section. He offered to answered
questions.
2:07:56 PM
CHAIR EGAN asked if he was referring to Franklin Bluffs and
Happy Valley.
MR. BITNEY replied yes.
CHAIR EGAN thanked him and finding no further questions, closed
public testimony.
SENATOR FRENCH requested a response from DOTPF regarding Section
15.
2:08:36 PM
MR. BENNET said they had applications in on Franklin Bluffs and
Happy Valley for the last 20 years. These are very important
sites to be retrained in state ownership and public use in
anticipation of increased resource development and increased
maintenance needs along the Dalton Highway.
SENATOR FRENCH asked how big a dispute there is over the lands.
MR. BENNET answered that their overlays show an area that would
be appropriate to accommodate an airstrip and a building site
for a maintenance station. He estimated they would not be
requesting 30-50 percent of the original selected area. All of
their selections for Happy Valley and Franklin Bluffs have been
east of the Dalton Highway and there would still be remaining
selection area for the North Slope Borough.
SENATOR FAIRCLOUGH asked him to explain the process for getting
land from the feds to the state thinking in terms of the North
Anchorage Land Agreement that works in conjunction with the
state, the municipality and the Eklutna Corporation to try to
resolve land use when land disposals become available.
MR. BENNET said these are currently state owned lands. The
actual municipal entitlement process has been in process for 20
years and there are perhaps some insurmountable issues that may
require legislative action.
SENATOR FAIRCLOUGH commented that the legislature eventually
would have to make the decisions.
SENATOR BISHOP said it appeared that section 13 was also of
concern to the North Slope Borough. Mr. Bitney nodded yes.
SENATOR FAIRCLOUGH asked what process others go through to lay
claim on property in state ownership.
2:13:41 PM
ED FOGELS, Deputy Commissioner, Department of Natural Resources
(DNR), Juneau, Alaska, explained that the North Slope Borough
submitted their selections and the department is adjudicating
them. At some point they would be adjudicating those two parcels
as an administrative action if not for the bill, and it would be
up to the DNR commissioner to make the decision.
SENATOR FAIRCLOUGH asked what the fight is over and if
subsurface rights go along with the allocation.
MR. FOGELS answered no; the subsurface estate is not
transferred. The complication is that there are a lot of
existing uses on those two sites along with some fairly
significant contamination issues.
SENATOR FAIRCLOUGH asked who the contamination belongs to.
WYN MENEFEE, Chief of Operations, Division of Mining land and
water, Department of Natural Resources (DNR), said there is
contamination on part of the Happy Valley site. He said he
didn't know who is responsible for the contamination, but the
state received both areas from the federal government. The issue
is this bill says DOTPF should get the lands rather than
conveying it to the North Slope Borough as a selection going
through the normal decision process, which would consider other
uses or demands on the site including DOTPF's. The use issues
are that there is an airstrip and gravel material that is part
of the surface estate. The material is at hand because DOTPF
uses the material; they usually manage airstrips and they also
can manage the incidental other permits they have on the land
for commercial guide facilities there and some things like that.
SENATOR FAIRCLOUGH asked if the properties were surveyed and
available for conveyance, and the amount of land that has been
requested by North Slope Borough and conveyed.
MR. FOGELS answered the land has not been surveyed, but that is
not required for conveyance.
SENATOR FAIRCLOUGH asked if they believe the North Slope Borough
is only asserting a claim on this property because of the gravel
assets or some other reason, since the Borough is somewhat
surprised this is on the table and hadn't been informed that the
department was going to assert before the legislature that these
parcels were off the table.
MR. FOGELS answered that the intent of the municipal entitlement
program is to convey lands to municipalities so they can get an
economic benefit to sustain their areas and see these two
parcels as important economic generators, and the department
should have given them a courtesy phone call.
CHAIR EGAN said those are former pipeline construction camps and
he couldn't believe they weren't surveyed.
MR. BENNET answered that virtually everything was surveyed back
in the day, but their definition of the sites they would like
transferred from DNR to DOTPF would be surveyed once they had a
funded project and received the conveyance. They intend to
construct a maintenance station at Franklin Bluffs and that
would follow suit.
2:21:16 PM
SENATOR DYSON remarked that transferring land before surveying
it is a very startling concept. What at first seemed like a
simple issue has become more complicated and he thought they
were being asked to remove some barriers so development can
happen. But people were concerned about taking away a bunch of
protections at the same time. He asked if there is any public
process they could go through for transferring land from DNR to
DOTPF without adding to the perception of diminishing rights.
MR. BENNET said the environmental reviews they go through for
project development to acquire a new piece of land from DNR is
far more extensive than possibly what DNR already goes through.
In the sense of the acquisition of lands section, what is lost
now is that DNR won't go through a decision making process and
public notice that they are in fact turning the land over to
DOTPF. However, this bill adds another public notice process
that wasn't in the mix before. So, there is no net loss on the
public involvement process, which is very extensive and their
ability to convey information to the public to make sure that
they are well noticed and protected is going to be well met.
2:26:14 PM
MR. FOGELS agreed that is what the bill lays out now.
SENATOR BISHOP said Section 3 talks about that public
notification on transfer of lands from one department to the
next as a public process, but he wanted to go back to Section
13, because it's about borrow pits that he knows something
about, having once built roads for a living. He asked if this
bill drills down into ROWs for DOTPF, specifically, and these
borrow pits would fall within the ROW jurisdiction for highway
construction.
MR. LYNCH answered that borrow pits are not always located in
the ROWs, particularly the borrow pits that DOTPF utilizes.
SENATOR BISHOP said that borrow pits are usually located in
close proximity to a project and asked if this bill were to
become law, as written, no money would change hands on the
materials. Especially in the advent of a new pipeline
construction, would DNR still be in control of a new borrow pit
for a pipeline contract and to make those sales and bids?
MR. MENEFEE answered that the bill does not remove DNR's ability
to do material site designations and material sale contracts.
So, they still have the option - whether it's a pipeline project
or a private individual that wants to go out and get materials
from state land. Even when DOTPF requests the title to be
conveyed over for a material site, they still have the
capability of doing a third-party contract out of that pit even
though DOTPF has fee simple ownership of the surface estate. DNR
could still do a third-party sale as long as DOTPF concurs with
it. If they need all the material, they wouldn't do the third-
party sale. And DOTPF could say no because they may need it for
another project in the long term, but if there was excess
material they couldn't.
SENATOR FAIRCLOUGH asked how the money would be allocated if
DOTPF chooses to sell the pit. She also asked if the purpose is
to lower the cost of projects and accounting
2:32:20 PM
MR. BENNET said DOTPF doesn't have authority to sell materials
to third parties and this bill doesn't grant that authority, so
this bill won't bring money into the department. However, it
could result in savings, because less money would be transferred
to DOTPF for state-owned material that both highway funds and
airport funds will then be able to be allocated for more
projects.
SENATOR FAIRCLOUGH said she thought she just heard that third-
party sales could happen and she could see the cost savings, but
couldn't it also be said that if you have federal dollars in a
project and you don't pay for that gravel with the federal
dollars that DOTPF is losing money.
MR. BENNET answered he didn't think the state was losing money;
it would just have more money available for projects. The
question she might have over third-party sales is that DOTPF
doesn't have authority to sell to ABC Construction directly; DNR
retains that authority to sell.
SENATOR FAIRCLOUGH asked where the money goes if it's sold and
how it is accounted for.
SENATOR DYSON said that is common for owner-supplied materials
to reduce the costs.
MR. FOGELS said right now they are required to charge DOTPF 50
cents/cubic yard for gravel for state highway projects, but with
this bill they won't have to charge. So, free materials would be
going into state roads, which should lower the cost of road
projects.
CHAIR EGAN asked if that 50 cent/yard works into their budget.
MR. FOGELS answered yes; it is an administrative fee that is far
below the normal appraised fair market value they would charge
anyone else. Theoretically, some of that comes back as program
receipts to help pay for the cost of administering that program
for DOTPF, which they would no longer have to do. That is why
they have a zero fiscal note.
SENATOR DYSON voiced an ancillary concern that all the land gets
transferred to DOTPF and won't reverted to DNR, the land
steward. And DOTPF can't be forced to go through that process.
2:38:06 PM
MR. FOGELS responded that from DNR's perspective, this allows
DOTPF to be able to dispose of some sewage lagoons built on the
Glenn Highway, for instance. Right now it can only deal with
parcels that deal with highway projects.
MR. LYNCH added that creating a new pit under current law would
be a DNR authorization in the best interest of the state
finding. Under the bill, Sections 3, 5, and 8 make that a DOTPF
determination, although it has to be reasonably necessary for
the project. In large part the documents given to the DNR for
the state best interest finding would be much the same as the
reasonably necessary ones for DOTPF.
SENATOR DYSON asked at what point do the borrow pits that belong
to DOTPF revert to DNR.
MR. LYNCH answered that from the DOTPF perspective the borrow
pit would become open for public use. DNR and DOTPF would have
to make a best interest determination under the Alaska Lands Act
to put it on their list of available pits.
SENATOR DYSON clarified his question: everything is done; no one
wants gravel and there the land sits. When can title go back to
DNR?
MR. MENEFEE explained that when DOTPF says they no longer need
the land, they give notice to DNR. At that point, the
commissioner can request that it be transferred back or not.
Ultimately, DOTPF gets to decide what it wants to do per SB 211.
Giving it back is optional.
SENATOR DYSON said he could imagine some folks in the region who
have traditional use of the land would be more comfortable
having the DOTPF land reverting automatically to DNR when they
are through with it.
SENATOR FAIRCLOUGH asked how a conflicting municipal or local
land use code would be affected under the bill.
2:44:43 PM
MR. BENNET said they have authorities in place, such as in AS
35, that requires the department to comply with the local
government land use ordinances.
MR. FOGELS summarized that from DNR's perspective the bill tries
to streamline inefficiencies and duplicative bureaucracy.
2:46:28 PM
MS. RICE opined that efficiencies will result with the
improvements this bill brings.
CHAIR EGAN expressed hope that the departments could meet with
the North Slope Borough before this issue comes up next time. He
held SB 211 in committee.
2:48:09 PM
CHAIR EGAN found no further business to come before the
committee, and adjourned the Senate Transportation Standing
Committee meeting at 2:48 p.m.