SENATE RESOURCES COMMITTEE March 23, 1994 3:37 P.M. MEMBERS PRESENT Senator Mike Miller, Chairman Senator Loren Leman, Vice Chairman Senator Steve Frank Senator Drue Pearce Senator Dave Donley MEMBERS ABSENT Senator Al Adams Senator Fred Zharoff COMMITTEE CALENDAR SENATE BILL NO. 293 "An Act relating to the authority of the commissioner of natural resources to reconvey, or relinquish an interest in, land to the United States if that land or interest being reconveyed or relinquished is identified in an amended application for a land allotment under federal law." SENATE BILL NO. 311 "An Act authorizing a credit against the fishery resource landing tax for certain contributions made by taxpayers not harvesting fisheries resources under a community development quota and for contributions based on fishery resources not harvested under a quota made by taxpayers harvesting fisheries resources under a community development quota, amending the manner of calculating the amount available for revenue sharing by operation of this credit, and expediting agency review of the credit applications under that tax; and providing for an effective date." SENATE BILL NO. 277 "An Act relating to the confidentiality of certain records relating to fish and wildlife; and providing for an effective date." PREVIOUS ACTION SB 293 - No previous action to record. SB 311 - No previous action to record. SB 277 - No previous action to record. WITNESS REGISTER Perry Ahsogeak Realty Director Tanana Chief's Conference 122 1st Ave., #303 Fairbanks, Ak. 99701 POSITION STATEMENT: Supported SB 293. Tom Hawkins, Sr. Vice President Bristol Bay Native Corporation P.O. Box 100220 Anchorage, Ak. 99510 POSITION STATEMENT: Supported SB 293. Diane Stevens, Realty Officer Arctic Slope Native Corporation, Ltd. P.O. Box 1232 Barrow, Ak. 99723 POSITION STATEMENT: Supported SB 293. Carl Meyer, Chief of Appeals Excise and Audit Division Department of Revenue P.O. Box 110420 Juneau, Ak. 99811-0420 POSITION STATEMENT: Opposed SB 311. Johne Binkley 5325 Chena Small Tracts Fairbanks, Ak. 99708 POSITION STATEMENT: Supported SB 311. Harvey Samuelson Dillingham, Ak. POSITION STATEMENT: Supported SB 311. Dewey Schwalenberg, Executive Director Bering Sea Commercial Fisheries Development Foundation 1577 C St., Ste 310 Anchorage, Ak. 99501 POSITION STATEMENT: Supported SB 311. Wayne Regelin, Deputy Director Division of Wildlife Conservation Department of Fish and Game P.O. Box 25526 Juneau, Ak. 99802-5526 POSITION STATEMENT: Supported SB 293. Gordon Haber P.O. Box 64 Denali Park, Ak. 99755 POSITION STATEMENT: Opposed SB 277. ACTION NARRATIVE TAPE 94-26, SIDE A Number 001 CHAIRMAN MILLER called the Resources Committee meeting to order at 3:37 p.m. and announced SB 293 (NATIVE ALLOTMENTS ON STATE LAND) to to be up for consideration. SENATOR JACKO, sponsor, said this bill would resolve one of the conflicts in Wood-Tikchik State Park. He explained there were no provisions in statute for transferring land owned by native allottees within a state park or any other designated state land area and that's what this bill does. SENATOR LEMAN asked why people would want to get rid of parcels that are on state land. SENATOR JACKO answered that the state is concerned that the people who have the 80 acre parcels will subdivide the land and build lodges. He explained that the native allotment requirements don't require that the land has to be used at the time you filed the claim. RON SWANSON, Director, Division of Lands, said he strongly supports this bill. He said the difference between this bill and other bills is that it allows any native allotment anywhere on state land to relocate. The other three bills only allow native allotments located within state parks to relocate to other state land. SB 293 has a much wider public appeal. SENATOR JACKO noted that in this bill the Commissioner has the authority to make the transfer and in SB 339 the Director has the authority. SENATOR MILLER asked how many people would take advantage of this legislation. SENATOR JACKO said of the 159 allotments identified statewide, 104 of them are in Wood-Tikchik State Park. MR. SWANSON said this bill does cover all native allotments on all state land. He said the vast majority of the applicants would be in Wood- Tikchik State Park, Denali State Park, and the Haines Bald Eagle Preserve. SENATOR FRANK asked if there was a use conflict also. MR. SWANSON answered that native allotments were different than other inholdings, because the use and occupancies establish the original date. The application could have come in as late as 1971 which isn't important. Under his proposal the applicant, the DNR, and the BLM would all have to agree. SENATOR FRANK asked what if the allottee wants to stay within the state park unit. MR. SWANSON explained that it would go through the adjudication process. BLM would have to determine if it was a valid claim. They would then request the DNR to reconvey the land to BLM; they would make a best interest finding and if the answer is no, the only resort is for the federal government Department of Justice to sue the state to reclaim title to the land. This does happen quite often and takes a long time, he said. PERRY AHSOGEAK, Realty Director for the Tanana Chiefs Conference, read a statement in support of SB 293. TOM HAWKINS, Sr. Vice President, Bristol Bay Native Corporation, said SB 293 is a useful tool for state land managers. He supported it strongly. Number 300 DIANE STEVENS, Realty Officer, Arctic Slope Native Association, Ltd., supported SB 293. SENATOR LEMAN moved to pass SB 293 from Committee with individual recommendations. There were no objections and it was so ordered. Number 370 SENATOR MILLER announced SB 311 (CREDIT TO FISHERY RESOURCE LANDING NG TAX) to be up for consideration. SENATOR JACKO, sponsor, explained last year a 3.3% landing tax was placed on factory trawlers operating in the waters outside of the state of Alaska. SB 311 would allow the factory trawlers to be given credit for making a contribution to nonprofit organizations in the amount of 15% of that tax. It would allow CDQ harvesters who have fish on board that are not part of their CDQ to qualify for the credit as well as the CDQ harvesters. SENATOR JACKO hoped the money would go to the Bering Sea Commercial Fisheries Development Foundation which provides valuable funding for employment training programs, educational opportunities, and other benefits in western Alaska. This tax would generate $8 - $10 million per year. SENATOR LEMAN asked how the credit worked. CARL MEYER, Department of Revenue, said the purpose of the landing tax enacted last year was to compliment the fisheries business tax and to compensate the state and local communities for the burdens the offshore trawler fleet was placing on the services the state and municipalities had to pay for. The Department, therefore, does not support, in principle, further credits against the landing tax. The credits are inconsistent with the underlying purpose of the tax and they erode the revenue available to the state and the impacted municipalities. The way the taxes are shared with the municipalities, MR. MEYER explained, has to do with where the resources are landed. They do not support the expedited review and approval process that is provided in this bill. It appears to require a public hearing process much like the process the department is involved in promulgating regulations which is somewhat costly and burdensome. MR. MEYER said the way he understands the bill is that the amount of the contribution dollar for dollar would be available as a credit which would be limited to the 13.65% of the tax. He commented that he didn't see why the public would want to be involved in the expedited review process. SENATOR FRANK asked what kind of nonprofits could qualify. SENATOR JACKO said that was in other legislation. MR. MEYER said AS 43.77.040 applies to any state nonprofit corporation. The only limitation is that nonprofits then use the contribution for a specific purpose. SENATOR MILLER asked how much each taxpayer would pay under this legislation. SENATOR JACKO said it averaged out to $400,000 a piece. SENATOR FRANK said he thought there was merit in focusing some effort in the form of tax credit on getting people trained and employed in this industry. He asked if this bill was focused enough to fit that purpose. SENATOR JACKO said he thought it was. SENATOR LEMAN asked how this would work for a taxpayer harvesting under a CDQ. MR. MEYER said that 100% of the contribution is available as a credit. The only limit is the percentage of the tax. He reiterated that the Department opposes any further credits. SENATOR FRANK said he would expect the Department to take that position, and he thought the issue was a policy call by the legislature. TAPE 94-26, SIDE B Number 580 JOHNE BINKLEY, Fairbanks, said if SB 311 passes, it would continue to put a tremendous amount of people to work in western Alaska and increase the economic benefits of our fisheries into an area that desperately needs it. He said the Foundation has been very effective in putting people to work in jobs that are compatible with their lifestyles. When the legislature passed the tax last year, it was difficult for the industry to justify continuing their voluntary tax to the Foundation, as well. They have made it clear to them that when they pay the tax to the state, they won't fund the operations of the Foundation, too. This is their economic reality. Dutch Harbor and Kodiak have a tremendous amount of economic activity in offshore industry and the bulk of the revenues would be generated from that area. He thought the intent of the bill was to spread the benefits to other impacted communities, as well. SENATOR LEMAN said there are other taxpayers in the state who give a lot of money to the treasury and they also contribute from their foundations into other community causes. He asked if these taxpayers who say they would no longer contribute to their foundation do so if the offer were a 50% credit instead of a 100% credit. MR. BINKLEY said he hadn't asked them that specifically, but he guessed they wouldn't. SENATOR FRANK asked if they are contributing to the foundation at this point and MR. BINKLEY answered they were. HARVEY SAMUELSON, Dillingham, supported Mr. Binkley's testimony. He pointed out other good things the Foundation had done for the community. He noted that a dollar circulates in a village a lot more than it does any place else. It has cut down on crime and the suicide rate and helps rehabilitate drug users. It gives the people something to look forward to. He said he had never seen a more successful program initiated in the villages. It should go further by being funded by the state. Number 350 DEWEY SCHWALENBERG, Executive Director, Bering Sea Commercial Fisheries Development Foundation, supported Mr. Binkley's testimony. He said the State Training and Employment Program was only able to provide 20% of the support funding for the 240 people under the Foundation. Number 367 SENATOR LEMAN said he thought incentive to a taxpayer to participate is warranted, but he was skeptical about 100% credit, because we don't do that for the University, APRN, and others. He said he was looking at consistency in the state tax laws and credits. MR. MEYER commented that he thought most credits were more limited. Number 280 SENATOR FRANK said he thought the real issue was sharing revenue with organizations that are accomplishing a very valuable public purpose. He said he thought they run the risk of people just not paying if we structure the credit on a 50% basis. SENATOR FRANK moved to pass SB 311. There was some discussion and SENATOR MILLER said they would hold the bill until Monday and work with the Department on the expediting issue. SENATOR PEARCE requested the Department give them a list of all the tax credits and their percentages, etc. for comparison. SENATOR MILLER announced SB 277 (FISH & WILDLIFE CONFIDENTIAL RECORDS) to be up for consideration. WAYNE REGELIN, Deputy Director, Division of Wildlife Conservation, said they routinely used radio collars and have always kept this information confidential. In 1986 they asked the Board of Fish and Game to make it confidential by regulation, because they had requests from the tourist industry for these frequencies for flight seeing. In 1990 an amendment was added to insure continued confidentiality, but they added some words that said, "The Department shall keep the information confidential when the knowledge may be detrimental to the wildlife population." The Department was sued in 1993 for refusing to release the radio frequency information to a private individual who wished to conduct research on these animals. They were required by the court to release the information, because they could not prove the information would not be detrimental to the population. Such a small number of animals are collared that it would be hard to prove. This bill removes "when the knowledge may be detrimental to the wildlife population." It also adds section (d) which would allow the Department to keep specific locations of capture sites for wildlife research or management confidential. MR. REGELIN suggested adding language allowing the release of this information if the requestor is under contract to the state to conduct research on a fish and wildlife population. MR. REGELIN added that this type of information in other states is kept confidential. Federal agencies also keep this information confidential. SENATOR LEMAN moved to adopt the CS to SB 277, Utermohle, E version. There were no objections and it was so ordered. GORDON HABER, Denali Park, said this bill would make it impossible for any valid scientific research to be conducted on radio collared animals except under ADF&G contract. The only affect this bill would have would be to suppress the kind of scientific research he is conducting as an independent scientist. He noted that his research has cost over $100,000 and it is available to everyone which is a pretty good deal for taxpayers. TAPE 94-27, SIDE A Number 001 MR. HABER said people in his area are very disturbed about the wolf control program, including the wolf trappers. They have come to him to help them out. He said some of the things ADF&G tell them are not true. For instance wolves do not run from planes, except in rare instances. He invited them to fly with him to see this. Number 198 SANDRA ARNOLD, Alaska Wildlife Alliance, opposed SB 277. She said it was introduced specifically in response to their request for public records under the Freedom of Information Act and in response to Dr. Haber's lawsuit. The future of Alaska will depend more and more on cooperative research and cooperative interaction between agencies and private entities, she said. SENATOR MILLER said he would hold the bill until Mr. Haber could send the rest of the documents he wanted them to see before taking action on the bill. SENATOR MILLER adjourned the meeting at 5:30 p.m.