00 HOUSE BILL NO. 109 01 "An Act relating to the management and disposal of state land and resources; 02 relating to certain remote parcel and homestead entry land purchase contracts and 03 patents; and providing for an effective date." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05 * Section 1. AS 09.10.120 is amended by adding a new subsection to read: 06 (b) Notwithstanding (a) of this section or any other provision of law, the state 07 may bring an action in the name of or for the benefit of the state to (1) quiet or 08 confirm the state's interests in real property, or (2) protect resources held in trust for 09 the public, at any time. 10 * Sec. 2. AS 38.04.010(b) is amended to read: 11 (b) State land that is located beyond the range of existing schools and other 12 necessary public services, or that is located where development of sources of 13 employment is improbable, may be made available for seasonal recreational purposes 14 or for low density settlement. The seasonal recreation use or low density settlement 01 shall have sufficient separation between residences so that public services will not be 02 necessary or expected. The availability of timber, firewood, and water resources shall 03 be considered in determining separation between residences. By considering the 04 availability of timber, firewood, and water under this subsection or in making any 05 disposal decision, the state does not by virtue of that consideration imply any 06 right of the person receiving the disposal to an exclusive or other right to the 07 timber, firewood, or water, that the state will not make any other disposals in the 08 area, or that any disposals made will be limited in type or any other manner. 09 * Sec. 3. AS 38.04.020(a) is amended to read: 10 (a) State [THE COMMISSIONER SHALL ESTABLISH A] land disposals 11 must include [DISPOSAL BANK CONTAINING] state land identified and classified 12 under adopted regional land use plans for disposal into private ownership. 13 * Sec. 4. AS 38.04.020(b) is amended to read: 14 (b) State [THE] land disposals may [DISPOSAL BANK DOES] not include 15 (1) land nominated for selection or selected by a municipality to satisfy 16 a general grant land entitlement under AS 29.65 or former AS 29.18.201 - 29.18.213; 17 (2) land retained in state ownership for multiple-use management; 18 (3) land where less than a fee simple title has been conveyed; 19 (4) land retained in state ownership under an enactment of the 20 legislature or by the governor or a state agency under authority of law. 21 * Sec. 5. AS 38.04.020(d) is repealed and reenacted to read: 22 (d) By January 15 of the first regular session of each legislature, the 23 commissioner shall notify the legislature that the commissioner has available a report 24 on the total acreage of land planned and classified as suitable under this title for 25 (1) settlement purposes, including homestead, commercial, or industrial 26 disposal; 27 (2) agricultural disposal; and 28 (3) grazing leases. 29 * Sec. 6. AS 38.04.020(e) is repealed and reenacted to read: 30 (e) The commissioner may annually submit to the governor an appropriation 31 request for the amount of funding estimated to be necessary to allow survey and 01 disposal of land that the commissioner proposes to be offered for (1) homestead entry 02 under AS 38.09, (2) agricultural, commercial, industrial, or other uses under 38.05.055 03 or 38.05.057, or (3) other subdivisions. The appropriation request must include the 04 general location of the land, the estimated income of the proposal, and the estimated 05 cost necessary to develop and market the land. 06 * Sec. 7. AS 38.04.020(g) is amended to read: 07 (g) The [AFTER JULY 1 OF EACH YEAR, THE] commissioner shall direct 08 the expenditure of money appropriated for the disposal of land in response to requests 09 made under (e) [AND (f)] of this section for the following: 10 (1) land [LAND] designated as suitable for homestead disposal shall 11 be [CLASSIFIED AND] surveyed under this chapter and AS 38.05 and made available 12 for entry [STAKING AND LEASE] under AS 38.09; [.] 13 (2) land [LAND] designated as suitable for subdivision and homesite 14 disposal shall be surveyed, subdivided, [CLASSIFIED,] and disposed of under this 15 chapter, AS 38.05, and AS 38.08; [.] 16 (3) land [LAND] designated agricultural, commercial, industrial, or 17 suitable for other disposal shall be sold under AS 38.05.055 or 38.05.057. 18 * Sec. 8. AS 38.04.020(h) is amended to read: 19 (h) Individual parcels disposed of in subdivisions intended for private 20 residential or recreational use may not exceed five acres unless the commissioner 21 determines that a larger size is necessary to comply with municipal ordinances; [,] to 22 permit the design of a viable subdivision because of topographical features, soil 23 conditions, on-site sewage disposal requirements, or water drainage or supply 24 considerations that are unique to the subdivision; to increase the return to the state 25 from the sale of the parcels; [,] to minimize adverse effect on wildlife, fishery, public 26 recreation, timber, or other significant resources in the area; [,] or to minimize adverse 27 effect on other residential uses in the area. 28 * Sec. 9. AS 38.04.020(i) is amended to read: 29 (i) Nothing in this section prevents the disposal of other land by the 30 commissioner in accordance with AS 38.05.055, 38.05.057, 38.05.070, the issuance of 31 remote recreational cabin site leases or sales [PERMITS] under AS 38.05.600 01 [AS 38.05.079], AS 38.08, AS 38.09, or other law. 02 * Sec. 10. AS 38.04.021(a) is amended to read: 03 (a) A municipality may apply for financial assistance for the execution of a 04 land disposal program of general grant land entitlements received from the state under 05 AS 29.65 or former AS 29.18.201 - 29.18.213 by submitting a request to the 06 commissioner for inclusion in the request submitted to the governor [LEGISLATURE] 07 under AS 38.04.020(e). A municipality may request financial assistance for expenses 08 of surveying land, designing subdivision plats, installing improvements required by 09 municipal ordinance or regulation of the local platting authority, and other reasonable 10 direct costs of land disposal. 11 * Sec. 11. AS 38.04.021(b) is amended to read: 12 (b) A request by a municipality under this section must be accompanied by 13 (1) a schedule for the disposal of municipal land for the next five years; 14 the schedule shall be based on an assessment of the demand for private land within the 15 municipality [AND INCLUDED IN THE ASSESSMENT SUBMITTED UNDER 16 AS 38.04.020(f)]; 17 (2) an estimate of the number of acres of municipal land that the 18 municipality plans to dispose of during each fiscal year of the five-year period; 19 (3) a description of the methods to be used for the disposal of 20 municipal land and the terms under which it will be offered to the public; and 21 (4) a description of the municipal land that the municipality plans to 22 dispose of each fiscal year during the five-year period. 23 * Sec. 12. AS 38.04.030 is amended to read: 24 Sec. 38.04.030. Land availability programs. Programs that may be used by 25 the director to make the state's land surface available for private use under 26 AS 38.04.020 - 38.04.055 include sale of whole or partial rights to the fee simple 27 estate, including conveyance of agricultural use rights; leasing; [OPEN-TO-ENTRY;] 28 homesiting; homesteading; permitting for construction and occupation of cabins in 29 isolated locations on land retained in state ownership; and other methods as provided 30 by regulation or other law. Notwithstanding a contrary provision of this title, a 31 land availability program adopted by regulation must provide for competitive 01 disposal, based on no less than fair market value, to serve the best interests of the 02 state. 03 * Sec. 13. AS 38.04.035 is amended to read: 04 Sec. 38.04.035. Criteria for program selection. In determining which land 05 availability program is appropriate for state land in different locations, the director 06 shall be guided by the following criteria: 07 (1) to cover public costs associated with private land use and to provide 08 the public with a fair return for publicly owned property, conveyance of state land to 09 private parties shall [SHOULD] be at fair market value except where otherwise 10 authorized by statute, or by an administrative regulation the adoption of which is 11 specifically permitted by statute; 12 (2) sale or lease programs should be used where land is readily 13 accessible to a major community center or where, because of a prime location on 14 waterfront or a transportation route or some other location characteristic, land has 15 relatively high real estate value; 16 (3) sale programs are preferred but lease programs may [SHOULD] be 17 used 18 (A) where special land use controls are required and there is a 19 high public interest in having certain types of land used for particular purposes; 20 (B) when the intended use is a temporary one; 21 (C) in commercial or industrial situations when a leasehold can 22 provide cash flow advantages to the lessee; 23 (D) when a unique location with special public values is 24 involved, as in a deep water port, hydroelectric site, or aquaculture facility; 25 (E) where current demand for private use is high, but 26 projections suggest that, in the future, the land may be more valuable for public 27 use, as in accessible waterfront recreation areas; 28 (4) [FOR ENABLING ISOLATED CABIN DEVELOPMENT IN 29 REMOTE LOCATIONS WHERE SURVEY AND CONVEYANCE IS 30 IMPRACTICAL, OR WHERE DISPOSAL OF LAND WOULD CAUSE POTENTIAL 31 CONFLICTS WITH OTHER RESOURCES AND USES, OR WHERE A LONG- 01 RANGE INTEREST IN PUBLIC OWNERSHIP AND USE EXIST, A SYSTEM FOR CABIN 02 PERMITS ON PUBLIC LAND MAY BE USED; 03 (5)] limited or conditional title may be granted when the state's best 04 interest so dictates; among other things, title limitations may include grants of 05 agricultural interest only, retention of development rights, and retention of scenic or 06 other easements; a conditional title may be tied to a development schedule or other 07 standards of performance. 08 * Sec. 14. AS 38.04.045(b) is amended to read: 09 (b) Before the issuance of a long-term lease under AS 38.05.070 or of a patent 10 for state land, an official cadastral survey shall be accomplished, unless a comparable, 11 approved survey exists that has been conducted by the federal Bureau of Land 12 Management. Before land may be offered under AS 38.08 or AS 38.09, or before land 13 may be offered under AS 38.05.055 or 38.05.057, except land that is classified for 14 agricultural uses, an official rectangular survey grid shall be established. The 15 rectangular survey section corner positions shall be monumented and shown on a 16 cadastral survey plat approved by the state. For those areas where the state may wish 17 to convey surface estate outside of an official rectangular survey grid, the 18 commissioner may waive monumentation of individual section corner positions and 19 substitute an official control survey with control points being monumented and shown 20 on control survey plats approved by the state. The commissioner may not issue more 21 than one conveyance for each section within a township outside of an official 22 rectangular survey grid. Land to be conveyed may not be located more than two miles 23 from an official survey control monument except that the commissioner may waive this 24 requirement on a determination that a single purpose use does not justify the 25 requirement if the existing status of the land is known with reasonable certainty. The 26 lots and tracts in state subdivisions shall be monumented and the cadastral survey and 27 plats for the subdivision shall be approved by the state. Where land is located within 28 a municipality with planning, platting, and zoning powers, plats for state subdivisions 29 shall comply with local ordinances and regulations in the same manner and to the same 30 extent as plats for subdivisions by other landowners. State subdivisions shall be filed 31 and recorded in the district recorder's office. The requirements of this section do not 01 apply to land made available [THROUGH A CABIN PERMIT SYSTEM,] for material 02 sales, for short-term leases, or for parcels adjoining a surveyed right-of-way [, OR 03 FOR LAND THAT HAS BEEN OPEN TO RANDOM STAKING UNDER THE 04 REMOTE PARCEL PROGRAM OR HOMESTEAD PROGRAM IN THE PAST]; 05 however, for short-term leases, the lessee shall comply with local subdivision 06 ordinances unless waived by the municipality under procedures specified by ordinance. 07 In this subsection, "a single purpose use" includes a communication site, an aid to 08 navigation, and a park site. 09 * Sec. 15. AS 38.05.050 is amended to read: 10 Sec. 38.05.050. Disposal of land for private ownership. The commissioner 11 shall determine the land to be disposed of for private use. The commissioner shall 12 determine the time and place of disposal. An auction sale, a lottery sale, or a disposal 13 of land for homesites may [SHALL] be held in a community that is near the land to 14 be sold or disposed of. 15 * Sec. 16. AS 38.05.055 is amended to read: 16 Sec. 38.05.055. Auction sale procedures. Unless another method of sale is 17 required under this chapter, [AS 38.07, OR] AS 38.08, or AS 38.09, the sale of state 18 land shall be made at public auction to the highest qualified bidder as determined by 19 the director. The director may accept bids and sell state land under this section at no 20 less than 70 percent of the appraised fair market value of the land. To qualify to 21 participate under this section in a public auction of state land that is other than 22 commercial, industrial, or agricultural land, a bidder shall have been a resident of the 23 state for at least one year immediately preceding the date of the auction and submit 24 proof of that fact, as the commissioner requires by regulation. [A BIDDER MUST 25 APPEAR IN PERSON AT THE AUCTION UNLESS MEDICAL REASONS, 26 ATTENDANCE AT SCHOOL, OR MILITARY SERVICE OUTSIDE THE STATE 27 PREVENT ATTENDANCE.] A bidder may be represented by an attorney or agent 28 at the auction [IF THE LAND OFFERED FOR DISPOSAL IS COMMERCIAL, 29 INDUSTRIAL, OR AGRICULTURAL LAND]. An aggrieved bidder may appeal to 30 the commissioner within five days after the sale for a review of the director's 31 determination. The sale shall be conducted by the director, and, at the time of sale, 01 the successful bidder shall deposit an amount equal to five percent of the purchase 02 price. The director shall immediately issue a receipt containing a description of the 03 land or property purchased, the price bid, and the amount deposited. The receipt shall 04 be acknowledged in writing by the bidder. 05 * Sec. 17. AS 38.05.057(a) is amended to read: 06 (a) The commissioner may dispose of land, including land limited to use for 07 agricultural purposes, by lottery. The purchase price of land sold by lottery shall be 08 the fair market value of the land as determined by the commissioner. The 09 commissioner may sell land by lottery for less than the fair market value of the land 10 on a determination that scarcity of land for private use in the area of the land to be 11 sold has resulted in unrealistic land values. [THE COMMISSIONER SHALL 12 CONSULT WITH THE ASSESSOR OF A MUNICIPALITY BEFORE 13 DETERMINING THE PURCHASE PRICE FOR LAND THAT IS LOCATED IN 14 THE MUNICIPALITY AND THAT IS TO BE SOLD UNDER THIS SECTION.] The 15 lottery shall be conducted in public by the commissioner. A [AN APPLICANT MAY 16 NOT BE SELECTED TO PURCHASE LAND UNLESS THE APPLICANT IS 17 PRESENT ON THE DATE AND AT THE PLACE THAT THE LOTTERY IS 18 CONDUCTED UNLESS MEDICAL REASONS, ATTENDANCE AT SCHOOL, OR 19 MILITARY SERVICE OUTSIDE THE STATE PREVENT ATTENDANCE. AN 20 APPLICANT MAY BE REPRESENTED BY AN AGENT ON THE DAY OF THE 21 LOTTERY IF THE LAND OFFERED FOR SALE IS COMMERCIAL, 22 INDUSTRIAL, OR AGRICULTURAL LAND. ON THE DAY OF THE LOTTERY 23 A] purchaser selected by lot shall deposit an amount equal to five percent of the 24 purchase price within 30 days after receiving notification of the selection. 25 * Sec. 18. AS 38.05.065(a) is amended to read: 26 (a) The contract of sale for land sold at public auction under AS 38.05.055 27 shall require the remainder of the purchase price to be paid in monthly, quarterly, or 28 annual installments over a period of not more than 20 years, with interest at the 29 [PREVAILING] rate provided in (i) of this section [FOR REAL ESTATE 30 MORTGAGE LOANS MADE BY THE FEDERAL LAND BANK FOR THE FARM 31 CREDIT DISTRICT FOR ALASKA AT THE TIME THE CONTRACT IS SIGNED]. 01 Installment payments plus interest shall be set on the level-payment basis. 02 * Sec. 19. AS 38.05.065(b) is amended to read: 03 (b) The contract of sale for land sold under AS 38.05.057 or under former 04 AS 38.05.078 shall require the remainder of the purchase price to be paid in monthly, 05 quarterly, or annual installments over a period of not more than 20 years. Installment 06 payments plus interest shall be set on the level-payment basis. The interest rate to be 07 charged on installment payments is the [PREVAILING] rate provided in (i) of this 08 section [FOR REAL ESTATE MORTGAGE LOANS MADE BY THE FEDERAL 09 LAND BANK FOR THE FARM CREDIT DISTRICT FOR ALASKA AT THE TIME 10 THE CONTRACT IS SIGNED]. 11 * Sec. 20. AS 38.05.065 is amended by adding a new subsection to read: 12 (i) The interest rate for contracts under this section is the prime rate as 13 reported in the Wall Street Journal on the first business day of the month in which the 14 contract is sent to the purchaser for signature, plus four percent; however, the total rate 15 of interest may not exceed 16 (1) 9.5 percent, in contracts for the sale of land classified under 17 AS 38.05.020(b)(6) for agricultural uses; or 18 (2) 13.5 percent, in other contracts for the sale of land. 19 * Sec. 21. AS 38.05.067(d) is amended to read: 20 (d) This section does not apply to the sale of state land under AS 38.05.057, 21 AS 38.08, or [AS 38.04.020(g)(2) AND] AS 38.09. 22 * Sec. 22. AS 38.05.069(e)(2) is repealed and reenacted to read: 23 (2) "adjacent" means that a tract of land has one common boundary 24 point with presently held land or is separated from the presently held land only by a 25 physical barrier such as a road or stream. 26 * Sec. 23. AS 38.05.075(a) is amended to read: 27 (a) Except as provided in AS 38.05.035, 38.05.070, 38.05.073, [38.05.079,] 28 38.05.082, 38.05.083, 38.05.087, 38.05.102, 38.05.600, 38.05.810, and this section, 29 leasing shall be made at public auction to the highest qualified bidder as determined 30 by the commissioner. In the public notice of a lease to be offered at public auction, 31 the commissioner shall specify a minimum acceptable bid and the lease compensation 01 method. The lease compensation method shall be designed to maximize the return on 02 the lease to the state and shall be a form of compensation set out in AS 38.05.073(m). 03 An aggrieved bidder may appeal to the commissioner within five days for a review of 04 the determination. The leasing shall be conducted by the commissioner and the 05 successful bidder shall deposit at the auction the first year's rental or other lease 06 compensation as specified by the commissioner, or that portion of it that the 07 commissioner requires in accordance with the bid. The commissioner shall require, 08 under AS 38.05.860, qualified bidders to deposit a sum equal to any survey or 09 appraisal costs reasonably incurred by another qualified bidder acting in accordance 10 with the regulations of the commissioner or incurred by the department under 11 AS 38.04.045 and AS 38.05.840. If a bidder making a deposit of survey or appraisal 12 costs is determined by the commissioner to be the highest qualified bidder under this 13 subsection, the deposit shall be paid to the unsuccessful bidder who incurred those 14 costs or to the department if the department incurred the costs. All costs for survey 15 and appraisal shall be approved in advance in writing by the commissioner. The 16 commissioner shall immediately issue a receipt containing a description of the land or 17 interest leased, the price bid, and the terms of the lease to the successful qualified 18 bidder. If the receipt is not accepted in writing by the bidder under this subsection, 19 the commissioner may offer the land for lease again under this subsection. A lease, 20 on a form approved by the attorney general, shall be signed by the successful bidder 21 and by the commissioner within the period specified in the auction notice. 22 * Sec. 24. AS 38.05.083 is repealed and reenacted to read: 23 Sec. 38.05.083. Aquatic farming and hatchery site leases. (a) The 24 commissioner may offer to the public for lease at public auction under AS 38.05.075 25 or by negotiation under AS 38.05.070 a site for aquatic farming or related hatchery 26 operations. Before a final decision to issue or renew a lease under this section, the 27 commissioner shall give notice and allow opportunity for comment in accordance with 28 AS 38.05.945 and may hold a hearing to take testimony. Before a final decision to 29 issue or renew a lease under this section, the commissioner shall consider all relevant 30 comment or testimony submitted under this section, AS 38.05.945, or 38.05.946. 31 (b) The commissioner, for good cause, may deny an application for issuance 01 or renewal of a lease under this section but shall provide the applicant with written 02 findings that explain the reasons for the denial. 03 (c) A site may be leased under this section for not less than the appraised fair 04 market value of the lease. The value of the lease shall be reappraised every five years. 05 (d) A lease under this section may be assigned, but, if the assignee changes 06 the use of the site, the lease reverts to the state. 07 (e) Before entering into a lease under this section, the commissioner shall 08 require the lessee to post a performance bond or provide other security to cover the 09 costs to the department of restoring the leased site in the event the lessee abandons the 10 site. 11 (f) The commissioner shall adopt regulations establishing criteria for the 12 approval or denial of leases under this section and for limiting the number of sites for 13 which leases may be issued in an area in order to protect the environment and natural 14 resources of the area. The regulations must provide for the consideration of upland 15 management policies and whether the proposed use of a site is compatible with the 16 traditional and existing uses of the area in which the site is located. 17 * Sec. 25. AS 38.05.090 is repealed and reenacted to read: 18 Sec. 38.05.090. Removal or reversion of improvements upon termination 19 of leases. (a) Unless otherwise agreed to in writing by the commissioner, a lessee 20 shall remove from a former leasehold 21 (1) all personal property, including above-ground and below-ground 22 tanks, transportable buildings, equipment, machinery, tools, and other goods, not 23 belonging to the state, within 30 days after termination of the lease; and 24 (2) all buildings and fixtures, including gravel pads, foundations, and 25 slabs, not belonging to the state, within 60 days after termination of the lease. 26 (b) Unless otherwise agreed to in writing by the commissioner, the lessee shall 27 restore the leasehold to a good and marketable condition, acceptable to the 28 commissioner, within 120 days after termination of the lease. 29 (c) If the lessee does not remove personal property, buildings, and fixtures as 30 required within the time specified under (a) of this section, title to the personal 31 property, buildings, and fixtures that remain automatically vests in the state unless the 01 commissioner elects to remove and dispose of the remaining personal property, 02 buildings, and fixtures of the lessee. The commissioner may assess upon the lessee 03 the cost of removing and disposing of personal property, buildings, and fixtures 04 remaining upon the land. 05 (d) If the lessee does not restore the land within the time period specified 06 under (b) of this section, the commissioner may have the land restored and assess the 07 costs upon the lessee. 08 (e) As part of a lease agreement, and in order to protect the public interest, the 09 commissioner may require terms for removal or reversion of improvements additional 10 to those specified in (a) - (d) of this section. 11 (f) Private residential improvements of a lessee that have become fixtures of 12 the land and that are not removed by that lessee upon termination of the lease shall be 13 purchased by the subsequent purchaser of the land if the improvements were 14 authorized in the former lease or by permit from the director and if they have a net 15 value of more than $10,000. The net value is the value of the improvements as 16 determined by an appraisal approved by the commissioner, less all rents due the 17 department, all costs of restoration under (d) of this section, and all department 18 expenses estimated to be incurred in making the sale. After termination of the former 19 lessee's lease, and at additional times as determined necessary by the commissioner, 20 the value of the authorized residential fixtures shall be determined by an independent 21 appraisal made at the cost of the former lessee. A notice or offer by the state to sell 22 formerly leased land under this subsection must state (1) the appraised value of 23 authorized residential fixtures remaining on the land that must be purchased, and (2) 24 that that cost is included in the purchase price. Out of the proceeds of the sale, the 25 department shall pay to the former lessee the appraised value of the residential 26 improvements, less all rents due the department, all costs of restoration due the 27 department under (d) of this section, and all department expenses incurred in making 28 the sale. 29 (g) Personal property described in (c) of this section is not subject to AS 34.45 30 (Uniform Unclaimed Property Act). 31 * Sec. 26. AS 38.05.131(a) is amended to read: 01 (a) Unless specifically provided otherwise in AS 38.05.132 - 38.05.134, the 02 provisions of AS 38.05.005 - 38.05.037 [AS 38.05.005 - 38.05.040], 38.05.140(f), 03 38.05.180, 38.05.182 - 38.05.184, and 38.05.920 - 38.05.990 apply to the issuance of 04 oil and gas exploration licenses and leases under AS 38.05.132 - 38.05.134. 05 * Sec. 27. AS 38.05 is amended by adding a new section to read: 06 Article 12A. Remote Recreational Cabin Site Sales and Leases. 07 Sec. 38.05.600. Remote recreational cabin sites. (a) The commissioner may 08 provide for the sale or lease of state land for remote recreational cabin sites in areas 09 of the state with dispersed populations if the land is classified for that purpose under 10 the procedures required by AS 38.05.300 and 38.05.945. Sales under this section shall 11 be at fair market value and the purchaser shall reimburse the state for the appraisal, 12 survey, and platting costs for the recreational cabin site. 13 (b) The annual fee for a remote recreational cabin site lease shall be set by the 14 commissioner so as to ensure that the state receives a fair return for the use granted 15 by the lease for the term of the lease. The commissioner shall establish regulations 16 that specify the application procedures for and the terms and conditions of a remote 17 recreational cabin site lease. A lease must be for a term of not more than five years, 18 and may be renewed for one additional five-year period. At any time during the lease, 19 the lessee may purchase the remote recreational cabin site by having the site appraised 20 and surveyed in a manner acceptable to the department and by paying to the state the 21 fair market value for the site. The lease may not be assigned by the original lessee 22 during the term of the lease. 23 (c) A remote recreational cabin site lease may be terminated by the 24 commissioner before the expiration of the term of the lease if a permittee fails to use 25 the land under lease in the manner required by the terms of the lease. After 26 termination of a remote recreational cabin site lease, improvements or personal 27 property on the land subject to the lease shall be managed in the same manner as 28 required by AS 38.05.090. 29 * Sec. 28. AS 38.05.810(a) is amended to read: 30 (a) Except as otherwise provided in AS 38.05.183(h), the (1) lease, sale, or 31 other disposal of state land or resources may be made to a state or federal agency or 01 political subdivision, (2) [THE] lease, sale, or disposal of coal deposits suitable for 02 mining may be made to a utility owned and operated by a government agency or 03 nonprofit cooperative association organized to participate under the Federal Rural 04 Electrification Act for the purpose of generating electric power and energy or the 05 production of process steam, or both, (3) [OR THE] sale or other disposal of state land 06 may be made to a tax-exempt, nonprofit corporation, association, club, or society 07 organized and operated [EXCLUSIVELY] for the management of a cemetery or a solid 08 waste or other public facility, or (4) sale or other disposal of land within a state 09 subdivision may be made to that subdivision's nonprofit, tax-exempt homeowners' 10 association, for less than the appraised value as determined by the director and 11 approved by the commissioner to be fair and proper and in the best interests of the 12 public, with due consideration given to the nature of the public services or function 13 rendered by the applicant [AGENCY, SUBDIVISION, TAX-EXEMPT, NONPROFIT 14 CORPORATION, ASSOCIATION, CLUB, OR SOCIETY, OR UTILITY MAKING 15 APPLICATION], and of the terms of the grant under which the land was acquired by 16 the state. The commissioner shall ensure, by regulation, deed restriction, covenant, 17 or otherwise, that disposals of land under this subsection serve a public purpose 18 and are in the public interest. 19 * Sec. 29. AS 38.05.850(a) is amended to read: 20 (a) The director, without the prior approval of the commissioner, may issue 21 permits, rights-of-way, or easements on state land for roads, trails, ditches, field 22 gathering lines or transmission and distribution pipelines not subject to AS 38.35, 23 telephone or electric transmission and distribution lines, log storage, oil well drilling 24 sites and production facilities for the purposes of recovering minerals from adjacent 25 land under valid lease, and other similar uses or improvements, or revocable, 26 nonexclusive permits for the [LIMITED] personal or commercial use or removal of 27 resources that the director has determined to be of limited value [OF TIMBER OR 28 MATERIALS]. The commissioner, upon recommendation of the director, shall 29 establish a reasonable rate or fee schedule to be charged for these uses, subject to the 30 exception for nonprofit cooperative associations specified in (b) of this section. In the 31 granting, suspension, or revocation of a permit or easement of land, the director shall 01 give preference to that use of the land that [WHICH] will be of greatest economic 02 benefit to the state and the development of its resources. However, first preference 03 shall be granted to the upland owner for the use of a tract of tideland, or tideland and 04 contiguous submerged land, that [WHICH] is seaward of the upland property of the 05 upland owner and that [WHICH] is needed by the upland owner for any of the 06 purposes for which the use may be granted. 07 * Sec. 30. AS 38.05.945(a) is amended to read: 08 (a) This section establishes the requirements for notice given by the department 09 for the following actions: 10 (1) classification or reclassification of state land under AS 38.05.300 11 and the closing of land to mineral leasing or entry under AS 38.05.185; 12 (2) zoning of land under applicable law; 13 (3) issuance of a 14 (A) preliminary written finding under AS 38.05.035(e)(5)(A) 15 regarding the sale, lease, or disposal of an interest in state land or resources for 16 oil and gas subject to AS 38.05.180(b); 17 (B) final written finding under AS 38.05.035(e)(5)(B) regarding 18 the sale, lease, or disposal of an interest in state land or resources for oil and 19 gas subject to AS 38.05.180(b); 20 (C) written finding for the sale, lease, or disposal of an interest 21 in state land or resources under AS 38.05.035(e)(6), except an oil or gas lease 22 sale described in AS 38.05.035(e)(6)(G) for which the director must provide 23 opportunity for public comment under the provisions of that subparagraph; 24 (4) a competitive disposal of an interest in state land or resources after 25 final decision under AS 38.05.035(e); 26 (5) [A PUBLIC HEARING UNDER AS 38.05.856(b); 27 (6)] a preliminary finding under AS 38.05.035(e) [AND 38.05.855(c)] 28 concerning sites for aquatic farms and related hatcheries; 29 (6) [(7)] a decision under AS 38.05.132 - 38.05.134 regarding the sale, 30 lease, or disposal of an interest in state land or resources. 31 * Sec. 31. AS 38.05.945(d) is amended to read: 01 (d) Notice at least 30 days before action under (a)(5) [OR (6)] of this section 02 shall be given to appropriate 03 (1) regional fish and game councils established under AS 16.05.260; 04 and 05 (2) coastal resource service areas organized under AS 46.40.110 - 06 46.40.210. 07 * Sec. 32. AS 38.08.030(b) is amended to read: 08 (b) Fees for filing an application may not exceed $25 [$10]. 09 * Sec. 33. AS 38.08.040(a) is amended to read: 10 (a) An applicant meeting the qualifications for homesite entry under 11 AS 38.08.030 and selected under (f) of this section shall be issued a revocable permit 12 to occupy and improve the homesite in order to qualify for issuance of patent as 13 provided in this chapter. The holder of a homesite entry permit shall pay, in 14 advance, an annual rental fee of $100. [THE APPLICATION FEE IS THE SOLE 15 RENT CHARGEABLE ON THE PERMIT FOR ITS DURATION.] 16 * Sec. 34. AS 38.08.040 is amended by adding a new subsection to read: 17 (f) If only one application for a homesite parcel is received, the commissioner 18 shall offer an entry permit for the parcel to the applicant provided the applicant is 19 otherwise qualified. If more than one application is received for a parcel, the 20 commissioner shall select by lottery the applicant who is entitled to receive the permit 21 for the parcel. The lottery shall be conducted under regulations adopted by the 22 commissioner that are to the maximum extent practicable consistent with the provisions 23 of AS 38.05.057 and the regulations adopted under that section. 24 * Sec. 35. AS 38.09.010(g) is amended to read: 25 (g) The commissioner may limit the number of persons permitted to obtain 26 [STAKE] homestead entries within an area designated under (a) of this section by a 27 lottery of qualified applicants. [THE COMMISSIONER MAY CONDUCT A 28 LOTTERY HELD UNDER THIS SUBSECTION IN THE COMMUNITY THAT IS 29 CLOSEST TO THE AREA DESIGNATED FOR HOMESTEAD ENTRY. THE 30 COMMISSIONER MAY REQUIRE THAT EACH PARTICIPANT IN THE 31 LOTTERY BE PRESENT UNLESS ATTENDANCE AT THE LOTTERY IS 01 PREVENTED BY 02 (1) MEDICAL REASONS, ATTENDANCE AT SCHOOL, OR 03 MILITARY SERVICE OUTSIDE THE STATE; OR 04 (2) A MANDATORY, UNAVOIDABLE EMPLOYMENT 05 COMMITMENT DETERMINED VALID BY THE COMMISSIONER BEFORE THE 06 SALE.] 07 * Sec. 36. AS 38.09.030(a) is amended to read: 08 (a) An applicant for a homestead entry permit shall 09 (1) submit proof acceptable to the commissioner that the applicant is 10 at least 18 years of age and has been a resident of the state for not less than one year 11 immediately before the date of application; 12 (2) pay a fee of $5 per acre according to the description provided by 13 the applicant if the entry is on land classified agricultural, or $20 per acre if the 14 entry is on land not classified agricultural; and 15 (3) agree to comply with the requirements of AS 38.09.050 [; 16 (4) CERTIFY THAT THE CORNERS OF THE LAND ENTERED 17 HAVE BEEN STAKED AND THE BOUNDARIES HAVE BEEN FLAGGED; OR 18 (5) ASSUME FULL RESPONSIBILITY FOR THE ACCURACY OF 19 THE DESCRIPTION OF THE LAND FILED WITH THE COMMISSIONER UNDER 20 AS 38.09.020(b)]. 21 * Sec. 37. AS 38.09.050(a) is amended to read: 22 (a) The commissioner shall issue a patent to homestead entry land if the permit 23 holder 24 (1) either 25 (A) resides and lives on the homestead entry land for not less 26 than 25 months within five years after the issuance of the homestead entry 27 permit and reimburses the state for the survey and platting of the 28 homestead parcel; 29 (B) within five years pays the state the fair market value of 30 the homestead parcel at the time of patent and reimburses the state for the 31 survey and platting of the homestead parcel; or 01 (C) pays to the state the fair market value of the homestead 02 parcel under the terms of a contract under AS 38.05.065 to purchase the 03 parcel, entered into within five years of the issuance of the permit, and 04 reimburses the state for the survey and platting of the parcel; under this 05 subparagraph, the fair market value of the homestead parcel shall be 06 determined as of the date of the contract; and 07 (2) [SUBMITS AN ALIQUOT PARTS DESCRIPTION OR 08 COMPLETES AN APPROVED SURVEY OF THE LAND IN AN AREA WHERE 09 THE COMMISSIONER WAIVES THE RECTANGULAR SURVEY GRID WITHIN 10 FIVE YEARS AFTER THE ISSUANCE OF THE PERMIT; 11 (3) ERECTS A HABITABLE, PERMANENT DWELLING ON THE 12 HOMESTEAD WITHIN THREE YEARS AFTER THE ISSUANCE OF THE 13 HOMESTEAD ENTRY PERMIT; 14 (4) BRUSHES THE BOUNDARIES OF THE LAND NOT 15 DESCRIBED BY ALIQUOT PARTS OR AS A LOT OF RECORD WITHIN 90 16 DAYS AFTER THE ISSUANCE OF THE PERMIT; 17 (5)] clears and either puts into production or prepares for cultivation 18 either 25 percent of the land classified for agricultural use or 50 percent of the 19 cropland soils, whichever is less, within five years after issuance of the permit. 20 * Sec. 38. AS 38.09.050(b) is amended to read: 21 (b) Nothing in this chapter prohibits a homestead entry permit holder from 22 residing in a temporary dwelling on the homestead [BEFORE ERECTION OF THE 23 PERMANENT DWELLING]. 24 * Sec. 39. AS 38.09 is amended by adding a new section to read: 25 Sec. 38.09.105. Removal of conditions on remote parcel and homestead 26 entry land. (a) The commissioner may not include the conditions of former 27 AS 38.05.078(d) in a remote parcel purchase contract issued on or after the effective 28 date of this section. 29 (b) The commissioner shall amend a remote parcel or homestead entry land 30 purchase contract or patent issued before the effective date of this section to remove 31 the conditions of former AS 38.05.078(d) or former AS 38.09.050(e) if the holder of 01 the purchase contract or patent 02 (1) requests the amendment; 03 (2) pays the reasonable administrative costs of the amendment as 04 determined by the commissioner; and 05 (3) pays the difference, as established by the commissioner, between 06 the land's fair market value before the amendment and the estimated fair market value 07 after the amendment. 08 * Sec. 40. AS 38.95 is amended by adding a new section to read: 09 Article 7. No Obligation to Provide Services to Disposals 10 of State Land; No Limitation on Further Disposals. 11 Sec. 38.95.300. Disclaimer applicable to state disposals. Except as otherwise 12 specifically provided, nothing in this title 13 (1) obligates the state to provide services to land that is disposed of by 14 the state, or any grantee of the state, or is the subject of any disposal program; 15 (2) limits the authority of the state to dispose of land or any interest 16 in land or resources in the area of the current disposal, provides any exclusive right 17 or interest in the area of the disposal, or implies or requires that any disposals made 18 will be limited in type or any other manner. 19 * Sec. 41. AS 38.04.020(c), 38.04.020(f), 38.04.020(j), 38.04.020(k); AS 38.05.040, 20 38.05.057(g), 38.05.057(j), 38.05.079, 38.05.855, 38.05.856, 38.05.946(b); AS 38.08.090; 21 AS 38.09.010(e), 38.09.020, 38.09.040(a)(2), 38.09.040(a)(3), 38.09.040(a)(4), 38.09.050(d), 22 38.09.050(e), 38.09.060, 38.09.070, 38.09.090, 38.09.900(1), 38.09.900(3), and 38.09.900(4) 23 are repealed. 24 * Sec. 42. Notwithstanding AS 41.21.120 - 41.21.125, within Township 10 North, Range 25 1 East, Seward Meridian, the commissioner of natural resources may 26 (1) convey a property interest in land to the Alaska Railroad Corporation for 27 the purpose of realigning the railroad in conjunction with the relocation of the Seward 28 Highway, provided that the property interest conveyed must be equivalent to that conveyed 29 to the state-owned railroad under 45 U.S.C. 1201 - 1214 (Alaska Railroad Transfer Act of 30 1982) and shall be held and managed by the Alaska Railroad Corporation under AS 42.40; 31 (2) grant a 300 foot wide highway easement to the Department of 01 Transportation and Public Facilities for the relocated Seward Highway; 02 (3) grant a 100 foot wide utility easement to Chugach Electric Association, 03 Inc., for the relocation of the 115 kilovolt electric transmission line (Federal Power 04 Commission project no. 2170, AA-39417, and ADL 32417) and the electric distribution line 05 (A-029885) located within the Chugach State Park. 06 * Sec. 43. A disposal by the Department of Natural Resources of a homesite under 07 AS 38.08 by lottery, on or after July 6, 1984, and before the effective date of this section, is 08 valid and effective, notwithstanding the fact that the disposal was by lottery, if the disposal 09 otherwise complied with the requirements of AS 38.08. 10 * Sec. 44. APPLICABILITY. The change to the interest rate to be charged on contracts 11 for the sale of land under AS 38.05.065, made by secs. 18 - 20 of this Act, applies to all 12 contracts under AS 38.05.065 sent by the Department of Natural Resources to purchasers for 13 signature on or after the effective date of secs. 18 - 20 of this Act. 14 * Sec. 45. TRANSITIONAL PROVISIONS: REGULATIONS. (a) Notwithstanding 15 sec. 47 of this Act, the Department of Natural Resources may proceed to adopt regulations 16 necessary to implement the changes made by this Act. The regulations take effect under 17 AS 44.62 (Administrative Procedure Act), but not before July 1, 1997. 18 (b) To the extent they are consistent with AS 38.08, regulations governing the 19 selection of applicants for homesite parcels under AS 38.08 in effect on the effective date of 20 secs. 33 and 34 of this Act remain in effect notwithstanding the amendment to AS 38.08.040, 21 made by secs. 33 and 34 of this Act, until the regulations are amended, repealed, or 22 superseded. 23 * Sec. 46. RETROACTIVE EFFECT. To the maximum extent constitutionally permissible, 24 sec. 1 of this Act is retroactive to January 3, 1959. 25 * Sec. 47. Except for sec. 45 of this Act, this Act takes effect July 1, 1997. 26 * Sec. 48. Section 45 of this Act takes effect immediately under AS 01.10.070(c).