HB 515: "An Act relating to the management of state land and resources; relating to certain remote parcel and homestead entry land purchase contracts and patents; and providing for an effective date."

00HOUSE BILL NO. 515 01 "An Act relating to the management of state land and resources; relating to 02 certain remote parcel and homestead entry land purchase contracts and patents; 03 and providing for an effective date." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05 * Section 1. AS 38.04.020(a) is amended to read: 06  (a) The state [COMMISSIONER SHALL ESTABLISH A] land disposal 07 program consists of [BANK CONTAINING] state land identified and classified 08 under adopted regional land use plans for disposal into private ownership. 09 * Sec. 2. AS 38.04.020(b) is amended to read: 10  (b) The state land disposal program [BANK] does not include 11  (1) land nominated for selection or selected by a municipality to satisfy 12 a general grant land entitlement under AS 29.65 or former AS 29.18.201 - 29.18.213; 13  (2) land retained in state ownership for multiple-use management; 14  (3) land where less than a fee simple title has been conveyed;

01  (4) land retained in state ownership under an enactment of the 02 legislature or by the governor or a state agency under authority of law. 03 * Sec. 3. AS 38.04.020(d) is repealed and reenacted to read: 04  (d) In the annual classification report required by AS 38.05.300(b), the 05 commissioner shall report to the legislature on the planned total acreage of land 06 classified as suitable for disposal under AS 38 for 07  (1) settlement purposes, including homestead, commercial, or industrial 08 disposal; 09  (2) agricultural disposal; and 10  (3) grazing leases. 11 * Sec. 4. AS 38.04.020(e) is repealed and reenacted to read: 12  (e) The commissioner may annually submit to the governor an appropriation 13 request for the entire amount of funding estimated to be necessary for each project 14 proposal to allow survey and disposal of land proposed to be offered for (1) homestead 15 staking under AS 38.09; (2) agricultural, commercial, industrial, or other uses under 16 AS 38.05.055 or 38.05.057; or (3) other subdivisions. Each project proposal shall 17 include the general location of the land and the estimated cost of preliminary feasibility 18 studies, engineering design work, right-of-way acquisition, and construction of access 19 roads and capital improvements required by municipal subdivision ordinance or 20 regulation of the platting authority or otherwise necessary to develop and market the 21 land. 22 * Sec. 5. AS 38.04.020(g) is amended to read: 23  (g) The [AFTER JULY 1 OF EACH YEAR, THE] commissioner shall direct 24 the expenditure of money appropriated for the disposal of land in response to requests 25 made under (e) [AND (F)] of this section for the following: 26  (1) Land designated as suitable for homestead disposal shall be 27 [CLASSIFIED AND] surveyed under this chapter and AS 38.05 and made available 28 for staking and lease under AS 38.09. 29  (2) Land designated as suitable for subdivision and homesite disposal 30 shall be surveyed, subdivided, [CLASSIFIED,] and disposed of under this chapter, 31 AS 38.05, and AS 38.08.

01  (3) Land designated agricultural, commercial, industrial, or suitable for 02 other disposal shall be sold under AS 38.05.055 or 38.05.057. 03 * Sec. 6. AS 38.04.020(h) is amended to read: 04  (h) Individual parcels disposed of in subdivisions intended for private 05 residential or recreational use may not exceed five acres unless the commissioner 06 determines that a larger size is necessary to comply with municipal ordinances; [,] to 07 permit the design of a viable subdivision because of topographical features, soil 08 conditions, on-site sewage disposal requirements, or water drainage or supply 09 considerations that are unique to the subdivision; to increase the return to the state 10 from the sale of the parcels; [,] to minimize adverse effect on wildlife, fishery, public 11 recreation, timber, or other significant resources in the area; [,] or to minimize adverse 12 effect on other residential uses in the area. 13 * Sec. 7. AS 38.04.020(i) is amended to read: 14  (i) Nothing in this section prevents the disposal of other land by the 15 commissioner in accordance with AS 38.05.055, 38.05.057, 38.05.070, the issuance of 16 remote cabin permits under AS 38.05.079, AS 38.08, AS 38.09, or other law. 17 * Sec. 8. AS 38.04.021(b) is amended to read: 18  (b) A request by a municipality under this section must be accompanied by 19  (1) a schedule for the disposal of municipal land for the next five years; 20 the schedule shall be based on an assessment of the demand for private land within the 21 municipality [AND INCLUDED IN THE ASSESSMENT SUBMITTED UNDER 22 AS 38.04.020(f)]; 23  (2) an estimate of the number of acres of municipal land that the 24 municipality plans to dispose of during each fiscal year of the five-year period; 25  (3) a description of the methods to be used for the disposal of 26 municipal land and the terms under which it will be offered to the public and 27  (4) a description of the municipal land that the municipality plans to 28 dispose of each fiscal year during the five-year period. 29 * Sec. 9. AS 38.04.030 is amended to read: 30  Sec. 38.04.030. LAND AVAILABILITY PROGRAMS. Programs that may 31 be used by the director to make the state's land surface available for private use under

01 AS 38.04.020 - 38.04.055 include sale of whole or partial rights to the fee simple 02 estate, including conveyance of agricultural use rights; leasing; [OPEN-TO-ENTRY;] 03 homesiting; homesteading; permitting for construction and occupation of cabins in 04 isolated locations on land retained in state ownership; and other methods as provided 05 by regulation or other law. Notwithstanding a contrary provision of AS 38, a land 06 availability program adopted by regulation must provide for competitive disposal, 07 based on no less than fair market value, to serve the best interests of the state. 08 * Sec. 10. AS 38.04.035 is amended to read: 09  Sec. 38.04.035. CRITERIA FOR PROGRAM SELECTION. In determining 10 which land availability program is appropriate for state land in different locations, the 11 director shall be guided by the following criteria: 12  (1) to cover public costs associated with private land use and to provide 13 the public with a fair return for publicly owned property, conveyance of state land to 14 private parties shall [SHOULD] be at fair market value except where otherwise 15 authorized by statute, or by an administrative regulation the adoption of which is 16 specifically permitted by statute; 17  (2) sale or lease programs should be used where land is readily 18 accessible to a major community center or where, because of a prime location on 19 waterfront or a transportation route or some other location characteristic, land has 20 relatively high real estate value; 21  (3) sale programs are preferred but lease programs should be used 22  (A) where special land use controls are required and there is a 23 high public interest in having certain types of land used for particular purposes; 24  (B) when the intended use is a temporary one; 25  (C) in commercial or industrial situations when a leasehold can 26 provide cash flow advantages to the lessee; 27  (D) when a unique location with special public values is 28 involved, as in a deep water port, hydroelectric site, or aquaculture facility; 29  (E) where current demand for private use is high, but 30 projections suggest that, in the future, the land may be more valuable for public 31 use, as in accessible waterfront recreation areas;

01  (4) for enabling isolated cabin development in remote locations where 02 survey and conveyance is impractical at the anticipated time of cabin development, 03 or where disposal of land would cause potential conflicts with other resources and 04 uses, or where a long-range interest in public ownership and use exist, a system for 05 cabin permits on public land may be used; 06  (5) limited or conditional title may be granted when the state's best 07 interest so dictates; among other things, title limitations may include grants of 08 agricultural interest only, retention of development rights, and retention of scenic or 09 other easements; a conditional title may be tied to a development schedule or other 10 standards of performance. 11 * Sec. 11. AS 38.05.035(b)(9) is amended to read: 12  (9) quitclaim land or an interest in land to the federal government on 13 a determination that the land or interest in land was wrongfully or erroneously 14 conveyed by the federal government to the state, or that it is in the best interests of 15 the state to reconvey the land or interest in land, under terms authorized by 16 43 U.S.C. 1617(c), in substitution for land or an interest in land located in a state 17 park unit created under AS 41.21; 18 * Sec. 12. AS 38.05.050 is amended to read: 19  Sec. 38.05.050. DISPOSAL OF LAND FOR PRIVATE OWNERSHIP. The 20 commissioner shall determine the land to be disposed of for private use. The 21 commissioner shall determine the time and place of disposal. An auction sale, a 22 lottery sale, or a disposal of land for homesites may [SHALL] be held in a community 23 that is near the land to be sold or disposed of. 24 * Sec. 13. AS 38.05.055 is amended to read: 25  Sec. 38.05.055. AUCTION SALE PROCEDURES. Unless another method of 26 sale is required under this chapter, [AS 38.07, OR] AS 38.08, or AS 38.09, the sale 27 of state land shall be made at public auction to the highest qualified bidder as 28 determined by the director. The director may accept bids and sell state land under this 29 section at no less than 70 percent of the appraised fair market value of the land. [A 30 BIDDER MUST APPEAR IN PERSON AT THE AUCTION UNLESS MEDICAL 31 REASONS, ATTENDANCE AT SCHOOL, OR MILITARY SERVICE OUTSIDE

01 THE STATE PREVENT ATTENDANCE.] A bidder may be represented by an 02 attorney or agent at the auction [IF THE LAND OFFERED FOR DISPOSAL IS 03 COMMERCIAL, INDUSTRIAL, OR AGRICULTURAL LAND]. An aggrieved 04 bidder may appeal to the commissioner within five days after the sale for a review of 05 the director's determination. The sale shall be conducted by the director and at the 06 time of sale the successful bidder shall deposit an amount equal to five percent of the 07 purchase price. The director shall immediately issue a receipt containing a description 08 of the land or property purchased, the price bid, and the amount deposited. The 09 receipt shall be acknowledged in writing by the bidder. 10 * Sec. 14. AS 38.05.057(a) is amended to read: 11  (a) The commissioner may dispose of land, including land limited to use for 12 agricultural purposes, by lottery. The purchase price of land sold by lottery shall be 13 the fair market value of the land as determined by the commissioner. The 14 commissioner may sell land by lottery for less than the fair market value of the land 15 on a determination that scarcity of land for private use in the area of the land to be 16 sold has resulted in unrealistic land values. [THE COMMISSIONER SHALL 17 CONSULT WITH THE ASSESSOR OF A MUNICIPALITY BEFORE 18 DETERMINING THE PURCHASE PRICE FOR LAND THAT IS LOCATED IN 19 THE MUNICIPALITY AND THAT IS TO BE SOLD UNDER THIS SECTION.] The 20 lottery shall be conducted in public by the commissioner. A [AN APPLICANT MAY 21 NOT BE SELECTED TO PURCHASE LAND UNLESS THE APPLICANT IS 22 PRESENT ON THE DATE AND AT THE PLACE THAT THE LOTTERY IS 23 CONDUCTED UNLESS MEDICAL REASONS, ATTENDANCE AT SCHOOL, OR 24 MILITARY SERVICE OUTSIDE THE STATE PREVENT ATTENDANCE. AN 25 APPLICANT MAY BE REPRESENTED BY AN AGENT ON THE DAY OF THE 26 LOTTERY IF THE LAND OFFERED FOR SALE IS COMMERCIAL, 27 INDUSTRIAL, OR AGRICULTURAL LAND. ON THE DAY OF THE LOTTERY 28 A] purchaser selected by lot shall deposit an amount equal to five percent of the 29 purchase price within 30 days after receiving notification of the selection. 30 * Sec. 15. AS 38.05.069(e)(2) is repealed and reenacted to read: 31  (2) "adjacent" means that a tract of land has a common boundary or

01 corner to presently held land or is separated from the presently held land only by a 02 physical barrier such as a road or stream. 03 * Sec. 16. AS 38.05.082(b) is amended to read: 04  (b) The director may classify land as subject to leases for fisheries 05 development. In an area or region of the state for which a land use plan has not been 06 adopted under AS 38.04.065, the director may classify land for lease under this section 07 after notice under AS 38.05.945. The director may [SHALL] publicly invite 08 applications for lease of the selected areas. Each application shall be accompanied by 09 an affidavit to the effect that the applicant presently intends to personally utilize the 10 leased area for fishing purposes throughout the term of the lease [THE 11 FOLLOWING SEASON]. If two or more applications are received for the same shore 12 area, the director may offer [SHALL AWARD] the lease at public auction under 13 AS 38.05.075(a). If only one application is received and the appraisal value of the 14 lease is $5,000 a year or less, the commissioner may issue a negotiated lease under 15 AS 38.05.070(b) [TO THE MOST QUALIFIED APPLICANT. IN DETERMINING 16 THE QUALIFICATIONS OF APPLICANTS, THE DIRECTOR SHALL CONSIDER 17 THE LENGTH OF TIME DURING WHICH THE APPLICANT HAS BEEN 18 ENGAGED IN SET NETTING, THE PROXIMITY OF THE PAST FISHING SITES 19 OF THE APPLICANT TO THE LAND TO BE LEASED, THE PRESENT ABILITY 20 OF THE APPLICANT TO UTILIZE THE LOCATION TO ITS MAXIMUM 21 POTENTIAL, AND OTHER FACTORS RELEVANT TO THE EQUITABLE 22 ASSIGNMENT OF THE DISPUTED AREA. IF THE DIRECTOR CANNOT 23 DETERMINE A PREFERENCE BETWEEN CONFLICTING APPLICANTS FOR 24 THE SAME LEASE SITE ON THE BASIS OF QUALIFICATIONS, THE 25 DIRECTOR SHALL SELECT BETWEEN THE APPLICANTS BY LOT. AN 26 AGGRIEVED APPLICANT MAY APPEAL TO THE COMMISSIONER WITHIN 30 27 DAYS FOR A REVIEW OF THE DIRECTOR'S DETERMINATION]. 28 * Sec. 17. AS 38.05.082(c) is amended to read: 29  (c) A lease for set net fishing may be issued for any period not exceeding 10 30 years. If the commissioner determines that the land is not being utilized for the 31 purpose for which the lease is issued, the lease may be declared void. [THE

01 DIRECTOR SHALL ESTABLISH A REASONABLE RENTAL FOR THE LEASE, 02 EQUAL TO THE ADMINISTRATIVE COSTS INVOLVED IN PROCESSING THE 03 LEASEHOLD APPLICATIONS.] 04 * Sec. 18. AS 38.05.083 is repealed and reenacted to read: 05  Sec. 38.05.083. AQUATIC FARMING AND HATCHERY SITE LEASES. 06 (a) The commissioner may offer to the public for lease at public auction under 07 AS 38.05.075 or by negotiation under AS 38.05.070 a site for aquatic farming or 08 related hatchery operations. Before a final decision to issue or renew a lease under 09 this section, the commissioner shall give notice and allow opportunity for comment in 10 accordance with AS 38.05.945, and may hold a hearing to take testimony. Before a 11 final decision to issue or renew a lease under this section, the commissioner shall 12 consider all relevant comment or testimony submitted under this section, AS 38.05.945, 13 or 38.05.946. 14  (b) The commissioner, for good cause, may deny an application for issuance 15 or renewal of a lease under this section, but shall provide the applicant with written 16 findings that explain the reasons for the denial. 17  (c) A site may be leased under this section for not less than the appraised fair 18 market value of the lease. The value of the lease shall be reappraised every five years. 19  (d) A lease under this section may be assigned, but if the assignee changes the 20 use of the site the lease reverts to the state. 21  (e) Before entering into a lease under this section, the commissioner shall 22 require the lessee to post a performance bond or provide other security to cover the 23 costs to the department of restoring the leased site in the event the lessee abandons the 24 site. 25  (f) The commissioner shall adopt regulations establishing criteria for the 26 approval or denial of leases under this section and for limiting the number of sites for 27 which leases may be issued in an area in order to protect the environment and natural 28 resources of the area. The regulations must provide for the consideration of upland 29 management policies and whether the proposed use of a site is compatible with the 30 traditional and existing uses of the area in which the site is located. 31 * Sec. 19. AS 38.05.090 is repealed and reenacted to read:

01  Sec. 38.05.090. REMOVAL OR REVERSION OF IMPROVEMENTS UPON 02 TERMINATION OF LEASES. (a) Unless otherwise agreed to in writing by the 03 commissioner, a lessee shall remove from a former leasehold 04  (1) all personal property, including above-ground and below-ground 05 tanks, transportable buildings, equipment, machinery, tools, and other goods, not 06 belonging to the state, within 30 days after termination of the lease; and 07  (2) all buildings and fixtures, including gravel pads, foundations, and 08 slabs, not belonging to the state, within 60 days after termination of the lease. 09  (b) Unless otherwise agreed to in writing by the commissioner, the lessee shall 10 restore the leasehold to a good and marketable condition, acceptable to the 11 commissioner, within 120 days after termination of the lease. 12  (c) If the lessee does not remove personal property, buildings, and fixtures as 13 required within the time specified under (a) of this section, title to the personal 14 property, buildings, and fixtures that remain automatically vests in the state unless the 15 commissioner elects to remove and dispose of the remaining personal property, 16 buildings, and fixtures of the lessee. The commissioner may assess upon the lessee 17 the cost of removing and disposing of personal property, buildings, and fixtures 18 remaining upon the land. 19  (d) If the lessee does not restore the land within the time period specified 20 under (b) of this section, the commissioner may have the land restored and assess the 21 costs upon the lessee. 22  (e) As part of a lease agreement, and in order to protect the public interest, the 23 commissioner may require terms for removal or reversion of improvements additional 24 to those specified in (a) - (d) of this section. 25  (f) Private residential improvements of a lessee that have become fixtures of 26 the land and that are not removed by that lessee upon termination of the lease shall be 27 purchased by the subsequent purchaser of the land if the improvements were 28 authorized in the former lease or by permit from the director and if they have a net 29 value of more than $10,000. The net value is the value of the improvements as 30 determined by an appraisal approved by the commissioner, less all rents due the 31 department, all costs of restoration under (d) of this section, and all department

01 expenses estimated to be incurred in making the sale. After termination of the former 02 lessee's lease, and at additional times as determined necessary by the commissioner, 03 the value of the authorized residential fixtures shall be determined by an independent 04 appraisal made at the cost of the former lessee. A notice or offer by the state to sell 05 formerly leased land under this subsection shall state (1) the appraised value of 06 authorized residential fixtures remaining on the land that must be purchased, and (2) 07 that that cost is included in the purchase price. Out of the proceeds of the sale, the 08 department shall pay to the former lessee the appraised value of the residential 09 improvements, less all rents due the department, all costs of restoration due the 10 department under (d) of this section, and all department expenses incurred in making 11 the sale. 12  (g) Personal property described in (c) of this section is not subject to AS 34.45 13 (Uniform Unclaimed Property Act). 14 * Sec. 20. AS 38.05 is amended by adding a new section to read: 15  Sec. 38.05.117. SALVAGE SALES. (a) Notwithstanding the provisions of 16 AS 38.05.113, the commissioner, after making a determination that the disposal will 17 serve the best interests of the state, may offer for salvage sale timber stands that will 18 lose substantial economic value, or will perpetuate insect or disease epidemics, if not 19 salvaged within two years. Timber on land to be cleared for conversion to nonforest 20 uses also may be offered as a salvage sale under this section. 21  (b) A salvage sale offered as a negotiated timber sale is exempt from 22 AS 38.05.115. 23 * Sec. 21. AS 38.05.118(c) is amended to read: 24  (c) A sale of timber may not be negotiated by the commissioner under this 25 section except on a finding that, within an area proximate to the business site that 26 [WHICH] the manufacturer may economically serve, there exists, or will exist within 27 two years, 28  (1) a high level of local unemployment; 29  (2) an underutilized timber manufacturing capacity; and 30  (3) an underutilized allowable cut of state timber, or timber that will 31 lose substantial economic value due to insects, disease, fire, or land use

01 conversion. 02 * Sec. 22. AS 38.05.180(c) is amended to read: 03  (c) Except as provided in (d) and (w) of this section, an oil and gas lease sale 04 may not be held unless it was included in the proposed leasing programs submitted to 05 the legislature during the two calendar years preceding the year in which the sale is 06 held. [A LEASE SALE SHALL BE HELD DURING THE CALENDAR QUARTER 07 FOR WHICH IT IS SCHEDULED IN THE PROPOSED OIL AND GAS LEASING 08 PROGRAM BUT MAY BE DELAYED BY THE COMMISSIONER FOR NOT 09 MORE THAN 90 DAYS AFTER THE LAST DAY OF THE CALENDAR 10 QUARTER FOR WHICH IT WAS SCHEDULED IF THE COMMISSIONER 11 DETERMINES THAT A DELAY IS IN THE BEST INTEREST OF THE STATE. 12 A LEASE SALE WHICH IS NOT HELD DURING THE CALENDAR QUARTER 13 FOR WHICH IT WAS SCHEDULED IN THE OIL AND GAS LEASING 14 PROGRAM, OR IN THE FOLLOWING 90-DAY PERIOD AUTHORIZED BY THIS 15 SUBSECTION, MAY BE HELD ONLY IF RESCHEDULED AS PROVIDED IN (b) 16 OF THIS SECTION.] A lease sale may not be held before the date it is scheduled in 17 the proposed oil and gas leasing program. 18 * Sec. 23. AS 38.05.185(a) is amended to read: 19  (a) The acquisition and continuance of rights in and to deposits on state land 20 of minerals, which on January 3, 1959, were subject to location under the mining laws 21 of the United States, shall be governed by AS 38.05.185 - 38.05.275. Nothing in 22 AS 38.05.185 - 38.05.275 affects the law pertaining to the acquisition of rights to 23 mineral deposits owned by any other person or government. The director, with the 24 approval of the commissioner, shall determine that land from which mineral deposits 25 may be mined only under lease, and, subject to the limitations of AS 38.05.300, that 26 land that shall be closed to location under AS 38.05.185 - 38.05.275 [MINING]. 27 State land may not be closed to [MINING OR MINERAL] location under 28 AS 38.05.185 - 38.05.275 except as provided in AS 38.05.300 and unless the 29 commissioner makes a finding that mining would be incompatible with significant 30 surface uses on the state land. State land may not be restricted to mining under lease 31 unless the commissioner determines that potential use conflicts on the state land

01 require that mining be allowed only under written leases issued under AS 38.05.205 02 or the commissioner has determined that the land was mineral in character at the time 03 of state selection. The determinations required under this subsection shall be made in 04 compliance with land classification orders and land use plans developed under 05 AS 38.05.300. 06 * Sec. 24. AS 38.05.190(a) is amended to read: 07  (a) The right to acquire exploration and mining rights under AS 38.05.185 - 08 38.05.275 may be acquired or held only by 09  (1) citizens of the United States at least 18 years of age; 10  (2) legal guardians or trustees of citizens of the United States under 18 11 years of age on behalf of the citizens; 12  (3) persons at least 18 years of age who have declared their intention 13 to become citizens of the United States; 14  (4) [ALIENS AT LEAST 18 YEARS OF AGE IF THE LAWS OF 15 THEIR COUNTRY GRANT LIKE PRIVILEGES TO CITIZENS OF THE UNITED 16 STATES;] 17  (5) corporations organized under the laws of the United States or of any 18 state or territory of the United States and qualified to do business in this state [, 19 EXCEPT THAT IF MORE THAN 50 PERCENT OF THE STOCK OF A 20 CORPORATION IS OWNED OR CONTROLLED BY ALIENS WHO ARE NOT 21 QUALIFIED, THE CORPORATION IS NOT QUALIFIED TO ACQUIRE OR HOLD 22 THE RIGHTS]; 23  (6) associations of persons described in (1) - (5) of this subsection. 24 * Sec. 25. AS 38.05.211(d) is repealed and reenacted to read: 25  (d) The rental amount established under this section shall be revised by the 26 commissioner as provided in this section based on changes in the Consumer Price 27 Index for all Urban Consumers, Anchorage Metropolitan Area (Semi-Annual Average) 28 compiled by the Bureau of Labor Statistics, United States Department of Labor, as 29 revised, rebased or replaced by that bureau. The reference base index is the index for 30 January - June, 1989, as revised or rebased by that bureau. The rental amount shall 31 be revised by the commissioner if the change between the index for the first six

01 months of the current year and the most recent index used to revise the rental, or the 02 reference base index if the rental amount has never been revised, equals or exceeds $5. 03 The rental amount must be increased or decreased, as appropriate, by an amount equal 04 to the change in the index described in this subsection rounded to the nearest whole 05 $5 unit. The commissioner shall calculate the change in the index annually and, if the 06 rental amount must be revised, shall adopt a regulation establishing the revised rental 07 amount. A revised rental amount applies to a rental payment if the regulation 08 establishing the revised rental amount took effect at least 90 days before the date the 09 rental payment is due. 10 * Sec. 26. AS 38.05.255 is amended to read: 11  Sec. 38.05.255. SURFACE USE OF LAND OR WATER. (a) Surface uses 12 of land or water included within mining properties by owners of those properties shall 13 be limited to those necessary for the prospecting for, extraction of, or basic processing 14 of mineral deposits and shall be subject to reasonable concurrent uses. Leases 15 [PERMITS] for millsites and tailings disposal may be issued [GRANTED] by the 16 director. The leases [PERMITS] shall be conditioned upon payment of a reasonable 17 annual rent [CHARGE] for the lease [USE] and restriction to [CONTINUANCE OF] 18 the limited use. Timber from land open to mining without lease, except timberland, 19 may be used by a mining claimant or prospecting site locator for the mining or 20 development of the location or adjacent claims under common ownership. On other 21 land, timber may be acquired as provided in this chapter. Use of water shall be made 22 in accordance with AS 46.15. 23  (b) A lease issued under this section is exempt from the provisions of 24 AS 38.05.070 - 38.05.105. The commissioner, by regulation, shall establish 25 appropriate leasing procedures and annual rent amounts for leases under this 26 section. 27 * Sec. 27. AS 38.05.265 is amended to read: 28  Sec. 38.05.265. ABANDONMENT. Failure to properly record a certificate of 29 location or a statement of annual labor, [FILE WITH THE DIRECTOR WITHIN THE 30 TIME PRESCRIBED A LEASE APPLICATION,] pay any required annual rental, pay 31 any required production royalty, or keep location boundaries clearly marked as

01 required by AS 38.05.185 - 38.05.275 and by regulations adopted under these sections 02 constitutes abandonment of all rights acquired under the mining claim, leasehold 03 location, lease, or site involved, and the claim, location, lease, or site is subject to 04 relocation by others. A locator or claimant of an abandoned location or a successor 05 in interest may not relocate the location until one year after abandonment. A statement 06 of annual labor that does not accurately set out the essential facts is void and of no 07 effect. If an annual rental or a royalty payment is deficient but is otherwise timely 08 paid, abandonment does not result if full payment is made within 09  (1) the period prescribed by a deficiency notice from the commissioner; 10 or 11  (2) 30 days after a final judgment establishing the amount due if the 12 deficiency amount due was contested. 13 * Sec. 28. AS 38.05.850(a) is amended to read: 14  (a) The director, without the prior approval of the commissioner, may issue 15 permits, rights-of-way or easements on state land for roads, trails, ditches, field 16 gathering lines or transmission and distribution pipelines not subject to AS 38.35, 17 telephone or electric transmission and distribution lines, log storage, oil well drilling 18 sites and production facilities for the purposes of recovering minerals from adjacent 19 land under valid lease, and other similar uses or improvements, or revocable, 20 nonexclusive permits for the personal or commercial use or removal of resources 21 that the director has determined to be of limited value [FOR THE LIMITED 22 PERSONAL USE OF TIMBER OR MATERIALS]. The commissioner, upon 23 recommendation of the director, shall establish a reasonable rate or fee schedule to be 24 charged for these uses, subject to the exception for nonprofit cooperative associations 25 specified in (b) of this section. In the granting, suspension or revocation of a permit 26 or easement of land, the director shall give preference to that use of the land which 27 will be of greatest economic benefit to the state and the development of its resources. 28 However, first preference shall be granted to the upland owner for the use of a tract 29 of tideland, or tideland and contiguous submerged land, which is seaward of the upland 30 property of the upland owner and which is needed by the upland owner for any of the 31 purposes for which the use may be granted.

01 * Sec. 29. AS 38.05.945(d) is amended to read: 02  (d) Notice at least 30 days before a preliminary finding under 03 AS 38.05.035(e) concerning sites for aquatic farms and related hatcheries 04 [ACTION UNDER (a) (5) OR (6) OF THIS SECTION] shall be given to appropriate 05  (1) regional fish and game councils established under AS 16.05.260; 06 and 07  (2) coastal resource service areas organized under AS 46.40.110 - 08 46.40.210. 09 * Sec. 30. AS 38.08.030(b) is amended to read: 10  (b) The provisions of AS 38.05.057(e), (f), and (h) apply to application for 11 and issuance of a homesite entry permit. Fees for filing an application may not 12 exceed the amount set out in AS 38.05.057(d) [$10]. 13 * Sec. 31. AS 38.08.040(a) is amended to read: 14  (a) An applicant meeting the qualifications for homesite entry under 15 AS 38.08.030 and selected under AS 38.05.057(e) shall be issued a revocable permit 16 to occupy and improve the homesite in order to qualify for issuance of patent as 17 provided in this chapter. The holder of a homesite entry permit shall pay, in 18 advance, an annual rental fee of $100. [THE APPLICATION FEE IS THE SOLE 19 RENT CHARGEABLE ON THE PERMIT FOR ITS DURATION.] 20 * Sec. 32. AS 38.09.010(g) is amended to read: 21  (g) The commissioner may limit the number of persons permitted to stake 22 homestead entries within an area designated under (a) of this section by a lottery of 23 qualified applicants. [THE COMMISSIONER MAY CONDUCT A LOTTERY HELD 24 UNDER THIS SUBSECTION IN THE COMMUNITY THAT IS CLOSEST TO THE 25 AREA DESIGNATED FOR HOMESTEAD ENTRY. THE COMMISSIONER MAY 26 REQUIRE THAT EACH PARTICIPANT IN THE LOTTERY BE PRESENT UNLESS 27 ATTENDANCE AT THE LOTTERY IS PREVENTED BY 28  (1) MEDICAL REASONS, ATTENDANCE AT SCHOOL, OR MILITARY 29 SERVICE OUTSIDE THE STATE; OR 30  (2) A MANDATORY, UNAVOIDABLE EMPLOYMENT COMMITMENT 31 DETERMINED VALID BY THE COMMISSIONER BEFORE THE SALE.]

01 * Sec. 33. AS 38.09.030(a) is amended to read: 02  (a) An applicant for a homestead entry permit shall 03  (1) submit proof acceptable to the commissioner that the applicant is 04 at least 18 years of age and has been a resident of the state for not less than one year 05 immediately before the date of application; 06  (2) pay a fee of $5 per acre according to the description provided by 07 the applicant if the entry is on land classified agricultural, or $20 per acre if the 08 entry is on land not classified agricultural; 09  (3) agree to comply with the requirements of AS 38.09.050; 10  (4) certify that the corners of the land entered have been staked and the 11 boundaries have been flagged; and [OR] 12  (5) assume full responsibility for the accuracy of the description of the 13 land filed with the commissioner under AS 38.09.020(b). 14 * Sec. 34. The amendments to AS 38.05.082(b) made by sec. 16 of this Act do not affect 15 the amendments made to that subsection by sec. 3, ch. 27, SLA 1991, effective January 1, 16 1997. Unless amended or repealed by Act of the legislature after the effective date of this 17 Act, the amendments to AS 38.05.082(b) made by sec. 16 of this Act continue in effect after 18 the amendments made by sec. 3, ch. 27, SLA 1991 take effect January 1, 1997. 19 * Sec. 35. AS 38.04.020(c), 38.04.020(f), 38.04.020(j), 38.04.020(k); AS 38.05.035(e)(6), 20 38.05.057(g), 38.05.057(j), 38.05.207, 38.05.855, 38.05.856, 38.05.945(a)(5), 38.05.945(a)(6), 21 38.05.945(g), 38.05.946(b); AS 38.09.050(d), and 38.09.050(e) are repealed. 22 * Sec. 36. APPLICABILITY. Legal rights accrued under AS 38.05.083, 38.05.255, 23 38.05.856, or AS 38.08.040, as those statutes existed before July 1, 1994, are not impaired by 24 the amendments to or repeal of those statutes by this Act. 25 * Sec. 37. TRANSITIONAL PROVISIONS: REGULATIONS. Notwithstanding sec. 40 26 of this Act, the Department of Natural Resources may proceed to adopt regulations necessary 27 to implement the changes made by this Act. The regulations take effect under AS 44.62 28 (Administrative Procedure Act), but not before July 1, 1994. 29 * Sec. 38. TRANSITIONAL PROVISIONS: REMOVAL OF CONDITIONS ON 30 REMOTE PARCEL AND HOMESTEAD ENTRY LAND. (a) The commissioner may not 31 include the conditions of former AS 38.05.078(d) in a remote parcel purchase contract issued

01 on or after July 1, 1994. 02 (b) The commissioner shall amend a remote parcel or homestead entry land purchase 03 contract or patent issued before July 1, 1994 to remove the conditions of AS 38.05.078(d) or 04 AS 38.09.050(e), if the holder of the purchase contract or patent 05 (1) requests the amendment; 06 (2) pays the reasonable administrative costs of the amendment as determined 07 by the commissioner; and 08 (3) pays the difference, as established by the commissioner, between the land's 09 fair market value before and the estimated fair market value after the conditions would be 10 removed. 11 * Sec. 39. Section 37 of this Act takes effect immediately under AS 01.10.070(c). 12 * Sec. 40. Sections 1 - 36 and 38 of this Act take effect July 1, 1994.