03/18/2011 01:00 PM House RESOURCES

               HB 106-COASTAL MANAGEMENT PROGRAM                                                                            
                                                                                                                                
2:42:20 PM                                                                                                                    
                                                                                                                                
CO-CHAIR SEATON  announced that  the final  order of  business is                                                               
HOUSE BILL  NO. 106,  "An Act extending  the termination  date of                                                               
the  Alaska  coastal  management  program  and  relating  to  the                                                               
extension; relating  to the  review of  activities of  the Alaska                                                               
coastal management  program; providing  for an effective  date by                                                               
amending the  effective date of  sec. 22,  ch. 31, SLA  2005; and                                                               
providing for an effective date."                                                                                               
                                                                                                                                
CO-CHAIR  SEATON  noted that  today's  witness  [Glenn Gray]  was                                                               
invited to  make a presentation  from the  districts' perspective                                                               
and is not  representing any particular district.   Next week the                                                               
Department of Natural Resources  (DNR) will present its responses                                                               
for any issues on which it has a difference of opinion.                                                                         
                                                                                                                                
2:43:51 PM                                                                                                                    
                                                                                                                                
GLENN GRAY, Glenn  Gray & Associates, first corrected  a March 16                                                               
statement about  hard rock mining  in which  he had said  that it                                                               
was up  to each  individual landowner  to have  the restrictions.                                                               
However,  he  continued,  Representative  Feige  was  correct  in                                                               
saying  that there  are some  uniform  provisions throughout  the                                                               
state - a  hard rock mine development project must  obtain a plan                                                               
of operations and  a reclamation plan from DNR no  matter who the                                                               
land owner.                                                                                                                     
                                                                                                                                
2:44:33 PM                                                                                                                    
                                                                                                                                
MR. GRAY  turned to the  remaining three slides from  his 3/16/11                                                               
PowerPoint presentation, explaining that  [slide 13] is a summary                                                               
of some of the  effects that he thinks are of  concern to many of                                                               
the coastal  districts.  A top  concern is the inability  to have                                                               
meaningful enforceable policies.   The coastal program  as it was                                                               
set up  in 1977, as  well as the  2003 changes, is  a cooperative                                                               
program between  the State of  Alaska and the  coastal districts.                                                               
Thus,  the coastal  districts are  not  just another  stakeholder                                                               
because,  with the  state agencies,  the districts  implement the                                                               
program.   A second concern of  many people is the  Department of                                                               
Environmental  Conservation (DEC)  carve-out.   The carve-out  is                                                               
very confusing  to almost everyone.   The scope of review  is not                                                               
always clear, especially  if there is a  federal permit involved.                                                               
Almost every coastal  resource or use is affected in  some way by                                                               
water quality, which  adds to the confusion.   Another concern is                                                               
the  centralized decision-making  that  is the  result of  having                                                               
moved the program to one agency  and having all decisions made by                                                               
one agency.  The legislative audit  stated that this has led to a                                                               
lack  of  opportunities  for consensus  building  during  project                                                               
reviews.                                                                                                                        
                                                                                                                                
2:46:00 PM                                                                                                                    
                                                                                                                                
MR. GRAY, based on his talks  with some of the districts, offered                                                               
suggestions  for  possible  statutory  changes (slide  14).    He                                                               
recommended a  clarification of  the enforceable  policy statutes                                                               
because there have  been some differences in opinion  of what the                                                               
statutes actually mean.  In  his opinion, the proposed work draft                                                               
[Version B, moved 3/16/11] would  provide that clarification.  He                                                               
said  none of  the districts  are asking  to remove  some of  the                                                               
other provisions;  for example,  districts cannot  arbitrarily or                                                               
unreasonably affect  uses of state  concern.   Regarding statutes                                                               
for the  centralization of power,  things can be done  to provide                                                               
checks and balances.  The  proposed work draft appears to include                                                               
an appeals  board/regulatory board and  that might be one  way to                                                               
do it;  another idea might be  to have a third  impartial agency.                                                               
Elevations could be decided by  all three resources commissioners                                                               
as was done in the past, or  they could be decided by the appeals                                                               
board as written  in the proposed work draft.   Another change is                                                               
elimination of  the DEC  carve-out.   He said  he thinks  this is                                                               
something  that  would  be supported  by  the  federal  3/12/2008                                                               
evaluation  and he  believes  the  legislative audit  recommended                                                               
that DNR look  into some options to eliminate  the carve-out, and                                                               
DNR's own  draft bill  in 2008 would  have eliminated  the carve-                                                               
out.   While likely not  a purposeful change, the  2003 carve-out                                                               
eliminated  all  possibilities  for  public comment  on  the  DEC                                                               
finding  when it  does  not  have a  permit;  for example,  outer                                                               
continental  shelf (OCS)  reviews or  federal activities.   While                                                               
DEC  did  come up  with  a  good  process,  there is  nothing  in                                                               
regulation  that   would  require   the  department  to   do  so.                                                               
Regarding  the  timeline,  he  said  it  seems  that  the  90-day                                                               
timeline is  a problem when there  is a large project  with a lot                                                               
of  unresolved issues.   The  proposed work  draft would  address                                                               
that by  making an exemption  for projects with  an Environmental                                                               
Impact Statement (EIS), which most large projects will have.                                                                    
                                                                                                                                
2:48:41 PM                                                                                                                    
                                                                                                                                
MR. GRAY recommended possible regulatory  changes (slide 15).  He                                                               
pointed  out that  statutes are  not necessarily  needed to  make                                                               
regulatory changes,  but unless there  is some commitment  on DNR                                                               
there is no  guarantee that suggested regulatory  changes will be                                                               
made.   He said one regulatory  change would be to  eliminate the                                                               
designated area requirement.  Whether  this is done in statute or                                                               
regulation, there  would still be the  opportunity for designated                                                               
areas if  a district wanted  a special management area,  but this                                                               
eliminates that  tie between the  enforceable policies  having to                                                               
have a designated area first.   A tremendous amount of funds have                                                               
been  spent on  these designated  areas and  mapping, as  well as                                                               
state time to review them, and  they were the topic of several of                                                               
the  mediations.   Regarding  enforceable  policies,  he said  he                                                               
believes  that some  of the  problems could  be fixed  just by  a                                                               
different interpretation  of the regulatory language  or changing                                                               
some  of  that  language.   Regarding  statewide  standards,  one                                                               
example is  the habitat standard  which used to cover  the entire                                                               
coastal zone  but now  only covers  a small  part of  the coastal                                                               
zone, and  that is the  same for  several other standards.   That                                                               
could easily be  fixed in regulation.  A  minerals standard could                                                               
be reinstated to look at mining impacts under its own standard.                                                                 
                                                                                                                                
2:50:13 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  SEATON  requested  Mr.   Gray  to  review  prescriptive                                                               
requirements for  enforceable policies and how  that would differ                                                               
from a performance-based standard.                                                                                              
                                                                                                                                
MR. GRAY replied  that one way to  look at this might  be to look                                                               
at  the  current statewide  standards  -  almost every  statewide                                                               
standard is performance based or some kind of a process.                                                                        
                                                                                                                                
CO-CHAIR  SEATON asked  whether  Mr. Gray  is saying  performance                                                               
based or prescriptive based.                                                                                                    
                                                                                                                                
MR. GRAY responded  that he is saying  either a performance-based                                                               
or a process-based statewide standard  because that would provide                                                               
flexibility  in how  to  meet  that standard.    He recalled  the                                                               
example of a floating facility that  he gave on 3/16/11 for which                                                               
an  actual enforceable  district policy  stated exactly  how many                                                               
feet  the  tide  would  be,  which  would  be  prescriptive.    A                                                               
performance  base  would state  that  the  floating facility  can                                                               
never ground on  the bottom, and it would be  up to the applicant                                                               
to decide  how to do  that; there might be  more ways to  do that                                                               
than  might  be  in  the  prescription.   Another  example  is  a                                                               
proposed  policy  on the  North  Slope  for avoiding  impacts  to                                                               
bowhead whales,  in which a  specific decibel level could  not be                                                               
exceeded when  measured at  a specific number  of miles  from the                                                               
activity.  This  is prescriptive, and the  company absolutely has                                                               
to do  that no  matter what.   A  performance base  would specify                                                               
that at a  specific number of miles from the  source of the noise                                                               
there shall be  no deflection of whales, and then  it would be up                                                               
to  the  industry  as  to  how  to meet  that.    He  said  that,                                                               
generally,  when  he  was  working with  the  oil  industry,  the                                                               
industry liked  these performance-based stipulations  or policies                                                               
because that  gave them  some flexibility to  meet the  intent of                                                               
the policy without having to meet an actual prescription.                                                                       
                                                                                                                                
2:53:16 PM                                                                                                                    
                                                                                                                                
CO-CHAIR SEATON  understood Mr.  Gray to  have earlier  said that                                                               
the statewide standards are almost all performance based.                                                                       
                                                                                                                                
MR. GRAY answered yes, performance based or process based.                                                                      
                                                                                                                                
CO-CHAIR  SEATON  further  understood  that  the  local  district                                                               
policies are required to be prescriptive.                                                                                       
                                                                                                                                
MR. GRAY replied, "Exactly."                                                                                                    
                                                                                                                                
2:53:40 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  SEATON   requested  Mr.   Gray  to   provide  citations                                                               
regarding the issues depicted on slide 7.                                                                                       
                                                                                                                                
MR. GRAY agreed to do so.                                                                                                       
                                                                                                                                
CO-CHAIR  SEATON,  regarding  slide  9,  referenced  a  March  17                                                               
document about  the Alaska Coastal Management  Program's changing                                                               
requirements for subsistence use  designations.  He surmised that                                                               
the examples  in the March 17  document relate to the  arrows and                                                               
changes outlined on the slide.                                                                                                  
                                                                                                                                
MR. GRAY replied  he has the actual documentation  in his records                                                               
and aforementioned  is a  summary of the  documents.   He pointed                                                               
out that  many of the  meetings were not taped  and a lot  of the                                                               
direction  was oral,  so there  was  no written  record unless  a                                                               
district  sent a  follow-up e-mail  stating its  understanding of                                                               
the direction  given in  a meeting.   On  several occasions  as a                                                               
consultant he  did that  to make sure  he understood  the meeting                                                               
correctly, and  the response he  got [from  DNR] on at  least two                                                               
occasions was  that it would not  go back and clarify  whether he                                                               
had  interpreted  the  various  points correctly.    He  said  he                                                               
provided to the committee what he  could find in some document or                                                               
another, but  a lot of  this was  verbal in its  original record,                                                               
other than notes.                                                                                                               
                                                                                                                                
2:56:20 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  FEIGE inquired  why it  is unreasonable  to expect  the                                                               
Division of  Coastal and  Ocean Management  (DCOM) to  not change                                                               
its  regulations.     It  seems  that  a   natural  evolution  of                                                               
regulations  would   be  expected   in  the  normal   process  of                                                               
regulating things like the coastal management program.                                                                          
                                                                                                                                
MR. GRAY responded that he did  not mean to give that impression.                                                               
While not speaking  for any specific district, he  said he thinks                                                               
the   districts  would   have  welcomed   some  changes   to  the                                                               
regulations for  a while  now.  However,  personally, he  has not                                                               
heard  any commitment  to  make  any changes  other  than to  the                                                               
consistency review regulations.                                                                                                 
                                                                                                                                
2:56:59 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FEIGE,  regarding DCOM asking  for more and  more detail                                                               
in terms  of larger  and larger  map scales,  said that  does not                                                               
seem unreasonable  to him.  While  such maps may cost  money, the                                                               
boroughs are not destitute.                                                                                                     
                                                                                                                                
MR.  GRAY related  that he  received a  call from  DCOM yesterday                                                               
saying that it is in the process  of changing that map scale.  He                                                               
said  his personal  opinion is  that it  is unreasonable  because                                                               
such maps  would cost hundreds  of thousands of dollars  for some                                                               
of these boroughs, which is  significant even for the North Slope                                                               
Borough.    The  Bering  Strait  district,  which  is  the  third                                                               
largest, receives an annual grant  of $75,000 and this must cover                                                               
everything from travel to employment of the program director.                                                                   
                                                                                                                                
CO-CHAIR  SEATON commented  that he  does not  have any  problems                                                               
with  going  through a  regulatory  process  and making  changes.                                                               
However, what is being looked at  here is that the districts were                                                               
told  how  to  write  their enforceable  policies  to  make  them                                                               
consistent  with  the  statewide standards  and  requirement  for                                                               
enforceable policies.   But over  time, as they went  through the                                                               
process of  creating an enforceable policy,  the requirements for                                                               
writing  the enforceable  policy  changed and  the districts  are                                                               
therefore always trying to develop a  plan that is required and a                                                               
policy that  is required,  but the  requirements for  that policy                                                               
keep changing.   This is where  much of the frustration  has come                                                               
from numerous districts over the past several years.                                                                            
                                                                                                                                
2:59:49 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FEIGE asked  whether Mr. Gray has  been working actively                                                               
to make statutory changes to the Alaska Coastal Management Plan.                                                                
                                                                                                                                
MR.  GRAY   responded  that   he  has  no   means  to   do  that.                                                               
Occasionally an  aide will give him  a call and he  will give his                                                               
opinion, but he did not prepare this bill.                                                                                      
                                                                                                                                
CO-CHAIR FEIGE said that was not  what he asked; he said he asked                                                               
whether Mr. Gray  has actively lobbied for changes  to the Alaska                                                               
Coastal Management Plan regulations.                                                                                            
                                                                                                                                
MR. GRAY answered he is not a  lobbyist so he does not lobby, but                                                               
that, yes, he has been promoting changes.                                                                                       
                                                                                                                                
CO-CHAIR FEIGE inquired  how much time Mr. Gray  has dedicated to                                                               
that.                                                                                                                           
                                                                                                                                
MR. GRAY replied  he does not know  how to make a  guess at that.                                                               
He said it is a small part of  what he does and that currently he                                                               
has seven  different contracts with coastal  communities, not all                                                               
on coastal zone issues, so his day is pretty full.                                                                              
                                                                                                                                
3:00:50 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  SEATON held  over  HB 106,  noting  that the  committee                                                               
packets  include bullet  points  on the  proposed committee  work                                                               
draft for HB 106 as well  as a sectional analysis on the proposed                                                               
work  draft [Version  B, moved  3/16/11].   He  urged members  to                                                               
review these documents.