04/07/2014 01:00 PM House RESOURCES

                HB 371-STATE LAND AND MATERIALS                                                                             
                                                                                                                                
2:42:25 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  SADDLER  announced  that  the final  order  of  business                                                              
would  be  HOUSE   BILL  NO.  371,  "An  Act   providing  for  the                                                              
Department  of Transportation  and Public  Facilities to  hold the                                                              
surface estate  of certain  state land;  relating to the  transfer                                                              
of  certain  state  land  and materials  from  the  Department  of                                                              
Natural Resources  to the Department of Transportation  and Public                                                              
Facilities  for  the  construction  or maintenance  of  the  state                                                              
highway system,  state airports,  and state  public buildings  and                                                              
facilities; relating  to the  lease or sale  of certain  marine or                                                              
harbor  facilities;  relating to  the  lease  or disposal  by  the                                                              
Department of Transportation  and Public Facilities  of rights-of-                                                              
way,  property  interests,  or improvements  that  are  no  longer                                                              
required;  relating  to  the  grant   of  certain  easements  over                                                              
submerged state  land to the  federal government; relating  to the                                                              
transfer  of certain  maintenance  stations  on the  James  Dalton                                                              
Highway   to  the   Department   of  Transportation   and   Public                                                              
Facilities; relating  to the conveyance  of land  for right-of-way                                                              
purposes from  the Alaska Railroad  Corporation to  the Department                                                              
of  Transportation and  Public Facilities;  and  providing for  an                                                              
effective date."                                                                                                                
                                                                                                                                
2:43:39 PM                                                                                                                    
                                                                                                                                
CO-CHAIR FEIGE  moved to adopt  the proposed committee  substitute                                                              
(CS)  for HB  371, labeled  28-LS1545\O, Bullock,  4/4/14, as  the                                                              
working draft.   There  being no objection,  Version O  was before                                                              
the committee.                                                                                                                  
                                                                                                                                
2:44:02 PM                                                                                                                    
                                                                                                                                
BECKY  ROONEY, Staff,  Representative Peggy  Wilson, Alaska  State                                                              
Legislature,  explained the  changes  to the  proposed Version  O.                                                              
She said that Section  15 had been removed.  She  reported that HB
  had  been   introduced  at  the  request   of  Department  of                                                              
Transportation  & Public  Facilities  (DOT&PF)  and Department  of                                                              
Natural  Resources  (DNR)  and  was  collaboration  between  these                                                              
departments  to  reduce  ambiguity  and  streamline  rights-of-way                                                              
processes.   She declared  that this was  a no-cost  solution that                                                              
would  save time  and resources  for  transportation projects,  as                                                              
well  as  eliminate   contractor  requirements  between   the  two                                                              
departments  when  accessing  road  materials  for  transportation                                                              
projects.   She stated  that there would  be a reciprocal  removal                                                              
of the  55-year lease  limit on  US Forest Service  transportation                                                              
easements and DNR log transfer easements.                                                                                       
                                                                                                                                
2:45:40 PM                                                                                                                    
                                                                                                                                
KIM  RICE,  Deputy  Commissioner,   Office  of  the  Commissioner,                                                              
Department of Transportation  & Public Facilities,  explained that                                                              
the  purpose of  the bill  was to  create  a relationship  between                                                              
DOT&PF and  DNR for the overlap  of land process procedures.   She                                                              
said that the  bill would streamline project delivery  by removing                                                              
duplicate  process,  would improve  the  process  for disposal  of                                                              
excess  right  of way  to  adjoining  property owners,  and  would                                                              
reduce bureaucracy  for the  management of  state material  sites.                                                              
She  pointed  out that  the  agency  did  request the  removal  of                                                              
Section 15 of the  proposed bill.  She stated that  the agency had                                                              
been  diligent  in  its  attempt  to respond  to  all  the  public                                                              
comments and make  clarifications and changes per  those requests.                                                              
She  paraphrased   from  the   Sectional  Analysis   [included  in                                                              
members' packets], which read:                                                                                                  
                                                                                                                                
     Sec.  3, 5 &  8. These  sections are  identical in  form                                                                 
     and  establish  a process  for  the transfer  of  state-                                                                   
     owned   public   domain   land   to   DOT&PF   for   the                                                                   
     construction  or  maintenance  of  state-owned  airports                                                                   
     (AS  02), highways  (AS 19)  and  public facilities  (AS                                                                   
     35).   Within   four   months    of   DOT&PF's   written                                                                   
     determination  that  public  domain land  is  reasonably                                                                   
     necessary  for  a  DOT&PF facility,  DNR  must  transfer                                                                   
     title   to  the   surface  estate   of  the   identified                                                                   
     property.  The public  receives notice  of the  intended                                                                   
     transfer of  state land by  posting of DOT&PF's  written                                                                   
     determination   and  property   plans.  These   sections                                                                   
     clarify that  a transfer of  land from DNR to  DOT&PF is                                                                   
     not a  "disposal" of  state land  and that the  transfer                                                                   
     of state  property for  the construction or  maintenance                                                                   
     of the state's  infrastructure is presumed to  be in the                                                                   
     public interest.                                                                                                           
                                                                                                                                
MS.  RICE  directed  attention to  the  [Typical  DOT&PF]  Project                                                              
Development  Process flow  chart  [included  in members'  packets]                                                              
which  described  the  dealings   with  agencies  and  the  public                                                              
through  the National  Environmental  Policy Act  (NEPA) of  1969.                                                              
She explained that,  although there was a misperception  that this                                                              
process did not  happen on all state projects, it  was required if                                                              
there  were  wetlands  or archaeological  sites  involved.    This                                                              
dictated  the   public  involvement  process,  which   included  a                                                              
checklist.   She  assured the  committee that  the public  process                                                              
was not being  thrown away, but  was being offered earlier  in the                                                              
project development process.                                                                                                    
                                                                                                                                
2:49:56 PM                                                                                                                    
                                                                                                                                
JOHN BENNETT, Right-of-Way  Chief, Northern Region,  Department of                                                              
Transportation &  Public Facilities, relayed that, as  some of the                                                              
existing  language  in the  disposal  statutes was  confusing  and                                                              
difficult, the  proposed bill attempted  to provide  language that                                                              
was  uniform for  aviation, highways,  and  public facilities,  in                                                              
order to  solve some  of the  problems.   He paraphrased  from the                                                              
Sectional Analysis, [included in members' packets], which read:                                                                 
                                                                                                                                
     Sec. 2,  4 & 10.  These sections  are identical  in form                                                                 
     and  provide uniform  language  across  all of  DOT&PF's                                                                   
     statutory  authorities for the  disposal of excess  land                                                                   
     and property  interests for  airports (AS 02),  highways                                                                   
     (AS 19)  and public  facilities (AS  35). Upon a  DOT&PF                                                                   
     determination  that  lands  or  property  interests  are                                                                   
     excess to  its needs, DOT&PF  shall notify DNR  to allow                                                                   
     the  transfer  of excess  lands  to  be used  for  other                                                                   
     public  purposes. DOT&PF retains  its current  authority                                                                   
     to dispose  excess property  and improvements  according                                                                   
     to the  terms and conditions  established by  the DOT&PF                                                                   
     commissioner.                                                                                                              
                                                                                                                                
MR.  BENNETT  explained  that this  essentially  offered  DNR  the                                                              
first right of refusal  for the return of excess  land, which also                                                              
allowed the opportunity  to assist adjoining property  owners.  He                                                              
offered an  anecdote for  sewage lagoons within  the right  of way                                                              
and  the  unresolvable   disposal  issues,  which   would  now  be                                                              
resolvable with  the proposed bill.   He relayed  another anecdote                                                              
for the return of  excess land, under AS 35, which  stated that it                                                              
had  to be  returned to  the vested  owner.   This  resulted in  a                                                              
situation whereby,  when the  original owner  could not  be found,                                                              
the land could not be sold.                                                                                                     
                                                                                                                                
2:53:25 PM                                                                                                                    
                                                                                                                                
SEAN LYNCH,  Assistant Attorney  General, Transportation  Section,                                                              
Civil  Division  (Juneau),  Department of  Law,  paraphrased  from                                                              
Sections 1, 6, and 9, which read:                                                                                               
                                                                                                                                
     Sec.  1, 6 &  9. These  sections are  identical in  form                                                                 
     and  resolve  an  ambiguity  in  state  law  that  vests                                                                   
     DOT&PF with  authority to hold  and manage airports  (AS                                                                   
     02), highways  (AS 19), public  facilities (AS  35), and                                                                   
     vests  DNR  with  authority  to hold  and  manage  state                                                                   
     lands (AS  38). These sections  clarify that  DOT&PF has                                                                   
     primary authority  to manage  the surface estate  of its                                                                   
     facilities;  DNR  retains its  authority  to  administer                                                                   
     its  statutory  authorities  on  highway,  airport,  and                                                                   
     public facility  land, upon DOT&PF terms  and conditions                                                                   
     to protect the state's infrastructure.                                                                                     
                                                                                                                                
MR.  LYNCH  explained  that  this placed  DOT&PF  in  the  primary                                                              
regulatory  position regarding highway  rights-of-way,  instead of                                                              
the current  overlapping authority  with DNR  for state land.   He                                                              
said a similar  issue for material sales was  addressed in Section                                                              
13, an  amendment to  the DNR  Alaska Lands  Act, which  broadened                                                              
the existing  DOT&PF exemptions in  AS 38.05.030 to  exempt DOT&PF                                                              
from  the DNR  material  sales  contract requirements,  while  DNR                                                              
retained its full authority to issue material sales contracts.                                                                  
                                                                                                                                
2:56:24 PM                                                                                                                    
                                                                                                                                
CO-CHAIR SADDLER  asked whether DOT&PF would have  to declare that                                                              
the material  was surplus to  its needs  before DNR could  sell it                                                              
to the public.                                                                                                                  
                                                                                                                                
MR. LYNCH  explained that third  party sales were under  an Alaska                                                              
Lands  Act  standard.   The  DNR  sales  were determined  by  best                                                              
interest to  the state, and DOT&PF  would coordinate with  DNR for                                                              
third party sales.                                                                                                              
                                                                                                                                
CO-CHAIR  SADDLER  asked if  there  were examples  of  legislative                                                              
appropriation supplanting best interest findings.                                                                               
                                                                                                                                
MR.  LYNCH  directed   attention  to  the  lands   acquisition  in                                                              
Sections 3,  5, and 8, and  explained that the transfer  of public                                                              
domain from  DNR to DOT&PF  was not a  disposal of state  land, it                                                              
was a  transfer presumed to  be in the  public interest.   He said                                                              
there  was not  a  need  for a  best  interest finding  under  the                                                              
Alaska  Lands Act when  state land  was appropriated  for  a state                                                              
infrastructure project.                                                                                                         
                                                                                                                                
CO-CHAIR SADDLER asked  for similar examples in state  law of this                                                              
language  where  the action  is  presumed  to  be in  the  state's                                                              
interest without a best interest finding.                                                                                       
                                                                                                                                
MR. LYNCH  reported that examples  of other state  agencies exempt                                                              
from the Alaska  Lands Act included the University  of Alaska, the                                                              
Alaska Railroad,  and the  Alaska Mental  Health Trust  Authority,                                                              
and therefore did not need best interest findings.                                                                              
                                                                                                                                
3:00:55 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  TARR requested  further  clarification on  Section                                                              
13.                                                                                                                             
                                                                                                                                
WYN MENEFEE,  Chief of  Operations, Division  of Mining,  Land and                                                              
Water,  Department of  Natural Resources,  clarified that  Section                                                              
13 was  different than the  previous Sections  1, 6, and  9, which                                                              
recognized  the  DOT&PF  primary  authority on  lands  needed  for                                                              
rights  of  way, and  Sections  3,  5,  and 8,  which  transferred                                                              
needed lands.   Section 13 offered  DOT&PF the liberty  to go into                                                              
and obtain  materials from  many other  material sites  which were                                                              
not  managed  by  DOT&PF,  without  a  material  contract  or  any                                                              
charge.  He  clarified that it was  up to DOT&PF to  determine how                                                              
to  manage  what  was  necessary,   as  DNR  would  manage  for  a                                                              
different purpose.                                                                                                              
                                                                                                                                
REPRESENTATIVE TARR  inquired as to where this was  located in the                                                              
budget, as DNR  would no longer receive the revenue  for materials                                                              
used by DOT&PF.                                                                                                                 
                                                                                                                                
MR. MENEFEE  explained that there  would be no charge  or transfer                                                              
of monies  for materials  used by DOT&PF.   DOT&PF currently  paid                                                              
DNR  an  administrative  processing   fee  for  a  material  sales                                                              
contract, but  under proposed HB  371, there would be  no transfer                                                              
of funds between the departments.                                                                                               
                                                                                                                                
MS.  RICE  explained  that the  administrative  fees  covered  the                                                              
contract cost,  but under  the proposed bill,  there would  not be                                                              
any  contract written.   She  added  that DNR  would consult  with                                                              
DOT&PF  and  would  limit  its   material  sales  based  on  those                                                              
requests.  She  pointed out that an existing  third party contract                                                              
would not be affected.                                                                                                          
                                                                                                                                
3:04:20 PM                                                                                                                    
                                                                                                                                
MR. BENNETT directed  attention to concerns for Section  3, 5, and                                                              
8,  and  the process  for  acquiring  new  property from  DNR  for                                                              
projects.   Eliminating DNR from  the decision-making  process and                                                              
the public  notice would  reduce transparency  to the  public, but                                                              
as  legislation specified  that  DOT&PF would  determine that  the                                                              
lands were  reasonably necessary,  another point of  public notice                                                              
was added  to the process with  no net loss in  public involvement                                                              
or notice.   He  stated that  public involvement  and process  was                                                              
extensive and varied depending on the complexity of the project.                                                                
                                                                                                                                
CO-CHAIR SADDLER held over HB 371.