Legislature(2019 - 2020)CAPITOL 106
04/22/2019 08:00 AM House EDUCATION
Note: the audio ![]()
and video ![]()
recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.
| Audio | Topic |
|---|---|
| Start | |
| HJR13 | |
| HB128 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HJR 13 | TELECONFERENCED | |
| += | HB 128 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
HJR 13-COMPLETION OF UNIVERSITY LAND GRANT
8:09:04 AM
CO-CHAIR DRUMMOND announced the first order of business would be
HOUSE JOINT RESOLUTION NO. 13, Urging the Alaska delegation in
Congress, the United States Department of the Interior, and the
Governor to facilitate the completion of a land grant endowment
to the University of Alaska.
[Due to recording difficulties, portions of the audio were
lost.]
8:09:32 AM
REPRESENTATIVE LANCE PRUITT, Alaska State Legislature, informed
the committee although the University of Alaska (UA) is a land
grant university, it has not received its full allotment of
land. In fact, UA is still owed approximately 360,000 acres,
which, if conveyed, would serve to alleviate some of the
university's financial challenges, as does land owned by the
Alaska Mental Health Trust Authority, which generates income
from its land to provide services to its beneficiaries. In 2000
and 2005, the legislature sought to provide land allotments to
UA, but its actions were found unlawful by the Alaska Supreme
Court. Therefore, HJR 13 requests the Alaska congressional
delegation work with the federal government to complete the land
grant endowment to UA.
[Due to recording difficulties, portions of the audio were
lost.]
REPRESENTATIVE ZULKOSKY asked whether the land in question is
federal land, and for the amount of land that would be conveyed.
REPRESENTATIVE PRUITT affirmed the land is federal land ....
[Due to recording difficulties, portions of the audio were
lost.]
8:15:00 AM
The committee took an at-ease from 8:15 a.m. to 8:17 a.m.
REPRESENTATIVE JOHNSON asked about the specifics of the land to
be conveyed.
REPRESENTATIVE PRUITT explained the total land grant is a little
under 105,000 acres ....
[Due to recording difficulties, portions of the audio were
lost.]
REPRESENTATIVE PRUITT said the current and previous [state]
administrations have been actively pursuing this matter.
REPRESENTATIVE JOHNSON asked how many other states have not
received their conveyance of federal land.
REPRESENTATIVE PRUITT advised the majority of other states have
received their federal land conveyances. He pointed out,
especially on the East Coast, all federal land grants were
conveyed to [institutions of higher education]; however, as
western states were granted statehood, less land was given to
state universities. He explained after the [Alaska Statehood
Act] was enacted changes were made to the Territory of Alaska's
earlier land grant allocations, in a manner similar to changes
in federal law made by passage of the Alaska National Interest
Lands Conservation Act (ANILCA). However, Alaska can still
request to change the law again and receive the land grants that
were originally authorized to support its university system.
REPRESENTATIVE JOHNSON surmised this is a favorable time to
approach the U.S. Department of the Interior (DOI).
REPRESENTATIVE PRUITT agreed for multiple reasons: the current
[federal] administration is favorable to Alaska; there are two
U.S. senators representing Alaska who hold positions in key
places; current federal fiscal challenges require states to
"provide for themselves." He addressed the importance of
putting Alaska in a position to educate its students.
8:23:26 AM
MILES BAKER, Associate Vice President, Government Relations, UA,
provided a PowerPoint presentation entitled, "University of
Alaska Land Grant Status" dated 4/22/19. Mr. Baker informed the
committee UA is a land grant university, but out of 49 states
that received college land grants, only Delaware was given less
acreage than Alaska. He directed attention to information
provided in the committee packet on the history of land grants
dedicated to higher education; Attachment 1 was information on
the acreage of all of the university land grants allotted to 49
states [Hawai'i received a monetary permanent endowment]. Mr.
Baker said a land grant university, college, or institution is
an entity of higher education that has been granted federal land
so that the entity can raise money and establish an endowment.
The program was established by the Morrill Act of 1862; the
mission of the act was to spread education in the fields of
agriculture, science, and engineering, and to develop U.S.
western expansion. Currently there are over 70 land grant
institutions in the U.S; however, under terms within the Alaska
Statehood Act (statehood), Alaska was not granted its allotment.
Mr. Baker directed attention to slide 3 and noted Alaska has
received 110,000 acres of its entitlement and is due
approximately 360,000 acres. A permanent land grant would help
provide an endowment for the university and generate a steady
source of income that would reduce the amount of funds required
from the state's general fund (GF). However, the federal
government's position is that the federal responsibility for
providing the land grant was fulfilled by the land that was
transferred to the state at statehood (slide 4).
8:29:00 AM
MR. BAKER continued, noting three pre-[Alaska]statehood federal
laws determine Alaska's entitlement (slide 5): the Morrill Act
of 1862, which was revoked at statehood; the 1915 Wickersham
Land Grant Statute, which granted Alaska 336,000 acres in the
Tanana Valley area, of which only 5 percent was conveyed prior
to its revocation at statehood; the 1929 Land Grant Statute,
which conveyed 100,000 acres of UA's current landholdings.
Attempts by the legislature to provide additional land to UA
began in 1959, when the First Alaska State Legislature
transferred 1 million acres to UA, but the legislation was
vetoed by former Governor William Egan; between the '60s and the
'80s, land issues in Alaska were complicated by legal action
related to the Alaska Native Claims Settlement Act (ANCSA) and
the Alaska National Interest Lands Conservation Act (ANILCA),
and by Land Orders imposed by the Bureau of Land Management
(BLM), DOI, related to construction of the Trans-Alaska Pipeline
System. In 2000, the legislature passed legislation to grant
land to UA, which received a favorable ruling by the Alaska
Supreme Court; in 2005, the legislature passed legislation to
transfer actual pieces of land to UA, however, in 2009, that
legislation was ruled against by the Alaska Supreme Court as a
violation of the anti-dedication clause of the Alaska State
Constitution. Currently, UA owns about 151,000 acres from the
1929 Land Grant Statute, private donations, and land granted
from local governments (slides 6 and 7).
8:34:26 AM
MR. BAKER noted there is a possible solution for the legislation
that was ruled unconstitutional: an exemption from the anti-
dedication clause in the state constitution. He said, "There is
[an] exemption in that - in the dedication clause - that says
that dedication, in essence, is allowed when required by the
federal government for state participation in a federal
program." So, since 2009, UA has been working with the Alaska
delegation to create an applicable federal program; however, he
restated the federal government's position that UA's land is
included in the federal land that will be transferred when the
state makes its final land selection from its remaining
entitlement of 5 million acres not encumbered by public land
orders. In fact, about 20 million acres could be part of an
agreement between BLM, the Department of Natural Resources
(DNR), and UA. The agreement would be part of a UA land trust
program established by the federal government (slide 8). He
remarked:
We believe it could be a robust program that also
solves some of the outstanding administrative and
other land issues that are affecting the final
selection for the state. So, we see this as sort of a
potentially good impetus and a good problem to be
worked into that final solution with, with the state's
own land ... selections. We've looked at whether
there's a need for federal legislation, there may not
be a need, for that ... but we do believe that through
the ... federal land policy management act, which is
the federal act that governs how public lands are
managed by BLM, and also some authorities ... included
in ANILCA, that DOI may actually have the
administrative authority to do these sorts of
exchanges ....
8:38:28 AM
MR. BAKER directed attention to slide 9 which illustrated UA's
current landholdings in the amount of 151,000 acres; about
12,000 acres are educational land consisting of campuses,
research sites, and other facilities, and 139,000 acres are
invested in five categories of real estate. He pointed out UA
does not hold a significant amount of land with developable
natural resources; most investment has been in residential real
estate, commercial property, and timber resources. Slide 10
illustrated historical receipts: since 1987, UA generated
$220,000 from its lands; in fiscal year 2018 (FY 18) UA
generated $10 million in gross receipts, with an average over
the last 20 years of $8.5 million. Slide 11 was a graph which
illustrated "sporadic" receipts by resource category from FY 87-
FY 18; a permanent land endowment would "smooth out that revenue
stream." Finally, he presented the UA Land Trust Balance that
at the end of FY 18 was about $160 million, a large portion of
which funds the UA Scholars Program that offers scholarships to
the top 10 percent of Alaska high school graduates (slide 12).
8:42:53 AM
REPRESENTATIVE ZULKOSKY returned attention to slide 11 and asked
if the graph shows how UA monetizes its land to generate revenue
for the university.
MR. BAKER said yes. He pointed out the pie chart on slide 10
illustrates the cumulative amount, earned since 1987, is $221
million, from the following categories: real estate, including
sales, leases, and easements; forest timber sales in the
[Tongass National Forest]; gravel and rock extractions; mining,
coal, oil, and gas. Mr. Baker further explained land and timber
sales are predominately a one-time gain; however, UA prefers
landholdings that fit the profile of the university and generate
income on an ongoing basis, such as royalty from oil and gas,
other property leases, or wetlands carbon banks.
REPRESENTATIVE ZULKOSKY returned attention to slide 6, noting
ANCSA, characterized in the presentation as a "complicating
[factor]," was in fact a settlement of treaty obligations to
aboriginal land claims which has generated millions of dollars
of revenue for Alaska and significant investment in higher
education. Further, ANILCA established over 43 million acres of
new national parkland in Alaska. She asked:
What is the university's expectation, potentially, of
impacts to other federal lands or land status in order
to make sure that this land, land grant is conveyed?
[Are] there going to be impacts to other federal lands
in Alaska as a result of any potential acts of
Congress?
MR. BAKER responded:
I think we certainly understand ... under the broader
sort of feeling in Congress, and within the federal
land managers, that probably no, no new federal land,
no new additive federal land would come to Alaska
through this program ... we don't anticipate the feds
deciding that, we know, we should get ... 360,000
acres of federal land that exists in Alaska, that it
is not due to someone else already, or to another
organization. We do believe that there are things we
have in our portfolio that are to the, could be to the
benefit of the federal government and the public at
large. Whether that's our park inholdings - we've got
several inholdings in national parks - that sound
great, but they're very remote, very hard to develop.
It's a small market of folks that might even be
interested ... but the federal government, I think, is
interested in them ... potentially being able to more
effectively manage those national parks in a
contiguous fashion. ... We think there actually may
be sort of mutual benefits there, but I think it, it
will largely depend on what land, what land we would
end up negotiating with DNR. We anticipate that it's
principally going to be state land or land owed to the
state through their final five million settlement.
But where those lands are and how they might impact
other adjacent property owners, that sort of thing,
I'm not sure we know yet.
8:50:16 AM
ANDY HARRINGTON, Associate General Counsel, UA, agreed with Mr.
Baker. He opined UA is offering a simple proposal that will not
require federal legislation or the need to revisit any previous
decision by Congress. He surmised the idea is to get the land
grant "gap" filled, using lands that are due to the state as
much as possible. Mr. Harrington said UA would avoid lands that
are in dispute between the state and Native corporations, or
other controversial issues, and seeks to fill the gap with
noncontroversial land.
8:51:48 AM
REPRESENTATIVE JOHNSON returned attention to slide 11, noting
the [University of Alaska Fairbanks (UAF)] agricultural farm,
and the Trunk Road property, were large tracts of federal land
that were granted to UA for experimental farms and agriculture,
but were sold because of their monetary value. She asked, if UA
is granted more federal land, whether the land would be used for
educational or resource development purposes, or would be sold
to generate revenue.
MR. BAKER related UA seeks to manage its land as a trust so that
receipts earned from the sale of real estate would be returned
to the trust to fund UA operations and programs - some of which
are related to natural resource development - in order to
establish a connection between educational programming and
resource revenue in support of educational programming. He
opined the aforementioned sales were of land that was in demand,
with the intent to balance UA's portfolio and thereby reduce its
dependence on state GF.
8:56:12 AM
LAURA CARMACK, Senior Property Manager, UA, confirmed the
aforementioned properties were sold in response to industry
need; however, UA's focus is now on resource development and the
properties currently owned by UA in the Matanuska-Susitna (Mat-
Su) area are mostly educational land.
REPRESENTATIVE JOHNSON pointed out several [UA] agricultural
holdings and projects in Mat-Su are being transferred to UAF
even though Mat-Su is the only location for a thriving
agricultural and educational facility. She asked whether
additional UA holdings in Mat-Su will be sold because of their
value.
CO-CHAIR DRUMMOND recalled the Fairbanks area was once entirely
self-supporting through agriculture.
MR. BAKER offered to provide further information related to UA's
short-term plans for its experimental farm that is part of the
UAF extension program. He acknowledged portions of the Mat-Su
properties were primarily sold to accommodate the growth of
transportation corridors and the Mat-Su Regional Medical Center.
REPRESENTATIVE JOHNSON returned to slide 11 and questioned
whether UA seeks to sell its property or turn to "active
resource development," such as oil and gas leasing, on its land.
MR. BAKER related UA is currently conducting a review of its
land and will further discuss with DNR the land that was
[transferred] by the legislature in 2005 and returned to the
state in 2010; he advised - generally - UA is interested in the
same sort of revenue-generating land as the state; for example,
UA's preference is to maintain landholdings that have oil and
gas, mineral, and mining potential.
REPRESENTATIVE JOHNSON urged UA to seek and manage land that
produces income from resource development.
9:02:46 AM
CO-CHAIR DRUMMOND encouraged Mr. Baker to review the continuity
of services to Southcentral that are delivered from the UA
cooperative extension service office in Fairbanks.
REPRESENTATIVE REVAK asked whether there are other sources of
real estate income, in addition to sales, such as commercial or
residential rent and leases, and if so, the amount thereof.
MS. CARMACK explained the revenue generated from the sale of UA
property, leasing, and permitting activity is included on slide
11.
[Due to recording difficulties some portions of the audio were
lost.]
REPRESENTATIVE REVAK inquired as to the percentage of real
estate revenue earned by leasing and permit activity.
MS. CARMACK said currently the majority is permit activity and
leasing; the majority of leasing revenue is from commercial
office space leasing and leasing of land throughout the state.
In further response to Representative Revak, she offered to
provide the percentage of real estate revenue from lands that UA
has retained.
9:07:13 AM
CO-CHAIR STORY asked how the UA land grant "dovetails with land
grants for K-12 schools." She recalled K-12 schools are
entitled to land that has not been acquired because the land was
never surveyed.
MR. HARRINGTON affirmed public school land grants and university
land grants began with the 1915 Wickersham Land Grant Statute
which set aside one section in each township of the Tanana
Valley [survey] "rectangle" and two sections in each township
throughout the territory for public school lands. Subsequently,
the two issues diverged; in 1978, the legislature changed the
public school land sections into general land grants and instead
gave the public schools a revenue stream: one-half of one
percent of all revenue generated from resource development
throughout the state. Although UA was given the same option,
the UA Board of Regents decided not to accept. Also, in 1980,
ANILCA included an additional 75,000 acres of federal land
specifically to fulfil the remaining school land trust but did
not address the UA land grant gap. In response to Co-Chair
Drummond, he said further information on legislation related to
UA could be found in the committee packet.
9:10:59 AM
CO-CHAIR DRUMMOND opened public testimony on HJR 13. She
announced HJR 13 was held over with public testimony open.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB128 Response to H EDC Committee questions 4.20.19 (002).pdf |
HEDC 4/22/2019 8:00:00 AM |
HB 128 |
| HJR 13 2019 Presentation House Education UA Lands.pdf |
HEDC 4/22/2019 8:00:00 AM |
HJR 13 |