01/24/1996 03:35 PM Senate RES

 SRES 1/24/96                                                                  
        SB 190 RESIDENCY REQUIREMENT/STATE LAND AUCTION                       
                                                                              
 SENATOR LEMAN announced an at-ease from 4:10 p.m. to 4:12 p.m. and            
 announced  SB 190 .                                                           
                                                                               
 SENATOR TAYLOR, Sponsor of SB 190, said the purpose of this bill is           
 to make certain that Alaskans have first option at purchasing our             
 State lands, those lands that are residential and recreational in             
 nature.  He filed the bill as a response to what occurred this                
 summer when people were attempting to "sell the Alaskan mystique."            
 The Alaska Tourism Marketing Council had advertised on the Internet           
 for people to come up and buy land.  Looking at the actual bids, he           
 found there was a resident of Fairbanks who submitted a bid on                
 State land, only to be outbid by a resident of Washington state by            
 $61.80.  A couple from Wasilla lost their chance to own a piece of            
 Alaska to a Minnesota woman, because she outbid them by $442. An              
 Anchorage woman lost out to a man from Michigan for $214.                     
                                                                               
 SENATOR TAYLOR said he didn't think the revenue was significant               
 enough to justify to him turning down Alaskans who might want a               
 chance of owning a piece of the State that they live in.  He                  
 thought they should be allowed first option.  He thought                      
 establishing sufficient residency for the Permanent Fund would be             
 good to use for this purpose.                                                 
                                                                               
 SENATOR TAYLOR provided the Committee with an amendment saying that           
 this bill does not interfere with commercial sales, the development           
 of agriculture, or the development of industries.  His "purpose is            
 to allow Alaskan individuals to own residential land and                      
 recreational land, and not to impede the development of an                    
 economy," he said.                                                            
                                                                               
 Number 501                                                                    
                                                                               
 SENATOR TAYLOR moved to adopt the amendment.  He explained that it            
 removed the restriction on commercial, industrial, or agricultural            
 land being available to only Alaskans.  SENATOR HALFORD objected              
 for a question.                                                               
                                                                               
 SENATOR HALFORD said he understood the industrial and commercial              
 exemption, but didn't understand the agricultural.  He did not want           
 to see the agricultural opportunities advertised outside, in farm             
 journals particularly, with such a pattern of subsidy.  SENATOR               
 TAYLOR said the concern comes from the agricultural community who             
 said SB 190 was very restrictive, because frequently in the history           
 of Alaska, farms have been developed by people from outside Alaska.           
 Many other enterprises, like barley, came in from outside the                 
 State.  His concern was for the fellow who lives here who wants to            
 buy the adjoining 40 acres to his already established parcel.                 
 Should he have to compete against outside agricultural purposes.              
                                                                               
 Number 540                                                                    
                                                                               
 RON SWANSON, Deputy Director, Division of Lands, said there already           
 is a preference right.  If you are an adjoining agricultural land             
 owner, you do have the preference to the adjacent parcel.  You                
 would have to meet the high bid to get it, though.                            
                                                                               
 MR. SWANSON said Alaskans should have the opportunity to obtain               
 lands first.  Of the almost 500 parcels that were available for               
 disposal, 287 of them have been sold to date.  The others are still           
 available over-the-counter about a week and a half ago.  He said              
 the land in Southeast has particularly high interest.                         
                                                                               
 SENATOR LINCOLN said she was also concerned about adding the                  
 agricultural lands.  She wanted to see any agricultural lands in              
 the future, whether it is an individual with adjacent land, she               
 would like to see it go to an Alaskan, first.                                 
                                                                               
 She was puzzled with the fiscal note of $5,000 for residency                  
 verification.  MR. SWANSON said to date the residency requirement             
 for homesteading is an affidavit for residency on the application             
 which has to be notarized by a postmaster.  Unless there is a                 
 question by someone, they do not verify the information.  If the              
 intent of the bill is to find out if the individual is truly a                
 resident, they would have to take that extra step.                            
                                                                               
 SENATOR LINCOLN said she couldn't see why it would cost so much               
 with today's technology to verify against a Permanent Fund                    
 application.                                                                  
                                                                               
 Number 586                                                                    
                                                                               
 TAPE 96-5, SIDE B                                                             
 Number 590                                                                    
                                                                               
 SENATOR FRANK asked for the logic behind exempting industrial and             
 commercial land.  SENATOR TAYLOR explained that primarily there is            
 a market.  That market is determined by the business you're in, not           
 necessarily by State boundaries.  We have never excluded based on             
 residency before in those areas, nor have we on the residential or            
 recreational.  He is beginning a process of providing some                    
 exclusion.                                                                    
                                                                               
 SENATOR FRANK asked if we sell commercial land much.  MR. SWANSON             
 answered that the State doesn't sell commercial land; that it is              
 leased.  This is still considered "disposal."                                 
                                                                               
 Number 575                                                                    
                                                                               
 CHARLES FORCK, Delta Junction, supported SB 190 and the proposed              
 amendment.  The residency requirement for agriculture is                      
 counterproductive to agricultural development.  "Agricultural                 
 expertise is in short supply in Alaska, as are people who want to             
 do the work.  Also, capital is in short supply for development."              
                                                                               
 SENATOR TAYLOR noted for the record that on line 11 the word                  
 "proceeding" should be changed to "preceding."                                
                                                                               
 Number 544                                                                    
                                                                               
 SENATOR HALFORD said he wanted to differentiate between the high              
 value, high popularity, small, agricultural parcels where there are           
 plenty of residents and a lot of people competing for them and the            
 big farms that require the outside expertise.  He thought the                 
 agricultural auction could be advertised across the country and the           
 reaction of the local people would be exactly the same thing in as            
 in Southeast, when people lost parcels to outsiders.                          
                                                                               
 MR. SWANSON agreed that there could be a problem and suggested that           
 a possible solution would be to leave the agricultural                        
 resident/non-resident decision up to the commissioner who would               
 make a best-interest-finding of which way to do it.  SENATOR LEMAN            
 asked if that's the way it is done now.  MR. SWANSON replied, no,             
 that currently all land is available to residents and non-                    
 residents.  That is the purpose of this amendment.  The                       
 prequalification language for agricultural land currently in law is           
 for financial reasons, not inability to develop agricultural                  
 parcels.                                                                      
                                                                               
 SENATOR TAYLOR said he would be willing to work with Senator                  
 Halford and Mr. Swanson for a solution.  If they can't find a                 
 solution, he thought it better to leave the law as it's been for              
 the last 20 years.                                                            
                                                                               
 MR. SWANSON said the bill they passed Monday, dealing with                    
 agricultural lands, deleted the prequalification requirements.  If            
 that passes, the Department would have no ability to screen out who           
 does not qualify.  He said he would be happy to work with the two             
 Senators on a solution.                                                       
                                                                               
 SENATOR LEMAN asked if there were any other objections to amendment           
 He noted the change of "proceeding" on line 11 to "preceding."                
                                                                               
 SENATOR PEARCE moved to pass SB 190 am from committee with                    
 individual recommendations and the accompanying fiscal note.  There           
 were no objections and it was so ordered.