02/12/2002 01:35 PM Senate L&C

                SB 263-REAL PROPERTY CONVEYANCES                                                                            
                                                                                                                              
CHAIRMAN BEN STEVENS called the Senate Labor & Commerce Committee                                                             
meeting to order at 1:35 p.m. and announced SB 263 to be up for                                                                 
consideration.                                                                                                                  
                                                                                                                                
MS. ANNETTE KREITZER, Staff to Senator Leman, sponsor of SB 263,                                                                
said this bill was requested by Sealaska and attempts to resolve                                                                
a legal dilemma. She explained:                                                                                                 
                                                                                                                                
     Under the  Alaska Native  Claims Settlement Act  (ANCSA)                                                                   
     village  corporations   own  surface  estate   to  lands                                                                   
     conveyed under ANCSA, but regional  corporations own the                                                                   
     subsurface  estate. Where estate  is passed to  a person                                                                   
     by a  quit claim deed, only  the rights the  grantor had                                                                   
     are passed  to the grantee, so the village  corporations                                                                   
     cannot pass on  the right to disturb the  surface of the                                                                   
     property   so  that   shareholders   could  build,   for                                                                   
     instance,  a home.  To correct  this SB  263 amends  the                                                                   
     conveyance  statutes to allow  after acquired title  for                                                                   
     shareholders.  There have  been some  concerns that  the                                                                   
     legislation as  introduced was too broad and  would have                                                                   
     unintended  impacts  and  for  that reason  you  have  a                                                                   
     committee   substitute   in   your   packets,   LS1318\J                                                                   
     Bannister 2/12/02.  On page 2,  lines 3 -  6, subsection                                                                   
     (b) - this is the subsection  we believe will ameliorate                                                                   
     the concerns  that the  Department of Natural  Resources                                                                   
     had…                                                                                                                       
                                                                                                                                
SENATOR DAVIS moved to adopt the CS to SB 263. There were no                                                                    
objections and it was so ordered.                                                                                               
                                                                                                                                
MR. RICHARD HARRIS, Sr. Vice President, Natural Resources,                                                                      
Sealaska Corp. and MR. JON TILLINGHAST, Counsel to Sealaska, said                                                               
they appreciated consideration of this bill.                                                                                    
                                                                                                                                
MR. HARRIS explained:                                                                                                           
                                                                                                                                
     It [this bill] was driven by  a problem that we began to                                                                   
     encounter in  which village corporations  had subdivided                                                                   
     their  property  and  conveyed  some of  their  land  to                                                                   
     shareholders.  In  doing  those  transactions,  in  some                                                                   
     cases we  had worked with  the village corporations  and                                                                   
     actually gave them a subsurface  easement, which allowed                                                                   
     people to develop the subsurface  in terms of putting in                                                                   
     foundation, water  lines, sewers and sewer  lines, to be                                                                   
     able to move  sand and gravel around on the  estate that                                                                   
     belonged  to Sealaska. In  some circumstances,  however,                                                                   
     subdivisions  were created and  the subsurface  easement                                                                   
     was not  completed or transferred  to the recipients  of                                                                   
     the property.  We estimate that we have right  now about                                                                   
     500 -  600 people who own  lots in Southeast  Alaska who                                                                   
     don't  have  a  clear  title.  They  are  currently  the                                                                   
     subsurface   in   some   way,   probably   without   the                                                                   
     appropriate easement.  This legislation would  enable us                                                                   
     to  create   the  easement,  pass  it  to   the  village                                                                   
     corporation  who would then,  by virtue of that  action,                                                                   
     would allow the easement, which  we are willing to grant                                                                   
     to be transferred down to people.  The effect is that we                                                                   
     clear up their title.                                                                                                      
                                                                                                                                
SENATOR TORGERSON  questioned the  wording of the  purpose section                                                              
and  asked  if  they  were trying  to  accomplish  more  than  one                                                              
purpose.                                                                                                                        
                                                                                                                                
MR. TILLINGHAST replied that they could say "the purpose".                                                                      
                                                                                                                                
SENATOR TORGERSON asked  why they referred to "some  cases" in the                                                              
purpose section.                                                                                                                
                                                                                                                                
MR.  TILLINGHAST replied  with  the exceptions  the  bill has  for                                                              
state  conveyances  and  municipalities   and  the  University  of                                                              
Alaska, it is probably now more accurate to say "in some cases".                                                                
                                                                                                                                
CHAIRMAN STEVENS asked if that was (b) on page 2.                                                                               
                                                                                                                                
MR. TILLINGHAST replied yes.                                                                                                    
                                                                                                                                
SENATOR  TORGERSON asked  if  they needed  to  mention the  Mental                                                              
Health Trust  since it is a trust,  not an agency of  the state or                                                              
the executive branch.                                                                                                           
                                                                                                                                
MR.  TILLINGHAST  said  they  would  have  no  objection  to  that                                                              
language.                                                                                                                       
                                                                                                                                
SENATOR LEMAN said he supported this legislation.                                                                               
                                                                                                                                
SENATOR TORGERSON  moved to adopt amendment  #1 on page  1, line 7                                                              
delete  "one"  and insert  "the"  and on  page  2,  line 6  insert                                                              
"Mental  Health Trust".  There were  no objections  and it  was so                                                              
ordered.                                                                                                                        
                                                                                                                                
SENATOR LEMAN  moved to  pass CSSB 263  (L&C) from committee  with                                                              
individual recommendations.  There were  no objections and  it was                                                              
so ordered.