Legislature(2001 - 2002)

04/23/2002 08:06 AM House CRA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HB 500-ADVANCE ACQUISITION OF REAL PROPERTY                                                                                   
CO-CHAIR MEYER announced  that the first order  of business would                                                               
be  HOUSE  BILL  NO.  500,   "An  Act  relating  to  the  advance                                                               
acquisition of real property for public purposes."                                                                              
Number 0097                                                                                                                     
MIKE  KRIEBER,   Staff  to  Representative  Vic   Kohring,  House                                                               
Transportation  Standing  Committee,  Alaska  State  Legislature,                                                               
noted that he met with  Representative Kerttula and discussed the                                                               
issues  brought  up at  the  last  House Community  and  Regional                                                               
Affairs Standing  Committee hearing.   Ultimately, Version  F was                                                               
developed.  The committee packet  should include a summary of the                                                               
changes incorporated in  Version F.  Although there  are many new                                                               
sections in Version F, many of them are redundant.                                                                              
MR. KRIEBER  pointed out that  Section 2  had referred to  a time                                                               
period  not greater  than five  years  for advanced  acquisition.                                                               
That was  changed in Version  F to refer to  advanced acquisition                                                               
"that will occur in the future."   Version F added Sections 5, 7,                                                               
9,  11, and  13,  which  are essentially  identical.   These  new                                                               
sections  address the  fairness  issue.   In  other  words, if  a                                                               
public  entity that  acquired a  property through  eminent domain                                                               
doesn't use the property for  the stated purpose within 20 years,                                                               
the property  owner from  which the  state acquired  the property                                                               
would have the first right to  purchase the property for the same                                                               
price  it was  acquired through  eminent domain.   Therefore,  it                                                               
prevents public sector speculation.                                                                                             
Number 0390                                                                                                                     
CO-CHAIR  MEYER posed  a situation  in which  the state,  through                                                               
eminent domain, pays  $500 per acre for land.   However, 20 years                                                               
from  the acquisition  the  state realizes  it  doesn't need  the                                                               
land.   Co-Chair  Meyer understood  that then  the land  would be                                                               
returned  to  the owner  for  the  same  price  at which  it  was                                                               
acquired.   Therefore, he questioned whether  returning that land                                                               
back at  the price of acquisition  would be fair to  the state or                                                               
public entity.                                                                                                                  
MR. KRIEBER  explained that  if the  land [was]  acquired through                                                               
eminent  domain,  then  the  property   owner  would  still  have                                                               
interest   in  the   property   through   the  following   years.                                                               
Therefore,  the  property  owner  would have  the  value  of  the                                                               
property later  and thus the  benefit of the  [possible increase]                                                               
in the  price of  the land  should accrue  to the  property owner                                                               
rather than the  state.  However, allowing the  state the ability                                                               
to purchase  land and sell  it later  seems in opposition  to the                                                               
"Fairness Doctrine."                                                                                                            
CO-CHAIR  MEYER remarked  that it  is probably  a good  method of                                                               
acquiring  land,   especially  in  order  to   avoid  speculation                                                               
Number 0568                                                                                                                     
REPRESENTATIVE MURKOWSKI pointed out that  Sections 3 and 4 refer                                                               
to "reasonably  foreseeable future use", but  that language isn't                                                               
maintained in Sections 6, 8, and 12.   She inquired as to why the                                                               
language in  Sections 6, 8,  and 12  don't conform to  Sections 3                                                               
and 4.                                                                                                                          
MR. KRIEBER  said that was  an oversight and thus  announced that                                                               
he  would   be  amenable   to  changing   the  language   [to  be                                                               
Number 0726                                                                                                                     
REPRESENTATIVE  MURKOWSKI moved  that  the  committee adopt  CSHB
500,  Version 22-LS0610\F,  Utermohle,  4/22/02,  as the  working                                                               
document.   There being  no objection, Version  F was  before the                                                               
REPRESENTATIVE  MURKOWSKI  moved  that the  committee  adopt  the                                                               
following conceptual Amendment 1:                                                                                               
     Page 4, line 24;                                                                                                           
     Page 5, line 19;                                                                                                           
     Page 6, line 12;                                                                                                           
     Page 6, line 31;                                                                                                           
          Before "future",                                                                                                  
          Insert "reasonably foreseeable"                                                                                       
There being no objection, Amendment 1 was adopted.                                                                              
Number 0891                                                                                                                     
CO-CHAIR  MORGAN referred  to page  4, line  10, which  specifies                                                               
"The  corporation shall  offer the  land  to the  person, or  the                                                               
person's successor in  interest, from whom the  land was acquired                                                               
at the same  price that the corporation paid the  person when the                                                               
land was  acquired."  Therefore,  could the siblings of  an owner                                                               
who had died purchase the acquired  land for the same price as it                                                               
was sold.                                                                                                                       
MR.  KRIEBER  replied  yes.   In  further  response  to  Co-Chair                                                               
Morgan, Mr. Krieber clarified that  the provision provides a one-                                                               
time opportunity when the [state] decides  to sell it back to the                                                               
person  who  owns  the  property  or who  would  have  owned  the                                                               
property once the  owner is deceased.  He  further clarified that                                                               
the property  would be [sold to  the owner or the  owner's heirs]                                                               
at the original value.                                                                                                          
REPRESENTATIVE KERTTULA  remarked that  Mr. Krieber has  went far                                                               
in attempting to  make this section of HB 500  fair.  She pointed                                                               
out  that the  right to  hold  property and  property rights  are                                                               
really  fundamental constitutional  rights.    She expressed  her                                                               
desire  not  to  allow  any corporation  to  land  speculate,  in                                                               
particular  against   the  individual   property  holder.     She                                                               
emphasized that  the 20-year  limit is a  long time  during which                                                               
people will have  died, and therefore the first  right of refusal                                                               
to the individual [is important].                                                                                               
Number 1132                                                                                                                     
REPRESENTATIVE SCALZI commented  that in a situation  in which an                                                               
individual had  the first  right of refusal  after 20  years, the                                                               
speculator  would   remain  in   a  good  position   because  the                                                               
speculator  would purchase  the land  at the  price for  which he                                                               
sold it for 20 years prior.                                                                                                     
REPRESENTATIVE KERTTULA  highlighted that this  [provision] would                                                               
only  be used  in cases  of  eminent domain  when the  government                                                               
takes the land.  Although the land  may have been owned by a land                                                               
speculator, it  was still  their land.   She suggested  that this                                                               
will  impact  those with  rights-of-way  and  such.   In  further                                                               
response  to   Representative  Scalzi,   Representative  Kerttula                                                               
acknowledged  that a  speculator could  purchase land  subject to                                                               
eminent  domain, which  can happen  now.   Once someone  owns the                                                               
land, that  individual has  property rights.   This  provision of                                                               
selling the land back to the  owner only comes into effect if the                                                               
state doesn't  use the  land after  20 years.   She  reminded the                                                               
committee that this is all  in reference to advanced acquisition.                                                               
Representative Kerttula echoed earlier  testimony that only those                                                               
with  the original  interest  in  the land  are  protected.   She                                                               
related  her  belief that  it  would  probably be  unlikely  that                                                               
someone would  save their  money to purchase  the land  back from                                                               
the state.                                                                                                                      
Number 1351                                                                                                                     
DANA  OLSON testified  via teleconference.   Ms.  Olson expressed                                                               
concern with  public utilities and corporations  having the right                                                               
to  eminent domain.   She  didn't believe  [public utilities  and                                                               
corporations]  have   a  legal  authority  [to   utilize  eminent                                                               
domain].    With  regard  to   the  20-year  limitation  and  the                                                               
"foreseeable future" language, Ms.  Olson characterized it as too                                                               
broad.  She pointed out that  under the "Federal Aid Highway Act"                                                               
[the state]  can't take  more property  than is  necessary, which                                                               
means  that  [the  state]  would have  to  demonstrate  that  the                                                               
property wasn't taken  unnecessarily.  Since many  of the state's                                                               
projects  are federally  funded,  Ms. Olson  didn't believe  this                                                               
bill would  work with the  federal provision.   Furthermore, this                                                               
bill fails  to consider  mineral entry;  that is  mineral entries                                                               
could be acquired for public purposes.   She pointed out that the                                                               
14th Amendment of the U.S.  Constitution prohibits the government                                                               
from  rationalizing what  property is,  which is  what this  bill                                                               
seems to be doing.                                                                                                              
MR. OLSON returned to the  "foreseeable future" language that she                                                               
believes  is   too  broad.     She  suggested  that   a  regional                                                               
transportation  plan  must be  in  place  before any  acquisition                                                               
occurs.  She clarified that the  burden to show a compelling need                                                               
to  condemn or  acquire property  falls on  the government.   She                                                               
didn't believe the  burden [would be met]  under the "foreseeable                                                               
future" language.                                                                                                               
Number 1619                                                                                                                     
MR.  KRIEBER pointed  out  that currently  no  entities have  the                                                               
authority  for advanced  acquisition of  right-of-way.   Property                                                               
can  be  acquired   through  a  federal  funding   process.    He                                                               
emphasized that  public utilities  and corporations  already have                                                               
state authority for  eminent domain.  This  bill merely addresses                                                               
advanced acquisition.   In regard the charge  of the "foreseeable                                                               
future" language  being too broad,  Mr. Krieber pointed  out that                                                               
Section 3 specifies  the prerequisites for taking  property.  The                                                               
new prerequisite,  paragraph (4),  specifies that  the reasonably                                                               
foreseeable use  be identified  in a development  plan.   A judge                                                               
would   make   the   decision  as   to   whether   the   regional                                                               
transportation plan met the criteria.                                                                                           
Number 1774                                                                                                                     
REPRESENTATIVE  SCALZI  moved to  report  CSHB  500, Version  22-                                                               
LS0610\F, Utermohle,  4/22/02, as  amended out of  committee with                                                               
individual  recommendations and  the  accompanying fiscal  notes.                                                               
There being  no objection,  CSHB 500(CRA)  was reported  from the                                                               
House Community and Regional Affairs Standing Committee.                                                                        

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