Legislature(2013 - 2014)HOUSE FINANCE 519
03/26/2013 09:00 AM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| SB27 | |
| HB129 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 27 | TELECONFERENCED | |
| + | HB 129 | TELECONFERENCED | |
| + | TELECONFERENCED |
SENATE BILL NO. 27
"An Act establishing authority for the state to
evaluate and seek primacy for administering the
regulatory program for dredge and fill activities
allowed to individual states under federal law and
relating to the authority; and providing for an
effective date."
9:00:09 AM
DANIEL SULLIVAN, COMMISSIONER, DEPARTMENT OF NATURAL
RESOURCES, explained that SB 27 and HB 129 were presented
by the Department of Transportation and Public Facilities
(DOT/PF). He noted the strong bipartisan support for the
bill. He provided a PowerPoint presentation, "Statewide
Permitting Reform" (copy on file).
Commissioner Sullivan discussed slide 2: "Importance of
Permitting Reform for Alaska's Competitiveness."
Permitting reform has bipartisan, national, and local
recognition and support
-Permitting reform is a bipartisan effort as
policymakers realize the economic benefits of
allowing large-scale development projects to
proceed in a responsible, timely manner
-States as politically diverse as California,
Massachusetts, Indiana, and Kansas are fully
engaged in modernizing their permitting processes
-The Federal government also recognizes the
issues and has undertaken initiatives to reduce
costs, simplify the system, and eliminate
redundancy and inconsistency
-Last year (February 2012), The Economist ran a
cover story called "Overregulated America" in
which it concluded that ''America needs a smarter
approach to regulation" that will "mitigate a
real danger: that regulation may crush the life
out of America's economy"
-In Newsweek June 2011), President Bill Clinton
lamented that it can take three years or more to
permit major economic development projects. One
of his top recommendations to put Americans back
to work \-vas to speed up the regulatory approval
process and grant state waivers on environmental
rules to hasten start times on construction
projects
Commissioner Sullivan looked at slide 3: "Importance of
Permitting Reform for Alaska's Competitiveness."
Permitting reform is a national issue affecting
U.S. competitiveness
-Potential investors sometimes express reluctance
to pursue projects in the U.S. and Alaska because
of the ever-present risk of permitting delays and
litigation
-In 2012, the investment firm Behre Dolbear
Group, 'which undertakes an annual global survey
of mineral sector investment, ranked the United
States last (tied with Papua New Guinea) out of
25 countries in the category of "permitting
delays"
"Permitting delays are the most significant
risk to mining projects in the United
States"
States are negatively impacted by federal
rules that they are bound to enforce
resulting in a 7-to 10-year waiting period
before mine development can begin
Australia is one of the countries with the
fewest permitting delays
-Contrast Alcan Highway construction
9:04:21 AM
Commissioner Sullivan highlighted slide 4: "Importance of
Permitting Reform for Alaska's Competitiveness."
Jobs and the Environment are Undermined by Permitting
Delays and Overregulation
-While an overly burdensome regulatory system can
discourage investments and job creation, it can
also undermine, not enhance, environmental
protection
-When companies forgo investing in places like
Alaska and the U.S. places with very high
environmental standards-because of regulatory
delays, it can result.in passing energy and
mineral investment to nations with substandard
environmental regulations and little capacity or
desire to protect the environment
Last year the Associated Press estimated
that 5 to 20 million tons of oil leaked a
year in Russia. At even the lower end, that
would be the equivalent of a Deepwater
Horizon blowout about every two months
Russia experienced approximately 18,000 oil
pipeline ruptures in 2010 the figure in the
U.S. for the same year was 341
-The global environment would be much better off
if hydrocarbons and other natural resources were
produced in countries with the highest
environmental standards rather than some of the
lowest
Commissioner Sullivan highlighted slide 8: "Statewide
Permitting Reform." He stated that the assistance of the
committee was imperative to reform and he stated that the
budget was reduced by one third.
9:07:49 AM
Representative Gara asked for a synopsis of permitting
"streamline bills." Commissioner Butcher replied that HB
360 passed in the previous legislature.
ED FOGELS, DEPUTY COMMISSIONER, DEPARTMENT OF NATURAL
RESOURCES, stated that interstate mining compact commission
bill passed in the previous session.
Representative Gara noted problems with the Army Corps of
Engineers in the past. He recalled a slide from a previous
presentation that stated that the decisions from the Army
Corps of Engineers had been historically timely. He
wondered if there would be a similar slide in the
presentation. Commissioner Sullivan noted that Pt. Thompson
and CD 5 were examples of the need for primacy. He added
that the department wished to avoid the problem of federal
EPA and Fish and Wildlife permitting delays.
Representative Gara stressed that there were possible
deficits that would reach beyond a billion dollars. He felt
that the primacy bill would ask the state to spend $2
million per year. He asked if there would be a slide
related to the timeliness of the decisions of the Army
Corps of Engineers. Commissioner Sullivan replied that
fully evaluating the cost to benefit aspect of primacy. He
stated that the Corps budget was recently reduced, so he
could not speak to the timeliness of their decisions.
Mr. Fogels added that the time limits were not the whole
issue. Stipulation and mitigation requirements played a
large role in the permitting process.
9:14:50 AM
LARRY HARTIG, COMMISSIONER, DEPARTMENT OF ENVIRONMENTAL
CONSERVATION, discussed the primacy aspect of the fiscal
note. He noted the bridge and build program in Section 404
permit from the Corp of Engineers. He noted that with
primacy, the state could be issuing the permits more
quickly. The 404 program included wetlands and waters of
the United States, with 65 percent of the nation's wetlands
are located in Alaska. He stated that a wetlands permit was
required for every project. He discussed the Corps of
Engineers and the delays of the 404 program, but stressed
the importance of the program. He stated that the wetlands
provided the improvement to water quality that clean the
waters, and noted that many states were looking at primacy.
He stated that the Waste Water Discharging Permitting
Process was regulated by Department of Environmental
Conservation (DEC) for the last five years. He mentioned
that Oregon and Alaska were poised to pursue primacy.
Mr. Hartig noted the large issue on the national level
regarding primacy. He stated that the bill would allow the
resources to be accessed sooner. He could not promise that
primacy was good for the state, but bill authorized the
state to pursue primacy. If the bill passed, the department
would continue to review the option. He stated that the
application for primacy with the EPA would require another
visit to the legislature for the money. He anticipated that
the process could last a few years.
9:21:47 AM
Mr. Hartig mentioned that he asked the Corps of Engineers
with employees if the state would be well positioned to
achieve primacy. He pointed out that the three year study
period.
Mr. Hartig stated that the permitting was a three year
process, so 5-8 years for permuting effort.
Representative Kawasaki asked about the jurisdiction for
Pebble Mine.
Mr. Hartig offered examples regarding the navigable waters.
He stated that a negotiation to the memorandum of
agreement. He remarked that the memorandum outlined the
jurisdiction and how they would be determined. He noted
that the pros and cons and the benefits were weighed in the
jurisdiction.
Commissioner Sullivan noted that the amount of jurisdiction
that the federal government was authorized through the
state might not be worth pursuing.
9:27:37 AM
Representative Wilson asked about the placer miners. Mr.
Hartig anticipated that the interior placer miner permits.
Representative Wilson asked if the bill would help the
miners through the 7 year process. Commissioner Hartig
noted that the 404 permitting and its geographical
boundaries had programmatic general permits. He noted that
the activity had low impact individually or collectively.
He stated that the Clean Water Act and the authority by DEC
permitting for placer miner would not be obstructed by
geographical location.
9:30:02 AM
Commissioner Hartig stated that that the Pebble Mine
legislation was not the impetus for the legislation. He
pointed out the ability to veto permits, and stressed that
EPA still holds the trump card.
Representative Munoz asked if the EPA would have veto
authority over the permits that were issued under a state
program. Commissioner Hartig stated that two states had
primacy, and one dozen other states were seeking it. He
remarked that the EPA would have veto power, but only in
very rare occasions.
Mr. Fogels pointed out that there were a number of programs
that the federal government oversaw in the state.
Commissioner Sullivan noted that the state would be
required to meet the federal standards by law.
9:35:40 AM
Representative Costello asked when the Clean Water Act was
passed. Commissioner Fogels replied 1972.
Representative Costello thought that the states pursuing
primacy and the timing interesting. Commissioner Hartig
replied that Alaska reviewed the decision to review the
permitting process. He stated that the process lasted six
years, as was the primacy of the program. He did not know
why there might be more effort now, but it might be the
general recognition that development was hampered by the
permitting process. He pointed out that Alaska had so many
wetlands that it was worth looking at. He added that most
states expressed concern.
Commissioner Sullivan added that the agencies came in at
the last minute killed the project.
Representative Costello stated that the bill would allow
analysis of the cost benefits of the decision. She asked if
state primacy would allow for more local knowledge in the
decision making process. Commissioner Butcher indicated
that he would provide that information.
9:42:50 AM
Vice-Chair Neuman asked about resource development projects
held up by 404 permit hold up. Mr. Fogels stated that Pt.
Thompson was the largest example of a delay, because it
stalled 1000 Alaskan jobs. He stressed that primacy would
ease that delay.
Commissioner Hartig mentioned smaller projects, but noted
that the authorization difficulties. He stressed that there
were delay issues with the Corps of Engineers and the
permitting process.
Mr. Fogels mentioned that the stipulations on the permits
make the legislation extremely important.
Vice-Chair Neuman discussed federal oversight for small
miners. He understood that the federal government and the
permitting process, but felt that smaller mining operations
with too much federal intrusion. Mr. Fogels stated that a
wetlands permit was required for nearly every project in
the state. He believed that state control of the permitting
process would benefit the development of every chapter. He
added that different states might have different views
about the state's activities, but noted that the state had
64 percent of the country's wetlands. Most wetlands in
Alaska were undisturbed.
9:49:08 AM
Vice-Chair Neuman asked about the oversight of the federal
government later on. He hoped for the future chance for the
federal government to take a step back. Commissioner Hartig
replied that the 404 application would remain the same,
including all regulations. The mitigation resources were
available and Alaska might make different decisions.
Representative Gara requested that the decision be made
with facts. He wished for information about the Army Corps
of Engineers, and the 84 percent of the applications were
decided in 60 days. He asked for the approval of $10
million in the next 5 years. He requested an analysis of
the Army Corp. Commissioner Hartig pointed out that
applications for 402 general permits were processed more
quickly, but he would need to see the slide that
Representative Gara keeps referring to. He promised to
return with more facts. His experience with permitting was
that the 404 was a large project when mitigations were
considered, but stated that the process might be appealed.
The average cost of a permit application was $270 thousand.
9:55:21 AM
Representative Gara discussed CD 5. He wondered if the
state takes over primacy, would the Clean Water Act Rules
be observed. He discussed mitigation options and the
statutory authorities as applied. He stated that decisions
would be different and the state would and could take
control. Mr. Fogels responded that the bill would be
implementing the state's own regulations challenges and
appeals in Alaska.
SB 27 was HEARD and HELD in committee for further
consideration.