Legislature(1999 - 2000)
03/03/2000 01:50 PM FIN
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
SENATE BILL NO. 7 An Act relating to the University of Alaska and university land, and authorizing the University of Alaska to select additional state land. JIM POUND, STAFF, SENATOR ROBIN TAYLOR, commented that the University of Alaska system was created under federal authority as a land grant institution to provide for the higher education requirements of Alaska's people into perpetuity. Mr. Pound continued that most colleges established under the land grant program were endowed with sizable land bases from which to generate income to be used for operating purposes. Unlike most institutions in the lower 48 states, the University of Alaska does not have the larger population base and proximity to other support services that are so beneficial. The University of Alaska additionally, suffers from a smaller pool of alumni and other normal sources of endowment income which many institutions rely on to help support operations. Mr. Pound pointed out that in the past decade, several legislators have introduced legislation allowing the University of Alaska to select additional lands from the State. The purpose of all legislative attempts to provide more land for the University statewide system has been to provide more income producing assets. SB 7 would continue that effort to give the University of Alaska a larger and more productive land base. Mr. Pound stated that the bill also will provide clear expectations that the land conveyed would be used for the development of value added industries. Mr. Pound advised that the provisions of SB 7 would allow the University of Alaska to select 250,000 acres of State land. Lands selected for transfer would include interests in minerals, oil, and gas, and would be subject to certain limitations. Mr. Pound noted that certain lands would be exempt from the selection, such as: ? Lands subject to a coal lease or where a lease application is pending; ? Land reserved by law from the public domain; ? Land included in a five-year proposed oil and gas leasing program; and ? Leased land where the lease applications are pending. In an endeavor to encourage local support, up to twenty percent (20%) of the income derived from lands conveyed as a result of the legislation, would be given to the campus or campuses in the region from which the earnings are derived. That revenue is to be used for programs and services that support the development of natural resources within that region. The appropriation by the Board of Regents would only happen, if the local municipality where the campus or campuses were located, provided a match of the same amount. Mr. Pound concluded that SB 7 would enable the University of Alaska to begin making its way toward equal footing with other land grant universities around the country. Representative J. Davies referenced the language "municipality" indicated on Page 4. He asked if that was land which the municipalities had already claimed. Mr. Pound replied that it would be land that the municipalities or the boroughs "may" select. Mr. Pound admitted that was a gray area and that the bill addresses a "negotiation process" between the University and the particular municipality. Representative J. Davies asked if the language indicated properties already selected by the municipalities. Mr. Pound commented that was not the case. Representative J. Davies referenced Page 4, Line 29, and asked what that would include. Mr. Pound did not know. Representative J. Davies requested that information be clarified. Representative Grussendorf asked if the legislation would stand-alone or if it would be tied in with legislation currently happening in the U.S. Congress. Mr. Pound replied that there are two bills in Congress that are stand-alone. They would provide 250,000 federal acres to the University. Co-Chair Therriault clarified that this legislation would be separate from that passed on the federal level and would double the amount of land available for the University. Vice Chair Bunde noted that some of his constituents were concerned with legislation "blocking up" lands. Mr. Pound replied that the legislation was essentially dealing with various accesses and processes already in place. He believed that the legislation would not have any effect on access of lands. Representative J. Davies inquired about the timing between SB 7 and the federal bills. Mr. Pound replied that he did not know when the federal match would occur, but that SB 7 is based on a 20-year selection process. Co-Chair Therriault asked if Senator Taylor had taken a position on the bill having access to any of the legislatively designated areas. Mr. Pound did not know. He noted that the access concern was brought up during the House Resources Committee hearing. He advised that there was no intention by Senator Taylor to deny access under what is considered "normal process". Representative G. Davis pointed out that there was not a fiscal note submitted by the Department of Law. He advised that Department would definitely have an added cost associated with the proposed legislation. ANN RINGSTAD, DIRECTOR, GOVERNMENT RELATIONS, STATEWIDE OFFICE OF UNIVERSITY RELATIONS, UNIVERSITY OF ALASKA, FAIRBANKS, (TESTIFIED VIA TELECONFERENCE), read testimony prepared by Wendy Redman, Vice President, University of Alaska. Ms. Ringstad advised that the House Resources version of SB 7, which is before the Committee, is not satisfactory to the University for a variety of reasons, including provisions that would give the commissioners of the Department of Natural Resources and the Department of Fish & Game, policy and regulation making authority regarding the management of University lands. Ms. Ringstad added that other amendments made during the Resources Committee would weaken the University's ability to generate revenue from lands that would be made available, and curtail which lands would be available. She noted that it was the University's intent to continue to work with Co- Chair Therriault, Senator Taylor, other interested legislators, representatives Department of Natural Resources and Department of Fish and Game and interested constituent groups, in order to develop a Finance Committee substitute, that would be a more satisfactory bill. Ms. Ringstad reminded Committee members that of the original 350,000 acres that the University was provided between 1915 and 1929 by virtue of its land grant status, only 112,000 acres were actually transferred to the University. In 1959, the Alaska Statehood Act cancelled the University's right to receive all unsurveyed lands which amounted to 238,000 acres. Ms. Ringstad acknowledged that it is true that there is no legal obligation for the State to provide lands to the University. However, there was an assumption at the time of statehood that the State would use land from its federal land grant to "make good" on the original commitment to establish a land endowment for the University. She pointed out that in direct response to that assumption, the first Alaska Legislature passed a bill giving the University of Alaska, one million acres of land to develop for the purpose of providing support for the post-secondary needs of our new State. She pointed out that Governor Egan vetoed that legislation citing that Alaska lands should be best developed by the Department of Natural Resources. Governor Knowles cited the same rationale when he vetoed similar legislation in 1994 and 1996. Ms. Ringstad noted that the Department of Natural Resources has never had, nor does it now have, adequate resources to meet the mandate. Ms. Ringstad advised that the Department of Natural Resources has done an outstanding job of managing Alaska's oil and gas lands, however, they do not have the staff to actively manage all of the states additional lands. Ms. Ringstad advised that support for the legislation comes down to a philosophical decision about the development of State lands. Ms. Ringstad stated that there is not a large quantity of good, income producing State land available. Additionally, it is true that the income generated from additional lands to the University would not be significant in the short term. The University is not looking to the legislation as a panacea. The University would much rather have $250 million dollars than 250 million acres of land. The University has an excellent record of land management. Over the years, the legislation has generated controversy from a wide variety of constituencies, all of whom have their own self-interests to protect when it comes to Alaska's lands. The bill is full of amendments and compromises to meet the interests of miners, hunters, fishers, berry-pickers, recreationalists, and oil and gas interests. She requested additional time to work with the Committee to adequately address the legislation. ANDREW DEVALPINE, DIRECTOR, BRISTOL BAY COASTAL RESOURCE SERVICE AREA (BBCRSA), DILLINGHAM, (TESTIFIED VIA TELECONFERENCE), noted that the legislation proposes a "threat" for the resource areas. He noted that the bill appears to exempt the University from AS 38.04, which speaks to State land use plans. Mr. DeValpine stated that there is no guarantee that the University would honor the priorities established by the municipalities. The bill represents an invasion of a rural area. Those residents rely on the natural abundance of fish and game provided for their families. ROBERT LOEFFLER, DIRECTOR, DIVISION OF MINING, LAND AND WATER, DEPARTMENT OF NATURAL RESOURCES, ANCHORAGE, (TESTIFIED VIA TELECONFERENCE), noted that the Department would be willing to enter into negotiated agreements with the University. He listed the fundamental concerns of the Department: ? The Department believes that the bill puts the University in competition with the municipalities in a way in which the University would win. ? The Department believes that the bill would have a significant effect on State land and timber sale programs. The Department has been working with the Senate to come up with a stable land disposable program favored by Alaskans. SB 7 would put that bill in jeopardy. He thought that the University would chose all saleable State land. ? He noted that the bill could have a "chilling" effect on development of Alaska land in many ways. The bill carries an uncertainty in land tenure. That is one of the reasons that the Alaska Mental Health Land Trust (AMHLT) stopped development throughout Alaska during the years before selections were final. Also, the bill allows selection of the fiberoptics. ? He addressed the bill's effect on promises made to the public. The Department of Natural Resources identifies public use areas, areas used for subsistence, and areas used for public access. There is no similar process in the bill. Mr. Loeffler advised that there are two additional technical problems with the bill. He noted that they were addressed in the letter from Commissioner Shively to the members. (TAPE CHANGE HFC 00 - 47, Side 2) Mr. Loeffler stated that there are general grant lands subject to and which the Legislature can not exempt from constitutional requirements otherwise applicable to State land. Mr. Loeffler noted the second technical defect is the University selection of the designated areas and their definition of public domain. He believed that the bill intended that the University not select areas that are critical habitat areas, however, the language accomplishes the opposite that intent. Co-Chair Therriault asked if these concerns had been expressed to the House Resources Committee. Mr. Loeffler stated that they were, however, the technical defects were submitted in a letter afterward. SUSAN SCHRADER, CONSERVATION ADVOCATE VOTERS (CAV), ALASKA CONSERVATION VOTERS, JUNEAU, stated that the Alaska Conservation Voters, formerly Alaska Conservation Voice, is a not-for-profit organization dedicated to protecting Alaska's environment through public education and advocacy. The membership represents over 22,000 registered Alaskan voters. She stated that ACV believes that investment in the University system is critical for the State's continued economic prosperity and for enabling the State's participation in the developing intellectual and knowledge- based economy fueling our country's progress. Ms. Schrader noted that ACV is pleased to see that the House Resource Committee substitute for the bill addresses several concerns with environmental impacts, namely providing for consultation with Department of Fish and Game and requiring protection of riparian areas. Nevertheless, ACV believes that the bill does not guarantee adequate or reliable funding for the University. The University's attention should be directed towards education and not be diverted towards the complex and often contentious arena of land management. Ms. Schrader noted that ACV has serious concerns with SB 7 which include: ? Alaskans may lose the use of 250,000 acres of public lands, including the potential loss of acreage within our State game refuges, State game sanctuaries, State recreation areas, recreational mining areas, State critical habitat areas, etc., including one of our State parks, all of which are located in the public domain. ? Because of the University's aggressive development polices, the bill threatens fish and wildlife re- sources, as well as the subsistence, recreational, and commercial uses that depend on them. The bill would threaten community water sources and local use, expansion and planning options, at both the local and regional level. The University land selections would further complicate confusing land ownership patterns and make sorting out the conflicts a costly and time- consuming process. ? Even with the language in the committee substitute to ensure access, SB 7 might impact highly valued access rights on selected lands that the University chooses to sell to a third party or develop in such a way as to preclude access. Potentially at risk are the hunting, fishing, skiing, mushing, and innumerable other recreational and commercial activities that Alaskans depend upon. ? SB 7 very likely violates the Dedicated Fund Clause, Article IX, Section 7, of the Alaska Constitution. The Dedicated Fund Clause explicitly allows continuation of dedicated funds that predated ratification of the constitution and it also allows dedicated funds required participating in federal programs. While the existing University land trust does not violate the clause because it meets the two circumstances. However, any new grant of land created by SB 7 would not meet either circumstance. Ms. Schrader concluded that if SB 7 becomes law, the University would select 250,000 acres with the highest potential for future revenue generation. At a time of significant budget shortfalls, the last thing that the legislature should remove is the State's 250,000 most promising acres for future revenue. Representative Austerman mentioned the fish and game resources and asked if there could be a "crisis" because of the legislation. Ms. Schrader replied that there would most likely be an impasse, as 250,000 acres of State land would be transferred to the University. Representative Austerman could not guess the impact that the legislation could have, not knowing the lands selected. Ms. Schrader replied that the very existence of setback requirements found in the Forest Practices Act, are examples that government appreciates those private lands needed to protect our resources. Putting 250,000 acres into private ownership places our resources at risk. Representative J. Davies pointed out that the University would have to adhere to the stipulations established in the Forest Practices Act. He advised that State law protects many of the concerns voiced by ACV. Ms. Schrader agreed that the State law would protect fish on private land, however, the reality of the situation given the current funding allocated to Department of Environmental Conservation and the Department of Fish and Game, it would be difficult for those agencies to do the type of monitoring that would need to be done on private lands. KEN TAYLOR, DIRECTOR, DIVISION OF HABITAT AND RESTORATION, DEPARTMENT OF FISH AND GAME, responded to a query voiced by Representative J. Davies regarding the public domain issue in relationship to designated areas. None of the 10 designated State game refuges, 17 critical habitat areas, or the 3 State game refuges have been removed from the public domain. The proposed legislation would free the University to select many of those areas. Mr. Taylor added that the legislation could include many very important areas as indicated on Page 6, Line 16-22, Section (365b-1). He commented that to deal with the broad language terms would be difficult for the Department. Mr. Taylor pointed out that these areas were designated by the Legislation to be statutorily protected. SB 7 would minimize that protection. It would reduce it from statutory protection to the discretion of future governors and commissioners. Mr. Taylor added that the Department is concerned with the lack of protections for lands designated as important fish and wildlife habitat in the Department of Natural Resources areas management plans. These plans were developed with strong public participation. The legislation would not afford the same protection to these lands. A lot of these lands have a high economic value. Mr. Taylor added that the Department of Natural Resources had submitted a fiscal note with the bill. Vice Chair Bunde commented that if the University wanted to select a specific land, they would have to meet legislative approval and they would be responsible to see that the State game refugee continues. The uses would be limited by overlying covenants. Mr. Taylor replied that the statute would remove the University lands from the public domain and that if they were removed from the domain they would not remain part of the refugee. Vice Chair Bunde reiterated that the legislative approval would still remain. Mr. Taylor agreed. He suggested that if the bill passes, most likely there would be annual selections. The parcels will be as small as 650 acres. Mr. Taylor emphasized that is a lot of pieces and for the Legislature to enter into detail on each parcel will be a lot of additional work. RICHARD BISHOP, VICE PRESIDENT, ALASKA OUTDOORS COUNCIL, JUNEAU, noted that the Council has followed the bill for several years. He stated that AOC's principle interest is in the lands. The Council recognizes that the amount suggested is a relatively small portion of State private lands, however, because there are differences in the importance of habitats and access, it would be prudent to look at the terms of the bill in relationship of principle interest of sound conservation and the opportunity to using public resources. Mr. Bishop recommended adding an amendment to Page 5, Line 2, which would delete the entire text and replace it with the following language: "Is a legislatively designated area, including but not limited to state critical habitat areas, wildlife refuges, wildlife sanctuaries, forests, parks, recreation areas, range areas, public use areas, and recreational mining areas, of is a state administratively designated site dedicated to public access or other uses." PAMELA LABOLLE, PRESIDENT, ALASKA STATE CHAMPBER OF COMMERCE, JUNEAU, voiced support for the legislation. She noted that the State Chamber recognizes the valuable contribution that an academically strong and financially secure State University system can make to Alaska's future. Management of lands provides the University system with a source of recurring revenues. Ms. LaBolle pointed out that in managing its current land portfolio, the University has demonstrated that it can meet and exceed the requirements of responsible land development. Conveyance of State and federal lands to the University for appropriate development will enhance economic opportunities on many fronts. Representative Foster remarked about the total fiscal amount which had been submitted. Co-Chair Therriault advised that the fiscal notes would be reevaluated during the further consideration of the legislation. Co-Chair Therriault asked if all State lands would be available for selection. Ms. Ringstad understood that they would. SB 7 was HELD in Committee for further discussion.