Legislature(2011 - 2012)BARNES 124
03/02/2012 01:00 PM House RESOURCES
| Audio | Topic |
|---|---|
| Start | |
| HB340 | |
| Confirmation Hearings(s):|| Big Game Commercial Services Board|| Fishermen's Fund Advisory & Appeals Council | |
| Board of Game | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| *+ | HB 340 | TELECONFERENCED | |
| + | TELECONFERENCED |
HB 340-PETERSVILLE RECREATIONAL MINING AREA
1:10:56 PM
CO-CHAIR FEIGE announced that the first order of business would
be HOUSE BILL NO. 340, "An Act relating to the reservation of
certain mining claims from all uses incompatible with the
purposes for establishing the Petersville Recreational Mining
Area."
1:11:13 PM
REPRESENTATIVE MARK NEUMAN, Alaska State Legislature, prime
sponsor, introduced HB 340, explaining it is a "fix-it" bill.
In 1995 under the Hickel Administration, his constituent,
Michele Stevens, had mining claims on about 220 acres of federal
lands. The State of Alaska wanted that land, so it requested
Ms. Stevens to lift her mining claims so the land could be
transferred to the state. Ms. Stevens agreed to do so and
worked with Jules Tileston, director of the Division of Mining,
Land and Water at that time. Harry Noah was commissioner of the
Department of Natural Resources (DNR) at that time. The state
accepted the land and committed to convey the mining claims back
to Ms. Stevens. However, Alaska's statutes disallow this from
happening and Ms. Stevens has been working to make it happen
since then. It is a time sensitive issue, he pointed out, and
he has met with Ms. Stevens, Ed Fogels, the current deputy
commissioner of DNR, and the Alaska Miners Association to figure
out how to get these mining claims conveyed back to Ms. Stevens.
He said the language in HB 340 allows the state to fix this
mistake.
1:13:54 PM
REPRESENTATIVE GARDNER inquired whether Ms. Stevens has any
documentation of the agreement that the state would give back
the mining claims and then could not.
REPRESENTATIVE NEUMAN replied yes, Ms. Stevens has multiple
documents. Also, there is a letter in the committee packet from
Mr. Tileston and Marty Rutherford, deputy commissioner of DNR at
the time that it was DNR's intent to transmit these mining
claims back to Ms. Stevens. He explained that a technicality in
the way the Alaska statutes are written needs to be fixed. He
added that he has personally spoken with Mr. Tileston about Mr.
Tileston's desire to make Ms. Stevens whole again.
1:15:44 PM
REPRESENTATIVE KAWASAKI requested an explanation of the term
"recreational mining area".
REPRESENTATIVE NEUMAN deferred to Mr. Fogels.
EDMUND FOGELS, Deputy Commissioner, Office of the Commissioner,
Department of Natural Resources (DNR), responded that a
recreational mining area is a legislative designation by which
land is set aside for the specific purpose of creating an area
on which people can recreate and mine. A normal staked mining
claim must be worked for mineral production in a commercial
fashion and is not designed for recreational or tourism
purposes. However, recreational mining areas were designed to
allow recreational and tourism activity and are typically closed
to mineral entry so that normal mining claims cannot be staked.
1:17:14 PM
CO-CHAIR FEIGE surmised there are limitations on the size of
equipment that can be used on a recreational mining claim.
MR. FOGELS believed there is not and added that it is up to the
legislature to decide how big of an area it wants to create.
1:17:31 PM
REPRESENTATIVE NEUMAN, returning to Representative Kawasaki's
question, said he understood from talking with Ms. Stevens that
her intent was to be able to open these areas so that people
could recreationally try to find gold or other minerals.
REPRESENTATIVE KAWASAKI asked for further explanation about the
purpose of a recreational mining claim.
MR. FOGELS answered that it is not a recreational mining
"claim", it is a recreational mining "area", which is an area
that the legislature creates and sets the rules for. Typically,
some kind of management plan is required to be in place and then
DNR has the ability to go to bid for concession for someone to
operate a recreational mining area. He pointed out that the
Crow Creek Mine in Girdwood is a private enterprise rather than
a state recreational mining area, but it is the same kind of
operation - a tourist-oriented business that charges for a gold
pan and the opportunity to pan for some gold in the creek.
1:19:23 PM
REPRESENTATIVE KAWASAKI inquired about the differences in what
would be required for a recreational mining area versus a
traditional mining claim.
MR. FOGELS explained that for a traditional mining claim the
state's mining laws must be followed for staking the claim,
paying annual rental, working the claim, and showing that the
claim is being progressed. Once there is an economic discovery,
the state's permitting process must be undergone. If the state
issues the permits, the mine can be built and people hired to
begin a commercial mining operation that pays royalties and
taxes. For a recreational mining area, the intent is to give
Alaskans and other visitors a place to go gold panning either on
their own or through a business that rents out gold pans for the
day. The intent is for the recreationists to have fun and maybe
get a few flecks of gold in their pans.
1:21:03 PM
CO-CHAIR SEATON drew attention to the April 9, 2010, letter to
Senator Huggins in the committee packet from Dick Mylius,
Director, Division of Mining, Land and Water. He observed that
page 2, paragraph 2, states that the area would be open to
staking and there would be no assurance that Ms. Stevens would
be able to stake prior to other people. He asked whether HB 340
enacts what this letter says or gets around that by ensuring
that prior claims continue on through state ownership and leave
the rest of the area open for a recreational mining area.
MR. FOGELS replied that HB 340 would remove just that one
portion of recreational mining area from the whole recreational
mining area. It is a very complicated land situation in that
area, which is in part why there is this problem to begin with.
The land has not yet actually been conveyed to the state; it is
state selected land that is still owned by the U.S. Bureau of
Land Management (BLM). The statutes that enact the recreational
mining area are only valid on state land. It hovers above state
selected land and will take effect as soon as that land gets
conveyed to the state. The letter from Director Mylius points
out that if the recreational mining area is removed there would
then be no guarantee that Ms. Stevens would be the first one to
stake the claim. In the subsequent looking at and picking apart
of this complex situation, DNR thinks it may be more complicated
than that, so the department is trying to chase that piece down.
The bottom line is that there is still no guarantee that Ms.
Stevens will be able to re-stake these claims if this bill goes
through.
1:23:24 PM
REPRESENTATIVE SEATON observed that the April 9, 2010, letter
states there are two areas - a northern area of 300 acres and a
southern area of 200 acres. The letter further states that the
northern recreational mining area has not been used much due to
[difficult] access, so the presumption is that the southern area
has better access and would provide the activity. He inquired
whether HB 340 would vacate the entire southern area.
MR. FOGELS confirmed that HB 340 would vacate the entire
southern area of 220 acres; he noted that the northern area has
a lot of potential. At some point the department would next do
a management plan for the entire area to determine a way to
provide for a concessionaire in the southern area and focus
recreational activity on the northern area rather than the
southern areas.
1:24:31 PM
CO-CHAIR SEATON asked why not remove only the five acres within
the southern area on which the BLM is issuing Ms. Stevens a
lease, rather than the entire two hundred acres.
MR. FOGELS believed the mining claims at issue for Ms. Stevens
are more than five acres. He deferred to Mr. Wyn Menefee for
further explanation.
WYN MENEFEE, Chief of Operations, Central Office, Division of
Mining, Land and Water, Department of Natural Resources (DNR),
explained that the original claims had by Michele Stevens
encompassed the entire southern recreational mining area. Those
claims no longer exist there, so currently there are no claims.
The aforementioned five acres is a portion of the area that Ms.
Stevens is working out with the federal government to bring
under lease in order for the state to get conveyance of that
land because there are trespass structures that must be brought
into compliance before the state receives the land. Aside from
that, currently there are no claims that sit over top of this
area and therefore there is no five-acre claim and all the
claims have disappeared.
1:27:05 PM
REPRESENTATIVE GARDNER understood the reason there are no claims
[in this southern area] is because Ms. Stevens gave up those
claims in the understanding that once the state had title she
would be made whole.
MR. FOGELS confirmed that that is correct.
REPRESENTATIVE GARDNER maintained that it is not quite right to
say those claims do not exist because Ms. Stevens has a standing
agreement that was never met.
CO-CHAIR FEIGE replied correct, but said the claims have been
released.
MR. FOGELS explained that Ms. Stevens voluntarily relinquished
those claims and by law they extinguish and are no longer there.
1:27:58 PM
REPRESENTATIVE GARDNER noted that when Ms. Stevens voluntarily
relinquished those claims there was an agreement with the state
that when the state had title Ms. Stevens' claims would be
reinstated. So, she concluded, there is a moral claim as well
as a legal claim.
CO-CHAIR FEIGE commented that he, too, would be upset.
REPRESENTATIVE NEUMAN responded that that is exactly what HB 340
is fixing - the intent of the bill is to fix that promise made
by the state to Ms. Stevens. The state promised to make Ms.
Stevens whole after that land was conveyed to the state,
valuable land that the state wanted. Ms. Stevens agreed to do
so even though she did not have to. In the complications of
conveying that back to her, there are about four lines in
statute that need to be changed, which is what HB 340 would do,
and then the department can convey those claims to her.
REPRESENTATIVE GARDNER surmised there were original documents
signed by the state regarding the state's promise to Ms.
Stevens.
REPRESENTATIVE NEUMAN answered he has seen documentation that
would fill this room.
REPRESENTATIVE KAWASAKI asked whether the Department of Law is
available for questions.
CO-CHAIR FEIGE replied no. He invited Ms. Stevens to provide
testimony.
1:30:07 PM
MICHELE STEVENS, a lifelong Alaskan, explained that in 1995 she
gifted approximately 500 acres of area encompassed by state
selected mining claims that she had acquired. These were
located as a result of previous federal mining claims being
declared null and void and were known as the "Peters Creek
Jacobsen Mining Property". She agreed to gift portions of her
state selected mining claim, situated within the U.S. Mineral
Survey 2384, to the State of Alaska with the express commitment
by the state that once the federal land was conveyed to the
state, approximately 220 acres of the area known as the southern
Petersville Recreational Mining Area would be leased to her for
the establishment of a commercial recreational mining concession
that would include a museum and other amenities to be provided
by her. She owns several historic buildings and a Marion shovel
that helped build the Panama Canal and the Alaska Railroad and
was used for mining at Petersville in the 1940s. She also has
other structures that are on the federal mining claims located
within the 220 acres. She said Representative Neuman has maps
of the area that can be shared with the committee. The
agreement she had with the State of Alaska to transfer or gift
her state selected mineral rights to the state was necessary
because there was no other legal mechanism for her to have a
recreational mining business on state land.
1:31:56 PM
MS. STEVENS specified that to ensure the area could be managed
in accordance with the agreement with her and to ensure that
other parties could not stake mining claims in the area, Mineral
Closing Order 674 was issued on June 2, 1994. On May 8, 1997,
House Bill 46 was signed into law establishing two portions of
recreational mining area. The north Petersville Recreational
Mining Area is currently active and the south Petersville
Recreational Mining Area is not active. The two parcels total
approximately 500 acres. It was the intent of the Department of
Natural Resources that the approximately 220 acres in the
southern recreational area would be leased to her when the state
received conveyance from the BLM. Subsequent to the claims
being gifted to the state and its issuance of the Mineral
Closing Order, the Department of Natural Resources determined
that it could not, under existing state law, establish a
noncompetitive commercial lease to fulfill the agreement with
her. However, in 2006, DNR determined a legal way whereby a
commercial business could be operated on a portion of a state
mining claim or claims by establishing a miscellaneous land use
lease, provided there was concurrence with the state mining
claim holder. This approach, however, could not be followed for
lands designated by statute as a recreational mining area.
1:33:49 PM
MS. STEVENS said HB 340 contains two provisions. First, it
would reinstate her full mineral rights to those portions of her
mining claim that encompass the southern recreational area,
which can be seen on the map. Second, it would remove the
statutory designation and allow DNR to fulfill its original
agreement with her. She said the State of Alaska, DNR, and the
Alaska Miners Association concur that this is the best mechanism
to proceed forward.
MS. STEVENS, addressing the statement that the mining claims
might not go back to her, explained that a mining claim located
on the outside of a federal area is called an at-risk claim, so
it automatically goes back to the person who has the area on the
outsides of that portion. Since she has portions outside the
proposed recreation area that are active mining claims, that
gives her at-risk claims. She suggested that Mr. Kerwin Krause
[of DNR] explain this.
1:35:25 PM
REPRESENTATIVE KAWASAKI asked whether Ms. Stevens has the
"expressed commitment" in writing so that the committee could
see it.
MS. STEVENS replied she has some documents written by Jules
Tileston expressing that he was working with the public, Ms.
Stevens, and the Yetna Mining District to have this recreational
area presented. She said the state has a whole folder of
documents and related that Mr. Tileston has been talking with
people in the department to let them know what the intent was.
CO-CHAIR FEIGE drew attention to the 1/26/12 letter to Governor
Parnell from Jules Tileston and Marty Rutherford, who were DNR
officials involved in the transaction at the time.
REPRESENTATIVE KAWASAKI inquired whether Ms. Stevens has any
information from 1994 when the "expressed commitment" was made.
MS. STEVENS confirmed that some things were written down by
Jules Tileston, but said that back then it was a handshake type
of thing - in her meetings with the DNR director and
commissioner, everyone agreed that this would be a good
situation for everybody because the state would get revenue,
people would have a place to recreate, and she could have a
concession with a museum. It was supposed to be a win-win
situation for everyone.
1:38:12 PM
MS. STEVENS, in response to Representative Gardner, agreed to
provide a written copy of her testimony.
REPRESENTATIVE GARDNER said that like Representative Kawasaki
she is looking for some kind of documentation. She inquired
whether Ms. Stevens received any other kind of compensation when
she signed the quit claim or other document at the time.
MS. STEVENS said she did not receive any money. The agreement
with the state was that she would have a concession and the
public could come and the state would receive revenue from the
concession. It was supposed to be a win-win situation for the
state, her, and the public because her buildings and equipment
are historic and there was a need and a desire by the public to
have a place to recreate since at the time it was illegal to
have recreational mining on a mining property, claim, or lease.
This was a way to let the public have a place to go.
1:40:30 PM
REPRESENTATIVE GARDNER specified that in the absence of
documentation from the time, she wanted to make sure on the
record that there was not some other compensation because, if
not, she would say that Ms. Stevens was very generous to give up
her claims to 500 acres for mining.
MS. STEVENS thanked Representative Gardner and replied she
thinks the documentation is quite clear that Jules Tileston was
the director [of the Division of Mining, Land and Water] and
Marty Rutherford was the [deputy] commissioner [of DNR] at the
time, and those are the people she was working with at the time
to have a bill passed. She also wrote letters to Lyda Green and
Rick Halford to have the bill passed. She felt the biggest
documentation is what the committee has in front of it now,
which states that this was the intent.
REPRESENTATIVE NEUMAN interjected that he has spoken to Mr.
Tileston and others about the intent and read the documentation
presented by Ms. Stevens. He pointed out that the current DNR
deputy commissioner has just testified before the committee that
that was the intent, and the letter from the director and deputy
commissioner at the time states that that was the intent.
Reputable people are saying that this was the intent of the
state. There is a lot of documentation, he continued, but he
was trying not to give the committee too much paper. He said HB
340 would simply make Ms. Stevens whole by fixing some language
that would then allow the department to fix the situation.
1:42:48 PM
REPRESENTATIVE KAWASAKI said that because he was not around when
House Bill 46 was passed, he is trying to understand the issue
since it is for a very specific area. He added that he is also
trying to ascertain whether there could be potential legal
exposure from creating a law that allows a noncompetitive
commercial lease, as would be done by HB 340.
KERWIN KRAUSE, Mineral Property Manager, Central Office,
Division of Mining, Land and Water, Department of Natural
Resources (DNR), stated that he thought Ms. Stevens had, or
would be, providing to the committee some memorandums from Jules
Tileston. Other than those and a few emails in the file, he
said he is unaware of any letters issued on this matter by the
commissioner or the director. In response to Co-Chair Seaton,
he agreed to provide these documents to the committee.
1:45:12 PM
REPRESENTATIVE GARDNER noted that while the sponsor has said he
has read all the documentation presented by Ms. Stevens, the
committee only has a lone letter written 16 years after the fact
and another letter written 18 years after the fact. It is
important for the committee to do due diligence to determine
what the agreement was at the time. While she has great respect
for Mr. Tileston and Mr. Rutherford, it is important for the
committee to look at all documentation that is available.
MS. STEVENS offered to provide the committee with the letters
she wrote to Lyda Green and Rick Halford stating her support of
House Bill 146 and that the bill would benefit her by allowing
her to have a concession there. In response to Co-Chair Feige,
she agreed to fax the letters to the committee. She added that
if this is thought about logically, she would not have gifted
the mineral rights back to the state if the state had not said
that it would let her have a concession in return. Seventeen
years ago this was the only way that a person could have a
concession on mining properties.
1:47:42 PM
CO-CHAIR SEATON read from page 2 of the 4/9/10 letter to Senator
Huggins from Dick Mylius, which states: "In addition, there is
no assurance that [Michele] Stevens would be the first to stake
claims for the law is in favor of whoever stakes the claim first
after the land becomes open. It is likely that a number of
claimants would end [up] with conflicting claims. It is likely
that the Department of Fish and Game may have concerns about any
large-scale mining on the active portion of the Creek." Co-
Chair Seaton inquired whether the current bill gets past the
problems pointed out by Mr. Mylius.
MR. FOGELS replied that HB 340, as currently written, only gets
partly there. It would remove the legislatively designated
area. The Department of Natural Resources would then have to
lift the Mineral Closing Order to make that land available to be
staked. What complicates the matter is that that land is not
yet state land, it is state selected. The BLM must actually
convey that land to the State of Alaska. Thus, three key things
have to happen before that land can be staked and have it be a
valid staked claim. As mentioned by Ms. Stevens, an at-risk
claim is where a claimant stakes a state claim on state selected
land. It is not yet a real claim and will never be a real claim
unless the federal government actually conveys that land to the
state. If the federal government never conveys that land to the
state, then it will never be a valid claim, which is why it is
called an at-risk claim. Ms. Stevens has at-risk claims on top
of federal land that is state selected that has a legislatively
designated area on top of it and a state Mineral Closing Order
on it, so it is very complicated. The department is trying to
get some clarity from the Department of Law, but if Michele
Stevens does indeed have valid at-risk claims staked, then once
all this unravels and the state finally gets the land, then Ms.
Stevens is likely to have her claims whole. He said he cannot
at this point, from the department's perspective, tell the
committee 100 percent that that is exactly what will happen.
1:51:12 PM
CO-CHAIR SEATON, noting that HB 340 would write a statute, asked
whether there is any other way to recognize the holdover claims
from the federal government so as to avoid a time period of open
staking.
MR. FOGELS responded the department has discussed that, and a
number of other things could be done in this legislation. For
example, the legislature could lift the Mineral Closing Order so
the department does not have to do that later down the road.
However, he did not know whether the legislature could actually
reinstate those claims in HB 340.
1:52:28 PM
CO-CHAIR SEATON said he does not want to hold up this process
given that it is a process, but said it seems this process has
the potential for further entanglements. Honoring the state's
previous agreement needs to be done in the most expeditious way
that does not open these claims to conflict. He requested that
the sponsor and DNR work with the Department of Law to find out
whether HB 340 can do that and not result in years of litigation
for an Alaska citizen who acted in good faith. While he did not
want to hold up the process, he said that perhaps the Department
of Law could suggest a way to honor this commitment in a much
clearer way than going through an open staking process and
relying on at-risk claims to give priority.
REPRESENTATIVE NEUMAN said that that is the intent, but certain
steps must occur first, as stated by Mr. Fogels, and HB 340 is
the first step in working through this process. Ms. Stevens
acted in good faith and did not have to do this in the first
place; she wanted to help the State of Alaska get these lands
conveyed to it. Many people are working to make Ms. Stevens
whole and this is the simplest way.
The committee took a brief at-ease.
1:56:49 PM
CO-CHAIR SEATON stated that the committee is trying to find the
most expedited way to accomplish this process without creating
further legal entanglements for Ms. Stevens. He said he is
hearing from DNR that there may be some other things that could
be added by the legislature that the department cannot do. He
understood that DNR would be conferring with the Department of
Law between now and the next committee of referral to determine
whether there are amendments that would accomplish the intent
without putting Ms. Stevens' claims at risk.
MR. FOGELS confirmed that Co-Chair Seaton's understanding is
correct.
CO-CHAIR SEATON said he is fine with moving the bill today but
thinks there could be a better and clearer way to resolve this
in Ms. Stevens favor.
REPRESENTATIVE KAWASAKI said he thinks there are legal issues
with HB 340 and he therefore feels uncomfortable moving the bill
with recommendations because there is no other committee of
referral. The next time members will see this bill is
potentially on the House floor.
1:58:47 PM
REPRESENTATIVE GARDNER stated that the bill is not quite ready,
given that it has no other committee of referral. In principle,
she absolutely agrees with the bill - the right thing to do is
to make this person whole. However, it is also the right thing
for the committee to ensure that it is doing things properly and
with due diligence. This needs to be done correctly so it will
not come back and bite the state.
CO-CHAIR FEIGE noted that the bill's next stop is the House
Rules Standing Committee. While HB 340 is one way forward, he
concurred that there may be other methods the Department of Law
can recommend for righting the wrong dealt to Ms. Stevens. He
requested that if the bill is reported from committee the
chairman of the House Rules Standing Committee be provided with
an opinion from the Department of Law as to any other options
that might be available to the state or Ms. Stevens. It is
unfortunate the Department of Law was unavailable for this
meeting, he said, but he would like to see HB 340 moved out of
committee in the spirit of righting this wrong.
2:01:21 PM
CO-CHAIR SEATON moved to report HB 340 out of committee with
individual recommendations and the accompanying zero fiscal
notes.
REPRESENTATIVE GARDNER objected, saying that while she supports
the bill in principle, she thinks it is "half baked" and will
create a fiasco down the road.
REPRESENTATIVE DICK inquired whether the sponsor can provide
assurance that HB 340 will do the right thing for Ms. Stevens.
REPRESENTATIVE NEUMAN replied that there have been many hours of
discussion to get to this point to make sure that the right
thing is being done, and he will continue to do that.
REPRESENTATIVE GARDNER maintained her objection.
MS. STEVENS suggested that reinstating the active mineral rights
that existed prior to the [land transfer agreement] would
probably clear up the problem.
2:03:27 PM
A roll call vote was taken. Representatives Dick, Munoz,
Foster, Feige, and Seaton voted in favor of reporting HB 340.
Representatives Gardner and Kawasaki voted against it.
Therefore, HB 340 was reported out of the House Resources
Standing Committee by a vote of 5-2.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Big Game Commercial Svcs - Meekin #1.pdf |
HRES 3/2/2012 1:00:00 PM |
|
| Big Game Commercial Svcs - Quarberg #1.pdf |
HRES 3/2/2012 1:00:00 PM |
|
| HB 340 A.pdf |
HRES 3/2/2012 1:00:00 PM |
HB 340 |
| HB 340 Sponsor Statement vers A.pdf |
HRES 3/2/2012 1:00:00 PM |
HB 340 |
| HB340 Fiscal Note.pdf |
HRES 3/2/2012 1:00:00 PM |
HB 340 |
| HB 340 Map.PDF |
HRES 3/2/2012 1:00:00 PM |
HB 340 |
| HB340 Tileston - Rutherford Letter 1.26 (1).pdf |
HRES 3/2/2012 1:00:00 PM |
HB 340 |
| HB340 DNR Letter to Sen. Huggins 4.9.10.pdf |
HRES 3/2/2012 1:00:00 PM |
HB 340 |