Legislature(1997 - 1998)

01/30/1997 01:07 PM RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
 HB 46 - MINING CLAIMS ON PUBLIC LANDS                                       
 Number 915                                                                    
 CO-CHAIRMAN BILL HUDSON announced the next order of business was              
 House Bill No. 46, "An Act relating to mining; and providing for an           
 effective date."  He advised there was a proposed committee                   
 substitute and asked for a motion to adopt it as a work draft.                
 REPRESENTATIVE BARNES moved to adopt the substitute.                          
 CO-CHAIRMAN HUDSON asked if there was any objection.  There being             
 none, Work Draft 1/29/97, Luckhaupt, 0-LS0265\B was before the                
 committee.  Co-Chairman Hudson invited Representative Kelly to                
 present the bill.                                                             
 Number 950                                                                    
 REPRESENTATIVE PETE KELLY, a prime sponsor of HB 46, explained, "HB
 46 comes out of the permitting process for some of the larger mines           
 that have recently come up to speed here in Alaska, most notably              
 Fort Knox and Illinois Creek.  In getting those mines up and                  
 producing, a number of flaws were discovered in Title 38,                     
 specifically as it relates to mining on state land.  This bill                
 addresses those flaws and brings the statutes into line with the              
 procedures that actually exist within DNR.  The bill is supported             
 by industry and the Administration.  To my knowledge, there is                
 little or no controversy surrounding this."  Representative Kelly             
 offered to go through the bill section by section.                            
 REPRESENTATIVE BARNES indicated if there was no objection to the              
 bill, that was unnecessary.                                                   
 Number 1017                                                                   
 CO-CHAIRMAN HUDSON asked if the committee had questions.  He then             
 called on Jules Tileston to testify.                                          
 Number 1031                                                                   
 JULES TILESTON, Director, Division of Mining and Water Management,            
 Department of Natural Resources (DNR), stated, "The Administration            
 does support the bill and the amendments that you are looking at              
 now.  I would be pleased to answer any questions."                            
 CO-CHAIRMAN HUDSON asked if there were questions and said he would            
 entertain a motion.                                                           
 Number 1068                                                                   
 REPRESENTATIVE BARNES made a motion that CSHB 46 move from                    
 committee with individual recommendations.                                    
 REPRESENTATIVE KELLY pointed out there was an amendment before the            
 Number 1075                                                                   
 REPRESENTATIVE BARNES withdrew her motion.  She referred to                   
 Amendment 0-LS0265\B.1, Luckhaupt, 1/30/97, which read:                       
      TO:  Draft CSHB 46( )("B" Version)                                       
      Page 5, line 29, through page 6, line l:                                 
           Delete "The rental amount shall be revised by the                   
      commissioner if the change between the index for the first six           
      months of the current year and the most recent index used to             
      revise the rental, or the reference base index if the rental             
      amount has never been revised, equals or exceeds $5."                    
      Page 6, line 4:                                                          
           Delete "index annually"                                             
           Insert "rental amount each 10 years"                                
 REPRESENTATIVE BARNES moved that the amendment be adopted.                    
 CO-CHAIRMAN HUDSON asked if there was any objection.  There being             
 none, the amendment to the committee substitute was adopted.                  
 Number 1103                                                                   
 REPRESENTATIVE BARNES made a motion to move CSHB 46, as amended,              
 from the committee with individual recommendations and asked                  
 unanimous consent.                                                            
 CO-CHAIRMAN HUDSON asked if there was any objection and noted there           
 was none.  He advised that someone wished to testify and asked                
 Representative Barnes to hold her motion.                                     
 Number 1174                                                                   
 BAERENT STRANDBERG, Strandberg Mineral Services, testified via                
 teleconference from Mat-Su.  He referred to the original bill and             
 indicated the Strandbergs had been involved in one of the largest             
 placer mines in Alaska and had written a lengthy report on the                
 Valdez Creek project.                                                         
 CO-CHAIRMAN HUDSON inquired whether Mr. Strandberg was working from           
 the 1/29/97 committee substitute adopted as a work draft and                  
 described it.                                                                 
 Number 1223                                                                   
 MR. STRANDBERG responded, "No, no, apparently not."  He indicated             
 a legislative aide was helping him.  Mr. Strandberg referred to the           
 "South Denali entrance problem," which he said had some relation to           
 the bill.  He asked how he could coordinate with the committee.               
 REPRESENTATIVE BARNES suggested Mr. Strandberg state his concern              
 and then let the bill's sponsor identify whether or not that was              
 addressed in the new committee substitute.                                    
 MR. STRANDBERG agreed.  He referred to AS 38.05.285(a) and stated,            
 "It says that state lands may not be closed to mining or mineral              
 location under AS 38.05.185 - 38.05.275 except as provided in AS              
 38.05.300 and unless the commissioner makes the finding that mining           
 will be incompatible with significant surface uses on state land."            
 He explained he had a problem with the commissioner making a                  
 determination of whether mining was compatible with other uses.               
 MR. STRANDBERG said, "If you're in a mining district, the industry            
 that is moving into the district should be evaluated as to whether            
 it is compatible with mining.  And that comes in with the Denali              
 south entrance.  We believe that the tourist industry being jammed            
 up against industrial projects will create significant additional             
 MR. STRANDBERG explained, "And what I would like to see in this               
 bill right here, I'd like to see you add an amendment in there                
 where any additional activities will be evaluated as to its                   
 potential upset of the financial structure of the project.  And for           
 instance, there's a mine that went down just outside of Yellowstone           
 where President Clinton came in to play and killed the mining                 
 operation.  And we do have a number of projects that are coming in            
 right next door to state and federal parks.  And I'd like to see              
 your committee here address ... that issue.  And I think that's our           
 major one."                                                                   
 Number 1391                                                                   
 CO-CHAIRMAN HUDSON voiced his understanding that they were looking            
 at page 4, line 12, of the adopted draft.  He asked whether                   
 Representative Kelly understood what Mr. Strandberg was suggesting.           
 Number 1396                                                                   
 REPRESENTATIVE KELLY responded, "As I understand, this is state law           
 and this bill does not affect what he is referring to here.  If he            
 would like, I would gladly let him contact my office to entertain             
 amendments at a later time, in a different committee."                        
 CO-CHAIRMAN HUDSON said it did not, then, apply to what was being             
 addressed by HB 46.                                                           
 REPRESENTATIVE KELLY agreed it did not apply.                                 
 CO-CHAIRMAN HUDSON asked whether Mr. Strandberg had heard that.               
 Number 1423                                                                   
 MR. STRANDBERG replied he would contact Representative Kelly's                
 legislative assistant.  He had tried to contact someone from                  
 Representative Kelly's office that morning, he said.                          
 REPRESENTATIVE KELLY acknowledged that telephone call and said his            
 staff had tried unsuccessfully to return it.  He indicated his                
 staff would contact Mr. Strandberg that afternoon.                            
 MR. STRANDBERG said that was his only question.  It was a                     
 significant problem trying to mix the tourist business with mining.           
 "I don't see how it's compatible," he concluded.                              
 REPRESENTATIVE BARNES made a motion that CSHB 46, as amended, move            
 from the committee with individual recommendations and asked                  
 unanimous consent.                                                            
 Number 1465                                                                   
 CO-CHAIRMAN HUDSON asked if there was any objection.  There being             
 none, CSHB 46(RES) moved from the House Resources Standing                    
 HB 46 - MINING CLAIMS ON PUBLIC LANDS                                       
 TAPE 97-7, SIDE A                                                             
 Number 006                                                                    
 The next order of business was House Bill No. 46, "An Act relating            
 to mining; and providing for an effective date."                              
 REPRESENTATIVE BARNES referred to the fiscal note from the DNR for            
 HB 46.  At $1,000, it was a very small fiscal note for changes                
 required in regulations.  Representative Barnes believed the DNR              
 could absorb that cost.  She saw no reason for HB 46 to go to the             
 House Finance Committee for that amount.                                      
 REPRESENTATIVE BARNES moved that the House Resources Standing                 
 Committee zero out the fiscal note and further moved that a zero              
 fiscal note be moved from the committee along with CSHB 46(RES), as           
 amended.  She asked unanimous consent.                                        
 CO-CHAIRMAN HUDSON asked if there was any objection.                          
 Number 081                                                                    
 CO-CHAIRMAN OGAN inquired whether they needed to rescind the                  
 previous action.                                                              
 REPRESENTATIVE BARNES replied no.                                             
 CO-CHAIRMAN HUDSON concurred, saying it was an attachment and the             
 motion was proper.                                                            
 REPRESENTATIVE BARNES advised that the committee needed to prepare            
 a zero fiscal note and specify that it was by the House Resources             
 Standing Committee.                                                           
 CO-CHAIRMAN HUDSON said he would ask the committee to prepare that.           
 Number 131                                                                    
 REPRESENTATIVE NICHOLIA stated, "I'd like to know what the entailed           
 costs are for the $1,000 and why they have a $1,000 fiscal note."             
 She asked if someone from the DNR could explain it.                           
 REPRESENTATIVE BARNES responded, "It says on the bottom that it is            
 for revising the regulations that goes with this.  And I believe              
 that those revisions, as I stated, can be made as part of their ...           
 in-house budget."                                                             
 REPRESENTATIVE NICHOLIA still wanted to know how the department               
 came up with the $1,000 fiscal note.                                          
 Number 202                                                                    
 REPRESENTATIVE BARNES pointed out there was a narrative at the                
 bottom stating how the DNR would use the $1,000.                              
 REPRESENTATIVE NICHOLIA responded, "I'd just like to state that               
 it's kind of dumb that we have a fiscal note here for $1,000 and              
 nobody from the department, the Division of Mining Development,               
 that is here to back it up."                                                  
 Number 249                                                                    
 CO-CHAIRMAN HUDSON acknowledged the motion and request for                    
 unanimous consent to attach and advance CSHB 46, as amended, with             
 the fiscal note zeroed.  He indicated staff had been ordered to               
 prepare a zero fiscal note.  He asked if there was any objection to           
 the motion.  There being no objection, CSHB 46(RES) moved from the            
 House Resources Standing Committee with a zero fiscal note.                   

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