Legislature(1999 - 2000)

05/14/1999 01:27 PM RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
SB   7-INCREASE LAND GRANT TO UNIV. OF ALASKA                                                                                   
CO-CHAIRMAN OGAN announced that the first order of business before                                                              
the committee would be CS FOR SENATE BILL NO. 7(FIN) am, "An Act                                                                
relating to the University of Alaska and university land, and                                                                   
authorizing the University of Alaska to select additional state                                                                 
Number 0095                                                                                                                     
JANE ANGVIK, Director, Division of Land, Department of Natural                                                                  
Resources, testified via teleconference from Anchorage.  She                                                                    
informed the committee that the Administration is opposed to SB 7.                                                              
This legislation places the university in competition with                                                                      
municipal governments for access to land.  There is also concern                                                                
that the pattern of use for the state lands will be significantly                                                               
altered as a result of the University Lands Act.  Ms. Angvik                                                                    
believed in the full funding of the university and encouraged that,                                                             
however, this legislation is viewed as an appropriation of state                                                                
lands and the revenue of those lands directly to the university.                                                                
She indicated that this legislation would remove the land from the                                                              
management of the best interest of all Alaskans.  This legislation                                                              
will further complicate land ownership which would increase the                                                                 
difficulties with resource development and public access.  She                                                                  
explained that the university has different rules than those                                                                    
required by Title 38.  State lands are required to have a public                                                                
process while the university's policies are unknown.  Furthermore,                                                              
the Board of Regents would establish those policies under which the                                                             
same public process is not required.  Similarly, the university is                                                              
not required to follow the same intended use of public lands that                                                               
are described by the area land use plans which have been prepared                                                               
for the use of state lands.                                                                                                     
MS. ANGVIK specified that this legislation places the university in                                                             
competition with municipalities that have not yet finished or need                                                              
to revise their municipal entitlements.  She noted that the Alaska                                                              
Municipal League (AML) is concerned about this proposal.  While                                                                 
this legislation was amended on the Senate floor to provide                                                                     
municipal governments with the first right of refusal on land, the                                                              
university's pool for land selection is much larger than that of                                                                
municipal governments.  Therefore, the AML has requested that the                                                               
pool for municipal governments be expanded to include all the lands                                                             
from which the university can select or limit the university's                                                                  
selection pool to the same as that available to the municipalities.                                                             
Number 0381                                                                                                                     
MS. ANGVIK expressed concern that the Division of Lands' capacity                                                               
to fulfill the municipal entitlements for existing municipalities                                                               
would be significantly impaired by this bill.  She pointed out that                                                             
one of the major policy effects of this legislation is that should                                                              
future boroughs try to be established, those municipal governments                                                              
would be precluded from having access to the best lands which the                                                               
university is predicted to choose.                                                                                              
MS. ANGVIK stressed that although as currently written, the bill                                                                
would require the university to pay the cost of the selection and                                                               
conveyance of the lands, the bill will be expensive to administer.                                                              
She believed that much money would be spent up-front and  the                                                                   
university would not accrue revenues for some time.  The university                                                             
would be better served, if the legislature provided direct                                                                      
appropriations for the management of the university as opposed to                                                               
the appropriation of lands.  She believed that the university can                                                               
select rights-of-way, gravel deposits, and land planned for                                                                     
disposal in order that revenues from those sources would benefit                                                                
the university rather than the programs of the rest of the state.                                                               
She indicated that there would be a limiting effect on the ability                                                              
of the state to sell lands in the immediate future because the                                                                  
lands most likely to be disposed or available for sale by the                                                                   
Division of Lands are the lands most likely to be pursued by the                                                                
university for selection.                                                                                                       
Number 0570                                                                                                                     
MS. ANGVIK noted that at the last meeting, the university testified                                                             
that it was able to generate $32 million in the time that it has                                                                
held the land it had transferred compared to the $590,000 generated                                                             
by the state in the same time period.  She pointed out that the                                                                 
vast majority of the university's funds are derived from the timber                                                             
resources in Yakataga.  The state still owns that land, but the                                                                 
university has the right to harvest the timber resources in                                                                     
Yakataga.  Furthermore, the university is in a position to have                                                                 
more up-front funding for the development of lands than are general                                                             
state lands.  For example, Ms. Angvik informed the committee that                                                               
it costs about $4 per acre for the university to manage its land                                                                
while the Division of Lands operates on a thirty cents per acre                                                                 
management fund.  In conclusion, Ms. Angvik encouraged the                                                                      
committee to consider the land development patterns in the state                                                                
which will compound and conflict with resource development.  Ms.                                                                
Angvik reiterated the Administration's opposition to this                                                                       
legislation.  She also noted that similar legislation has been                                                                  
vetoed by Governor Knowles twice before and once before by Governor                                                             
MEL KROGSENG, Legislative Assistant to Senator Taylor, Alaska State                                                             
Legislature, requested that Ms. Redman join her at the table and                                                                
address the process by which the Board of Regents determines how                                                                
its land will be managed.  She also requested that Ms. Redman                                                                   
discuss how much of the university's  land is currently being                                                                   
actively managed.                                                                                                               
Number 0861                                                                                                                     
WENDY REDMAN, Vice President, Statewide University of Alaska                                                                    
System, informed the committee that currently the university has                                                                
112,000 acres of land and an additional interest in another 85,000                                                              
acres.  As noted earlier, the university was given the rights to a                                                              
single cut in the Yakataga region.  Of the total land and interest                                                              
in land of the university, a little over half is currently in                                                                   
active management.  She pointed out that the remaining portion,                                                                 
about 80,000 acres, includes about 36,000 acres which are not                                                                   
developable.  The remaining 50,000 acres are either very remote or                                                              
viewed by the university as a long-term investment.                                                                             
MS. KROGSENG reiterated her question regarding the management plan                                                              
and the public process utilized to develop that plan.                                                                           
MS. REDMAN pointed out that the university's public process is                                                                  
specified in the board's policy.  Part of that policy is included                                                               
in the legislation itself in order to ensure the public process.                                                                
She acknowledged that the university's public process is slightly                                                               
different than the state's process.  The university's public                                                                    
process is extensive at the local level and the university is                                                                   
subject to the same local laws in terms of development.  Ms. Redman                                                             
clarified her statement from the previous hearing regarding the                                                                 
university's land managment.  She said that DNR has not had the                                                                 
staff or the resources to develop the lands of the state, while the                                                             
university has had those resources necessary for the development of                                                             
the university's land.  All of the development costs are covered by                                                             
the resources derived from the land, therefore the university does                                                              
not spend any general funds on its properties.                                                                                  
MS. REDMAN explained that she believed transferring land to the                                                                 
university is a good idea because the university is able to develop                                                             
the land.  If the state was able to place the appropriate resources                                                             
into DNR to develop the lands for the good of all Alaskans, Ms.                                                                 
Redman said she might not believe this to be appropriate.  However,                                                             
that does not look as if it will happen.  She viewed this as an                                                                 
alternative allowing a small portion of state land to be given to                                                               
the university to be placed in active management for the good of                                                                
the state.                                                                                                                      
MS. KROGSENG reiterated her comments from the previous hearing.  If                                                             
this bill is passed into law, the congressional university lands                                                                
bill is also likely to pass.  The congressional legislation                                                                     
contains a provision for 250,000 acres for the state university                                                                 
system with no strings attached.  The congressional legislation                                                                 
also provides an additional 250,000 acres for the university if the                                                             
state matches that amount with state land which the bill before the                                                             
committee would satisfy.  She utilized a map with an overlay to                                                                 
illustrate that the amount of land being discussed is one-half of                                                               
one percent of the entire state entitlement.  Ms. Krogseng                                                                      
encouraged the committee's support of this legislation.  She                                                                    
acknowledged that the university is not going to realize returns                                                                
for up to three years.  The university will probably not have its                                                               
hands on this land for another four to five years, after which the                                                              
university will have to develop a plan for the development of the                                                               
land.  This is a long-term plan.                                                                                                
CO-CHAIRMAN SANDERS asked if there were any further questions or                                                                
comments from anyone.  There being none, the public testimony was                                                               
Number 1292                                                                                                                     
REPRESENTATIVE MASEK moved to report CSSB 7(FIN)am out of committee                                                             
with individual recommendations and the accompanying fiscal notes;                                                              
she asked unanimous consent.                                                                                                    
REPRESENTATIVE JOULE objected.                                                                                                  
Upon a roll call vote, Representatives Whitaker, Harris and Masek                                                               
voted in favor of the motion to report CSSB 7(FIN) am out of                                                                    
committee.  Representatives Joule, Morgan, Kapsner and Sanders                                                                  
voted against the motion to report CSSB 7(FIN) am out of committee.                                                             
Representatives Barnes and Ogan were not present.  Therefore,  the                                                              
motion to report CSSB 7(FIN) am out of committee failed with a vote                                                             
of 4-3.                                                                                                                         
CO-CHAIR SANDERS called an at-ease at 1:44 p.m. and turned the                                                                  
gavel over to Vice Chair Masek.                                                                                                 
VICE CHAIR MASEK called the meeting back to order at 1:52 p.m.,                                                                 
noting that there was a quorum.                                                                                                 

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