Legislature(1995 - 1996)
04/03/1996 02:35 PM Senate CRA
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 466 ADAK REUSE AUTHORITY
CHAIRMAN TORGERSON called the Senate Community & Regional Affairs
Committee meeting to order at 2:35 p.m. He stated because the
committee lacked a quorum and could take no action on the
calendared legislation, the meeting would be considered a work
session on the bills. He then brought CSHB 466(FIN) am before the
committee as the first order of business.
Number 015
REPRESENTATIVE MOSES , prime sponsor of HB 466, explained the
legislation establishes an Adak Reuse Authority to facilitate the
conversion of the Adak Naval Air Facility to predominantly civilian
use. Because there is no local government on Adak, the authority
is needed to receive federal assets, manage a reuse plan and
perform administrative functions as the Navy withdraws from the
island.
The bill establishes a seven-member board, and provides that two of
those members must be residents of the Aleutian region. It also
empowers the authority to enter into contracts, operate
enterprises, receive grants and other funds, disperse funds and
issue revenue bonds. It also requires approval by the legislature
of any specific issue.
Representative Moses noted the legislation also contains a
provision for the director of the Office of Management & Budget to
approve transfers of property from the federal government once the
director has established that funds will be available to manage
that property appropriately.
Representative Moses said the bill has been written to ensure a
smooth transfer to any eventual municipality created locally or on
the island. The reuse authority is not expected to be a long-lived
entity.
In conclusion, Representative Moses said with the considerable
assets available once the Navy leaves Adak, a diverse commercially
viable community is a realistic vision of enhancement for the
Aleutian region. He urged the committee's favorable consideration
of the legislation.
Number 055
SENATOR TORGERSON questioned having the Department of Community &
Regional Affairs as the lead agency instead of the Department of
Commerce & Economic Development, because the biggest issue is
probably economic development. REPRESENTATIVE MOSES responded he
thought DCRA was selected because of the eventual need for forming
a local government in the region.
TIM BENINTENDI , legislative aide to Representative Moses, pointed
out the legislation provides that two members of the authority to
be selected by the governor will be heads of principal departments
of the executive branch, and he suggested the Department of
Commerce could be represented in that way.
Number 090
SENATOR KELLY inquired what the cost of the reuse authority will be
in general fund dollars. REPRESENTATIVE MOSES replied the fiscal
note from DCRA shows a cost of $281,000.
Number 104
SENATOR TORGERSON referred to language on page 2, lines 20 - 22,
which gives the governor the authority to break a tie vote on a
motion or resolution pending before the authority, and he
questioned why that provision was included. SENATOR KELLY also
pointed out that the section does not specify the number of votes
of the full membership needed to take an action. On most boards
and commissions there has to be a majority of the membership of the
board to take action, and, if it is a seven-member board, it takes
four votes in order to take an action. TIM BENINTENDI said the
language was pretty standard language that was included in the
original draft of the legislation and those issues hadn't been
previously raised.
SENATOR KELLY noted the fiscal note is for two employees, and he
suggested that be put into statute like was done several years ago
with the Tourism Marketing Council in order to limit the ability to
hire more than two employees. He assumed the authority would have
the ability to contract for employees to provide other types of
necessary services. TIM BENINTENDI agreed that was correct, and he
added that those contract employees would not be employees of the
state, but the executive director and the executive secretary will
be employees of the state.
Number 182
CHRIS GATES, representing the Aleut Corporation and testifying from
Boston, Mass., asked that the committee focus on three areas, the
first being representation. He said the intent of federal law is
real clear that it should be a local reuse authority, and, so far,
consideration of a local reuse concept has not been allowed to move
forward. He urged the committee to look at the possibility of a
local reuse committee.
Mr. Gates said the legislation provides that the governor appoint
five board members, which can come from any where in the state, two
of which might come from the Aleutians. He suggested the bill be
amended to allow villages, communities and Native groups of the
region, those who will win or lose when Adak is reused, to serve on
the board of directors.
Mr. Gates suggested on page 1, beginning on line 10, to change the
language to read as follows: "(a) The membership of the authority
consists of (1) a representative from the City of Unalaska; (2) a
representative from the City of Atka; (3) a representative from the
Aleutians East Borough; (4) a representative from The Aleut
Corporation; (5) a representative from the 15 village corporations
located within the Aleutians-Pribilof Island region; (6) a
representative from the 12 tribal organizations in the region; (7)
a representative from the Aleutians Pribilof Island Association;
and (8) two representatives from the state of Alaska."
Mr. Gates believes a local board will be more informed of the
economics, the political, the social, the administrative framework
of the region, and would be more capable of making quicker
decisions than the board that's proposed in the bill.
Mr. Gates noted the Aleut people having been working very hard for
several months to consolidate and make an arrangement with the
Department of Interior to trade all of their land entitlements
under ANCSA in the whole region on to Adak Island so that Adak will
be the "basket carrying all the eggs in the future of the Aleut
people and the Aleut community in the Aleutians."
Mr. Gates spoke to the necessity of keeping the assets and
infrastructure on Adak Island in tact. As an example, he noted
that when a school with an enrollment of over 400 students was
closed on the island, every thing in that was school stripped out
and dispersed to other locations, and when Adak is reused, all of
that will have to bought and resupplied to the island at great
cost. He suggested that if the legislation moves forward, it
should provide a moratorium on stripping equipment and
infrastructure off of the island for three to five years without a
super majority vote of the board.
Mr. Gates directed attention to page 13 and the section relating to
"Succession." He said the House Finance Committee pointed out the
section needs clarification as to the duties to be taken over by a
successive municipality, but no work has been done to clarify the
section.
In closing, Mr. Gates said the state authority concept may not be
the best tool. He said there are four bases around the country
that use simple nonprofit organizations that do exactly the same
things that this authority does, only does them better.
Number 326
SENATOR TORGERSON asked what Senator Stevens' position is on the
issue. REPRESENTATIVE MOSES answered that he doesn't think Senator
Stevens has taken a definitive position, although he would like to
see the interested parties come back with a united front.
Addressing Mr. Gates comments that the makeup of the board does not
constitute a local authority, Representative Moses said he gets the
impression that according to the Aleut Corporation, nothing will
work unless they have absolute control of whatever authority it
will be. He also believes that whatever authority comes into play,
it should not be limited and have its hands tied so that nothing
can be removed from the island. There undoubtedly will be a lot of
extra equipment that won't be immediately needed for the community
and it will just sit there and become obsolete and deteriorate.
Number 362
SENATOR TORGERSON asked for a response to Mr. Gates' comments on
the succession provision. TIM BENINTENDI said the bill was amended
on the floor to accommodate the House Finance Committee's concern.
He added that there has been no indication since the last House
Finance meeting or on the floor of the House that there is still a
problem with succession. The authority is designed to be a fairly
austere short-lived authority. He said the authority should have
the liberty to sell off surplus material, or trade it, lease it,
etc., in terms of generating cash flow to sustain itself and to
help the community remain on its feet until a municipality can be
formed. He also said the makeup of the board is compatible with
the way other boards have been done. The bill has been determined
to be a reasonable vehicle from many quarters of the state, and
even outside of the state, and that Aleut interests can participate
in it.
Number 422
SENATOR TORGERSON commented that it could end up with only two
people representing the Adak area on the board and five that are
not residents, so even with a super majority vote, equipment or
whatever else could be removed over the objections of the two
people who reside in the area. He asked Representative Moses if
this was a concern. REPRESENTATIVE MOSES replied that if an
authority is created for the benefit of Adak becoming a viable
community in a fairly rapid time, their charge is to look out for
the interests of Adak. However, if there were a number of
different communities controlling that board, they would probably
start fighting among themselves as to who was going to get what.
Number 445
CHRIS GATES informed the committee that Senator Stevens recently
wrote that a nonprofit corporation offers a mechanism to jump start
the process of attracting commercial enterprises to Adak this year.
He has looked at another entity besides this authority and thinks
that it might, if well constructed and well put together, do better
than the authority proposed in the legislation.
Number 475
SENATOR TORGERSON asked if with DCRA's involvement their primary
objective would be to form a municipality. TIM BENINTENDI answered
it is not addressed positively or negatively in the legislation.
SENATOR TORGERSON said he feels DCRA should probably have a
secondary role and DCED should be the lead agency because this is
a two billion dollar economic development issue. The secondary
proposal would be to form a local government if possible. Also, it
speaks to the bonding authority and the commissioner of DCRA is not
on the bond council, but the commissioner of DCED is.
REPRESENTATIVE MOSES said he didn't think he would have a problem
with DCED being the lead agency. He also related the City of
Unalaska has done a study on forming a borough and expanding their
boundaries to include Adak and Aleutians East.
Number 520
KRIS LETHIN , CEO of The Aleut Corporation, stated an issue that has
not been brought to the surface is the issue of lands. This
particular military base sits on national wildlife refuge land;
it's totally encompassed in that land. He said he has not heard
Representative Moses or Deputy Commissioner Cotten address how the
state is going to deal with the issue of taking over and having
authority in a national wildlife refuge and having all the
facilities to maintain and upkeep, as well as being able to have
the funding available to them.
Mr. Lethin said the Aleut people have felt very strongly about
their involvement because they would like to be able to be involved
from a land standpoint. They have 55,000 acres of unconveyed
surface estate and 144,000 acres of subsurface estate, which is
unconveyed to them under the ANCSA legislation. They have also
over-selected in the Aleutian Maritime Refuse over 1,000,000 acres
that basically cloud the title on the entire refuge in the
Aleutians. The U.S. Fish & Wildlife would very much like to
negotiate with the Aleut people to resolve those title clouds and
the title issues and to use Adak as the primary tool for that.
Mr. Lethin said there was a meeting the previous Friday with the
state of Alaska, the U.S. Navy and The Aleut Corporation
participating, to discuss how this issue could potentially be taken
care of. He said they were told that the state, in essence, did
not want to proceed any further until they knew exactly what was
going to happen with HB 466, so that brought that whole process on
the lands issue to a halt until the issue of the legislation is
resolved.
Mr. Lethin said this could end up being a very contentious thing,
and they have tried all along to figure how to bring some middle
ground to all of this, and he suggested there may be some middle
ground by using the nonprofit approach. He pointed out the Fort
Greely reuse program is under a nonprofit corporation. He
personally sees the state taking on an authority such as provided
for in HB 466, as a black hole with the state becoming the deep
pocket.
Number 580
There being no further testimony on HB 466, SENATOR TORGERSON said
a committee substitute would be prepared to address the issues of:
the number of employees of the authority being placed in statute;
the quorum requirement; and changing DCED to the lead agency. He
added that the issues brought up by Mr. Gates and Mr. Lethin,
relating to authority and limits, were questions that would need to
be addressed in Senate Finance. He stated it was his intention to
have the legislation back before the committee at its next meeting
for final action.
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