Legislature(1997 - 1998)

02/05/1997 01:35 PM Senate CRA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
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       SB 50 PUBLIC WATER SUPPLY VIOL: ADMIN PENALTIES                       
                                                                               
  CHAIRMAN MACKIE  brought SB 50 before the committee as the next              
 order of business.                                                            
                                                                               
  TAPE 97-5, SIDE B                                                            
 Number 001                                                                    
                                                                               
  JANICE ADAIR , Director, Division of Environmental Health,                   
 Department of Environmental Conservation, explained Congress                  
 reauthorized the Safe Drinking Water Act (SDWA) in 1996 and added             
 a new requirement for primacy of the drinking water program.                  
 Another change was requiring primacy for continued access to                  
 federal construction funds for drinking water systems.                        
                                                                               
 Ms. Adair pointed out that the state of Alaska has primacy for the            
 drinking water program at this time as does all other states except           
 for Wyoming.  Primacy means that the state manages and enforces the           
 terms of the SDWA in lieu of the federal government.  It affords              
 the state several benefits, including the ability to waive certain            
 monitoring requirements for specific water systems.  She related              
 these waivers have saved almost $1.5 million in laboratory costs              
 for systems that are located in the districts of committee members.           
 Primacy also allows the department to work one-on-one with systems            
 on solving their problems, and that helps ensure the delivery of              
 safe water to the communities served.                                         
                                                                               
 SB 50 will provide DEC the authority to establish a program for               
 administrative penalties.  It sets an amount of $1,000 per day per            
 violation for systems that serve more than 10,000 people, and for             
 all other systems, the penalty may not exceed $750 per day.                   
                                                                               
 On page 2, beginning with line 10 and ending on page 3, line 4, it            
 outlines the factors the department thought were important to be              
 considered when establishing an amount of a penalty.                          
                                                                               
 Ms. Adair pointed out that Section 7 of the bill delays the actual            
 effective date of the penalty authority until the EPA tells the               
 state it must have administrative penalty authority to retain                 
 primacy for the drinking water program.                                       
                                                                               
 Number 035                                                                    
                                                                               
  CHAIRMAN MACKIE  referred to the title of the bill and asked for an          
 explanation of change to the Alaska Rules of Civil Procedure.   MS.           
 ADAIR  explained that the administrative penalty for a violation is           
 a federal mandate.  The Civil Procedure Rule change is not a                  
 requirement of federal law, but where there is a water system that            
 refuses to pay a penalty and it necessitates taking them to court             
 in order to get them to do what needs to be done and to pay the               
 penalty, then that change would allow the state to recover those              
 attorney fees.                                                                
                                                                               
 Number 050                                                                    
  SENATOR HOFFMAN  referred to subsection (d) on page 3, line 8, which         
 provides a 30-day period in which a person can file an appeal after           
 receiving an assessment notice on a penalty, and suggested it was             
 too short a tim period and that it should be changed to 45 days.              
  MS. ADAIR  stated the department would not have a problem with his           
 suggested change.                                                             
                                                                               
  SENATOR HOFFMAN  then referred to page 3, line 19, which provides            
 that the person who receives an administrative penalty can file a             
 notice of appeal in the superior court.  He pointed out that people           
 in the smaller communities would have to fly in to file an appeal,            
 and he questioned why that couldn't be done in a district court               
 because there aren't that many superior courts in the state.   BRECK          
 TOSTEVIN , Assistant Attorney General, Department of Law, responded           
 that traditionally administrative appeals from an agency action go            
 to superior court and a superior court acts as an appellate court             
 and reviews the agency action as opposed to the district court, so            
 that's why those provisions were drafted that way.                            
                                                                               
  SENATOR HOFFMAN  referred back to subsection (d) and said it                 
 provides that the department may extend the time periods in the               
 subsection for good cause.  He then asked if there was a definition           
 of "good cause."   MS. ADAIR  answered that she did not know, but it          
 would be something that the department would want to address the              
 regulatory development process as they put the program together.              
                                                                               
 Number 105                                                                    
                                                                               
  SENATOR WILKEN  referred to the sectional analysis and asked if this         
 issue only deals with Anchorage, Juneau, Fairbanks, one air force             
 base and two army bases.   MS. ADAIR  said those six systems are the          
 ones that serve more than 10,000 people so those would be the                 
 systems that would be subject to the $1,000 per day per violation             
 penalty.  For all other systems in the state with less 10,000                 
 people are subject to a $750 per day per violation penalty.                   
  SENATOR WILKEN  inquired when the last time there was an issue that          
 required the filing of a lawsuit in a matter such as drinking                 
 water.   MS. ADAIR  thought it was in the very early 1990's, it was           
 a system in Southeast Alaska, and it was a criminal issue.                    
                                                                               
  SENATOR WILKEN  voiced his concern that as a society we need to talk         
 about administrative penalties and, particularly, allowing DEC to             
 impose them unilaterally.  He said this is probably an excellent              
 example of the heavy handed way that government controls what we              
 do, both state and federal.  He suggested there needs to be a                 
 better way to do this and not to just give carte blanche approval             
 to DEC to sanction something as simple as providing good drinking             
 water.                                                                        
                                                                               
  CHAIRMAN MACKIE  asked Ms. Adair what would happen if this                   
 legislation did not pass.   MS. ADAIR  replied that at some point in          
 time, the EPA would begin the process to withdraw primacy for a               
 drinking water program, and if primacy was withdrawn, the program             
 would become an enforcement only program.  She related that 85                
 percent of the state's drinking water program is funded by EPA,               
 which amounts to approximately $1 million.  The 1996 amendments to            
 SDWA added construction funds for drinking water systems, and in FY           
 98 that is expected to be about $28 million to the state.                     
                                                                               
 Number 180                                                                    
 In a brief discussion on why the appeals have to go a superior                
 court instead of a district court, it was concluded that it is a              
 standard that is set out in the Administrative Procedures Act.                
  SENATOR DONLEY  suggested that could be amended if Senator Hoffman           
 thought his constituents would be better served by access to                  
 district court.                                                               
                                                                               
 Number 215                                                                    
                                                                               
  SENATOR HOFFMAN  stated he agrees with Senator Wilken's statement            
 about the heavy hammer that this legislation is giving DEC, but               
 because it is required in order for the state to comply with the              
 changes in SDWA and to continue to receive funds, he suggested                
 working on it to make sure that the department does not have so               
 much discretion on the use of that heavy hammer.                              
                                                                               
  KEITH KELTON , Director, Division of Facility Construction &                 
 Operation, Department of Environmental Conservation, said what                
 Congress is attempting to do with the changes in SDWA is respond to           
 an unfunded mandate complaint.  They are putting a carrot in this             
 Safe Drinking Water Act reauthorization that says they will fund a            
 low interest loan program with state participation.  The initial              
 funding, starting in FY 96, was $27 million and the state has to              
 put in a match of $5 million, so the there will be a total of $32             
 million for low interest loans for solving community infrastructure           
 problems.  The stick they are throwing in is the administrative               
 penalty, and if the state doesn't do the administrative penalty, it           
 loses primacy and the funding that goes with it, he said.                     
                                                                               
 Number 365                                                                    
                                                                               
  SENATOR WILKEN  commented that on the campaign trail he heard a lot          
 of good things about what the Legislature had been doing in the               
 rural areas in regard to sewer and water, and his comments, by no             
 means, should be taken that he doesn't support that.  He just wants           
 to make sure that the process isn't slowed down by having someone             
 or some group get out of control and forget where the power really            
 lies, and that's why he speaks against the ability to just simply             
 write an order that stops the process.                                        
                                                                               
  MR. KELTON  related that probably the primary recipients of these            
 loan funds are the larger urban communities, but any municipal                
 government can apply.  For instance, Anchorage has received well              
 over $30 million in the waste water program.  The smaller                     
 communities normally rely on a grants program rather than the loan            
 program.                                                                      
                                                                               
  CHAIRMAN MACKIE  requested that Senator Hoffman and Senator Wilken           
 take a further look at this issue, both from an urban and rural               
 perspective, and work with the people at DEC to see if some of                
 these problems can be worked out before another hearing is                    
 scheduled on the legislation.                                                 

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