Legislature(2011 - 2012)BELTZ 105 (TSBldg)
03/13/2012 04:00 PM COMMUNITY & REGIONAL AFFAIRS
Download Mp3. <- Right click and save file as
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
SB 152-LEG. APPROVAL OF BRISTOL BAY SULFIDE MINE 4:20:32 PM CHAIR OLSON announced the consideration of SB 152. 4:21:23 PM DONALD M. BULLOCK, Legislative Counsel, Legislative Legal Services, Legislative Affairs Agency, said he looked at whether SB 152 conflicted with either Article I, sec. 15 or Article II, sec. 19 of the Constitution of the State of Alaska. Article I, sec. 15 has to do with prohibited state action. In part, it says: No law impairing the obligation of contracts, and no law making any irrevocable grant of special privileges or immunities shall be passed. The issue is that there is no information on whether there would be any contracts in place that would be voided or could not be carried out as a result of this legislation. Article II, sec. 19 has to do with local or special acts. In part, it says: The legislature shall pass no local or special act if a general act can be made applicable. Although the bill only identifies the specific headwaters of Bristol Bay, it would probably survive a challenge under the local and special prohibition because of the statewide interest in the Bristol Bay fishery. MR. BULLOCK said the requirement of legislative approval is probably the most significant provision in the bill. It is a separation of powers issue. The legislature has enacted laws and same with the federal government that relate to permits and what has to be done to receive a permit, license, authorization, or the approval of a plan of operation. The executive branch carries out that function, and the bill would effectively give the legislature the opportunity to veto an executive branch decision that presumably was made within the authority received from the legislature. Article II, sec. 1 and Article III, sec. 1 describes the powers that the legislature has and the powers that the executive has. 4:23:57 PM SENATOR MENARD questioned whether he was cautioning the committee about going forward with the bill. MR. BULLOCK said he couldn't talk about the outcome; he could talk about the constitutional issues. The other issue raised by the bill relates to the risk to the state if there was legislation or a regulation that effectively prohibited the development of vested mineral rights. This is a property interest that is protected by the takings clause under both the Alaska and U.S. Constitution. If there is a taking by the government, there may be a risk that the state would have to compensate the company or person that can no longer economically develop their claim. If SB 152 were to pass and the legislature vetoed something that DNR had approved, a challenge from the mineral interest owner could be expected under the separation of powers. Even without this legislation, if there was a change in the regulation that related to a vested mining interest, there is a risk that the state may have to compensate the owner of the mineral interest if the economic value has been effectively taken. It would probably be a question for a jury or other fact finder as to what the value would be. 4:27:57 PM CHAIR OLSON asked if other states have similar legislation with regard to legislative approval. MR. BULLOCK answered that virtually every state has a separation of powers issue, and the legislature can deal with this situation in other ways, such as appropriation. He explained the administrative process for classifying land that is and is not open to mining. If an area is open to mining, a company can come in and discover the mineral, locate and set the boundaries, and record it. That company has acquired a right to mine, and that is similar to the federal mining laws that date back to the 19th century. He said the concept of regulatory taking has come up in other states so there would be that issue as well as the separation of powers regarding who makes the decision as to whether something can go forward. He noted that a bill currently in the legislature would in the future close some land in the Alyeska area to mining. That does not present a problem when it's done ahead of time; it's after the rights have been vested that the risks and problems arise. CHAIR OLSON asked if the bill would conflict with either federal law or the U.S. Constitution. MR. BULLOCK said this would probably be limited to state action; the state does not have any power over any agency decision of the federal government. 4:30:29 PM SENATOR MENARD asked what mine project since the 19th century was held up the longest due to regulatory requirements. MR. BULLOCK said the Kennecott project in Juneau was delayed because of environmental concerns about the drainage from the mine tailings. The matter went to the U.S. Supreme Court because there was a conflict in the interpretation of laws administered by the Corps of Engineers and the Department of Environmental Conservation. He noted that environmental litigation has to be anticipated in any mining project. 4:33:19 PM SENATOR HOLLIS FRENCH, sponsor of SB 152, Alaska State Legislature, said he would first like to address the idea that the legislature's action could constitute a taking of a vested right. He said he would like Mr. Bullock to explain further how the agency's action is any different from the legislature's. He asked if it would be a taking if DNR ultimately denies a permit to Pebble because the legislature's action would be exactly the same. He said it is possible that the action is an encroachment on the executive function, but the legislature already exercises power in many blended areas. The governor's nominations of commissioners and attorney general is a blended area where the legislature exercises a check on his authority. The governor has some blended legislative authority as well. He can veto the legislature's capital appropriations. CHAIR OLSON opined that those were different than the separation of powers in the specific action that Mr. Bullock addressed. SENATOR FRENCH pointed out that there has been a law on the books since the mid-70s on the same topic with respect to oil and gas in Bristol Bay. Although the constitutionality of that statute has not been challenged, it has some precedential value. 4:35:35 PM SENATOR WAGONER asked who provided the maps. SENATOR FRENCH answered he got them from Rick Halford. SENATOR WAGONER said the exploration license area depicted on the maps was between 125 and 150 miles away from the proposed site of the Pebble Mine. SENATOR FRENCH reviewed the map and thanked Senator Wagoner for the correction; he agreed completely. CHAIR OLSON asked for a corrected map and Senator French agreed to provide one accurate map to all committee members. CHAIR OLSON asked what kind of support the bill had elicited. 4:38:15 PM KRISTEN PETERSON, Staff for Senator French, said the office had received a fair number of letters of support from members of the Renewable Resources Coalition. CHAIR OLSON held SB 152 in committee.