04/25/1994 09:10 AM Senate FIN

  CSSB 339(RES): An  Act   relating  to  the   management  and                 
                 disposal   of   state  land   and  resources;                 
                 relating   to   certain  remote   parcel  and                 
                 homestead entry land  purchase contracts  and                 
                 patents; and providing for an effective date.                 
                                                                               
                 Gerald  L.  Gallagher, Director,  Division of                 
                 Mining,  Department  of   Natural  Resources,                 
                 spoke to SB  339 by section.   Questions were                 
                 asked of Mr. Gallagher by Senators Rieger and                 
                 Jacko.   CSSB  339(RES) was  REPORTED out  of                 
                 committee  with  individual  recommendations,                 
                 and a zero fiscal note  for the Department of                 
                 Natural Resources with revenue of $(100.0).                   
                                                                               
  CS FOR SENATE BILL NO. 339(RES):                                             
                                                                               
       An Act relating to the management and disposal of state                 
       land and resources;  relating to certain  remote parcel                 
       and  homestead  entry   land  purchase  contracts   and                 
       patents; and providing for an effective date.                           
                                                                               
  Co-chair  Pearce  announced  that  SB  339  was  before  the                 
  committee.   She  invited  to Gerald  Gallagher to  join the                 
  committee at the table.                                                      
                                                                               
                                                                               
  GERALD   L.  GALLAGHER,   Director,   Division  of   Mining,                 
  Department  of Natural  Resources,  said  that revisions  to                 
  Title  38  in  SB 339  were  fairly  broad  and touched  all                 
  resources.   Sections 1  through 10  essentially reform  the                 
  land disposal program in the state.  What those sections did                 
  was require that  land be identified  in land use plans  and                 
  properly classified.   It also dictated that  the department                 
  adopt regulations to sell  land at no less than  fair market                 
  value.                                                                       
                                                                               
  Section 11 was amended in Senate Resources Committee and now                 
  conformed to language  that allowed  the exchange of  native                 
  allotments when it was in the best interests of the state.                   
                                                                               
  Sections  12,  13,  14,  again  made conforming  changes  to                 
  coincide with land  disposal changes  in Sections 1  through                 
  10.                                                                          
                                                                               
  Section 15 was a minor definition change.                                    
                                                                               
  Section 16  gave the department authority to  require and to                 
  appropriate action if a  lessee of state land did  not clean                 
  up or remove material from the site at the end of the lease.                 
                                                                               
  Section  17  and  18  dealt  with  timber  and  allowed  the                 
  Commissioner to negotiate timber sales  where there might be                 
  a Spruce bark beetle infestation, or an economic loss to the                 
  resource for land conversion.                                                
                                                                               
  Section 19 was identical to SB 322 that had passed the House                 
  and Senate.   It would eliminate  the 90 day restriction  on                 
  oil and gas lease sales.                                                     
                                                                               
  Section 20 clarifies  the Commissioner's authority to  close                 
  land  to mineral entry, limiting his authority on new claims                 
  and not on existing ones.                                                    
                                                                               
  Section 21  reformed  who would  be allowed  to hold  mining                 
  claims.  This would conform to all business practices of the                 
  state.                                                                       
                                                                               
  Section  22  changed how  rents  were adjusted  for consumer                 
  price indexes.  The new wording said "whenever it reached $5                 
  increments" and would make for easier accounting.                            
                                                                               
  Section 23 allowed  for surface use for  mine tailings, mill                 
  sites, and changed out the word "permit" for "lease".                        
                                                                               
  Section 24 conformed.                                                        
                                                                               
  Section 25 changed  old regulations  that said  if a  person                 
  applied for  a lease and  did not return  that lease to  the                 
  department within 90 days, the lease was lost.                               
                                                                               
                                                                               
  Section 26 clarified  when the department could  use permits                 
  and  was specific to  reindeer grazing. It  would allow such                 
  activities as rock collecting, etc.                                          
                                                                               
  Section  27,  28, 29,  30, 31,  and  32 were  all conforming                 
  changes to coincide  with the land  disposal package in  the                 
  first 10 sections of the bill.                                               
                                                                               
  Section 33 contained  all repealers to accomplish all of the                 
  above.                                                                       
                                                                               
  Sections 34, 35,  and 36 contained  the effective dates  and                 
  transitional provisions.                                                     
                                                                               
  In answer to  Senator Rieger, Mr.  Gallagher said there  was                 
  nothing in the bill that dealt with water rights.                            
                                                                               
  In another answer  to Senator Rieger, Mr. Gallagher said the                 
  Supreme Court had ruled that  requiring the disposal be held                 
  in a  local community  and to  have the  winner present  was                 
  unconstitutional.   He acknowledged it was a  good idea that                 
  the  disposal  be held  in the  community  near the  land in                 
  question, but it could not be required by law.                               
                                                                               
  In answer  to Senator Rieger,  Mr. Gallagher  said rents  on                 
  state   mining  claims,   instead  of  a   10-year  interval                 
  adjustment, would be  increased by $5 increments for ease of                 
  accounting  which  would  mean  every   5,  10  or  15-years                 
  depending on the price-index.                                                
                                                                               
  End SFC-93 #79, Side 1                                                       
  Begin SFC-93 #79, Side 2                                                     
                                                                               
  In  answer to Senator Rieger, Mr.  Gallagher said Section 24                 
  exempted land  surface from the competitive bidding process.                 
  Only the company that was developing the mine would have any                 
  reason to lease the  surface for mine improvements.   It did                 
  not exempt it from best interest  findings and all the costs                 
  associated with that.                                                        
                                                                               
  Again in answer  to Senator  Rieger, page 13,  line 23,  Mr.                 
  Gallagher  said  that "limited  value"  was not  defined but                 
  referred  to  a practice  that had  a  low dollar  value and                 
  little  impact on the  resources.  Mr.  Gallagher said there                 
  had been some  discussion internally about  the term.   Some                 
  examples given were rock collecting,  and short term grazing                 
  of reindeer.                                                                 
                                                                               
  In answer  to Senator Sharp,  Mr. Gallagher said  that there                 
  was nothing in the bill that  applied to lands leased within                 
  the  international  airport systems.   He  did say  that any                 
  state lease would  come under this  bill since it was  state                 
  land.                                                                        
                                                                               
                                                                               
  In answer to  Senator Jacko, Mr. Gallagher  said that Senate                 
  Resources  Committee had  added  language  that had  already                 
  passed the Senate.                                                           
                                                                               
  Again in answer Senator Rieger, Mr. Gallagher said that most                 
  repealers were related to the land  disposal program to make                 
  it conform with  the fair market value  competitive package.                 
  The one repealer that did not fall under that was 38.05.207,                 
  which  pertained to a mining  production license.  The other                 
  repealers  were   conforming  while  this   was  a  straight                 
  repealer.                                                                    
                                                                               
  Senator  Jacko  MOVED  for  passage  of CSSB  339(RES)  from                 
  committee  with individual  recommendations.   No  objection                 
  being  heard,  it   was  REPORTED  OUT  of   committee  with                 
  individual recommendations, and  a zero fiscal note  for the                 
  Department  of  Natural  Resources.    Co-chair  Pearce  and                 
  Senator  Jacko signed "do pass."   Senators Rieger and Sharp                 
  signed "no recommendation."                                                  
                                                                               
                         Recess 10:05am                                        
                        Reconvene 10:25am