Legislature(1999 - 2000)

02/04/1999 09:05 AM Senate FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
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SENATE BILL NO. 6                                                                                                               
                                                                                                                                
"An Act relating to the disposal of state land."                                                                                
                                                                                                                                
                                                                                                                                
Co-chair Torgerson then took up amended amendment #1.                                                                           
Senator Adams REMOVED his amendment to amendment #1.  Co-                                                                       
chair Torgerson explained the amendment.  It was his                                                                            
understanding that the appraiser in the specific case at                                                                        
hand did the wrong piece of property and that this was the                                                                      
source of all the misunderstandings.  He felt the problem                                                                       
was with certification of appraisers and that there was no                                                                      
problem with the Department of Natural Resources.  Perhaps                                                                      
they should take a new look at how appraisers are being                                                                         
certified.                                                                                                                      
                                                                                                                                
Senator Green said the seller should have established a                                                                         
basic price.  She noted that this was her concern with                                                                          
regards to the Department of Natural Resources.  Co-chair                                                                       
Torgerson agreed.  However, the Administration does not                                                                         
care if the Department of Natural Resources sells property.                                                                     
                                                                                                                                
Senator Adams MOVED that his amendment to amendment #1 be                                                                       
WITHDRAWN and WITHOUT OBJECTION was removed.  Senator                                                                           
Donley MOVED to WITHDRAW amendment #1.  WITHOUT OBJECTION                                                                       
it was WITHDRAWN.                                                                                                               
                                                                                                                                
Senator Donley MOVED amendment #2.  Senator Green OBJECTED.                                                                     
Co-chair Torgerson explained amendment #2. The amendment                                                                        
would allow them to add some flexibility.  Senator Green                                                                        
felt line eleven was redundant to the original bill, noting                                                                     
the language was far too broad.  Co-chair Torgerson                                                                             
explained that the two years were added last year.                                                                              
Otherwise, up until then, an appraisal could be given the                                                                       
next day.                                                                                                                       
                                                                                                                                
Senator Donley explained to Senator Green that the                                                                              
amendment was consistent with her point.  Senator Green                                                                         
said she would rather move towards an actual setting of a                                                                       
price.  She asked if there could be an arbitrary reason                                                                         
requiring anything from zero, unless the director said that                                                                     
there was evidence that there was a different value?  Could                                                                     
it be said that each piece of property be reevaluated?  She                                                                     
felt there was a bit of conflict.  There was a short                                                                            
discussion between Senators Donley and Green.  Senator                                                                          
Donley suggested a "clear and convincing" standard so the                                                                       
State could seek another appraisal.  This would free up the                                                                     
director.                                                                                                                       
                                                                                                                                
(Tape change #21, Side A, log 000.                                                                                              
                                                                                                                                
DICK MYLIUS, Resource Assessment and Development, Division                                                                      
of Land, Department of natural Resources testified before                                                                       
the committee via teleconference from Anchorage.  He                                                                            
explained the process used for appraising lands for sale.                                                                       
It depended on parcels and also on the rules as set out by                                                                      
statute.  In response to Senator Phillips, he said the                                                                          
situation in Kenai was a unique one.  He referred                                                                               
specifically to AS 38.05.067.  There was a permit to                                                                            
purchase land from the Forest Service.  And he explained,                                                                       
there was no lease with the State.                                                                                              
                                                                                                                                
Senator Donley MOVED to amend amendment #2, adding ".by                                                                         
clear and convincing evidence." to line eleven of the bill,                                                                     
making it consistent.   Senator Adams OBJECTED and asked                                                                        
the Department to respond.                                                                                                      
                                                                                                                                
Senator Kelly asked a question regarding grammar.  Senator                                                                      
Donley said the drafters would conform the language.                                                                            
                                                                                                                                
Senator Leman said there should be a standard for the                                                                           
appraisal, but it did not have to be this high.                                                                                 
                                                                                                                                
CAROL CARROLL, Director, Support Services, Department of                                                                        
Natural Resources was invited to join the committee.  She                                                                       
commented on the amendment.  She felt the standards should                                                                      
be used as the department uses them.  The "clear and                                                                            
convincing" standard may be too high.  Perhaps Dick Mylius                                                                      
or Judy Robinson in Anchorage could comment to this.                                                                            
                                                                                                                                
Mr. Mylius explained that they were concerned with the                                                                          
language of the "clear and convincing evidence" standard.                                                                       
The department noted that value of land changes over a                                                                          
five-year period.  Current wording on amendment #2 would                                                                        
make it more difficult for the department.  Changing the                                                                        
two years to five years would also make it difficult for                                                                        
the applicant.  The bottom line for the existing statute is                                                                     
that it works very well.                                                                                                        
                                                                                                                                
Senator Leman said he would like to hear what the standards                                                                     
were.                                                                                                                           
                                                                                                                                
JUDY ROBINSON, Land Appraisals, Department of Natural                                                                           
Resources testified via teleconference from Anchorage that                                                                      
the USPAC non-profit group was made up of members from the                                                                      
United States and Canada, put together at the behest of the                                                                     
US Congress.  The problem has to do with appraisals.  She                                                                       
said they followed the Federal guidelines as used by all                                                                        
certified appraisers.  The Department of Natural Resources                                                                      
also followed this same procedure.                                                                                              
                                                                                                                                
Senator Leman recognized the document she was referring to                                                                      
and then asked her what recommendation the director at the                                                                      
Department of Natural Resources followed?  Ms. Robinson                                                                         
said she did not think the director should be required to                                                                       
follow USPAC.                                                                                                                   
                                                                                                                                
(pause on record)                                                                                                               
                                                                                                                                
Co-chair Torgerson asked about the two-year time frame.  It                                                                     
did not take an appraiser to tell whether the value of the                                                                      
property went up.  He referred to Healy and that the land                                                                       
values have not gone up at all.  He then asked for comments                                                                     
regarding the change to five years.                                                                                             
                                                                                                                                
Mr. Mylius referred to appraisals over the counter.  Ms.                                                                        
Robinson said once an appraisal was done and property                                                                           
offered to the public there was no need to do another                                                                           
appraisal unless they thought the value had changed.                                                                            
                                                                                                                                
Senator Green referred again to amendment #2.  She asked                                                                        
about value changing within two years.   Senator Donley                                                                         
engaged in further discussion.  Senator Adams suggested the                                                                     
two-year question be posed to Ms. Robinson.                                                                                     
                                                                                                                                
Senator Donley asked if they went to a two year plan then                                                                       
would there would be a standard of review after two years?                                                                      
How would one deal with more recent changes in value during                                                                     
the two years?                                                                                                                  
                                                                                                                                
Ms. Robinson responded that if there was a reasonable                                                                           
belief to do a re-appraisal then she would do it.                                                                               
                                                                                                                                
Senator Green read line thirteen of amendment #2.  Senator                                                                      
Donley explained they could request this of the buyer.                                                                          
                                                                                                                                
Co-chair Torgerson HELD the bill in committee.                                                                                  
                                                                                                                                
                                                                                                                                
ADJOURNMENT                                                                                                                     
                                                                                                                                
Co-chair Torgerson recessed the meeting at approximately                                                                        
11:00 a.m.                                                                                                                      
SFC-99 (1) 02/04/99                                                                                                             

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