Legislature(2017 - 2018)SENATE FINANCE 532

03/27/2018 09:00 AM Senate FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ HB 286 APPROP: OPERATING BUDGET/LOANS/FUNDS TELECONFERENCED
<Bill Hearing Canceled>
<Pending Referral>
Invited Testimony:
David Teal, Legislative Finance Division
Public Testimony - Written Comments for the
Official Public Record Can be Sent to:
Finance.Committee@akleg.gov
9:30 - 10:30: Juneau
10:30 - 11:00: Barrow, Tok, Delta Junction
11:00 - 11:30: Kenai, Kodiak, Dillingham
11:30 - 12:00: Ketchikan, Wrangell, Petersburg
-- Public Testimony Limited to 2 Minutes --
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Scheduled End Time for Your Area
<Above Testimony on HB 286 CANCELED>
+ Bills Previously Heard/Scheduled: TELECONFERENCED
+= SB 154 PFD CONTRIBUTIONS TO GENERAL FUND TELECONFERENCED
Moved CSSB 154(FIN) Out of Committee
+= SB 86 ALASKA RAILROAD CORPORATION LAND TELECONFERENCED
Moved CSSB 86(FIN) Out of Committee
SENATE BILL NO. 86                                                                                                            
                                                                                                                                
     "An Act relating to the sale or other disposal,                                                                            
     leasing, or encumbrance of Alaska Railroad Corporation                                                                     
     land; and providing for an effective date."                                                                                
                                                                                                                                
9:40:07 AM                                                                                                                    
                                                                                                                                
Co-Chair  MacKinnon   directed  attention  to  SB   86.  The                                                                    
committee had  heard the bill  on March 5, 2018.  The public                                                                    
hearing was  opened and  closed. Multiple  people testified,                                                                    
and  the committee  reviewed the  fiscal note.  There was  a                                                                    
committee  substitute currently  before  the committee.  She                                                                    
asked for a motion.                                                                                                             
                                                                                                                                
Vice-Chair   Bishop  MOVED   to  ADOPT   proposed  committee                                                                    
substitute  for  SB  86,  Work  Draft  30-LS0487\U  (Laffen,                                                                    
3/26/18).                                                                                                                       
                                                                                                                                
Co-Chair MacKinnon OBJECTED for discussion.                                                                                     
                                                                                                                                
JULI  LUCKY,   STAFF,  CO-CHAIR  MACKINNON,   discussed  the                                                                    
changes to the  bill. She indicated that  the Senate Finance                                                                    
Committee had brought up several  concerns when the bill was                                                                    
first  heard.  The  committee   substitute  was  drafted  to                                                                    
address those  concerns. The first  changes were on  pages 1                                                                    
and  2. Sections  1  and 2  were added  and  related to  the                                                                    
retention  of subsurface  rights.  It added  these types  of                                                                    
land disposals to existing law  where the state retained the                                                                    
subsurface rights  for various  other land  disposals. There                                                                    
was a  3-year sunset  which was why  there were  2 sections.                                                                    
The  first section  would put  the  section into  law for  3                                                                    
years  in  which  the  railroad   would  not  have  to  have                                                                    
legislative approval. Section 2  would remove Section 1 from                                                                    
law once the 3-year period was over.                                                                                            
                                                                                                                                
Ms. Lucky reviewed the next change  which was on page 8. The                                                                    
bill  sponsor  rewrote  the current  Section  14  to  codify                                                                    
additional  specificity in  the  requirements  prior to  the                                                                    
disposal of land and to place  a few side bars on the public                                                                    
notice  process. One  of the  requirements was  to determine                                                                    
that land was not needed  for railroad purposes and that the                                                                    
action was in  the best interest of the  state (currently in                                                                    
law). It  would be  reentered into the  section of  law that                                                                    
would be in  place in the 3 years  that legislative approval                                                                    
was  not needed.  She also  reported that  there would  be a                                                                    
minimum public notice requirement of  60 days, found on line                                                                    
14,  and  a  requirement  that  adjacent  land  owners  were                                                                    
notified in addition to any  other public process on page 8,                                                                    
lines 18-19. Another change that  was discussed in committee                                                                    
but had not been added to the  bill at the time it was first                                                                    
presented was  a limit of  90 days  for the exercise  of the                                                                    
right-of-first-refusal. There  was also a sentence  added to                                                                    
the section  that specified that  the right-of-first-refusal                                                                    
was extinguished  the lease holder  rejected it  in writing.                                                                    
The railroad would not have to  hold it over 90 days as long                                                                    
as all lease holders provided their rejections in writing.                                                                      
                                                                                                                                
Ms.  Lucky reviewed  the next  changes on  page 9-10  of the                                                                    
bill.  Section  17 and  Section  18  were technical  changes                                                                    
accidentally  omitted from  the  first  bill by  Legislative                                                                    
Legal Services. Technical drafting  errors were corrected in                                                                    
the current version. Section 17  placed the section into the                                                                    
bill, and  Section 18 deleted language  after the conclusion                                                                    
of the 3-year period.                                                                                                           
                                                                                                                                
Ms. Lucky indicated  that the final change that  was made on                                                                    
behalf  of the  committee was  the inclusion  of Section  19                                                                    
through Section 22  beginning on page 10 of  the bill. There                                                                    
had been  discussion about  outstanding bond  authority that                                                                    
the railroad had  been granted over a period of  a number of                                                                    
years. Much  of the bond  authority might have  had sunsets,                                                                    
but  there were  3  bonding authorities  not  needed by  the                                                                    
railroad  which   the  bill   sponsor  confirmed   with  the                                                                    
railroad. They sunset  in the bill. She had  reviewed all of                                                                    
the  changes   to  the  bill   other  than   some  technical                                                                    
clarifications that needed to be included.                                                                                      
                                                                                                                                
Co-Chair MacKinnon  WITHDREW her  OBJECTION. There  being NO                                                                    
further OBJECTION, it was so ordered.                                                                                           
                                                                                                                                
9:44:49 AM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
9:45:10 AM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair MacKinnon  asked if  Ms. Moss  had any  comments on                                                                    
the CS for the committee's consideration.                                                                                       
                                                                                                                                
RYNNIEVA MOSS, STAFF, SENATOR JOHN  COGHILL, stated that the                                                                    
sponsor was  amendable to the  bill moving out  of committee                                                                    
with the changes.                                                                                                               
                                                                                                                                
Senator McKinnon asked if Ms.  Moss had contacted the Alaska                                                                    
Railroad   earlier  to   inform  them   the  CS   was  being                                                                    
introduced. Ms.  Moss responded that  she had  contacted Tim                                                                    
Sullivan earlier in the morning.                                                                                                
                                                                                                                                
Co-Chair MacKinnon OPENED and CLOSED public testimony.                                                                          
                                                                                                                                
Vice-Chair  Bishop  MOVED  to report  CSSB  86(FIN)  out  of                                                                    
Committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal  note. There being NO  OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
CSSB 86(FIN) was REPORTED out  of committee with a "do pass"                                                                    
recommendation and with one zero fiscal note: FN 1(CED).                                                                        
                                                                                                                                
Vice-Chair Bishop noted that the zero-impact fiscal note                                                                        
had been reviewed previously.                                                                                                   
                                                                                                                                
9:47:09 AM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
9:50:06 AM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair  MacKinnon  relayed  that the  committee  had  been                                                                    
having a  brief discussion  on the following  day's meeting.                                                                    
She cancelled the Wednesday  afternoon meeting scheduled for                                                                    
the following  day and would  see if there was  anything the                                                                    
committee   could  prepare   for  the   following  morning's                                                                    
meeting. She discussed the agenda for the following day.                                                                        
                                                                                                                                

Document Name Date/Time Subjects
SB 86 work draft v. U.pdf SFIN 3/27/2018 9:00:00 AM
SB 86
SB 154 work draft v. O.pdf SFIN 3/27/2018 9:00:00 AM
SB 154
SB 86 - Sectional Version U.pdf SFIN 3/27/2018 9:00:00 AM
SB 86