Legislature(2017 - 2018)BELTZ 105 (TSBldg)

03/26/2018 01:30 PM Senate JUDICIARY

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01:31:20 PM Start
01:31:44 PM Confirmation Hearing(s): Alaska Police Standards Council
01:51:09 PM SB175
01:57:47 PM SB202
02:28:19 PM HB43
02:30:19 PM Confirmation Hearing(s): Alaska Police Standards Council
02:36:35 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Consideration of Governor's Appointees
+ Alaska Police Standards Council TELECONFERENCED
- Larry Nicholson
- David Knapp
- Michael Craig
<Above Items Added to Agenda>
Heard & Held
-- Public Testimony --
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
Moved CSHB 43(JUD) Out of Committee
        SB 202-NATIVE CORP. LIABILITY FOR CONTAMINATION                                                                     
1:57:47 PM                                                                                                                    
CHAIR COGHILL announced the consideration of SB 202.                                                                            
1:58:14 PM                                                                                                                    
MARIDON  BOARIO,  Staff,  Senator  Lyman  Hoffman,  Alaska  State                                                               
Legislature, Juneau, Alaska,  introduced SB 202 on  behalf of the                                                               
sponsor speaking to the following sponsor statement:                                                                            
     Through  the   Alaska  Native  Claims   Settlement  Act                                                                    
     (ANSCA) the federal government  conveyed land to Alaska                                                                    
     Native  Corporations. During  the  1990s concerns  were                                                                    
     raised that contaminated land  was conveyed during this                                                                    
     process. In 1998 a Department  of Interior (DOI) report                                                                    
     to  Congress on  Hazardous  Substance Contamination  of                                                                    
     ANSCA Lands confirmed the  concerns and identified more                                                                    
     than  650  contaminated  sites  requiring  remediation.                                                                    
     These  sites were  contaminated under  ownership and/or                                                                    
     responsibility  of  the  federal  government  and  then                                                                    
     transferred to Native ownership.                                                                                           
     A  2016 Bureau  of Land  Management update  to the  DOI                                                                    
     report  to Congress  acknowledged that  the agency  had                                                                    
     not acted  on much of its  1998 report recommendations.                                                                    
     The update identified the Department  of Defense as the                                                                    
     single  largest  pre-transfer   owner  of  contaminated                                                                    
     sites  still  requiring   cleanup.  The  Alaska  Native                                                                    
     Village  Corporation   Association  testified   on  the                                                                    
     problem   as  recently   as   last   summer  before   a                                                                    
     congressional  committee,   pushing  for   the  federal                                                                    
     government to  deal with the problem  sites. The Alaska                                                                    
     Native   Village   Corporation  Association's   federal                                                                    
     legislative  priority list  includes protecting  Alaska                                                                    
     Native  corporations from  liability  claims over  land                                                                    
     that was  contaminated before it  was transferred  to a                                                                    
     Native corporation.                                                                                                        
     SB 202  amends Alaska state  statute so that  an Alaska                                                                    
     Native  corporation  is  not  liable  for  containment,                                                                    
     removal  or remediation  actions  if the  contamination                                                                    
     occurred on  the land before  it was  transferred under                                                                    
     the Alaska  Native Claims  Settlement Act.  Though this                                                                    
     change in state law would  not solve the federal issues                                                                    
     of  this  problem,  it  is  an  important  step  toward                                                                    
     protecting  Alaska Native  corporations from  liability                                                                    
     for actions by prior owners of the land.                                                                                   
MS. BOARIO stated  that the 2016 BLM update  identified 537 sites                                                               
that  were contaminated  at the  time  of the  land transfer  and                                                               
required remediation.  Ninety-four of  those sites  are not  in a                                                               
cleanup program  and are classified  by the BLM as  orphan sites.                                                               
There are also  over 100 sites that  require further verification                                                               
and may  be added to the  orphan sites list. She  noted that both                                                               
the 1998 and the 2016 reports were in the packets.                                                                              
2:01:06 PM                                                                                                                    
SENATOR WIELECHOWSKI asked the scope  of the problem and the type                                                               
of contamination that's been identified.                                                                                        
MS. BOARIO  said much of the  land was Department of  Defense and                                                               
Federal   Aviation   Association   property  and   the   numerous                                                               
contaminants include mercury and petroleum products.                                                                            
CHAIR COGHILL advised that Hallie  Bissett with the Alaska Native                                                               
Village Corporation Association (ANVCA) was online.                                                                             
SENATOR  WIELECHOWSKI  asked who  would  be  responsible for  the                                                               
cleanup should the bill pass.                                                                                                   
MS. BOARIO  replied the Native corporations  are currently liable                                                               
and  face threats  of lawsuits  because many  of these  sites are                                                               
close to  existing villages and could  contaminate drinking water                                                               
and adjacent  land. SB 202  would relieve Native  corporations of                                                               
liability if it  is proven that the contamination  existed at the                                                               
time of transfer. The primary goal  is to pursue funding from the                                                               
federal  government  to  clean  up  the  contamination,  but  the                                                               
corporations  would  also  need   help  in  determining  who  was                                                               
responsible for the contamination prior to transfer.                                                                            
2:04:00 PM                                                                                                                    
SENATOR  COSTELLO observed  that the  bill does  not specifically                                                               
assign liability to the federal government or any other entity.                                                                 
MS. BOARIO  agreed; the  bill says  that the  Native corporations                                                               
are not  liable if the  contamination happened prior to  the land                                                               
SENATOR COSTELLO asked  if the sponsor contemplated  going a step                                                               
further and asking for a timetable                                                                                              
MR.  BOARIO  said  not  necessarily;  the  sponsor  accepted  the                                                               
language that  the Alaska Native Village  Corporation Association                                                               
suggested.  It  aligns  with  their   efforts  with  the  federal                                                               
government and links to the recent spending bill.                                                                               
2:05:34 PM                                                                                                                    
SENATOR COSTELLO  asked if  there was a  log of  the contaminated                                                               
MS. BOARIO  replied the Department of  Environmental Conservation                                                               
(DEC) has a  list of all the contaminated sites.  She deferred to                                                               
Hallie Bissett to talk about whether a federal list exists.                                                                     
CHAIR COGHILL noted that DEC was not online.                                                                                    
2:06:07 PM                                                                                                                    
SENATOR SHOWER  said he'd like  to see  DEC's list and  access to                                                               
historical  knowledge about  whether  the  land was  contaminated                                                               
when  it was  transferred.  "It could  be a  big  liability on  a                                                               
person from decades ago if we don't know, if we're not careful"                                                                 
MS. BOARIO  agreed to provide  the information. She added  that a                                                               
map   in  the   packets  from   the  DEC   website  shows   where                                                               
contamination occurred  and the sites that  have been identified.                                                               
The orphan sites are also identified.                                                                                           
CHAIR COGHILL  asked what causes  a site  to be classified  as an                                                               
orphan site.                                                                                                                    
MS.  BOARIO said  she  could  read the  definition  from the  BLM                                                               
CHAIR COGHILL suggested Ms. Bissett  give her testimony while Ms.                                                               
Boario located the specific text.                                                                                               
2:08:04 PM                                                                                                                    
HALLIE  BISSETT,   Executive  Director,  Alaska   Native  Village                                                               
Corporation  Association (ANVCA),  Anchorage, Alaska,  said ANVCA                                                               
represents  176  Alaska  Native Village  Corporations  that  were                                                               
created  under  the  1971 Alaska  Native  Claims  Settlement  Act                                                               
(ANCSA). Land  was transferred to  these village  corporations at                                                               
that time and many of those sites were contaminated.                                                                            
She provided  examples to  illustrate the  scope of  the problem.                                                               
These included a  glow in the dark fish and  an unidentified gel-                                                               
like substance in  fish. These sites are  contaminated with PCBs,                                                               
they are White  Alice sites, and they are old  test sites for the                                                               
U.S. Department of Defense.                                                                                                     
MS. BISSETT agreed with Ms. Boario  that the bill does not assign                                                               
blame. The  hope is to clean  up the sites, but  the corporations                                                               
needs the legal liability shield  because there are probably more                                                               
sites  that haven't  been quantified.  Over 600  sites have  been                                                               
identified  and some  are in  a remediation  program. Ninety-four                                                               
sites have been classified as  orphan sites, which means there is                                                               
no intention  to clean them  up. Almost  all of those  are within                                                               
two  miles of  a  village. This  is a  large  problem for  Native                                                               
corporations  and   they  would   like  to  compel   the  federal                                                               
government  or  other  responsible  party to  clean  them  up  in                                                               
partnership with an Alaska Native workforce.                                                                                    
2:11:30 PM                                                                                                                    
CHAIR COGHILL asked  her to submit her testimony  in writing. The                                                               
connection  was  poor,  and  the committee  missed  some  of  the                                                               
MS. BISSETT agreed.                                                                                                             
CHAIR  COGHILL  asked  Ms.  Boario   how  many  sites  have  been                                                               
identified as the state's responsibility for cleanup.                                                                           
MS. BOARIO said she would follow up with the information.                                                                       
CHAIR  COGHILL  stated   his  intention  to  move   the  bill  on                                                               
2:15:43 PM                                                                                                                    
MS. BOARIO  paraphrased the following  sectional analysis  for SB
     Section 1 Amends AS 46.03.822(a)  to add subsection (n)                                                                    
     which  relieves Native  corporations from  liability if                                                                    
     the   Native  corporation   can  prove   the  hazardous                                                                    
     materials were  already present on the  land before the                                                                    
     land was  transferred to  the Native  corporation under                                                                    
     the Alaska Native Claims Settlement  Act (43 U.S.C 1601                                                                    
     et seq.).                                                                                                                  
     Section  2   Amends  AS  46.03.822(m)  to   add  a  new                                                                    
     paragraph that  defines Native Corporation to  have the                                                                    
     same  meaning as  in federal  law under  U.S.C 1602(m).                                                                    
     She read  the following definition:  Native corporation                                                                    
     means   any    regional   corporation,    any   village                                                                    
     corporation,  any  urban  corporation,  and  any  group                                                                    
     Section 3 Amends  AS 46.03.822 to add  a new subsection                                                                    
     (n)  that relieves  Native corporations  from liability                                                                    
     if  the  Native  corporation can  prove  the  hazardous                                                                    
     materials were  already present on the  land before the                                                                    
     land was  transferred to  the Native  corporation under                                                                    
     the Alaska Native Claims Settlement  Act (43 U.S.C 1601                                                                    
     et seq.).                                                                                                                  
     Section  4  Repeals  AS   46.03.822(c)(3)  which  is  a                                                                    
     narrower  exemption for  Native corporations  currently                                                                    
     in statute  and replaces  it with  the exemption  in AS                                                                    
MS.  BOARIO read  excerpts  of the  legislative  legal memo  that                                                               
details  the repealed  section and  clarifies that  the exemption                                                               
proposed  in  the bill  waives  liability  in  a broader  set  of                                                               
circumstances than current statute.                                                                                             
2:18:43 PM                                                                                                                    
SENATOR WIELECHOWSKI referenced  Section 1 and asked  if this was                                                               
a waiver of strict liability or negligence.                                                                                     
MS. BOARIO deferred to Ms. Nauman.                                                                                              
2:19:22 PM                                                                                                                    
EMILY  NAUMAN, Legislative  Counsel, Legislative  Legal Services,                                                               
Alaska  State  Legislature,  Juneau,  Alaska, replied  it  was  a                                                               
waiver of strict liability.                                                                                                     
SENATOR  WIELECHOWSKI  asked  if  Section  3  would  apply  to  a                                                               
negligence lawsuit or a strict liability lawsuit.                                                                               
MS. NAUMAN said there were  alternate legal methods through which                                                               
a Native corporation  could be found liable for  costs related to                                                               
spills on corporation land and negligence was one possibility.                                                                  
SENATOR WIELECHOWSKI  observed that under current  law the Native                                                               
corporation  would be  strictly liable  if contaminants  on their                                                               
land  leaked  into  a  neighboring   well.  Under  the  bill  the                                                               
corporation  would not  be strictly  liable if  they could  prove                                                               
that the land  was contaminated when the land  was transferred to                                                               
the corporation under ANCSA. He asked if that was correct.                                                                      
MS. NAUMAN  agreed in part and  pointed out that the  current law                                                               
provides  an  exception  if  the  Native  corporation  has  taken                                                               
certain steps  to clean  up and  monitor the  situation. However,                                                               
there are other ways through  which a Native corporation could be                                                               
found liable even if this bill becomes law.                                                                                     
SENATOR  WIELECHOWSKI  asked  for   confirmation  that  a  Native                                                               
corporation  would  not  be  exempt  from  a  nuisance  claim,  a                                                               
trespass claim, or a negligence claim.                                                                                          
MS. NAUMAN said that's correct.                                                                                                 
SENATOR  WIELECHOWSKI said  he  assumes that  the  owner of  non-                                                               
Native corporation  land would be  strictly responsible  if there                                                               
was contamination prior to conveyance at statehood.                                                                             
MS.   NAUMAN  said   AS  46.03.822(a)   places   the  burden   of                                                               
responsibility on a series of different parties.                                                                                
2:23:20 PM                                                                                                                    
SENATOR WIELECHOWSKI asked who would  be liable for contamination                                                               
on Native corporation land, should SB 202 pass.                                                                                 
MS.  NAUMAN  said  she  believes  that would  be  a  highly  fact                                                               
dependent action  because it's difficult  to say  without knowing                                                               
how the  hazardous substance  ended up  on the  land and  who was                                                               
responsible for its release.                                                                                                    
SENATOR WIELECHOWSKI  asked if  the language  in Section  3 would                                                               
place the liability on the federal government.                                                                                  
MS. NAUMAN said  she didn't believe the bill  changed the federal                                                               
government's  liability;  it  only  changes  the  liability  with                                                               
respect to a Native corporation.                                                                                                
CHAIR COGHILL  said his  expectation is that  the state  could be                                                               
liable  for land  it selected  at Statehood  but was  conveyed to                                                               
Native corporations  under ANILCA. There  would be a  question of                                                               
who the landowner was at the time of contamination.                                                                             
MS. NAUMAN said that was her understanding.                                                                                     
SENATOR WIELECHOWSKI  asked if  the state  would be  obligated to                                                               
clean  up  sites once  the  Native  corporation was  exempt  from                                                               
MS. NAUMAN deferred the question to Kristen Ryan with DEC.                                                                      
CHAIR COGHILL  asked Senator Wielechowski to  bring that question                                                               
up on Wednesday.                                                                                                                
MS.   BOARIO  clarified   that  the   Native  corporations   want                                                               
contamination on their  lands to be mediated and  either have the                                                               
federal government pay or be able  to qualify for funding for the                                                               
CHAIR COGHILL said  that's clear; we're trying to  figure out who                                                               
bears the ultimate responsibility.                                                                                              
SENATOR WIELECHOWSKI asked if a  Native corporation would be more                                                               
likely  to  qualify  for  funding  if they  were  not  the  party                                                               
responsible for the contamination.                                                                                              
MS.  BOARIO said  she believes  so, but  she would  look into  it                                                               
2:27:49 PM                                                                                                                    
CHAIR COGHILL  held SB 202  in committee awaiting answers  to the                                                               
questions brought forward today.