Legislature(2001 - 2002)
04/04/2001 03:40 PM Senate RES
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SB 167-AGRICULTURAL LAND
CHAIRMAN TORGERSON announced SB 167 to be up for consideration.
MR. DARWIN PETERSON, staff to Senator Torgerson, said:
This legislation is intended to resolve a problem that
dates back to the 1964 earthquake. In 1943, the Ross
Miller family homesteaded 27 acres of land in Hope. In
the early 1950s, the Millers leased 15 acres of adjoining
land from the Forest Service, which they used for
pasture. During the '64 earthquake, the Millers lost 18
of their 27-acre homestead. The Earthquake Exchange
Program compensated the Millers for their loss by giving
them only one acre of land. Subsequently, the state
determined that the Millers had been treated unfairly and
were entitled to the 15 acres of leased Forest Service
land as relief. In 1978, agricultural rights to this land
were conveyed as provided by former state law AS
38.05.321.
For many reasons, fee simple title should have been
granted at this time. Recently, DNR has declared that the
state has no compelling interest in retaining the
remaining interest in this property and, therefore,
supports conveying full land rights. Unfortunately, there
are no existing statutes that would authorize DNR to
remove the agricultural restrictions on this land.
SB 167 would make a minor statutory change to correct his
situation. Anyone who received agricultural rights to
land under section 6(a) of the Alaska Statehood Act would
be eligible for fee simple title if the owner pays the
fair market value for the state's remaining interest.
This would only apply to tracts that are 15 acres or
less.
SENATOR TAYLOR asked if there were others in this class.
CHAIRMAN TORGERSON said he didn't think there was.
MR. LOEFFLER stated support for SB 167.
MR. BILL WARD, a Delta Junction resident, said he thought this was
a reasonable circumstance to do a transfer from agricultural to fee
simple and supported SB 167. He cautioned them not to use the
legislative process to change the status of other agricultural
lands around the state because speculators would take advantage of
it.
CHAIRMAN TORGERSON said he shared his concerns and that this bill
only applies to one person at 15 acres.
MR. FRANK MILLER, a Ninilchik resident, said he appreciates the
work the committee has done on this bill. His one concern is
subsection (3) that says the owner of the rights for agricultural
purposes pays the state the fair market value of the remaining
interest in the land estate, as determined by an appraisal paid for
by the owner. He said that's like buying their own land back at
this point and he thought the price should go back to when the land
should have been conveyed.
MR. CHUCK GRAHAM, a Hope resident, said he concurred with Mr.
Miller's comments on subsection (3). The Millers have valid
preference rights and should have received fee simple title some
years ago. He actually thought the price should be based on the
appraised value in 1967.
CHAIRMAN TORGERSON asked Mr. Loeffler how he was going to handle
computing the fair market value of the Miller's property.
MR. LOEFFLER explained that they compute the market value by doing
an appraisal today and subtracting the appraised value of the
agricultural rights that they own. The Millers would pay the
difference under this bill.
CHAIRMAN TORGERSON asked about the assertion that they are owed
something because of the Earthquake Relief Act.
MR. LOEFFLER replied that he had no knowledge of that Act. He
added, "All I know is that in the 60's there was a preference right
they were given that allowed them to have land with an agricultural
covenant. He didn't know anything about the earthquake."
SENATOR TAYLOR said that agricultural rights are basically a
restriction on the land and he thought this removes the
agricultural restrictions.
MR. LOEFFLER responded that they own certain rights to the land and
he would give them the appraised value of the land minus the rights
of the land today.
SENATOR TAYLOR asked if those rights have a value they can
ascertain.
MR. LOEFFLER answered yes.
SENATOR TAYLOR said he empathized with the people, but he didn't
know if you could legally sell land at some previously appraised
price.
MR. LOEFFLER said he thought it would go against the grain of the
way they have done business in the state. He said they currently
own land subject to agricultural rights. He noted, "It's the same
way people at Pt. MacKenzie own the land with an agricultural
covenant on it. They own the agricultural rights so to speak. In
that, they have been living on it, their father and grandfather. I
concur with Darwin's assessment that there is no state interest in
keeping the land agricultural at this point. The world is not a
better place if we do that. I would support their urge to get the
land, but Senator, I don't know a way to do it for the 1967 price."
CHAIRMAN TORGERSON said he didn't either and that he would hold the
bill until he talked to the Millers about it.
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