Legislature(1999 - 2000)

02/03/1999 03:05 PM RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
         SB   7-INCREASE LAND GRANT TO UNIV. OF ALASKA                                                                          
CHAIRMAN HALFORD called the Senate Resources Committee meeting to                                                               
order at 3:05 p.m. and announced SB 7 to be up for consideration.                                                               
MS. MEL KROGSENG, staff to Senator Taylor, sponsor of SB 7, noted                                                               
the proposed committee substitute was LS0072\H, Luckhaupt, 2/3/99.                                                              
She explained that this bill would give to the University of Alaska                                                             
250,000 acres of state land to help fulfill the idea of a land                                                                  
grant college.  She passed around maps and little dots which                                                                    
represented just a little more than the proposed acreage.  She                                                                  
noted that some of the changes proposed by the Division of Lands                                                                
have been incorporated into the bill.                                                                                           
SENATOR TAYLOR moved to adopt the committee substitute to SB 7.                                                                 
There were no objections and it was so ordered.                                                                                 
MR. LUCKHAUPT, Legislative Counsel, explained that section 5 on                                                                 
page 4 is new and deals with how the land is selected.  He                                                                      
explained that the legislature has to approve the list of                                                                       
selections during the next regular session or it automatically goes                                                             
into effect.  The provisions about what land cannot be selected by                                                              
the University have not changed - those that are subject to an                                                                  
existing mineral or oil and gas lease, permit, prospective sight,                                                               
or any of those things cannot be selected.                                                                                      
After the date of selection by the University, before the                                                                       
University would actually receive patent title to the lands, the                                                                
State can still issue mining and oil and gas leases (mineral                                                                    
extraction) and the revenue from those leases goes to the State                                                                 
until the University actually receives title.  In prior years there                                                             
was an inconsistency with how those revenues were to be treated -                                                               
specifically with regards to leases that were entered into after                                                                
the date of selection and before the University received conveyance                                                             
of the lands.  Originally, there were to be no leases issued after                                                              
a selection to resolve the issue of who the revenue went to.  That                                                              
was felt to unduly bind both interests in getting these lands into                                                              
production.  These changes are in 365 (a) and (d).                                                                              
Another section regarding oil and gas that's different provides                                                                 
that the University doesn't receive any oil and gas revenues for                                                                
five years after the effective date of this act.  The University                                                                
could select lands that are subject to other leases and sales; for                                                              
example, timber sales.  The State would continue to get the                                                                     
revenues because they are the ones who issued the lease and were                                                                
managing the land.                                                                                                              
SENATOR TAYLOR congratulated Mr. Luckhaupt on doing a good job of                                                               
rewriting the bill and correcting a lot of problems that were in                                                                
the previous legislation. He said the format flows and makes some                                                               
sense.  It also complies with a lot of requests they have received                                                              
from the Department of Natural Resources.                                                                                       
Number 200                                                                                                                      
SENATOR PARNELL asked what other kinds of leases could the land be                                                              
subject to and the University still be able to select it.                                                                       
MS. KROGSENG suggested grazing leases.                                                                                          
MR. LUCKHAUPT suggested recreational sights, non-profits,                                                                       
easements, and rights-of-way.  He didn't think the University would                                                             
want to select lands that were subject to encumbrances like those,                                                              
On page 10, line 6 the bill deals with encumbrances.  During the                                                                
term of the lease the University doesn't get management of the                                                                  
MS. KROGSENG explained that the new draft tries to be more                                                                      
consistent with general principals of land management.                                                                          
MR. LUCKHAUPT explained that he tried to come up with a process                                                                 
where the revenues went with whomever was managing the land.                                                                    
Number 350                                                                                                                      
MR. ROSS COEN, student at the University of Alaska, Fairbanks,                                                                  
opposed SB 7.  As a student he recognizes the importance of                                                                     
adequate funding for the University, but he is vehemently opposed                                                               
to this short-sighted funding plan and backhanded assault on the                                                                
environment.  The University is not a land management agency and                                                                
should not be placed in the position of harvesting natural                                                                      
resources simply in order to survive.  It excludes the public from                                                              
participating in the process and might irrevocably harm the                                                                     
environment.  He used the Yakutaga clear cut as an example.  This                                                               
bill will close or restrict access to 250,000 acres for hunting,                                                                
fishing, skiing, etc.  The University requires more funding;                                                                    
however, he supports it coming from the appropriations process, not                                                             
short-sighted land give-aways.                                                                                                  
CHAIRMAN HALFORD asked how long he was a resident of the Fairbanks                                                              
MR. COEN answered for approximately three years and he was a                                                                    
resident of Alaska for two years before becoming a student.                                                                     
MS. JANE ANGVIK, Department of Natural Resources, said she                                                                      
appreciated the efforts to address some of their concerns; however                                                              
the administration is still opposed to this legislation and                                                                     
believes that the University must be able to acquire income.  She                                                               
has been advised that Senator Murkowski and Secretary Babbit have                                                               
had some communication with respect to the Governor's proposal for                                                              
a portion of the federal receipts from the National Petroleum                                                                   
Reserve Alaska (NPRA)to be provided to the University of Alaska. So                                                             
there may be hope on the federal front.  She said they hadn't had                                                               
time to go through the committee substitute, but would provide them                                                             
with a revised fiscal note.                                                                                                     
MS. WENDY REDMAN, Vice President for the University Statewide                                                                   
System, said she appreciated Mr. Luckhaupt's work on this bill over                                                             
the years.  She wanted to correct and clarify in response to some                                                               
comments that the University didn't use local hire in its Yakutaga                                                              
timber sale.  In fact, all of the University's land contracts                                                                   
require local hire.  They also provide, at their own expense, local                                                             
training for people within the community if they want to be hired                                                               
by the project.  She said the destruction by the timber harvest at                                                              
Cape Yakutaga was absolutely incorrect and continuing with that                                                                 
kind of misinformation doesn't help at all.  She emphasized that                                                                
the University has not ever been charged with any kind of                                                                       
environmental destruction.                                                                                                      
SENATOR TAYLOR compared the amount of acreage to the McNeil River                                                               
Bear Refuge which has a little over 200,000 acres.  He thought our                                                              
children should have at least the same amount of land as the bears                                                              
have.  He said that comments that the revenues derived from lands                                                               
would not be supplemented are completely false.  This legislature                                                               
has always supported the University and will continue to do so, but                                                             
they want the University to have the land grant basis that it was                                                               
supposed to have had at inception.  He added, but for a couple of                                                               
small changes that happened at statehood, our University would have                                                             
had a million acres.  Instead, the State acquired it with the                                                                   
assumption that we would do something with that acreage to support                                                              
the University.  Instead we are supporting the general fund.                                                                    
Frankly, SENATOR TAYLOR said, he would like to eliminate the entire                                                             
selection process and do it much like the federal government did,                                                               
which is to say every 16 and 32nd section within a township went to                                                             
education.  That's how most of the western states acquired their                                                                
education lands which they manage to help support their school                                                                  
systems.  He said Texas now has such valuable lands in education                                                                
that they are not only paying for all their university costs, but                                                               
they are paying a portion of the k through 12 costs, also.  Whether                                                             
Senator Murkowski is successful or not in his efforts to get the                                                                
additional 500,000 acres out of the federal domain, this bill would                                                             
grant the University the right to select 250,000 acres.  The two                                                                
bills are compatible and he has worked with Senator Murkowski's                                                                 
staff on his bill which will be submitted soon.  However, the bills                                                             
are not dependent on each other.                                                                                                
SENATOR TAYLOR moved to pass CSSB 7 with individual                                                                             
recommendations.  There were no objections and it was so ordered.                                                               

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