Legislature(2017 - 2018)BUTROVICH 205
03/22/2017 03:30 PM RESOURCES
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SB 88-AK MENTAL HEALTH TRUST LAND EXCHANGE 4:49:44 PM CHAIR GIESSEL announced consideration of SB 88 that deals with land exchanges related to the Alaska Mental Health Trust Land Office. SENATOR STEDMAN, Alaska State Legislature, Juneau, Alaska, sponsor of SB 88, said this measure facilitates a land trade between the Alaska Mental Health Trust and the U.S. Forest Service in Southeast. The federal government will receive 20,000 acres and will give up 18,000 acres. This land exchange has been going on for many years and is a win-win situation. He explained that some lands are adjacent to communities like Petersburg and Ketchikan that the Mental Health Trust had viewed for timber harvest for revenue, and both communities wanted to have the timber harvest not so close to their communities and their view sheds. So, that facilitates some of these parcels; it improves the logging productivity available from Alaska land. It has been worked through many meetings with environmental groups, communities, Mental Health, and the Forest Service. WYN MENEFEE, Deputy Director, Trust Land Office, Mental Health Trust, Anchorage, Alaska, said essentially, the Alaska Mental Health Trust is the foundational purpose for this exchange. It is a perpetual trust that helps support comprehensive integrated mental health services in Alaska. He provided a list of beneficiaries. He said the trust gives about $20 million annually to projects, activities, state agencies, and non-profits statewide. In Southeast they have done capital grants like the $100,000 capital grant to Petersburg Mental Health Services and the $10 million grant to help fund Medicare. Revenues are needed to support that and to keep the trust alive. So, the job of the Trust Land Office is basically as a contractor to the Trust Authority. They manage the non-cash assets: the land and resources, in the best interests of the trust. They manage multiple asset classes and one of those is timber. This exchange will help diversify their portfolio; it will increase timber revenues over current land holdings and it will protect the trust corpus by not devaluing timber assets in Southeast by letting the timber industry fail, because they would end up having no one to purchase their timber. MR. MENEFEE showed them a picture of trust land holdings currently scattered throughout Southeast Alaska and explained that the land exchange will take about 18,000 acres of trust lands which are primarily adjacent to communities in Southeast Alaska in exchange for 20,000 acres that are more removed on Prince of Wales Island and Shelter Cove. He explained that the trust does subdivisions and commercial transaction leases as well as timber harvest on their lands, but there is a lot of resistance to having these activities next to communities. It's basically an equal value land exchange; the idea is to allow timber extraction in an area that won't conflict with communities. The exchange has two phases: because the timber industry is at real risk of going under for the lack of timber, some timber is needed immediately to keep it going. So, some parcels will be exchanged within one year and the remaining will be exchanged within two years. It just gives the Forest Service more time to get the appraisals done for the other parcels. 4:56:45 PM MR. MENEFEE said among the benefits of the exchange are that fact that it consolidates trust land ownership, which is good for management; it replaces lands adjacent to the communities with ones that are more conducive for timber harvest; it will generate about $40-60 million over the 20 years; it will protect both timber and tourism industries; it will save real jobs; and it protects the view sheds and certain old growth stands. He clarified that the timber industry impacts the economy in many ways: stevedores, equipment rental, maintenance, purchase, transportation, timber fellers, and cruisers. Any timber harvested on trust lands to be received via the exchange would be done in an environmentally responsible manner, because they are required to follow the Alaska Forest Practices Act that has been demonstrated to be effective at protecting salmon streams and water quality. Why do it now? Mr. Menefee answered that this exchange is the result of about 10 years of planning and public input from the Tongass Futures Roundtable conservation groups which consists of 35 different parties, the Forest Service and communities. The Southeast Alaska Conservation Council (SEACC) expressed some concern that one of the parcels, the No Name Bay parcel, could be exchanged because it is involved in litigation. However, the Department of Law (DOL) determined that the trust has clear title to that parcel and the lawsuit in no way prohibits the State Legislature from enacting the exchange in this legislation. 5:00:06 PM Further, he said the timber industry with its lack of timber to market will go under in two years, and they are trying to give them timber before they leave, because once it is gone, it doesn't' just start back up. People move and it's just not easy to say come on up and cut our timber. So, Alaska would lose a market. 5:01:54 PM He explained that the Forest Service has the majority of the timber supply in Southeast and they have withdrawn and locked up much of the land. That means there is a dependency on the Mental Health Trust Land Office, the University, the State Forestry, and the Forest Service to all work together on the transition to a sustainable young growth harvest, but timber needs to be provided in the transition period. MR. MENEFEE said that Senator Murkowski and Senator Sullivan introduced SB 131 and Representative Young introduced HR 513 in Washington, D.C., that basically direct the Forest Service to do the exchange. They expect things to start moving very soon (this spring) on the federal side. If it's approved, they would start right away on working with the Forest Service to get the appraisals and surveys done within a one-year timeframe. This issue has a lot of support although most of it is for 2016 federal legislation that is the same piece of legislation. It is a positive revenue generating exchange and the trust needs those revenues to provide for its beneficiaries. He added that the trust supports those programs without going to the general fund. CHAIR GIESSEL said a number of people were on line to testify. SENATOR STEDMAN said he would rather have another meeting so people could have ample time to say their piece than try to run them short because the committee is out of time. CHAIR GIESSEL said she would hold SB 88 and bring it back at the earliest opportunity.