Legislature(2001 - 2002)

05/08/2002 02:23 PM House FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                  HOUSE FINANCE COMMITTEE                                                                                       
                        May 08, 2002                                                                                            
                         2:23 P.M.                                                                                              
                                                                                                                                
TAPE HFC 02 - 105, Side A                                                                                                       
TAPE HFC 02 - 105, Side B                                                                                                       
TAPE HFC 02 - 106, Side A                                                                                                       
TAPE HFC 02 - 106, Side B                                                                                                       
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Williams called the House  Finance Committee meeting                                                                   
to order at 2:23 P.M.                                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Bill Williams, Co-Chair                                                                                          
Representative Eldon Mulder, Co-Chair                                                                                           
Representative Con Bunde, Vice-Chair                                                                                            
Representative Eric Croft                                                                                                       
Representative John Davies                                                                                                      
Representative Richard Foster                                                                                                   
Representative John Harris                                                                                                      
Representative Bill Hudson                                                                                                      
Representative Ken Lancaster                                                                                                    
Representative Jim Whitaker                                                                                                     
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Carl Moses                                                                                                       
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Sara Wright, Staff, Senator Dave  Donley; Kim Ognisty, Staff,                                                                   
Senator John  Torgerson; John  Middaughy M.D., Department  of                                                                   
Health and Social  Services; Don Etheridge,  AFL-CIO, Juneau;                                                                   
Ron Wolfe, Corporate Forester,  Sealaska Corporation, Juneau;                                                                   
Jon  Tillinghast,  Attorney,  Sealaska  Corporation,  Juneau;                                                                   
Lynne  Freeman,  Executive  Director,  Alaska  Commission  on                                                                   
Aging,   Juneau;   Dennis   Poshard,   Legislative   Liaison,                                                                   
Department  of  Transportation  &  Public  Facilities;  Wendy                                                                   
Lindskoog,  Alaska Railroad  Corporation, Fairbanks;  Michael                                                                   
Downing,  Director/Chief  Engineer,   Division  of  Statewide                                                                   
Design & Engineering  Services, Department  of Transportation                                                                   
& Public Facilities; Kevin Ritchie,  Alaska Municipal League,                                                                   
Juneau.                                                                                                                         
                                                                                                                                
TESTIFIED VIA TELECONFERENCE                                                                                                  
                                                                                                                                
Lieutenant  Julia Grimes, Alaska  State Troopers,  Department                                                                   
of  Public   Safety,  Anchorage;   Janice  Adair,   Director,                                                                   
Division    of   Environmental    Health,    Department    of                                                                   
Environmental   Conservation,  Anchorage;  Phyllis   Johnson,                                                                   
Alaska Railroad  Corporation, Fairbanks; Alice  Hsieh; Dennis                                                                   
Wheeler,   Deputy   Municipal   Attorney,   Municipality   of                                                                   
Anchorage;   Jim   Cantor,   Assistant    Attorney   General,                                                                   
Department  of  Law,  Anchorage;  Dick  Cattanach,  Assistant                                                                   
Attorney General, Department of  Law, Anchorage; Dick Mylius,                                                                   
Divison  of Mining,  Land and  Water,  Department of  Natural                                                                   
Resources,   Anchorage;   Joe   McLaughlin,   Department   of                                                                   
Epidemiology, Anchorage; Michael Lohnan, Wasilla.                                                                               
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
HB 532    An  Act relating to  the powers  and duties  of the                                                                   
          Department   of  Environmental   Conservation,   to                                                                   
          barbers,  hairdressers, estheticians,  manicurists,                                                                   
          tattoo,   permanent    cosmetic   colorists,   body                                                                   
          piercers,   and   their  establishments,   to   the                                                                   
          licensure   of  child  care  facilities,   to  food                                                                   
          establishments,  to  cosmetics, to  tourist  camps,                                                                   
          trailer  camps,   motor  courts,  and   motels,  to                                                                   
          restrooms,  to  smoking  in public  facilities,  to                                                                   
          public   health   nuisances,  to   sanitation   and                                                                   
          sanitary  practices,  to  camps and  canneries,  to                                                                   
          schools, to soft drink  establishments, to beer and                                                                   
          wine dispensaries, to  other establishments, and to                                                                   
          commercially  compressed air; and providing  for an                                                                   
          effective date.                                                                                                       
                                                                                                                                
          HB 532 was HEARD and  HELD in Committee for further                                                                   
          consideration.                                                                                                        
                                                                                                                                
SB 222    An Act relating to certain  motor vehicles that are                                                                   
          required to yield to following traffic.                                                                               
                                                                                                                                
          HCS CS SB 222 (FIN) was reported out of Committee                                                                     
          with "individual"  recommendations and  with fiscal                                                                   
          notes  #1 by  the  Department  of Transportation  &                                                                   
          Public  Facilities  and  #2 by  the  Department  of                                                                   
          Public Safety.   Also included with the  bill was a                                                                   
          House  Concurrent Resolution  providing the  needed                                                                   
          title change.                                                                                                         
                                                                                                                                
SB 278    An Act  requiring a  good faith effort  to purchase                                                                   
          property  before  that  property is  taken  through                                                                   
          eminent  domain;  and  providing for  an  effective                                                                   
          date.                                                                                                                 
                                                                                                                                
          HCS CS SB 278 (FIN) was reported out of Committee                                                                     
          with "individual"  recommendations and  with fiscal                                                                   
          notes #1  by the Alaska Court System and  #4 by the                                                                   
          Department of Transportation & Public Facilities.                                                                     
                                                                                                                                
                                                                                                                                
CS FOR SENATE BILL NO. 222(FIN)                                                                                               
                                                                                                                                
     An Act relating to certain motor vehicles that are                                                                         
     required to yield to following traffic.                                                                                    
                                                                                                                                
SARA WRIGHT, STAFF,  SENATOR DAVE DONLEY, commented  that the                                                                   
legislation,  through the  cooperation of  the Department  of                                                                   
Transportation  &  Public  Facilities,   would  increase  the                                                                   
number  of  posted  signs along  some  of  Alaska's  highways                                                                   
informing   motorists   of  the   existing   regulations   of                                                                   
prohibiting a vehicle from delaying  traffic.  The bill would                                                                   
additionally increase the fine  for those in violation of the                                                                   
law from a $30 dollar fine to at least $100 dollars.                                                                            
                                                                                                                                
Current  Alaska  regulation prohibits  traffic  traveling  at                                                                   
less than the  posted speed limit from delaying  five or more                                                                   
vehicles.    The  vehicle  should  pull  over  at  the  first                                                                   
opportunity, however, many drivers  are not aware of the law.                                                                   
It is  the intent of the  legislation to make  motorists more                                                                   
conscious  of  the law  and  to  lessen  some of  the  summer                                                                   
congestion on highways.                                                                                                         
                                                                                                                                
Ms. Wright  advised that the  Department of Transportation  &                                                                   
Public Facilities had committed  to placing twenty (20) signs                                                                   
in  key  areas on  the  Alaskan  Highway.   The  signs  would                                                                   
indicate that it is unlawful to  delay five or more vehicles.                                                                   
The violation would be punishable  by a fine.  She added that                                                                   
the bill  would apply only to  drivers delaying five  or more                                                                   
vehicles  while traveling  at five  or more  miles below  the                                                                   
posted speed limit.                                                                                                             
                                                                                                                                
Co-Chair  Mulder  referenced   the  House  Finance  Committee                                                                   
substitute,  #22-LS0611\R, Ford,  /07/02, indicating  that it                                                                   
would  address concerns  voiced  by the  sponsor.   (Copy  on                                                                   
File).                                                                                                                          
                                                                                                                                
Co-Chair  Mulder commented  that  the work  draft included  a                                                                   
section, which  would amend  statutes, created several  years                                                                   
ago.    In  the  draft,  the  fines  have  been  doubled  for                                                                   
violation in work zones, suggesting  that was a public safety                                                                   
consideration.   Co-Chair  Mulder noted  that there has  been                                                                   
concern that  constructions zone  signs remain in  place when                                                                   
there  is no  work  happening in  the area.    He added  that                                                                   
Section 2  would include  verbiage-doubling fines  when there                                                                   
are workers  present at  the site.   The Department  needs to                                                                   
develop regulations  for when the workers are not  on the job                                                                   
site;  when  the  work  is  finished,  the  signs  should  be                                                                   
removed.                                                                                                                        
                                                                                                                                
Co-Chair Mulder MOVED  to ADOPT the work draft for  HCS CS SB
222 (FIN).  There being NO OBJECTION, it was adopted.                                                                           
                                                                                                                                
Vice-Chair Bunde  inquired about the additional  twenty-eight                                                                   
signs associated with the fiscal note.                                                                                          
                                                                                                                                
Ms.  Wright  agreed  that  there  is  signage,  however,  the                                                                   
Senator believes that there is  not enough.  The intent is to                                                                   
place signs in key spots.                                                                                                       
                                                                                                                                
Representative Hudson  asked how the bill would  affect those                                                                   
people  driving  below  the  speed  limit,  as  many  of  the                                                                   
highways do not have places to  pull over.  He suggested that                                                                   
the legislation was "troublesome".                                                                                              
                                                                                                                                
Co-Chair  Mulder   pointed  out   that  there  currently   is                                                                   
regulation in place between Anchorage  and Soldotna, which is                                                                   
already enforced,  and that SB  222 would only place  it into                                                                   
law.                                                                                                                            
                                                                                                                                
Representative  Lancaster   interjected  that   driving  that                                                                   
stretch of road  is not as bad  as it use to be,  noting that                                                                   
the highway has been upgraded.                                                                                                  
                                                                                                                                
Representative Croft recommended  that the legislation should                                                                   
read while driving  "well below" the speed limit  rather than                                                                   
just  "below".    He  asked  why   the  legislation  was  not                                                                   
providing a specific number.                                                                                                    
                                                                                                                                
Ms.  Wright explained  that  language  was part  of  existing                                                                   
regulation, "driving below the posted speed limit".                                                                             
                                                                                                                                
Representative Harris questioned  the unintended consequences                                                                   
of  the  legislation  and  the   committee  substitute.    He                                                                   
suggested that  there should be  a penalty to  the contractor                                                                   
doing the  roadwork if  signs were left  hanging.   The signs                                                                   
should act as a warning to drivers.                                                                                             
                                                                                                                                
Co-Chair Mulder  agreed that  if and when  the signs  are up,                                                                   
motorists  should  obey that  indication.     That  could  be                                                                   
accomplished through regulation.   He added that it would not                                                                   
be fair  to penalize motorists  when the signs are  not taken                                                                   
down and the work is complete.                                                                                                  
                                                                                                                                
Vice-Chair Bunde pointed out that  if a contractor was saving                                                                   
money by not  taking the signs down, they should  be ticketed                                                                   
and that no one should be subject to double fines.                                                                              
                                                                                                                                
Representative  Croft  commented  that  laws  should  not  be                                                                   
written that are  technically difficult to comply  with.  For                                                                   
people  interested  in  obeying   the  law  would  be  in  an                                                                   
impossible dilemma.   He  referenced the current  regulation,                                                                   
suggesting  that verbiage  be removed.   He recommended  that                                                                   
the language indicate a "safe" zone for compliance.                                                                             
                                                                                                                                
Representative   Davies  suggested   that  the  speed   limit                                                                   
reference be removed,  leaving language that if  five or more                                                                   
cars are held up, then the front driver should pull over.                                                                       
                                                                                                                                
Vice-Chair Bunde  thought that the basic speed  law in Alaska                                                                   
supercedes all other speed limits.                                                                                              
                                                                                                                                
Representative Hudson asked if  it was intended to target the                                                                   
driver causing the traffic back  up.  He recommended changing                                                                   
language on Page  1, Lines 8 & 9.  He advised  that it should                                                                   
be differentiated  who  would be responsible  for paying  the                                                                   
fees.                                                                                                                           
                                                                                                                                
Co-Chair Williams  understood that it would be  the first car                                                                   
in the backed-up line.                                                                                                          
                                                                                                                                
Ms. Wright advised  that the drafter indicated  that it would                                                                   
be "pointless" to place such a stipulation in the bill.                                                                         
                                                                                                                                
Representative Hudson pointed  out that the legislation would                                                                   
be creating law.                                                                                                                
                                                                                                                                
Representative  Lancaster  noted  that  signs  on  the  Kenai                                                                   
Peninsula do not indicate a speed limit.                                                                                        
                                                                                                                                
LIEUTENANT  JULIA  GRIMES,  (TESTIFIED   VIA  TELECONFRENCE),                                                                   
ALASKA   STATE  TROOPERS,   DEPARTMENT   OF  PUBLIC   SAFETY,                                                                   
ANCHORAGE, noted  that the Department  did support  Section 1                                                                   
of the  House Finance committee  substitute.  She  added that                                                                   
in  new Section  2,  it would  be unclear  to  the public  to                                                                   
determine if work  was complete or not.  She  thought that it                                                                   
could be  complex trying to prove  in court.  There  needs to                                                                   
be discretion  when working in  a construction zone  and that                                                                   
language must be clear.                                                                                                         
                                                                                                                                
Vice-Chair  Bunde pointed  out  that if  someone exceeds  the                                                                   
speed limit in a construction  zone, they would be subject to                                                                   
a citation.   The referenced language addresses  whether that                                                                   
person would receive a double fine.                                                                                             
                                                                                                                                
Lt. Grimes acknowledged that in  current statute, the reduced                                                                   
speed limit was  ten to twenty miles an hour in  a work zone.                                                                   
If the lower limit was exceeded,  the person could be subject                                                                   
to a fine.                                                                                                                      
                                                                                                                                
DENNIS   POSHARD,   LEGISLATIVE    LIAISON,   DEPARTMENT   OF                                                                   
TRANSPORTATION   AND  PUBLIC   FACILITIES,  noted   that  the                                                                   
Department  of Transportation  & Public  Facilities has  been                                                                   
supportive  of the legislation  throughout  the process.   He                                                                   
referenced the new proposed new  section.  When the work zone                                                                   
provisions   were  initially   proposed,   the  double   fine                                                                   
provisions  created  concern  for  the  workers.    There  is                                                                   
additionally concern for the safety  of the traveling public.                                                                   
                                                                                                                                
Another  issue is  whether the  signs are  up or  down.   The                                                                   
State does have regulations and  contract provisions in place                                                                   
that require  contractors to  take signs  down more  often to                                                                   
provide  a more consistent  application.   The public  should                                                                   
not be the ones to determine if there are workers present.                                                                      
                                                                                                                                
DON ETHERIDGE,  AFL-CIO LABOR  UNION, JUNEAU, noted  that the                                                                   
Union does  not support Section  2, but does  support Section                                                                   
1.   Sometimes, construction  crews work  late at night,  and                                                                   
moving the signage  could prove to be fatal  for some workers                                                                   
and drivers  who have no incentive  to slow down.   He agreed                                                                   
that there is concern regarding the traveling public.                                                                           
                                                                                                                                
Representative  Davies MOVED  to delete  language on  Page 1,                                                                   
Lines 5 & 6: "below the posted speed limit at any time".                                                                        
                                                                                                                                
Representative Croft OBJECTED.                                                                                                  
                                                                                                                                
Representative Davies commented  that there is an issue about                                                                   
what the  safe speed is  in the State  of Alaska.   There are                                                                   
times when the posted speed limit  is unsafe.  There are also                                                                   
times when  the posted  speed limit is  perfectly safe.   The                                                                   
legislation  does not  refer to  the speed  limit but  rather                                                                   
addresses  a "matter of  politeness" regarding  when  five or                                                                   
more cars are backed behind you.                                                                                                
                                                                                                                                
Representative Croft  addressed his objection to  Amendment 1                                                                   
both  on legal  and practical  grounds.   He  stated that  it                                                                   
would  be inappropriate  for the  Legislature  to punish  the                                                                   
person complying  with the law and then  encourage disobeying                                                                   
the  law.    He  thought  that   the  amendment  would  cause                                                                   
prosecutions to  double.  He stated  that laws should  not be                                                                   
written  like that.   Representative Croft  claimed that  the                                                                   
amendment would take the State backward.                                                                                        
                                                                                                                                
Co-Chair Mulder responded  that in the real  world, a trooper                                                                   
would  not issue  a citation  when the  car is  going at  the                                                                   
speed limit with  five cars following behind.   He might pull                                                                   
the driver  over and  ask that  he let traffic  pass by.   He                                                                   
noted that he  had confidence in the State  Trooper's ability                                                                   
to determine  the consideration fairly.   He added  that some                                                                   
people do not read signs.                                                                                                       
                                                                                                                                
Ms.  Wright noted  that section  had  been left  open in  the                                                                   
initial drafting and that seemed  to satisfy the public.  She                                                                   
pointed out that the sponsor did not support the amendment.                                                                     
                                                                                                                                
Vice-Chair   Bunde  suggested   that   the  amendment   would                                                                   
encourage speeders.   He agreed  that the posted  speed limit                                                                   
should  be included  in issuance  of a  ticket, however,  the                                                                   
driver needs to use common sense when to pull over.                                                                             
                                                                                                                                
Ms. Wright acknowledged  that perhaps she did  not understand                                                                   
the amendment.                                                                                                                  
                                                                                                                                
Co-Chair Williams explained what the amendment would do.                                                                        
                                                                                                                                
Ms.  Wright  suggested  that the  amendment  could  encourage                                                                   
speeders.                                                                                                                       
                                                                                                                                
A roll call vote  was taken on the motion to  adopt Amendment                                                                   
#1.                                                                                                                             
                                                                                                                                
IN FAVOR:      Davies, Harris, Hudson, Lancaster, Mulder,                                                                       
               Williams                                                                                                         
OPPOSED:       Whitaker, Bunde, Croft, Foster                                                                                   
                                                                                                                                
Representative Moses was not present for the vote.                                                                              
                                                                                                                                
The MOTION PASSED (6-4).                                                                                                        
                                                                                                                                
Representative  Croft MOVED  to  ADOPT Amendment  2, Page  1,                                                                   
Line 6, after  "roadway", inserting the language  "outside of                                                                   
an urban  area".  There being  NO OBJECTION, Amendment  2 was                                                                   
adopted.                                                                                                                        
                                                                                                                                
Co-Chair Mulder  MOVED to report HCS  CS SB 222 (FIN)  out of                                                                   
Committee  with  individual  recommendations   and  with  the                                                                   
accompanying fiscal notes.  There  being NO OBJECTION, it was                                                                   
so ordered.                                                                                                                     
                                                                                                                                
HCS  CS  SB  222(FIN) was  reported  out  of  Committee  with                                                                   
"individual" recommendations and  with fiscal notes #1 by the                                                                   
Department of  Transportation &  Public Facilities and  #2 by                                                                   
the Department of Public Safety.   Also included with passage                                                                   
of the bill  was a House Concurrent Resolution  providing for                                                                   
the needed title change.                                                                                                        
                                                                                                                                
                                                                                                                                
CS FOR SENATE BILL NO. 278(FIN)                                                                                               
                                                                                                                                
     An Act requiring a good faith effort to purchase                                                                           
     property before that property is taken through eminent                                                                     
     domain; and providing for an effective date.                                                                               
                                                                                                                                
KIM OGNISTY, STAFF, SENATOR JOHN  TOGERSON, explained that SB
278  would  provide  and bring  fairness  and  expediency  to                                                                   
government and other condemning  authorities that require the                                                                   
acquisition of private lands for  public uses.  The bill does                                                                   
not attempt  to remove  the authority  of the  State to  take                                                                   
land by eminent  domain.  It would add a provision  to ensure                                                                   
a  "reasonable  and  diligent   effort"  made  by  government                                                                   
agencies  to negotiate  with property  owners before  land is                                                                   
claimed under eminent domain.                                                                                                   
                                                                                                                                
She  added  that   it  would  be  reasonable   to  require  a                                                                   
government entity  to make a  reasonable and diligent  effort                                                                   
to negotiate  with the landowner  on a value and  price prior                                                                   
to  taking the  property.   Someone  that does  not have  the                                                                   
financial ability  or an understanding  of the  legal process                                                                   
could  be  overwhelmed  with  the bureaucracy  and  be  at  a                                                                   
disadvantage in trying to protect  their property rights.  By                                                                   
requiring a "reasonable  and diligent effort"  to justify the                                                                   
State's  authority of  eminent  domain,  the landowner  would                                                                   
have the  benefit of full  disclosure of information  used by                                                                   
the  State to  determine the  public  purpose and  legitimate                                                                   
value before property could be taken.                                                                                           
                                                                                                                                
Representative  Davies voiced  concern  that the  legislation                                                                   
could  drive up  costs by  establishing  a new  set of  court                                                                   
standards.                                                                                                                      
                                                                                                                                
Ms.  Ognisty  acknowledged  that   those  concerns  had  been                                                                   
expressed previously.                                                                                                           
                                                                                                                                
Representative  Harris questioned  if  the legislation  would                                                                   
prolong the time that a construction projection goes on.                                                                        
                                                                                                                                
Ms. Ognisty  indicated that the Department  of Transportation                                                                   
& Public  Facilities had previously  noted that concern.   It                                                                   
is  Senator Torgerson's  intent  that if  the situation  does                                                                   
occur with private  landholders, then those  individuals must                                                                   
be dealt  with fairly during the  process that their  land is                                                                   
being condemned.   She  added that then  both sides  would be                                                                   
coming from equal ground.                                                                                                       
                                                                                                                                
Representative  Harris understood that  in the process,  some                                                                   
of people  would not want  to sell their  land or  would want                                                                   
more  money than  being awarded.   It  will not  always be  a                                                                   
"willing to sell, willing to buy situation".                                                                                    
                                                                                                                                
Ms. Ognisty explained  that most situations do  not reach the                                                                   
point addressed through the legislation.                                                                                        
                                                                                                                                
Co-Chair  Williams   noted  that  the  committee   substitute                                                                   
basically  addressed technical  changes  in the  legislation,                                                                   
version #22-LS1399\T, Kurtz, 5/8/02.  (Copy on File).                                                                           
                                                                                                                                
Representative  Harris MOVED  to  ADOPT committee  substitute                                                                   
version #22-LS1399\T,  Kurtz, 5/8/02,  as the version  of the                                                                   
bill before  the Committee.   There  being NO OBJECTION,  the                                                                   
committee was substitute was adopted.                                                                                           
                                                                                                                                
                                                                                                                                
TAPE HFC 02 - 105, Side B                                                                                                     
                                                                                                                                
                                                                                                                                
DENNIS   POSHARD,   LEGISLATIVE    LIAISON,   DEPARTMENT   OF                                                                   
TRANSPORTATION AND  PUBLIC FACILITIES, noted that  because of                                                                   
the work done in the House Judiciary  Committee, the proposed                                                                   
legislation is  better.  However,  the Department  objects to                                                                   
the bill.   The basic  issue is that  the current  process is                                                                   
very fair and there is no need  to change it.  He pointed out                                                                   
that  93% of  the  State's  properties are  acquired  through                                                                   
negotiation and only  7% of the acquired parcels  are through                                                                   
condemnation.  That is an excellent  record compared to other                                                                   
states.                                                                                                                         
                                                                                                                                
The  Alaska  Constitution  requires  that  the  State  justly                                                                   
compensate  property  owners for  the  fair  market price  of                                                                   
their property  value.  Occasionally,  there is a  dispute by                                                                   
the property  owners over the  value as different  appraisers                                                                   
come up with different values.   The current system does well                                                                   
working that out.                                                                                                               
                                                                                                                                
Mr. Poshard added  that in addition to being  a fair process,                                                                   
it is also a mature process governed  by the Constitution and                                                                   
federal law and years of litigation  in case law.  Changes to                                                                   
the statute  would invite  expensive litigation,  which would                                                                   
likely delay  projects.  Interpretation  of the  new standard                                                                   
would take  years to sort out.   The Department's  concern is                                                                   
that an  unhappy property  owner could be  given a  "tool" to                                                                   
stop or  delay the project to  attempt to get more  money out                                                                   
of the State.   The consequences  of the bill would  not only                                                                   
affect the Department  of Transportation &  Public Facilities                                                                   
but also  anyone given eminent  domain authority  under State                                                                   
statute.   The  bill would  affect lessees  under the  Alaska                                                                   
Right of  Way Leasing  Act, those  in charge  of oil  and gas                                                                   
pipelines,  public  utilities,  all municipalities,  and  the                                                                   
Alaska Railroad Corporation.   The Department knows that many                                                                   
of  those agencies  have not  come forward  to address  their                                                                   
concerns.                                                                                                                       
                                                                                                                                
Mr. Poshard  added that  in addition, the  up to  10% penalty                                                                   
listed in Section  4 would be non-participating  general fund                                                                   
dollars.   The federal government  only participates  in just                                                                   
compensation to the property owner.   They do not participate                                                                   
in the payment  of penalty or any type of interest  that goes                                                                   
to the  property owner.  Those  funds would be  dispersed out                                                                   
of the State's general fund.                                                                                                    
                                                                                                                                
Mr. Poshard acknowledged that  the Department understands the                                                                   
concerns  indicated by  the  supporters of  the  bill and  is                                                                   
attempting  to alleviate them.   He  referenced memos  in the                                                                   
member's packets  that address that.  Mr.  Poshard reiterated                                                                   
that the Department does oppose the proposed legislation.                                                                       
                                                                                                                                
Co-Chair  Williams inquired  how  many cases  go through  the                                                                   
litigation process.                                                                                                             
                                                                                                                                
Mr.  Poshard  reiterated  that  93%  of  the  properties  are                                                                   
acquired  through negotiation  and  7% are  acquired  through                                                                   
condemnation.    The  litigation  is  usually  over  that  7%                                                                   
amount.   There are  some cases in  which the property  owner                                                                   
objects to  the "taking"  altogether.   In the current  legal                                                                   
standard, they  must determine whether or not  the Department                                                                   
has the  authority and the  necessity to take  that property.                                                                   
The Department  has the authority  based upon  State statute.                                                                   
Regarding  the necessity,  the  Department  usually has  been                                                                   
though  an  environmental  and  public  involvement  process,                                                                   
which usually  is an  easy standard to  meet.  He  reiterated                                                                   
that the process  is a fair process and sometimes  the dollar                                                                   
value requires litigation.                                                                                                      
                                                                                                                                
MICHAEL   DOWNING,  DIRECTOR/CHIEF   ENGINEER,  DIVISION   OF                                                                   
STATEWIDE  DESIGN  &  ENGINEERING   SERVICES,  DEPARTMENT  OF                                                                   
TRANSPORTATION &  PUBLIC FACILITIES, stressed that  the value                                                                   
litigation is essentially  7%.  One concern with  the bill is                                                                   
that it will encourage further litigation.                                                                                      
                                                                                                                                
Co-Chair  Williams  questioned   if  funding  came  from  the                                                                   
general fund.                                                                                                                   
                                                                                                                                
Ms.  Poshard  advised   that  the  money  used   to  pay  the                                                                   
attorney's fee or  the property owner award did  not come out                                                                   
of the  general fund.   The amount from  the general  fund is                                                                   
the charges of the additional  penalty resulting from Section                                                                   
4 of the  bill.  Currently,  the award to the  property owner                                                                   
is covered  through project funds,  which are  partly federal                                                                   
and partly  State matched funds.   However, the  penalty does                                                                   
have to come out of the participating general fund pot.                                                                         
                                                                                                                                
Co-Chair  Williams asked  for  further information  regarding                                                                   
the situation with Sealaska and Phillip Evans.                                                                                  
                                                                                                                                
Mr. Downing acknowledged that  situation has precipitated the                                                                   
concern.     He   stated  that   he   and  the   Department's                                                                   
Commissioner would  be making decisions regarding  the appeal                                                                   
of the master determination of  the property value.  He noted                                                                   
that rarely occurs.  Sealaska's  biggest concern is that they                                                                   
do  not want  to see  a reduction  in the  acreage that  they                                                                   
hold.    Sealaska  is  only  interested  in  an  exchange  of                                                                   
properties.   Mr.  Downing advised  that it  is important  to                                                                   
determine  ways  to expedite  the  project.   He  added  that                                                                   
passage of the bill would not encourage such action.                                                                            
                                                                                                                                
Co-Chair Williams  inquired about the potential  delay in the                                                                   
railroad and/or pipeline projects.                                                                                              
                                                                                                                                
Mr. Poshard  explained that  the concern  for delay  rests in                                                                   
language  in Sections  1,  2 &  3  of the  bill.   Section  1                                                                   
provides  the prerequisites,  which clarifies  that before  a                                                                   
property can be  taken, it should appear that  the Department                                                                   
has  made  a  reasonable  effort.   Section  2  of  the  bill                                                                   
attempts  to put  steps on  that process,  however, there  is                                                                   
language in  that version that  requires giving  the property                                                                   
owner a  reasonable time frame  to make a reasonable  counter                                                                   
offer.   The  concern  for the  Department  is that  language                                                                   
invites litigation from a property  owner who is unhappy with                                                                   
the amount  of the offer  made.  They  may use that  to delay                                                                   
the  project.    He  reiterated  that  the  language  invites                                                                   
litigation  and has  the potential  to cause  more delays  on                                                                   
projects.                                                                                                                       
                                                                                                                                
Vice-Chair Bunde  questioned whether  any State agency  would                                                                   
be concerned about  "reasonable efforts".  He  suggested that                                                                   
even if the legislation did invite  litigation, would it tend                                                                   
to not error on the side of the State.                                                                                          
                                                                                                                                
Mr. Poshard agreed.   He added that current  law requires the                                                                   
Department to offer  a fair market value from  the beginning.                                                                   
He emphasized  that the State  currently is 'reasonable'  and                                                                   
the  Department does  not  see the  need  for the  additional                                                                   
language, which would create potential for more litigation.                                                                     
                                                                                                                                
Mr. Downing interjected that the  concern regards what should                                                                   
be issued for the  staff if the bill should pass.   The staff                                                                   
would simply need  to comply with sections (b) &  (c).  Right                                                                   
of way is typically  on the critical path to  the development                                                                   
of a  project.  The delay  to right of  way does amount  to a                                                                   
delay of a project.   He added that the cumulative  effect of                                                                   
all  the legislation  over  the  past  few years  has  gotten                                                                   
Alaska to a point  where it takes a long time  to develop any                                                                   
project.  The proposed bill is  not necessary and needs to be                                                                   
considered in relationship  to all the other  steps that have                                                                   
been added.                                                                                                                     
                                                                                                                                
Representative Hudson asked about  the new elements contained                                                                   
in  Section 2.    He understood  that  the legislation  would                                                                   
require  the  Department  to advise  the  property  owner  to                                                                   
obtain an appraisal and then subject  to that, the Department                                                                   
could either buy the land or make a counter offer.                                                                              
                                                                                                                                
Mr. Downing  responded  that each property  owner is  unique.                                                                   
The new  language would  require that  each step could  delay                                                                   
the process.                                                                                                                    
                                                                                                                                
Co-Chair Williams  stated that CS SB 278 (FIN)  would be HELD                                                                   
in Committee for further consideration.                                                                                         
                                                                                                                                
                                                                                                                                
HOUSE BILL NO. 532                                                                                                            
                                                                                                                                
     An  Act  relating  to  the  powers  and  duties  of  the                                                                   
     Department  of Environmental  Conservation, to  barbers,                                                                   
     hairdressers,   estheticians,  manicurists,   tattooers,                                                                   
     permanent cosmetic  colorists, body piercers,  and their                                                                   
     establishments,   to  the   licensure   of  child   care                                                                   
     facilities,  to food  establishments,  to cosmetics,  to                                                                   
     tourist camps, trailer camps,  motor courts, and motels,                                                                   
     to  restrooms,  to  smoking  in  public  facilities,  to                                                                   
     public  health  nuisances,  to sanitation  and  sanitary                                                                   
     practices, to  camps and canneries, to schools,  to soft                                                                   
     drink establishments, to  beer and wine dispensaries, to                                                                   
     other  establishments,  and to  commercially  compressed                                                                   
     air; and providing for an effective date.                                                                                  
                                                                                                                                
Co-Chair Williams  explained that HB 532 had  been introduced                                                                   
to  pare back  some  responsibilities  of the  Department  of                                                                   
Environmental  Conservation.    Under  the  legislation,  the                                                                   
Department  would no  longer have  responsibility to  inspect                                                                   
restaurants,  food markets, temporary  food service  (fairs),                                                                   
cosmetology   businesses,  pool/spas,   washeterias,   public                                                                   
toilets, and overnight accommodations.                                                                                          
                                                                                                                                
Co-Chair Williams  advised that the legislation  would remove                                                                   
the State's responsibility for  oversight of those items, and                                                                   
would then  leave it to local  governments whether to  do the                                                                   
functions.     Currently,   the   State   provides  no   food                                                                   
inspections in  Anchorage, as the Municipality  has their own                                                                   
program.   Municipalities  should  work together  to come  up                                                                   
with a program that fits individual needs.                                                                                      
                                                                                                                                
Representative Davies  questioned why this bill  had not been                                                                   
submitted earlier.                                                                                                              
                                                                                                                                
Co-Chair  Williams responded  that he  had attempted  that in                                                                   
subcommittee  and had  met opposition.   He reminded  members                                                                   
that  there  is  now a  serious  budget  shortfall  and  that                                                                   
current inspections are not occurring often enough.                                                                             
                                                                                                                                
Representative  Davies  commented  that  there could  not  be                                                                   
adequate  testimony  heard from  affected  municipalities  at                                                                   
such a late time in the session.                                                                                                
                                                                                                                                
Co-Chair Williams  acknowledged there  could not be  and that                                                                   
the bill would  not be moved from committee  at present time,                                                                   
indicating that  there would be  a public hearing  within the                                                                   
next few days.                                                                                                                  
                                                                                                                                
Representative   Harris  inquired  if   the  intent   of  the                                                                   
legislation was  to transfer the Department  of Environmental                                                                   
Conservation's  oversight  to  the  local  communities.    He                                                                   
questioned  what  federal  funding  would  be  lost  in  that                                                                   
transfer.                                                                                                                       
                                                                                                                                
Co-Chair Williams responded that  schools and canneries would                                                                   
be subject to the loss of federal funds.                                                                                        
                                                                                                                                
Representative  Harris  requested  that  the  Committee  hear                                                                   
testimony from  the Department of Environmental  Conservation                                                                   
before the  legislation moved forward.   He pointed  out that                                                                   
the legislation could have dramatic  affects on food service.                                                                   
                                                                                                                                
Co-Chair  Williams  agreed.    He  observed  that  to  do  an                                                                   
adequate inspection  job, it would cost the  State between $8                                                                   
and $9 million general fund dollars  and the current level of                                                                   
funding is  around $1  million dollars.   He maintained  that                                                                   
there is enough incentive for  the private industry to assure                                                                   
that services were covered.                                                                                                     
                                                                                                                                
Representative  Lancaster  recommended   that  the  issue  be                                                                   
reviewed and  that the legislation  be considered  during the                                                                   
next year.                                                                                                                      
                                                                                                                                
Co-Chair  Williams  emphasized  the  lack  of  funding.    He                                                                   
maintained that  local communities should take  care of these                                                                   
concerns.  He questioned where  the appropriate funding would                                                                   
come from.                                                                                                                      
                                                                                                                                
Representative  Hudson acknowledged the  increased fees.   He                                                                   
recommended that  the Legislature  proceed cautiously  so not                                                                   
to abrogate the constitutional responsibility.                                                                                  
                                                                                                                                
Co-Chair Williams  pointed out that seafood  processing would                                                                   
continue to  be funded by the  Department.  He  observed that                                                                   
schools and senior facilities  receive federal funds and must                                                                   
be inspected.  He maintained that  $1.4 million dollars would                                                                   
be saved.                                                                                                                       
                                                                                                                                
Representative Davies  stressed that $1.2 million  dollars of                                                                   
that budget is  from program receipts and that  the remaining                                                                   
would  be general  funds.    He questioned  eliminating  food                                                                   
inspection  in  the State  of  Alaska, which  will  seriously                                                                   
impact schools and then save only  $200 thousand dollars.  He                                                                   
stressed  that this  is  not an  issue  that  will close  the                                                                   
fiscal gap or save money.  The  Department is currently doing                                                                   
an "okay"  job of providing  inspections and on  the average,                                                                   
there is an inspection once a year.                                                                                             
                                                                                                                                
The Department  of Environmental  Conservation is  attempting                                                                   
to inspect  some restaurants  twice a year  when there  is an                                                                   
indicated  need.   He  thought  that it  was  fair to  charge                                                                   
restaurants more  because all restaurants profit  from having                                                                   
a level  playing field.   Restaurants  depend on tourism  and                                                                   
passage  of  the  legislation   would  threaten  the  tourist                                                                   
industry.                                                                                                                       
                                                                                                                                
Representative J. Davies reiterated  his question of why this                                                                   
issue had  not been introduced  earlier.  He  maintained that                                                                   
the  current  program is  okay  and  stressed that  fees  are                                                                   
currently paying for these programs.                                                                                            
                                                                                                                                
Co-Chair  Williams asserted  that the  State is charging  for                                                                   
services that  are not being  supported.  He  maintained that                                                                   
communities could better perform those services.                                                                                
                                                                                                                                
JANICE  ADAIR,  (TESTIFIED  VIA   TELECONFERENCE),  DIRECTOR,                                                                   
DIVISION    OF   ENVIRONMENTAL    HEALTH,    DEPARTMENT    OF                                                                   
ENVIRONMENTAL  CONSERVATION, ANCHORAGE,  referred to  Section                                                                   
7, which prohibits the Department  and the State from any way                                                                   
regulating food establishments  and wholesale establishments.                                                                   
She referenced  Section 21,  which is  part of the  statutory                                                                   
repeal  of  AS  44.46.0205,  the  Department's  authority  to                                                                   
establish   standards  and   sanitation  for   a  number   of                                                                   
facilities  such as  childcare centers,  body piercing  shops                                                                   
and tourist  accommodations.   The rest of  the bill  is just                                                                   
technical amendments to affect those changes.                                                                                   
                                                                                                                                
Ms. Adair explained  that the bill would mean  that the State                                                                   
would have no authority to recall  foods that are not safe to                                                                   
serve  the public,  and would  be  unable to  close down  any                                                                   
retail establishments that are  suspected of causing illness.                                                                   
She added  that there  would be no  standards for  service of                                                                   
food at public schools, senior  citizen facilities, childcare                                                                   
centers, grocery  stores and fairs  or other special  events.                                                                   
Millions  of dollars that  Alaska receives  from the  federal                                                                   
government for school lunches,  breakfasts and senior citizen                                                                   
meals would be jeopardized.                                                                                                     
                                                                                                                                
Ms. Adair continued,  there would be no standard  of care for                                                                   
sanitization  for  childcare   facilities,  tattoo  and  body                                                                   
piercing shops and  public schools.  The State  would have no                                                                   
authority  to  assure  chlorination  of public  pools.    The                                                                   
recently passed  legislation regulating  tattooing  would not                                                                   
be implemented.                                                                                                                 
                                                                                                                                
Ms. Adair  maintained that  the current  program is  not new,                                                                   
and that it  is not failing.   The record is improving.   The                                                                   
Department  is  trying to  prioritize  their  work, which  is                                                                   
supported by industry.  Fees were  increased at the direction                                                                   
of the Legislature and non-profits are not charged a fee.                                                                       
                                                                                                                                
She added that the Division works  with operators before they                                                                   
open their  business to  learn how  to properly handle  food.                                                                   
There  are legal  impediments to  local governments  assuming                                                                   
the service.  Local governments  cannot work with the federal                                                                   
government on food recalls or  bio-terrorism.  She emphasized                                                                   
that the  statutes  and Title  29 would have  to be  changed;                                                                   
cities and boroughs would have to change their charters.                                                                        
                                                                                                                                
Ms.  Adair  observed  the difficulty  in  filling  positions.                                                                   
Inspectors  are trained  within the Department.   Many  local                                                                   
governments only  have a hand-full  of establishments  and do                                                                   
not  have the  economy-of-scale to  develop a  program.   She                                                                   
pointed  out the  outbreak in  Canada that  resulted in  sick                                                                   
tourists in Fairbanks.                                                                                                          
                                                                                                                                
Ms.  Adair  acknowledged  that  Anchorage does  have  a  good                                                                   
program, but emphasized that the  system is evolving and that                                                                   
they do  have outbreaks.   She  stressed that the  Department                                                                   
works  to prevent  outbreaks.   If  the proposed  legislation                                                                   
passes, the  safety net will be  gone.  That safety  net will                                                                   
affect people  throughout the  State.   She pointed  out that                                                                   
the  National   Restaurant  Association  estimates   that  an                                                                   
outbreak costs a  business around $75 thousand  dollars.  The                                                                   
last one in Kenai closed that business.                                                                                         
                                                                                                                                
                                                                                                                                
TAPE HFC 02 - 106, Side A                                                                                                     
                                                                                                                                
                                                                                                                                
Co-Chair  Williams asked  if the  qualifications  for a  food                                                                   
inspector could be lowered.                                                                                                     
                                                                                                                                
Ms. Adair responded that food  inspectors must understand how                                                                   
a bacterium  works in  an environment, how  it can  be spread                                                                   
through  food,  and  how  humans  help  that  spread.    Food                                                                   
inspectors  usually have  a degree in  biology, chemistry  or                                                                   
microbiology.    The  Department   does  have  an  'in-house'                                                                   
training program.  She stressed that the standards  cannot be                                                                   
lowered  because it  is critically  important  that there  is                                                                   
someone well trained going into the facilities.                                                                                 
                                                                                                                                
Co-Chair  Williams  questioned  if a  one-year  training  was                                                                   
sufficient.                                                                                                                     
                                                                                                                                
Representative Davies  asked if the  State were to  switch to                                                                   
the local governments  providing the inspections,  would they                                                                   
need to  have the State standards  in place in order  to meet                                                                   
the federal requirements.                                                                                                       
                                                                                                                                
Ms.  Adair affirmed  that  local  governments  would have  to                                                                   
follow State  standards and  the standards  would have  to be                                                                   
uniform.                                                                                                                        
                                                                                                                                
Representative Lancaster questioned  if the local governments                                                                   
could hire the current State staff.                                                                                             
                                                                                                                                
Ms.  Adair  thought that  it  would  be unlikely  that  local                                                                   
governments  would be  ready to  hire laid  off employees  by                                                                   
July 1, 2002.                                                                                                                   
                                                                                                                                
In  response to  a  question  by Representative  Hudson,  Ms.                                                                   
Adair  explained that  the school  lunch  program and  senior                                                                   
nutrition   programs   have   a   federal   requirement   for                                                                   
inspections and that the programs  are in compliance with the                                                                   
safety  statutes. Intrastate  food safety  issues are  at the                                                                   
discretion of each individual state.                                                                                            
                                                                                                                                
KEVIN  RITCHIE, ALASKA  MUNICIPAL  LEAGUE, JUNEAU,  commented                                                                   
that there are only a few boroughs  that could administer and                                                                   
assume these programs.   He addressed the scale  of who could                                                                   
provide  the inspections  the  best.   The Legislature  would                                                                   
have to establish who would pay;  essentially the Legislature                                                                   
is the assembly for the unorganized borough.                                                                                    
                                                                                                                                
LYNN  FREEMAN,  EXECUTIVE  DIRECTOR,   ALASKA  COMMISSION  ON                                                                   
AGING, voiced  concern with HB  532, specifically  Section 7.                                                                   
If  budget reduction  occurs, there  will be  no food  safety                                                                   
oversight anywhere  in Alaska outside of the  Municipality of                                                                   
Anchorage.  The federal government  does not have nor will it                                                                   
establish  a food  safety and  sanitation inspection  program                                                                   
for State's without their own program.                                                                                          
                                                                                                                                
Ms. Freeman claimed that the budget  cut would jeopardize the                                                                   
loss of approximately  $4 million dollars spent  in Alaska to                                                                   
fund senior  nutrition programs.   Federal dollars  cannot be                                                                   
expended for statewide  senior meal programs  unless the food                                                                   
is prepared  in a commercial  kitchen that has  been approved                                                                   
by the  State or  local agency  responsible for food  safety.                                                                   
Ms.  Freeman  urged  that  HB   532  does  not  pass  out  of                                                                   
Committee.                                                                                                                      
                                                                                                                                
Co-Chair  Williams  stated  that  HB  532 would  be  HELD  in                                                                   
Committee for further consideration.                                                                                            
                                                                                                                                
                                                                                                                                
CS FOR SENATE BILL NO. 278(FIN)                                                                                               
                                                                                                                                
     An Act requiring a good faith effort to purchase                                                                           
     property before that property is taken through eminent                                                                     
     domain; and providing for an effective date.                                                                               
                                                                                                                                
RON    WOLFE,   SEALASKA    CORPORATE   FORESTER,    SEALASKA                                                                   
CORPORATION,  JUNEAU,  spoke   in  support  of  the  proposed                                                                   
legislation.   The  bill  would  allow the  State  to make  a                                                                   
diligent effort  to negotiate  the purchase of  real property                                                                   
from a private landowner or make  a similar effort to make an                                                                   
exchange  of   property  before  condemning  it.     Sealaska                                                                   
Corporation has faced a threat  of eminent domain a few times                                                                   
over  the  past  several  years in  respect  to  public  work                                                                   
projects.                                                                                                                       
                                                                                                                                
Mr. Wolfe claimed  that those actions resulted  in protracted                                                                   
lengthy fights for Sealaska rights.   They were resolved with                                                                   
a  great deal  of  difficulty.   He  added  that the  process                                                                   
usually is  hostile because  of the rules  and the lack  of a                                                                   
level playing field.  SB 278 could remedy that process.                                                                         
                                                                                                                                
Mr.   Wolfe   advised   that  Sealaska   believes   that   by                                                                   
establishing  the  requirement   in  law,  it  would  provide                                                                   
private landowners insurance that  the eminent domain process                                                                   
will be fair.   The result would be less litigation  if those                                                                   
individuals were  treated fairly.   The efforts  to negotiate                                                                   
with an individual in a reasonable  manner would make it less                                                                   
likely to go to court.                                                                                                          
                                                                                                                                
Mr. Wolfe  noted that earlier  versions of the bill  had been                                                                   
amended  so that  the delay  process  would not  occur.   The                                                                   
current provisions  in the bill  provide for a  10% surcharge                                                                   
to landowners above the fair market  value of the property in                                                                   
the event that the condemnor has found that to be unfair.                                                                       
                                                                                                                                
Vice-Chair  Bunde   asked  if  there  was  anything   in  the                                                                   
legislation that could encourage the delay of projects.                                                                         
                                                                                                                                
Mr.  Wolfe  responded  that the  earlier  versions  had  been                                                                   
amended  to  address  that  there   are  not  delays  in  the                                                                   
projects.   He noted  that Sealaska's  attorney could  better                                                                   
address that idea.                                                                                                              
                                                                                                                                
Mr.  Wolfe pointed  out another  provision  within the  bill,                                                                   
which would  advise private  landowners  that they could  get                                                                   
their own  appraiser.  He thought  that would be a  good idea                                                                   
especially  for the unsophisticated  owners.   He added  that                                                                   
could add to leveling the playing field.                                                                                        
                                                                                                                                
JON  TILLINGHAST,  ATTORNEY,  SEALASKA  CORPORATION,  JUNEAU,                                                                   
stated that  the bill  before the  committee would  not delay                                                                   
the  acquisition  of any  property  under an  eminent  domain                                                                   
proceeding.  He  added that the Department  of Transportation                                                                   
&  Public  Facilities  had acknowledged  that  to  the  House                                                                   
Judiciary Committee.  The bill  does not have a subjection or                                                                   
ambiguous standard  that the Department  or the  Courts would                                                                   
have  trouble  interpreting.    He  added  that  Mr.  Poshard                                                                   
assured  the  House Judiciary  Committee  that  the  proposed                                                                   
version took care of those concerns.   Mr. Tillinghast stated                                                                   
that  they  were  disappointed  seeing  those  same  concerns                                                                   
currently on the table.                                                                                                         
                                                                                                                                
The idea of  having a statute, which requires  the condemning                                                                   
authority to be  reasonable and diligent, is not  unique.  It                                                                   
is a recommended provision of  the model domain code.  If the                                                                   
government  comes  first to  the  landowner  as an  equal  to                                                                   
purchase  the property,  that  immediately  creates a  better                                                                   
atmosphere  than the  government  coming to  the same  person                                                                   
stating that  they are  the government and  are here  to take                                                                   
the property.                                                                                                                   
                                                                                                                                
Mr. Tillinghast  noted that at  least 23 states  have adopted                                                                   
laws similar  to SB 278, however,  there is a  big difference                                                                   
between the  laws of  the sister states  and the  bill before                                                                   
the Committee.   Under  such statutes,  it is generally  held                                                                   
that a  bona fide attempt to  purchase the land  by agreement                                                                   
between the  parties and  a failure to  do so is  a condition                                                                   
precedence to eminent domain proceedings.   Failure to comply                                                                   
with  that  requirement renders  any  subsequent  proceedings                                                                   
void.   He  stated that  the land  owner can  not dismiss  or                                                                   
delay  an eminent  domain proceeding  by going  to Court  and                                                                   
that is the rule which the sister  state's have.  That is the                                                                   
rule  that  went  to the  House  Judiciary  Committee.    The                                                                   
Department  of Transportation  & Public Facilities  expressed                                                                   
concern  that  providing  additional basis  for  delaying  or                                                                   
stopping their  acquiring of the  property could  delay their                                                                   
acquiring of a right of way.                                                                                                    
                                                                                                                                
Sealaska  agreed to  a  "watering down  of  the bill",  which                                                                   
removed that aspect.   Under the proposed  legislation before                                                                   
the House Finance  Committee, it would be  legally impossible                                                                   
to stop, halt or  in any manner delay the acquisition  of any                                                                   
property  through any  authority.  That  remedy was  stripped                                                                   
from the  bill; it  had been  contained in  Section 4  of the                                                                   
prior versions of the bill.                                                                                                     
                                                                                                                                
Vice-Chair  Bunde asked  if the person's  whose property  was                                                                   
being condemned could delay that action.                                                                                        
                                                                                                                                
Mr.  Tillinghast  replied  that person's  property  could  no                                                                   
longer delay or hinder the State's  acquisition of a piece of                                                                   
property  of   eminent  domain   under  the  proposed   bill.                                                                   
Instead,  the  only  remedy  that the  landowner  has  is  to                                                                   
convince the Court  to add a 10% surcharge  onto the ultimate                                                                   
eminent domain award.                                                                                                           
                                                                                                                                
Representative Whitaker questioned the delay issue.                                                                             
                                                                                                                                
Mr. Tillinghast  stressed that a  case could not be  made and                                                                   
that  the Department  of Transportation  & Public  Facilities                                                                   
has acknowledged  that.  He  commented that he  was surprised                                                                   
to see the issue  before the Committee and  stressed that the                                                                   
sole remedy would be the 10% surcharge.                                                                                         
                                                                                                                                
Representative Whitaker  asked if the procedure  would change                                                                   
as a result of the bill.                                                                                                        
                                                                                                                                
Mr.  Tillinghast  interjected  that it  would  because  under                                                                   
present  law, if  the State  is not  reasonable and  diligent                                                                   
with  you,  the Court  cannot  add  the  10% surcharge  on  a                                                                   
condemnation award.  Through the  bill, they would be able to                                                                   
do that  and it would  not change  procedure but  does change                                                                   
the substance.                                                                                                                  
                                                                                                                                
Representative  Whitaker asked if  the bill would  change the                                                                   
procedure.                                                                                                                      
                                                                                                                                
Mr. Tillinghast  replied that  the bill  has not changed  any                                                                   
procedure.                                                                                                                      
                                                                                                                                
Representative Croft  questioned if there had  been good case                                                                   
effort and if  there was any difference  between "reasonable,                                                                   
diligent and good faith effort" in case law.                                                                                    
                                                                                                                                
Mr.  Tillinghast  commented  that  some  states  do  use  the                                                                   
language   "good  faith"   and  some   use  "reasonable   and                                                                   
diligent".    He  claimed  that "good  faith"  was  the  most                                                                   
subjective  of the standards  on the  menu.  "Reasonable  and                                                                   
diligent" are more objective standards.   He pointed out that                                                                   
did reflect  the Department's  second concern and  which made                                                                   
it to  the House  Judiciary Committee.   They were  concerned                                                                   
that  "reasonable  and  diligent"  was too  subjective.    To                                                                   
address that,  Section 2 was  created.  Defining  "reasonable                                                                   
and diligent" removed the subjectivity from the bill.                                                                           
                                                                                                                                
Representative Foster commented  that his district was mostly                                                                   
Native  land and  some of  those  lands are  joined to  State                                                                   
land.  He asked how Sealaska felt about that.                                                                                   
                                                                                                                                
Mr.  Tillinghast  responded that  would  depend  on how  they                                                                   
define  the problem.   A State  agency should  focus on  land                                                                   
exchanges as opposed  to condemnation.  A statute  is a safer                                                                   
cure  than  an  unenforceable  and  formal  promise  from  an                                                                   
administrative  agency.    The   concern  is  not  just  that                                                                   
Sealaska  wants  to  focus  on  land  exchanges  rather  than                                                                   
through eminent domain.   Sealaska as a private  landowner is                                                                   
interested  in   leveling  the  playing  field   between  the                                                                   
government and the private sector.                                                                                              
                                                                                                                                
Representative  Foster referenced back  up material  found in                                                                   
his packet.   He  asked an  estimate of  the amount  received                                                                   
versus a fair amount for the land.                                                                                              
                                                                                                                                
Mr.  Wolfe  interjected  that  Sealaska has  never  sold  the                                                                   
Alaska  Native  Claims  Settlement   Act  (ANCSA)  land.    A                                                                   
transaction that  occurred in the  last ten years was  a land                                                                   
exchange.  From  a practical standpoint, the  provision for a                                                                   
land   exchange   is  not   one   that  the   Department   of                                                                   
Transportation & Public Facilities  officials readily embrace                                                                   
because they are complex and complicated.   The preference of                                                                   
bureaucrats is to  go to a fair marketplace.   It took effort                                                                   
to convince the  Department to go to a land  exchange process                                                                   
in the Klawok Airport.  Sealaska  believes that the provision                                                                   
to a state  land exchange as  an alternative would  level the                                                                   
playing  field.   The corporate  lands were  fought long  and                                                                   
hard  for by  the Native  people and  they do  not want  them                                                                   
taken  away.   The  condemning agency  is  the Department  of                                                                   
Transportation &  Public Facilities.  The land  owning agency                                                                   
is  the Department  of Natural  Resources.   He  acknowledged                                                                   
that these are complex and difficult issues.                                                                                    
                                                                                                                                
Representative  Croft asked  to hear  from the Department  of                                                                   
Law on the delay issue.  He noted that they were on line.                                                                       
                                                                                                                                
In  response to  a  question  by Representative  Foster,  Mr.                                                                   
Wolfe  explained that  through  the highway  realignment  and                                                                   
upgrade,  additional property  was  purchased  and deeded  to                                                                   
Sealaska through an exchange.                                                                                                   
                                                                                                                                
Representative Foster  pointed out that  a lot of  the Native                                                                   
lands have  airports.   The only lands  to extend  an airport                                                                   
would be the  Native Corporation.  He thought  that there was                                                                   
a gray area.                                                                                                                    
                                                                                                                                
Mr.  Tillinghast  responded that  the  only  effect that  the                                                                   
proposed legislation  would have  on that situation  would be                                                                   
if the Department went to the  Native Corporation and did not                                                                   
behave reasonably with them.                                                                                                    
                                                                                                                                
DENNIS  WHEELER,   (TESTIFIED  VIA  TELECONFERENCE),   DEPUTY                                                                   
MUNICIPAL ATTORNY, MUNICIPALITY  OF ANCHORAGE, explained that                                                                   
his primary work  rests with eminent domain  proceedings.  He                                                                   
testified against  passage of  the proposed legislation.   He                                                                   
noted that there  could be considerations  for municipalities                                                                   
that  had  not   yet  been  brought  before   the  Committee.                                                                   
Primarily, the  Municipality of  Anchorage already  has codes                                                                   
on the books  that indicate how  to pay and gauge  an eminent                                                                   
domain.   He  noted that  they are  required to  make a  good                                                                   
faith  effort  to follow  federal  guidelines  in respect  to                                                                   
appraising public property and  the use of fair market value.                                                                   
That  is  important  in the  proposed  situation,  given  the                                                                   
previous testimony  by Sealaska that there are  two different                                                                   
standards used in  the State to determine what  is the proper                                                                   
method or efforts  for acquiring property.   The Municipality                                                                   
of Anchorage uses the good faith  subjective standard.  There                                                                   
seems to be testimony that reasonable  and diligent effort is                                                                   
more objective by  State statute.  That would  mean that they                                                                   
would face  fine and municipal  codes and be in  violation of                                                                   
State  law.   It would  give property  owners  two bites  and                                                                   
would create extra  layers of work and documentation  for the                                                                   
staff.                                                                                                                          
                                                                                                                                
Mr.  Wheeler  pointed   out  that  the  bill   makes  for  an                                                                   
"invitation  for   litigation".    The  current   civil  role                                                                   
regarding  eminent  domain requires  payment  for  successful                                                                   
council hired by  property owners.  There is  no disincentive                                                                   
and every  attorney would  attempt to  get the  10% fee.   In                                                                   
addition, it is the position that  the litigation would occur                                                                   
at the  front end.  Unless  there is a fantastic  legislative                                                                   
record,  which  clearly  indicates   across  the  board  that                                                                   
everyone  agrees, the  property owners  cannot come  back and                                                                   
raise the issue of reasonableness.   The attorneys would have                                                                   
to raise that issue.                                                                                                            
                                                                                                                                
Mr.  Wheeler   addressed  another   issue  with   respect  to                                                                   
appraisals.  The  current bill suggests that  if the property                                                                   
is worth  more than $15  thousand dollars, then  the property                                                                   
owner can get their  own appraisal.  That is not  done in all                                                                   
cases and that would drive up  the costs and make for further                                                                   
delays.   He commented that  there needs  to be some  sort of                                                                   
limitation to avoid costs associated with appraisals.                                                                           
                                                                                                                                
Mr. Wheeler added that the process  itself punishes bad faith                                                                   
because  the attorneys  that  represent  the property  owners                                                                   
bring  it to the  Courts attention.   At  every level,  those                                                                   
bodies  are not shy  about punishing  the municipalities  for                                                                   
acting in "bad faith".                                                                                                          
                                                                                                                                
Vice-Chair  Bunde understood  that  the proposed  legislation                                                                   
would only  affect the State  condemning property  by eminent                                                                   
domain.   He asked  how it would  affect the Municipality  of                                                                   
Anchorage.                                                                                                                      
                                                                                                                                
Mr. Wheeler advised  that the Municipality does  condemn land                                                                   
and  does that  through  complying  with State  Statutes  and                                                                   
through Title 9.                                                                                                                
                                                                                                                                
JIM  CANTOR,   (TESTIFIED   VIA  TELECONFERENCE),   ASSISTANT                                                                   
ATTORNEY GENERAL,  DEPARTMENT OF  LAW, testified  against the                                                                   
proposed  legislation.    He  noted  that  he  had  testified                                                                   
against  the  previous versions  of  the  bill in  the  House                                                                   
Judiciary Committee.   He reiterated comments  on the project                                                                   
delay.   The problem deals  with the prerequisite  in Section                                                                   
1,  "before  property can  be  taken".   The  former  version                                                                   
suffered  from the  same problem.   The version  is ripe  for                                                                   
extended  litigation.   He  observed that  litigation  occurs                                                                   
over high priced property.                                                                                                      
                                                                                                                                
                                                                                                                                
TAPE HFC 02 - 106, Side B                                                                                                     
                                                                                                                                
                                                                                                                                
Mr. Cantor  noted that  when dealing  with the higher  priced                                                                   
property, counsel  has incentive  to litigate.   He discussed                                                                   
the  process.    For  the  higher  value  parcel  (over  $200                                                                   
thousand  dollars), the  State  must get  two appraisals  and                                                                   
there  is  a  third  Department  review.  The  Department  of                                                                   
Transportation  and  Public  Facilities  offers  the  highest                                                                   
appraisal.   Other  appraisal   updates  occur  just   before                                                                   
litigation.   The amount of  money offered is  deposited into                                                                   
the court.   The landowners can withdraw that  money and have                                                                   
full access to  those funds.  Following that,  the case moves                                                                   
to a master  appointed by the  court and a  recommendation is                                                                   
then made.  If the parties are  not satisfied, they can go to                                                                   
Court.                                                                                                                          
                                                                                                                                
Mr.  Cantor  summarized  three  areas  of  concern  with  the                                                                   
legislation.   He asked what  a "reasonable" reason  would be                                                                   
to turn down the landowner's offer  with a 10% penalty at the                                                                   
end.   He  added what  could be  a comparable  parcel to  the                                                                   
developed  one.     He  noted  that  if  the   Department  of                                                                   
Transportation and Public Facilities  condemns someone else's                                                                   
land that too  would have legal problems.   Whose lands would                                                                   
the State  be dealing  with since  the Department of  Natural                                                                   
Resources   holds   the   land    not   the   Department   of                                                                   
Transportation.  Additionally,  what would be classified as a                                                                   
reasonable  period   of  time.    He  recommended   that  the                                                                   
legislation get further clarification.                                                                                          
                                                                                                                                
Mr.   Downing  clarified   that  it   was  the   Department's                                                                   
preference that the  legislation not pass.  He  noted that if                                                                   
the  bill  does pass,  they  would  like the  opportunity  to                                                                   
discuss these amendments.                                                                                                       
                                                                                                                                
Mr. Downing  submitted  documentation from  the Right  of Way                                                                   
Manual.   In that text,  the Department provides  guidance to                                                                   
the staff  in how to proceed  on those properties.   He added                                                                   
that threats of condemnation are not allowed.                                                                                   
                                                                                                                                
DICK  MYLIUS,  (TESTIFIED  VIA  TELECONFERENCE),  DIVISON  OF                                                                   
MINING,  LAND AND  WATER,  DEPARTMENT OF  NATURAL  RESOURCES,                                                                   
ANCHORAGE,   commented  that   the   Department  of   Natural                                                                   
Resources is also  concerned with Section 2(b).   He observed                                                                   
that  the provision  would  draw  the Department  of  Natural                                                                   
Resources  (DNR)  into  the  Department  of  Transportation's                                                                   
(DOT)  land discussions.   Most  property landowners  seeking                                                                   
exchanges would be looking at  land managed by the Department                                                                   
of   Natural   Resources   and    not   the   Department   of                                                                   
Transportation and Public Facilities.                                                                                           
                                                                                                                                
He added  that if DNR land  were involved, DNR would  need to                                                                   
conduct the  exchange, as DOT  has no statutory  authority to                                                                   
do  that  with  State  land.     Mr.  Mylius  concluded  that                                                                   
exchanges for State  land under, State law,  are designed for                                                                   
large-scale parcels  and would  not be efficient  for smaller                                                                   
scale  parcels.   He  noted that  the  Department of  Natural                                                                   
Resources   has  recently   completed   several  small   land                                                                   
exchanges.   Each of those exchanges  took over two  years to                                                                   
accomplish  and  the staff  costs  were between  $40,000  and                                                                   
$60,000 dollars for each exchange.                                                                                              
                                                                                                                                
MICHAEL  LOHNAN,  (TESTIFIED  VIA  TELECONFERENCE),  WASILLA,                                                                   
spoke  to concerns  with  his  personal property  located  in                                                                   
Wasilla.  He  explained that the entrance of  his building is                                                                   
25 feet from  the property line  on the road.  The  State has                                                                   
declared  that they  want to take  10 feet  for an  easement,                                                                   
which would leave 15 feet.  That  would land lock the 15 feet                                                                   
of  parking.   Mr. Lohnan  stressed that  landowners need  to                                                                   
have  someplace to  go  to negotiate  other  than through  an                                                                   
attorney.                                                                                                                       
                                                                                                                                
WENDY   LINDSKOOG,   ALASKA   RAILROAD   CORPORATION   (ARRC)                                                                   
testified   that   the   Alaska   Railroad   currently,   has                                                                   
condemnation powers.   To exercise  that power,  the Railroad                                                                   
must first  seek approval from  the Governor.  She  felt that                                                                   
the  legislation  would  add costs  to  future  projects  and                                                                   
shared concerns voiced by the Department of Transportation.                                                                     
                                                                                                                                
Representative  Foster MOVED to  report HCS  CS SB  278 (JUD)                                                                   
out  of Committee  with individual  recommendations and  with                                                                   
the accompanying fiscal notes.   There being NO OBJECTION, it                                                                   
was so ordered.                                                                                                                 
                                                                                                                                
HCS  CS SB  278  (JUD) was  reported  out of  Committee  with                                                                   
"individual" recommendations and  with fiscal notes #1 by the                                                                   
Alaska Court System and #4 by  Department of Transportation &                                                                   
Public Facilities.                                                                                                              
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
The meeting was adjourned at 5:05 P.M.                                                                                          

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