Legislature(2023 - 2024)ADAMS 519

05/02/2023 01:30 PM House FINANCE

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                  HOUSE FINANCE COMMITTEE                                                                                       
                        May 2, 2023                                                                                             
                         1:35 p.m.                                                                                              
1:35:48 PM                                                                                                                    
CALL TO ORDER                                                                                                                 
Co-Chair Foster  called the House Finance  Committee meeting                                                                    
to order at 1:35 p.m.                                                                                                           
MEMBERS PRESENT                                                                                                               
Representative Bryce Edgmon, Co-Chair                                                                                           
Representative Neal Foster, Co-Chair                                                                                            
Representative DeLena Johnson, Co-Chair                                                                                         
Representative Julie Coulombe                                                                                                   
Representative Mike Cronk                                                                                                       
Representative Alyse Galvin                                                                                                     
Representative Sara Hannan                                                                                                      
Representative Andy Josephson                                                                                                   
Representative Dan Ortiz                                                                                                        
Representative Will Stapp                                                                                                       
Representative Frank Tomaszewski                                                                                                
MEMBERS ABSENT                                                                                                                
ALSO PRESENT                                                                                                                  
Representative Kevin McCabe, Sponsor;  Buddy Whitt, Chief of                                                                    
Staff,  Representative  Kevin  McCabe;  Ryan  McKee,  Staff,                                                                    
Representative  George  Rauscher; Kris  Curtis,  Legislative                                                                    
Auditor, Alaska Division of Legislative Audit.                                                                                  
PRESENT VIA TELECONFERENCE                                                                                                    
Pam  Leary,  Director,   Treasury  Division,  Department  of                                                                    
Revenue;  Robert  Pearson, State/Federal  Programs  Manager,                                                                    
Department  of   Community  and  Regional   Affairs;  George                                                                    
Hightower, Self,  Wasilla; Hans Zigmend,  Director, Division                                                                    
of  Finance,  Department   of  Administration;  Cori  Mills,                                                                    
Deputy Attorney  General, Department  of Law;  Ashlee Adoko,                                                                    
Office  of Project  Management  and  Permits, Department  of                                                                    
Natural   Resources;  Charlie   Lean,  Last   Acting  Chair,                                                                    
Citizens  Advisory Council,  Nome;  Louis Cusack,  Executive                                                                    
Director, Safari Club  International Alaska Chapter, Alaska,                                                                    
Chugach; Richard Bishop,  Self, Fairbanks; Benjamin Mallott,                                                                    
Vice President, Alaska Federation of Natives, Anchorage.                                                                        
HB 3      GOLD AND SILVER SPECIE AS LEGAL TENDER                                                                                
HB 3 was HEARD and HELD in committee for further                                                                                
HB 83     CITIZEN ADVISORY COMM ON FEDERAL AREAS                                                                                
HB 83 was HEARD and HELD in committee for further                                                                               
Co-Chair Foster reviewed the meeting agenda.                                                                                    
HOUSE BILL NO. 3                                                                                                                
     "An  Act relating  to  specie as  legal  tender in  the                                                                    
     state; and relating  to borough and city  sales and use                                                                    
     taxes on specie."                                                                                                          
1:37:01 PM                                                                                                                    
REPRESENTATIVE KEVIN MCCABE, SPONSOR, provided a brief                                                                          
recap of the legislation. He read from a prepared                                                                               
     The  purpose   of  HB  3  was   to  recognize  Alaska's                                                                    
     constitutional duty, power and  right under Section 10,                                                                    
     Article I,  of the United States  Constitution, and the                                                                    
     Tenth Amendment  of the  United States  Constitution to                                                                    
     make gold  and silver  legal tender  in the  payment of                                                                    
     debt.  The  legislation  would  secure  the  rights  of                                                                    
     citizens  of  this  state under  the  Ninth  and  Tenth                                                                    
     Amendments of the United  States Constitution to tender                                                                    
     gold and  silver in  the payment of  a debt  should the                                                                    
     merchant or  payee agree  to accept  it. The  bill took                                                                    
     the first  step in  protecting specie from  the borough                                                                    
     city  use  or exchange  tax.  He  added that  12  other                                                                    
     states adopted laws to accept  gold and silver coins as                                                                    
     legal tender.  As of 2022,  42 states had  removed some                                                                    
     or  all taxes  from the  purchase of  gold and  silver.                                                                    
     The  bill  would  preserve, protect,  and  promote  the                                                                    
     state and  its economic  security, safety,  health, and                                                                    
     welfare of  the people of  this state; and  protect the                                                                    
     state  and   its  citizens   in  the   acquisition  and                                                                    
     possession of  gold and silver  and their use  as legal                                                                    
     tender in the payment of debt.                                                                                             
1:38:54 PM                                                                                                                    
Co-Chair Foster asked for a review of the sectional                                                                             
BUDDY WHITT, CHIEF OF STAFF, REPRESENTATIVE KEVIN MCCABE,                                                                       
reviewed the sectional analysis (copy on file):                                                                                 
     Section  1 amends  A.S. 29.45.650(a)  to include  a new                                                                    
     subsection (l) outlined under Section 2 below.                                                                             
     Section 2 amends  AS 29.45.650 to add  a new subsection                                                                    
     to protect "specie" from a  borough sales or use tax on                                                                    
     the sale or exchange of specie.                                                                                            
     Section  3  amends AS  29.45.700(a)  to  include a  new                                                                    
     subsection (h) outlined under Section 4 below.                                                                             
     Section 4 amends  AS 29.45.700 to add  a new subsection                                                                    
     to protect  "specie" from  a city sales  or use  tax on                                                                    
     the sale or exchange of specie.                                                                                            
     Section  5 amends  AS  44.12 to  add  Article 5.  Legal                                                                    
     Tender  which defines  "legal tender"  in the  state to                                                                    
     include  gold  and  silver tender  including  "specie."                                                                    
     This section  also states that  person is  not required                                                                    
     to accept gold  or silver specie as  tender and defines                                                                    
     "specie" and "legal tender."                                                                                               
     Section 5  is further amended  by adding a  new section                                                                    
     to read:  "The House Finance committee  shall study the                                                                    
     possibility of  establishing additional forms  of legal                                                                    
     tender  for  the  payment of  debts,  including  public                                                                    
     charges, taxes, and  other money owed to  the state. If                                                                    
     the  committee  determines  that  additional  forms  of                                                                    
     tender  are  practical  and beneficial,  the  committee                                                                    
     shall  prepare legislation  establishing an  additional                                                                    
     form of legal tender for introduction."                                                                                    
     Section 6.  Section 4, ch.  100, SLA 2002,  as repealed                                                                    
     and reenacted by sec. 9, ch.  117, SLA 2003 and sec. 2,                                                                    
     ch 30, SLA 2005 is  repealed, reenacted, and amended to                                                                    
     read as outlined in Section 1 above.                                                                                       
Mr.  Whitt  noted  Section 5  regarding  the  House  Finance                                                                    
Committee  making  the  determination  regarding  additional                                                                    
forms of  legal tender and  informed the committee  that the                                                                    
sponsor was agreeable to amending the provision.                                                                                
Representative Galvin  shared that  she had taken  some time                                                                    
to  read   up  on   the  constitution.  She   pondered  what                                                                    
implementation  of HB  3 would  look like.  She wondered  if                                                                    
passage of  the bill would  send a message to  Alaskans that                                                                    
they could pull  their gold bars out of storage  and pay for                                                                    
debt  in that  way. Representative  McCabe responded  in the                                                                    
negative. The tender would have to  be in the form of a coin                                                                    
with a  stamp stating its purity  and value in ounces.  If a                                                                    
merchant accepted  the specie, the merchant  and buyer would                                                                    
come  to an  agreement  on the  value of  the  coin and  the                                                                    
merchant would provide  change in whatever method  of his or                                                                    
her  choosing  (specie  or  money).  He  stressed  that  the                                                                    
transaction  was  purely  voluntary.  Representative  Galvin                                                                    
asked for verification that the  exchange between an Alaskan                                                                    
and   any  vendor   was  voluntary.   Representative  McCabe                                                                    
responded  in the  affirmative. Representative  Galvin cited                                                                    
page 2, line 21 of the bill as follows:                                                                                         
      The House Finance Committee shall study the                                                                               
     possibility of establishing additional forms of legal                                                                      
     tender for the payment of debts                                                                                            
Representative Galvin did  not know it was  within the scope                                                                    
of  the  Finance Committee  and  questioned  how that  would                                                                    
work.  Representative  McCabe  replied  that  Representative                                                                    
Hannan  had  brought the  issue  up  the previous  year.  He                                                                    
recently spoke with Co-Chair  Foster's office about changing                                                                    
the committee to the Legislative  Budget and Audit Committee                                                                    
(LBA). He  explained that the  provision left the  door open                                                                    
for the legislature to further consider the issue.                                                                              
1:45:03 PM                                                                                                                    
In  response  to  a   question  by,  Representative  Galvin,                                                                    
Representative McCabe answered that  the transaction was not                                                                    
on paper,  it was actually  a gold coin called   specie.  It                                                                    
was  not  a gold  certificate;  the  specie was  stamped  by                                                                    
weight  based   on  a  troy  ounce.   Representative  Galvin                                                                    
questioned whether  whatever was  exchanged or  agreed upon,                                                                    
may be worth something else the  next day because gold was a                                                                    
commodity. She understood there  were things like inflation,                                                                    
but it was not exactly the  same with specie, there was some                                                                    
risk. She asked what the sponsor  would say if gold was used                                                                    
one day, and  its value tanked the next day.  There might be                                                                    
merchants  that fault  the state  for legalizing  the tender                                                                    
and putting them at risk.                                                                                                       
1:46:58 PM                                                                                                                    
Representative  McCabe  related  a  historical  story  about                                                                    
using  a  gold  eagle  worth  $20 as  currency. He  reported                                                                    
that today a  gold eagle was worth $2,200  and believed that                                                                    
gold had  tracked with  the rest  of commodities,  but money                                                                    
had not  because of inflation.  He thought that gold  held a                                                                    
higher  value and  was  not subject  to  inflation like  the                                                                    
Representative Hannan observed that  the bill protected gold                                                                    
and  silver specie.  She wondered  what the  differentiation                                                                    
was  from just  using a  gold nugget.  Representative McCabe                                                                    
responded that the  gold had to be coined as  money in order                                                                    
to be recognized  by the bill. He ascertained  that what she                                                                    
had  described was  bartering.  Representative Hannan  asked                                                                    
who was  backing the currency.  She remarked that  the state                                                                    
was not  backing the specie. She  asked if it was  a private                                                                    
currency  exchanged between  two people.  She was  trying to                                                                    
determine how it  was a currency versus  a private agreement                                                                    
between  two  people  over a  valued  asset.  Representative                                                                    
McCabe answered  that it  needed no  backing because  it was                                                                    
gold.  He  furthered  that each  certificate  had  a  serial                                                                    
number and believed that it  was safer than dollars in terms                                                                    
of counterfeiting.                                                                                                              
1:51:22 PM                                                                                                                    
Representative Cronk  asked if  the sponsor had  reached out                                                                    
to communities  about sales tax loss.  Representative McCabe                                                                    
answered  in the  affirmative. He  had  discussed the  issue                                                                    
with the Alaska Municipal League  (AML) who thought it could                                                                    
cost communities $5  million in taxes. He deduced  that a $5                                                                    
million  loss at  the lowest  tax  rate of  3 percent  would                                                                    
equate to selling $167 million  in specie per year. He noted                                                                    
another statement by AML that  calculated a loss of $3000 in                                                                    
tax revenue  in Wasilla.  He spoke  to the  municipality who                                                                    
informed Representative McCabe that  there was only one gold                                                                    
and  silver buyer  licensed in  Wasilla  who only  purchased                                                                    
gold  but did  not sell  it.  He indicated  that Juneau  had                                                                    
informed  him  that they  tracked  sales  tax by  vendor  in                                                                    
broader categories  and did  not know  what impact  the bill                                                                    
would have. He  shared data from Arkansas  with a population                                                                    
of over  3 million with a  tax rate between 6.5  percent and                                                                    
11.5 percent.  Arkansas had lost  $255,000 in sales  tax due                                                                    
to its bill  legalizing specie. The state  of Tennessee lost                                                                    
$117,000  and Maine  had  lost $27,000  in  sales taxes.  He                                                                    
believed the benefit of the bill outweighed the losses.                                                                         
Co-Chair  Foster  asked why  stores  could  not continue  to                                                                    
charge  sales  tax  and  keep   track,  similar  to  regular                                                                    
currency. Representative  McCabe answered  that if  a person                                                                    
used specie to buy something,  the sales tax on the purchase                                                                    
would still apply.  However, there would be no  sales tax on                                                                    
the  transaction when  exchanging a  gold specie  for money.                                                                    
The one exception would be  on collectible coins or dollars,                                                                    
which were taxed when purchased.                                                                                                
1:56:49 PM                                                                                                                    
Representative Tomaszewski  asked what  the value of  1 troy                                                                    
ounce  would be.  Representative McCabe  stated the  biggest                                                                    
coin he had seen was  valued at $50 and weighed one-fiftieth                                                                    
of a troy ounce.                                                                                                                
Co-Chair Foster moved to the fiscal note discussion.                                                                            
PAM  LEARY,  DIRECTOR,   TREASURY  DIVISION,  DEPARTMENT  OF                                                                    
REVENUE  (via teleconference),  relayed that  the department                                                                    
did  not have  a fiscal  note. She  did not  have additional                                                                    
comments on the bill.                                                                                                           
Representative  Galvin  referenced  Representative  McCabe's                                                                    
statement that  another department  might study  other forms                                                                    
of  tender  instead  of the  House  Finance  Committee.  She                                                                    
assumed the Department of Revenue  (DOR) was not part of the                                                                    
bill, but if that were the  case, she asked if it would take                                                                    
some  resources  to  carry  out  the  study.  Representative                                                                    
McCabe answered  that they  had decided  a better  entity to                                                                    
address  the  issue was  the  Legislative  Budget and  Audit                                                                    
Committee.  Representative  Galvin  asked  for  verification                                                                    
LB&A  would  implement the  bill  and  determine the  costs.                                                                    
Representative McCabe answered in the affirmative.                                                                              
Representative Hannan  asked how  the department  felt about                                                                    
the bill.                                                                                                                       
2:00:23 PM                                                                                                                    
Ms. Leary  answered that the  department was neutral  on the                                                                    
current  version  of  the  bill.  She  had  testified  in  a                                                                    
previous  committee  [House   State  Affairs  Committee]  on                                                                    
Section 5  that authorized a  study that included  the state                                                                    
accepting  payment  in gold  or  another  legal tender.  She                                                                    
informed  the committee  that  the state  did  not have  any                                                                    
expertise  in  precious  metal   within  the  treasury.  She                                                                    
discovered that there were not  many if any states accepting                                                                    
specie as  a payment  for taxes. She  indicated that  if the                                                                    
state  accepted gold,  it would  be difficult  to value  the                                                                    
gold and  the state  would bear the  risk of  the valuation.                                                                    
She understood  that there were  ways of  establishing usage                                                                    
outside  of  the treasury,  but  it  was not  something  the                                                                    
department could currently handle.                                                                                              
2:01:54 PM                                                                                                                    
ROBERT PEARSON,  STATE/FEDERAL PROGRAMS  MANAGER, DEPARTMENT                                                                    
OF  COMMUNITY  AND  REGIONAL AFFAIRS  (via  teleconference),                                                                    
spoke to the Department  of Commerce, Community and Economic                                                                    
Development's  zero fiscal  note FN2  (CED). The  bill would                                                                    
not  impact  the  Department   of  Commerce,  Community  and                                                                    
Economic Developments (DCCED) operations.                                                                                       
2:03:21 PM                                                                                                                    
Co-Chair Foster OPENED public testimony.                                                                                        
2:04:07 PM                                                                                                                    
GEORGE HIGHTOWER, SELF,  WASILLA (via teleconference), spoke                                                                    
in support of  the bill. He shared that he  was 66 years old                                                                    
and recalled  when people carried  gold and silver  coins in                                                                    
everyones  pockets.  He referenced  Article 1 and  Article 2                                                                    
of  the  United States  (US)  Constitution  naming gold  and                                                                    
silver as legal  tender in the payment of  debt. He recalled                                                                    
as a child  in the early 60s paying for  goods and receiving                                                                    
change in silver quarters and  dimes and half dollars coined                                                                    
by  the US  Mint. He  offered  that today  the same  quarter                                                                    
coined by the U.S. Mint  would purchase more than one gallon                                                                    
of gas today  because the silver quarter would  now be worth                                                                    
$5.00. He  believed that  proved the  stability of  using of                                                                    
silver and  gold as the  foundation of the  monetary system.                                                                    
He thought  that it  spoke to the  question of  taxation and                                                                    
inflation.  The value  of silver  and gold  had kept  up and                                                                    
surpassed inflation  over time. He  spoke to the  effects of                                                                    
inflation on  the dollar.  He believed  that money  was lost                                                                    
through  inflation  by  not utilizing  gold  and  silver  as                                                                    
money.  He  believed  that  the  bill  was   reestablishing                                                                     
something that  was already proven  to be a   sound  system.                                                                    
He  added  that  other  nations were  also  moving  back  to                                                                    
accepting gold and silver as money.                                                                                             
2:11:38 PM                                                                                                                    
Co-Chair Foster CLOSED public testimony.                                                                                        
Representative  Hannan  stated  that  the  Alaska  Municipal                                                                    
League  had answered  some questions  that were  included in                                                                    
the  bill packet  (copy on  file). She  asked about  capital                                                                    
gains  taxes and  noted that  AML stated  species was  still                                                                    
subject to capital gains taxes.  She asked for the sponsor's                                                                    
thoughts  on the  topic.  She asked  about  the problem  the                                                                    
sponsor   was   aiming   to    solve   through   the   bill.                                                                    
Representative  McCabe  responded  in  the  affirmative  and                                                                    
stated that specie  was still subject to  capital gains tax,                                                                    
and  it  was  a  federal   requirement.  He  shared  that  a                                                                    
constituent brought the  idea of the bill to  him who wanted                                                                    
to store gold  specie instead of saving  cash. He discovered                                                                    
that  it was  possible  to  pay taxes  in  Texas with  gold.                                                                    
Representative Hannan  stated it was her  understanding that                                                                    
four states had gold specie:  Utah, Nevada, Wyoming, and New                                                                    
Hampshire. She wondered why Alaska  needed its own specie if                                                                    
others  existed.  Representative  McCabe answered  that  the                                                                    
state did  not need  to produce its  own specie  since other                                                                    
states   specie  would be  valid.  He  thought it  would  be                                                                    
amazing if  Alaska produced  its own  with images  of Denali                                                                    
and other  Alaskan symbols.  He added  that specie  could be                                                                    
currently purchased but it could  not be used in cities that                                                                    
had sales tax unless tax was paid on the specie.                                                                                
2:17:07 PM                                                                                                                    
Representative Stapp  thanked the  sponsor for  bringing the                                                                    
bill  forward. He  favored the  state to  producing its  own                                                                    
Co-Chair Foster  asked the  Department of  Administration to                                                                    
review its fiscal note.                                                                                                         
HANS ZIGMEND,  DIRECTOR, DIVISION OF FINANCE,  DEPARTMENT OF                                                                    
ADMINISTRATION    (via    teleconference),   reviewed    the                                                                    
department's zero  fiscal note.  He voiced that  there would                                                                    
be minimal impact  on the Division of Finance  and the State                                                                    
of Alaska's accounting system, which could be absorbed with                                                                     
existing resources.                                                                                                             
Co-Chair Foster set an amendment deadline of Friday, May 5                                                                      
at 5:00 p.m.                                                                                                                    
Representative McCabe appreciated the committee hearing the                                                                     
HB 3 was HEARD and HELD in committee for further                                                                                
2:19:46 PM                                                                                                                    
AT EASE                                                                                                                         
2:26:23 PM                                                                                                                    
HOUSE BILL NO. 83                                                                                                               
     "An   Act   reestablishing   the   Citizens'   Advisory                                                                    
     Commission on  Federal Management Areas in  Alaska; and                                                                    
     providing for an effective date."                                                                                          
2:26:53 PM                                                                                                                    
RYAN MCKEE, STAFF, REPRESENTATIVE GEORGE RAUSCHER, provided                                                                     
a brief recap of the bill. He read excerpts from the                                                                            
sponsor statement:                                                                                                              
     The  Citizens'  Advisory  Commission on  Federal  Areas                                                                    
     (CACFA)  was  CACFA  was  first  established  in  1981,                                                                    
     shortly  after  Congress  passed  the  Alaska  National                                                                    
     Interest Lands  Conservation Act (ANILCA)comprehensive                                                                     
     legislation governing  all federal public lands  in the                                                                    
     state. Under  the balanced compromise  Congress crafted                                                                    
     in  ANILCA, 104+  million  acres (on  top  of the  ~100                                                                    
     million  acres already  set  aside)  were set-aside  in                                                                    
     permanent  federal  ownership  as  conservation  system                                                                    
     units  (e.g.,   parks,  preserves,   wildlife  refuges,                                                                    
     wilderness  areas)  while  at the  same  time  enabling                                                                    
     Alaskan's  to  maintain their  traditions,  accommodate                                                                    
     the social and  economic needs of the  state, provide a                                                                    
     range  of land-use  and land  access rights,  safeguard                                                                    
     opportunities  for  responsible  resource  development,                                                                    
     and     facilitate     continued    improvements     in                                                                    
     transportation   and    utility   infrastructure.   The                                                                    
     provisions  of   ANILCA  plus   those  of   the  Alaska                                                                    
     Statehood Act  and the Alaska Native  Claims Settlement                                                                    
     Act  (ANCSA)  mean  that most  Alaskans  are  regulated                                                                    
   under a unique and extremely complex regulatory web.                                                                         
     For  the  decades  that  CACFA   operated,  it  was  an                                                                    
     independent  and impartial  source  of information  and                                                                    
     center  for advocacy  on Statehood,  ANCSA, and  ANILCA                                                                    
     issues that  impact all Alaskans. CACFA  helps Alaskans                                                                    
     navigate  complex regulations  and  works with  federal                                                                    
     agencies to ensure  Congressional intent is implemented                                                                    
     with respect to Alaska's  interests. Among many things,                                                                    
     the  Commission   holds  hearings  to   collect  public                                                                    
     comment  on decisions  that  affect them;  disseminates                                                                    
     information  about historical  and  new regulations  to                                                                    
     the public, the Executive  branch, and the Legislature;                                                                    
     monitors  the Federal  Register  and regularly  submits                                                                    
     written  comment in  response  to  actions that  affect                                                                    
     Alaska; and helps  Alaskans navigate federal permitting                                                                    
     processes. While  the State's ANILCA program  and CACFA                                                                    
     both monitor federal actions, CACFA  is the only entity                                                                    
     that   represents  the   views   of  Alaskan   citizens                                                                    
     concerning  federal land  management  plans within  the                                                                    
     The last  state audit conducted in  2020 concluded that                                                                    
     "there   is   a   continuing  public   need   for   the                                                                    
2:29:30 PM                                                                                                                    
Co-Chair Foster asked to hear from the legislative auditor.                                                                     
KRIS  CURTIS,   LEGISLATIVE  AUDITOR,  ALASKA   DIVISION  OF                                                                    
LEGISLATIVE AUDIT, reviewed the  findings of the legislative                                                                    
audit  [A  Sunset  Review  of   the  Department  of  Natural                                                                    
Resources,  Citizens' Advisory  Commission on  Federal Areas                                                                    
(CACFA)  April 8,  2020, Audit  Control Number  10-20121-20]                                                                    
(copy  on file)  conducted  in 2020.  She  relayed that  the                                                                    
commission  operated effectively  and did  not significantly                                                                    
duplicate  the efforts  of other  state entities.  The audit                                                                    
also concluded  that there is  a continuing public  need for                                                                    
the commission.  The audit  had recommended  the legislature                                                                    
extend  the commission's  termination date  eight years.  No                                                                    
recommendations  had  been  made for  improvements  and  the                                                                    
audit found  that the commission  and its staff  were highly                                                                    
productive  and impactful.  She pointed  to page  21 of  the                                                                    
audit that  contained the commissioner of  the Department of                                                                    
Natural  Resources (DNR)  response  in full  support of  the                                                                    
eight year extension.                                                                                                           
Representative Hannan related that  CACFA was last housed in                                                                    
DNR in  the Division of  Mining Land  and Water and  had two                                                                    
positions:  a   natural  resource  manager  and   a  natural                                                                    
resource specialist.  The new DNR  fiscal note  housed CACFA                                                                    
in  the  department's  Office   of  Project  Management  and                                                                    
Permitting  (OPMP).   She  asked   whether  the   prior  two                                                                    
positions  were able  to address  public issues.  Ms. Curtis                                                                    
responded  that the  structure that  had been  in place  was                                                                    
extremely effective.                                                                                                            
Co-Chair Foster asked for a review of the fiscal notes.                                                                         
CORI MILLS, DEPUTY ATTORNEY GENERAL,  DEPARTMENT OF LAW (via                                                                    
teleconference),  reviewed   the  department's   new  fiscal                                                                    
impact  fiscal   note  that   included  one   position.  She                                                                    
explained that  in the past,  a full time  attorney position                                                                    
had been dedicated  to supporting the commission  due to the                                                                    
additional  workload   it  generated  for   the  department.                                                                    
Currently,  it was  determined that  an additional  position                                                                    
would  be  warranted  again due  to  the  department's  high                                                                    
workloads.  The   position  would  be  funded   through  the                                                                    
Department of Law (DOL) as it was previously.                                                                                   
2:33:49 PM                                                                                                                    
Representative  Josephson  asked whether  reinstating  CACFA                                                                    
was  redundant  of  things like  statehood  defense  efforts                                                                    
promoted by the  administration and the PAD  Unit under DNR.                                                                    
Ms.  Mills  deferred   to  DNR  to  answer   from  a  policy                                                                    
perspective and to the sponsor  for comment. She shared that                                                                    
looking back  historically at the work  DOL accomplished for                                                                    
CACFA, it  consisted of  research and  legal review  DNR was                                                                    
not  providing.  Representative  Josephson stated  that  the                                                                    
sponsor  referred to   the diversity  of users  and uses  of                                                                    
federal  land.    He  asked  whether   Ms.  Mills   had  any                                                                    
recollection of  non-consumptive users being  represented by                                                                    
CACFA. Ms.  Mills answered that  her knowledge on  the issue                                                                    
was not  that specific. She deferred  to DNR. Representative                                                                    
Josephson asked  when DOL had  been involved, he  assumed it                                                                    
was when  the state  was in an  adversarial role  to federal                                                                    
policy.  He  asked  if  CACFA had  ever  asked  the  federal                                                                    
government  for more  regulations. Ms.  Mills answered  that                                                                    
she  did  not  recall  comments being  submitted  or  issues                                                                    
related to  more regulation. She remembered  that the issues                                                                    
revolved around tracking  federal regulations and  asserting                                                                    
when the interest of Alaskans came into play.                                                                                   
Representative  Tomaszewski  asked   what  happened  to  the                                                                    
attorney that previously worked  on the commission's issues.                                                                    
Ms.  Mills  answered  that the  department  had  experienced                                                                    
budget cuts  over several years,  therefore it was  a matter                                                                    
of attrition over time. She  did not see any capacity within                                                                    
the  existing Natural  Resources section  that could  absorb                                                                    
the  extra work.  The  budget cuts  and  attrition left  the                                                                    
section unable to  take the extra workload  on with existing                                                                    
positions.  Representative  Tomaszewski  surmised  that  the                                                                    
position was defunded.                                                                                                          
2:38:57 PM                                                                                                                    
Co-Chair Foster asked DNR to review its fiscal note.                                                                            
ASHLEE  ADOKO, OFFICE  OF  PROJECT  MANAGEMENT AND  PERMITS,                                                                    
DEPARTMENT  OF   NATURAL  RESOURCES   (via  teleconference),                                                                    
explained  the  new  DNR  fiscal  impact  fiscal  note.  She                                                                    
relayed  that  the fiscal  not  included  one position  that                                                                    
would be  necessary to carry  out the needs of  the program.                                                                    
The  source  of the  funds  was  Undesignated General  Funds                                                                    
(UGF). In  addition, some funding was  necessary for travel,                                                                    
services,    and   supplies.    Representative   Tomaszewski                                                                    
recounted that the  commission had sunset in  2021 and asked                                                                    
what  happened to  the prior  position. Ms.  Adoko responded                                                                    
that there  had been  a prior position  in DNR  according to                                                                    
the audit  report. She  was uncertain  what happened  to the                                                                    
employee in the position, but it did not exist any longer.                                                                      
Co-Chair  Foster  asked if  the  position  was an  executive                                                                    
director position.  Ms. Adoko  answered in  the affirmative.                                                                    
Co-Chair   Foster  noted   that   the   position  was   very                                                                    
specialized and required the candidate  know a lot about the                                                                    
history of  ANILCA and other very  technical information. He                                                                    
deduced that  there were  not a lot  of candidates  with the                                                                    
specific  type  of knowledge  required.  He  asked if  there                                                                    
would be  problems trying  to fill  the position.  Ms. Adoko                                                                    
confirmed it  was a highly specialized  area. The department                                                                    
would reach out  to known experts and work  closely to build                                                                    
up the knowledge.                                                                                                               
2:43:32 PM                                                                                                                    
Representative  Hannan reiterated  that when  the commission                                                                    
was operating, CACFA was last  housed in DNR in the Division                                                                    
of  Mining Land  and  Water and  utilized  two positions:  a                                                                    
natural resource manager and  a natural resource specialist.                                                                    
She  observed  that  the  new   fiscal  note  relocated  the                                                                    
commission to OPMP  with one employee designated  as a Large                                                                    
Project Coordinator.  The prior positions were  described as                                                                    
specialists   in  federal   permitting   of  large   complex                                                                    
development  projects. She  asked  why DNR  was choosing  to                                                                    
restructure and place  the position under OPMP  with a large                                                                    
project coordinator.  Ms. Adoko replied that  she would need                                                                    
to verify  and follow-up.  She understood that  the position                                                                    
had been  formerly under OPMP, and  the department currently                                                                    
had a  number of  staff with  the large  project coordinator                                                                    
title.  She   added  that  they  served   various  functions                                                                    
including coordinating  the states   review and  comments on                                                                    
federal actions  and regulations.  The role varied  in terms                                                                    
of   duties.  She   would  provide   follow-up  information.                                                                    
Representative Hannan  was supportive  of the need,  but the                                                                    
description  from statute  and concerned  citizens suggested                                                                    
that the  position warranted different support  duties other                                                                    
than  those carried  out  by a  large  project manager.  She                                                                    
deduced  that a  specialist  that dealt  with  a variety  of                                                                    
agencies on  a regular basis  was needed. She  observed that                                                                    
the statute was not changing.  She wanted to ensure that DNR                                                                    
was not missing the mark.                                                                                                       
2:46:44 PM                                                                                                                    
Ms. Adoko stated  her understanding that it  had been housed                                                                    
under OPMP.  She reiterated that large  project coordinators                                                                    
served varying roles  and any federal action  that needed to                                                                    
be  coordinated  required  a   number  of  individuals  with                                                                    
different  areas  of  expertise. She  indicated  that  other                                                                    
staff  along   with  the  large  project   coordinator  were                                                                    
involved in the process.                                                                                                        
Co-Chair Edgmon recalled that  the commission was reinstated                                                                    
in 2007 and sunset in 2015  or 2016. The fiscal note in 2015                                                                    
or  2016 was  around  $180,000  and there  had  not been  an                                                                    
additional position  under the  Department of Law.  He noted                                                                    
that the  DNR position  was housed differently.  He wondered                                                                    
if the mission of the commission had changed.                                                                                   
Ms. Mills explained  that the department had  looked back at                                                                    
the work that  had been previously done  for the commission.                                                                    
She  was  unsure   of  the  specific  years.   She  was  not                                                                    
anticipating  more work  than what  had  occurred under  the                                                                    
commission  in the  past,  but  it was  an  addition to  the                                                                    
current workload. She reiterated  that DOL previously had an                                                                    
attorney  dedicated to  the commission.  She recalled  three                                                                    
attorneys  helping with  the commission  at  one point.  The                                                                    
fiscal note was based on recent experience.                                                                                     
2:50:17 PM                                                                                                                    
Co-Chair Edgmon  was confident of  his memory that  the most                                                                    
recent  iteration  of the  commission  did  not have  a  DOL                                                                    
attorney. He would do the research on his own.                                                                                  
Co-Chair   Foster   commented   that   he   had   the   same                                                                    
2:51:08 PM                                                                                                                    
Co-Chair Foster OPENED public testimony.                                                                                        
CHARLIE LEAN, LAST ACTING  CHAIR, CITIZENS ADVISORY COUNCIL,                                                                    
NOME  (via  teleconference), shared  that  he  was the  last                                                                    
acting chair of  CACFA. The commission had been  a 12 person                                                                    
board  with six  members  appointed by  the governor,  three                                                                    
members  appointed by  the Speaker  of the  House and  three                                                                    
members  appointed  by  the  President  of  the  Senate.  He                                                                    
indicated  that  the  prior executive  director  would  help                                                                    
Alaskan  citizens with  permitting issues  with the  federal                                                                    
government. The  commissioners would  review and  comment on                                                                    
materials  regarding   projects  and  issues   from  various                                                                    
federal   agencies    submitted   as   land    claims.   The                                                                    
commissioners  would  hear   public  comments  on  primarily                                                                    
federal and some state land  policies. The commissioners had                                                                    
a varying mix  of expertise and would  review the directors                                                                     
work. He  recalled that DOL  had a part time  lawyer devoted                                                                    
to the commission.  He found the position  very helpful, and                                                                    
the person was different from year to year. The attorney                                                                        
had conducted  work on land  use issues at  the commissions                                                                     
request. He  related that the  commission worked  on several                                                                    
major projects in consultation with experts in the field.                                                                       
2:56:07 PM                                                                                                                    
[Secretary  Note: Some  of Mr.  Leans   final comments  were                                                                    
garbled and inaudible.]                                                                                                         
Mr. Lean stated  that he had bandwidth problems  in Nome. He                                                                    
informed the committee that there  was an electronic library                                                                    
of all  the 20 years'  worth of  work by the  commission. He                                                                    
felt that the  commission provided a lasting  service to the                                                                    
Co-Chair  Foster liked  the ability  to have  the commission                                                                    
work  on  issues  where  the  public may  want  to  use  old                                                                    
historic trails that  may not be able to be  used today when                                                                    
going into  a national  park in regard  to public  land. One                                                                    
concern that he  shared was about the  commission working on                                                                    
public  access  to  private  land:  tribal  land  or  native                                                                    
corporation land. He asked if  there had been any efforts by                                                                    
the  commission to  work on  access or  force access  by the                                                                    
public  on private  lands.  Mr. Lean  answered  that in  the                                                                    
commission's  view they  worked  on access  to public  lands                                                                    
that sometimes  accessed across  private lands.  He recalled                                                                    
particular  issues  regarding  the  Iditarod  Trail  in  the                                                                    
Susitna  area, forest  service  land  in Southeast  crossing                                                                    
corporation land denying public  access. He recounted issues                                                                    
concerning  RS   2477  routes   that  were   transferred  at                                                                    
statehood  but  retracted  by the  Park  Service,  navigable                                                                    
waters,  and many  other issues.  He noted  that trails  and                                                                    
access  routes  often  crossed multiple  land  users  and  a                                                                    
balance had to be struck.                                                                                                       
3:00:31 PM                                                                                                                    
LOUIS CUSACK, EXECUTIVE  DIRECTOR, SAFARI CLUB INTERNATIONAL                                                                    
(SCI) ALASKA CHAPTER,  ALASKA, CHUGACH (via teleconference),                                                                    
supported  the legislation.  He  stated that  it  was a  key                                                                    
legislative priority  for SCI. The commission  had protected                                                                    
peoples  traditional use on federal  public land. He offered                                                                    
that  when a  federal  agency told  hunters  they could  not                                                                    
access  federal  land  CACFA   helped  them  understand  the                                                                    
closure  or  could file  an  appeal  and inform  the  Alaska                                                                    
congressional   delegation.  He   exemplified  that   ANILCA                                                                    
allowed residents  to make  a living  trapping using  new or                                                                    
existing cabins,  but for over  20 years it  was prohibited.                                                                    
When  CACFA was  informed  of the  situation, the  executive                                                                    
director elevated the issue  to the congressional delegation                                                                    
and  trappers  were  permitted   to  use  cabins  again.  He                                                                    
reported that after CACFA was  disbanded, the agency created                                                                    
many hurtles and no cabin  permits were issued for a decade.                                                                    
In  addition,  several  years ago  a  federal  agency  began                                                                    
restricting access  to areas without  any basis  and federal                                                                    
land   managers   were   requiring  permits   for   a   fee,                                                                    
disregarding   the  regulatory   process  authorized   under                                                                    
ANILCA. He believed that without  CACFA the federal agencies                                                                    
were  expanding their  authority  to restrict  use in  other                                                                    
areas.  He   asked  for   support  of   the  bill   and  the                                                                    
reinstatement of CACFA.                                                                                                         
3:03:19 PM                                                                                                                    
RICHARD  BISHOP,   SELF,  FAIRBANKS   (via  teleconference),                                                                    
shared  information about  his  work  background related  to                                                                    
ANILCA. He  strongly supported  HB 83.  He reported  that he                                                                    
had  followed CACFAs   work and  testified on  issues before                                                                    
the  commission.   He  believed  that  the   commission  was                                                                    
3:05:06 PM                                                                                                                    
BENJAMIN  MALLOTT,  VICE  PRESIDENT,  ALASKA  FEDERATION  OF                                                                    
NATIVES  (AFN),  ANCHORAGE  (via teleconference),  spoke  in                                                                    
opposition to  the bill. He reviewed  information about AFN.                                                                    
He  shared that  AFN was  governed by  a 38-member  board of                                                                    
directors who serve as tribal,  corporate, and regional non-                                                                    
profit  leaders  in  Alaska.  AFN  membership  included  209                                                                    
federally  recognized tribes,  185  village corporations,  9                                                                    
regional corporations, and 12  regional nonprofit and tribal                                                                    
consortiums  that contract  and compact  to run  federal and                                                                    
state programs.  He communicated  that after  researching HB
83  and  past efforts  of  the  commission, AFN  decided  to                                                                    
oppose  the   legislation  because   many  of   their  prior                                                                    
positions were in opposition to  AFN priorities. One example                                                                    
was CACFA's support  of the State of Alaska  to assert title                                                                    
to  RS  2477  right-of-ways   (ROW)  throughout  the  state,                                                                    
including  Alaska   Native  Corporation  (ANC)   lands.  The                                                                    
federation   passed  an   AFN   Resolution  22-14   opposing                                                                    
additional  right-of-ways taken  by the  state for  RS 2477,                                                                    
which CACFA had supported.  In addition, CACFA had supported                                                                    
other  positions that  were antithetical  to supporting  the                                                                    
property rights of Alaska Native people.                                                                                        
Co-Chair  Foster shared  AFNs   concerns regarding  creating                                                                    
access  over tribal  land. He  cited  old historical  native                                                                    
trails or RS 2477s that CACFA  was charged to open up access                                                                    
to that were deeded over  to the Alaska Native Corporations,                                                                    
which became private lands. He  would not want public access                                                                    
through the back  yard of his house, and he  would share the                                                                    
same concern  if it was  tribal or Native  corporation land.                                                                    
He asked  if an amendment  changed the bill and  stated that                                                                    
the commission  would not pursue public  access over private                                                                    
land whether it changed AFN's position.                                                                                         
Mr. Mallott responded that he  could not answer the question                                                                    
at  the time.  He  mentioned that  the  organization sent  a                                                                    
letter  regarding the  bill (copy  on file)  and recommended                                                                    
the governor and legislature convene  a meeting of the major                                                                    
stakeholders to discuss the history  and experiences we have                                                                    
had  with  the  act  and formulate  priorities  for  further                                                                    
action  and   dialogue.  He  indicated  that   the  previous                                                                    
membership  of CACFA  lacked a  strong  advocate for  native                                                                    
communities. He  offered to bring  an amendment back  to the                                                                    
federation for  consideration. Co-Chair Foster  informed Mr.                                                                    
Mallott that  he would set  an amendment deadline  and would                                                                    
reach out to him regarding  drafting an amendment that would                                                                    
be more workable for AFN.                                                                                                       
Co-Chair Foster CLOSED public testimony.                                                                                        
Co-Chair Edgmon  stated the commission  was comprised  of 12                                                                    
members: 6  appointed by  the governor,  6 appointed  by the                                                                    
Speaker of  the House, and  6 appointed by the  President of                                                                    
the Senate.  He noted  the $10,000  increment for  travel in                                                                    
the DNR fiscal note. He  wondered whether the meetings would                                                                    
take place via Zoom or  some other virtual means. He deduced                                                                    
that  $10,000  was  for the  executive  director  to  travel                                                                    
around  the state.  He thought  it  seemed an  insignificant                                                                    
amount  regarding  the cost  of  travel  especially in  bush                                                                    
Alaska. He asked for comment from the sponsor.                                                                                  
Mr.  McKee deferred  to the  maker  of the  fiscal note.  He                                                                    
would follow up with additional information.                                                                                    
3:12:14 PM                                                                                                                    
Ms.  Adoko  agreed  with Co-Chair  Edgmons   deductions  and                                                                    
shared that the  travel cost was anticipated  to support the                                                                    
executive director.  The hope was that  the commission could                                                                    
do  most  things  virtually.  She   had  done  her  best  to                                                                    
approximate  travel costs.  Co-Chair Edgmon  stated that  he                                                                    
was  no student  of ANILCA  or  ANCSA and  believed that  an                                                                    
individual had  to be  immersed in it  to understand  it. He                                                                    
thought it seemed  that it necessitated a  more active board                                                                    
other than meeting virtually. He  commented that there was a                                                                    
lot  going on  with the  RS 2477  issue, etc.  He emphasized                                                                    
that if  CACFA was  going to be  reconstituted it  should be                                                                    
done  sufficiently. He  compared the  cost of  an additional                                                                    
DOL  attorney   versus  the  amount   for  travel   for  the                                                                    
commission. He  felt that they  should be  more  empowered.                                                                     
In  addition, he  disclosed that  the number  of individuals                                                                    
that  understood ANILCA  were dwindling  and there  might be                                                                    
only  a handful  remaining.  He stressed  the complexity  of                                                                    
ANILCA.  He suggested  DNR  consider  increasing the  fiscal                                                                    
note amount.                                                                                                                    
Representative Hannan  found the 2007 fiscal  note for CACFA                                                                    
that included a  travel budget of $30,000  for 12 commission                                                                    
members for one annual  meeting in Fairbanks, Anchorage, and                                                                    
in  Juneau  to  ensure  people   across  the  state  had  an                                                                    
opportunity  to  interact  with the  board.  She  could  not                                                                    
imagine that travel was cheaper  today. She ascertained that                                                                    
the current fiscal note would  not reconstitute the board to                                                                    
include community  outreach and engagement that  helped with                                                                    
the success of the program.                                                                                                     
Representative Josephson asked  Representative Hannan if the                                                                    
fiscal   note  had   referred  to   the  position   in  DOL.                                                                    
Representative  Hannan replied  in  the  negative and  added                                                                    
that  she only  had the  DNR  fiscal note.  She was  looking                                                                    
specifically at commission prior staffing.                                                                                      
3:16:35 PM                                                                                                                    
Co-Chair Foster  referred to AFN's letter  from Julie Kitka,                                                                    
President of AFN. He noted  that it requested two things, he                                                                    
read the following:                                                                                                             
     1) Suggest the Governor  convene the major stakeholders                                                                    
     to  discuss the  history  and experiences  we have  had                                                                    
     with  the  act  and  formulate  priori.notdefes for further                                                              
     action  and   dialogue,  and  2)  request   the  Alaska                                                                    
     Congressional  Delegation  to  reauthorize  the  Alaska                                                                    
     Land  Use  Council  and  obtain  an  appropriation  for                                                                    
     expert staffing.                                                                                                           
Co-Chair Foster  voiced that  he was  very sensitive  to the                                                                    
issues around  granting access to private  land. However, he                                                                    
was supportive of  the public having access  to public land.                                                                    
He mentioned the Bering Strait  Landbridge National Park. He                                                                    
would love  to see individuals  be able to  visit Serpentine                                                                    
without having to fly in.                                                                                                       
Co-Chair Foster set  an amendment deadline of  Friday, May 5                                                                    
at 5:00 p.m.                                                                                                                    
HB 83 was HEARD and HELD in committee for further                                                                               
3:19:32 PM                                                                                                                    
The meeting was adjourned at 3:19 p.m.                                                                                          

Document Name Date/Time Subjects
HB 83 NEW FN LAW 042823.pdf HFIN 5/2/2023 1:30:00 PM
HB 83
HB3 - Municipal Impact Statement 050123.pdf HFIN 5/2/2023 1:30:00 PM
HB 3
HB 83 Public Testimony Rec'd by 050223.pdf HFIN 5/2/2023 1:30:00 PM
HB 83
HB 83 Public Testimony Rec'd by 050223 Pkt. 2.pdf HFIN 5/2/2023 1:30:00 PM
HB 83
HJR2 HB38 Response OpCap Split graph. 050323pdf.pdf HFIN 5/2/2023 1:30:00 PM
HB 38
HB 83 Public Testimony Rec'd by 050923.pdf HFIN 5/2/2023 1:30:00 PM
HB 83
HB 83 Public Testimony Rec'd by 050923 Pkt 2.pdf HFIN 5/2/2023 1:30:00 PM
HB 83
HB 83 Public Testimony 09-13-23 .pdf HFIN 5/2/2023 1:30:00 PM
HB 83