Legislature(2001 - 2002)
05/12/2002 04:10 PM House RLS
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
HOUSE RULES STANDING COMMITTEE
May 12, 2002
4:10 p.m.
MEMBERS PRESENT
Representative Pete Kott, Chair
Representative Brian Porter
Representative Vic Kohring
Representative Carl Morgan
Representative Lesil McGuire
Representative Ethan Berkowitz
Representative Reggie Joule
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
SENATE BILL NO. 268
"An Act relating to the issuance of state-guaranteed revenue
bonds by the Alaska Housing Finance Corporation to finance
mortgages for qualifying veterans; and providing for an
effective date."
- MOVED SB 268 OUT OF COMMITTEE
CS FOR SENATE BILL NO. 371(RES) am
"An Act exempting the use of munitions in certain areas from a
waste disposal permit requirement of the Department of
Environmental Conservation; relating to general or nationwide
permits under the Alaska coastal management program and to
authorizations and permits issued by the Alaska Oil and Gas
Conservation Commission; and providing for an effective date."
- HEARD AND HELD
PREVIOUS ACTION
BILL: SB 268
SHORT TITLE:GUARANTEED REVENUE BONDS FOR VETERANS
SPONSOR(S): RLS BY REQUEST OF THE GOVERNOR
Jrn-Date Jrn-Page Action
02/01/02 2086 (S) READ THE FIRST TIME -
REFERRALS
02/01/02 2086 (S) STA, FIN
02/01/02 2086 (S) FN1: (GOV)
02/01/02 2086 (S) FN2: ZERO(REV)
02/01/02 2086 (S) GOVERNOR'S TRANSMITTAL LETTER
02/12/02 (S) STA AT 3:30 PM BELTZ 211
02/12/02 (S) Moved SB 268 Out of Committee
02/12/02 (S) MINUTE(STA)
02/13/02 2175 (S) STA RPT 5DP
02/13/02 2175 (S) DP: THERRIAULT, PHILLIPS,
STEVENS,
02/13/02 2175 (S) DAVIS, HALFORD
02/13/02 2175 (S) FN1: (GOV)
02/13/02 2175 (S) FN2: ZERO(REV)
05/06/02 (S) FIN AT 9:00 AM SENATE FINANCE
532
05/07/02 (S) FIN AT 9:30 AM SENATE FINANCE
532
05/07/02 (S) Heard & Held -- Time Change -
-
MINUTE(FIN)
05/09/02 3255 (S) FIN RPT 8DP
05/09/02 3255 (S) DP: DONLEY, KELLY, GREEN,
AUSTERMAN,
05/09/02 3255 (S) HOFFMAN, OLSON, WILKEN, LEMAN
05/09/02 3255 (S) FN1: (GOV)
05/09/02 3255 (S) FN2: ZERO(REV)
05/11/02 (H) RLS AT 9:30 AM BUTROVICH 205
05/11/02 (H) <Pending Referral> --
Recessed to a call of the
Chair --
05/11/02 (S) RLS AT 10:30 AM FAHRENKAMP
203
05/11/02 (S) MINUTE(RLS)
05/11/02 3355 (S) READ THE SECOND TIME
05/11/02 3355 (S) ADVANCED TO THIRD READING
UNAN CONSENT
05/11/02 3355 (S) READ THE THIRD TIME SB 268
05/11/02 3355 (S) PASSED Y20 N-
05/11/02 3355 (S) EFFECTIVE DATE(S) SAME AS
PASSAGE
05/11/02 3387 (S) TRANSMITTED TO (H)
05/11/02 3387 (S) VERSION: SB 268
05/11/02 3343 (S) RULES TO CALENDAR 1OR 5/11/02
05/12/02 3566 (H) READ THE FIRST TIME -
REFERRALS
05/12/02 3566 (H) RLS
05/12/02 (H) RLS AT 4:00 PM BUTROVICH 205
BILL: SB 371
SHORT TITLE:WASTE PERMIT & COASTAL ZONE EXEMPTIONS
SPONSOR(S): STATE AFFAIRS
Jrn-Date Jrn-Page Action
04/29/02 3024 (S) READ THE FIRST TIME -
REFERRALS
04/29/02 3024 (S) RES
05/03/02 (H) RES AT 1:00 PM CAPITOL 124
05/03/02 (H) <Pending Referral>
05/03/02 (S) RES AT 3:30 PM BUTROVICH 205
05/03/02 (S) Moved CSSB 371(RES) Out of
Committee
05/03/02 (S) MINUTE(RES)
05/03/02 (S) MINUTE(RES)
05/06/02 3175 (S) RES RPT CS 4DP 2DNP SAME
TITLE
05/06/02 3175 (S) DP: TORGERSON, STEVENS,
WILKEN, TAYLOR;
05/06/02 3175 (S) DNP: ELTON, LINCOLN
05/06/02 3175 (S) FN1: ZERO(DEC)
05/08/02 (S) RLS AT 9:30 AM FAHRENKAMP 203
05/08/02 (S) MINUTE(RLS)
05/08/02 (S) MINUTE(RLS)
05/09/02 3260 (S) RULES TO CALENDAR 2OR 5/9/02
05/09/02 3269 (S) READ THE SECOND TIME
05/09/02 3269 (S) RES CS ADOPTED UNAN CONSENT
05/09/02 3269 (S) ADVANCED TO 3RD READING FLD
Y13 N6 A1
05/09/02 3270 (S) ADVANCED TO THIRD READING
5/10 CALENDAR
05/10/02 3315 (S) PASSED Y15 N3 A2
05/10/02 3315 (S) EFFECTIVE DATE(S) SAME AS
PASSAGE
05/10/02 3315 (S) ELLIS NOTICE OF
RECONSIDERATION
05/10/02 3313 (S) READ THE THIRD TIME CSSB
371(RES)
05/10/02 3313 (S) RETURN TO SECOND FOR AM 1
UNAN CONSENT
05/10/02 3314 (S) AM NO 1 ADOPTED Y16 N2 A2
05/10/02 3314 (S) ...CHANGES TITLE OF
LEGISLATION
05/10/02 3314 (S) AUTOMATICALLY IN THIRD
READING
05/11/02 3532 (H) HELD ON CLERK'S DESK
05/11/02 3531 (H) READ THE FIRST TIME
05/11/02 (H) RLS AT 9:30 AM BUTROVICH 205
05/11/02 (H) <Pending Referral> --
Recessed to a call of the
Chair --
05/11/02 3349 (S) RECON TAKEN UP - IN THIRD
READING
05/11/02 3350 (S) PASSED ON RECONSIDERATION Y16
N4
05/11/02 3350 (S) EFFECTIVE DATE(S) SAME AS
PASSAGE
05/11/02 3387 (S) TRANSMITTED TO (H)
05/11/02 3387 (S) VERSION: CSSB 371(RES) AM
05/12/02 3566 (H) REREAD THE FIRST TIME -
REFERRALS
05/12/02 3566 (H) RLS
05/12/02 3583 (H) RULES TO CALENDAR 5/12/02
05/12/02 3583 (H) IN RULES COMMITTEE
05/12/02 (H) RLS AT 4:00 PM BUTROVICH 205
WITNESS REGISTER
JOHN BITNEY, Legislative Liaison
Alaska Housing Finance Corporation
Department of Revenue
PO Box 101020
Anchorage, Alaska 99510-1020
POSITION STATEMENT: Presented SB 268.
SENATOR GENE THERRIAULT
Alaska State Legislature
Capitol Building, Room 121
Juneau, Alaska 99801
POSITION STATEMENT: Testified on behalf of the sponsor of SB
371, the Senate State Affairs Standing Committee.
JOE BALASH, Staff
to Senator Gene Therriault
Alaska State Legislature
Capitol Building, Room 121
Juneau, Alaska 99801
POSITION STATEMENT: Provided additional information on SB 371.
JANET DANIELS, Member
of the Chickaloon Tribe
(No address provided)
POSITION STATEMENT: Testified that the Chickaloon Tribe holds
the position that the military should be held accountable for
compliance with environmental law in the same manner as any
other organization or business.
BOB SHAVELSON, Executive Director
Cook Inlet Keeper
(No address provided)
POSITION STATEMENT: Testified that this legislation isn't
necessary.
SUSAN SHRADER, Lobbyist
Alaska Conservation Voters
P.O. Box 22151
Juneau, Alaska 99802
POSITION STATEMENT: Testified that she would be most
comfortable with the original language of SB 181.
BECCA BERNARD, Staff Attorney
Trustees for Alaska
1026 W. 4th Avenue, Suite 201
Anchorage, Alaska 99501
POSITION STATEMENT: Testified that the Alaska Supreme Court
decision doesn't change existing law, rather it merely
interprets the law passed by the legislature.
JIM EASON, Lobbyist
Forest Oil Corporation
8611 Leeper Circle
Anchorage, Alaska 99504
POSITION STATEMENT: Testified that since the Coastal Zone
Management Act there has been no requirement and no
administrative practice of doing a consistency review for
permits to drill.
PAT GALVIN, Director
Division of Governmental Coordination
Office of the Governor
PO Box 110030
Juneau, Alaska 9981-0030
POSITION STATEMENT: Provided comments with regard to DGC's
position on SB 371.
SUSAN WARREN, Environmental Law Attorney
Office of the Staff Judge Advocate
Fort Richardson, U.S. Army
(No address provided)
POSITION STATEMENT: Provided comments with regard to the U.S.
Army's involvement with superfund sites.
MARY SIROKY, Manager
Information Education & Coordination
Division of Statewide Public Service
Department of Environmental Conservation
410 Willoughby, Suite 303
Juneau, Alaska 99801
POSITION STATEMENT: Testified that this change in statute [in
CSSB 371(RES)am] wouldn't change DEC's ability to deal with
contaminants should they be released at any facility.
ACTION NARRATIVE
TAPE 02-14, SIDE A
Number 0001
CHAIR PETE KOTT called the House Rules Standing Committee
meeting to order at 4:10 p.m. Representatives Kott, Porter,
Kohring, McGuire, Berkowitz, and Joule were present at the call
to order. Representative Morgan arrived as the meeting was in
progress. Representatives Kerttula, Green, James, and Scalzi
were also in attendance.
SB 268-GUARANTEED REVENUE BONDS FOR VETERANS
CHAIR KOTT announced that the first order of business would be
SENATE BILL NO. 268, "An Act relating to the issuance of state-
guaranteed revenue bonds by the Alaska Housing Finance
Corporation to finance mortgages for qualifying veterans; and
providing for an effective date."
Number 0067
JOHN BITNEY, Legislative Liaison, Alaska Housing Finance
Corporation, Department of Revenue, explained that SB 268 would
authorize a vote of the people with regard to whether or not to
authorize $500 million in state-guaranteed revenue bonds to fund
the Alaska veterans mortgage program within the Alaska Housing
Finance Corporation (AHFC). He noted that Alaska is one of five
states that has the veterans mortgage program, which was a tax
exemption that was provided by Congress in 1979. Those veterans
qualifing for this program are those who have served in the
military prior to January 1, 1977, or have not been discharged
more than 30 years prior to the date of the loan application.
Therefore, the number of qualified veterans is beginning to
diminish. Mr. Bitney said this would be last time that AHFC
would anticipate having such a ballot measure for these type of
bonds. There have been four previous ballot questions when the
program was more heavily used and each of those questions passed
with good public support. Mr. Bitney noted that [AHFC] supports
measures in Congress relating to an expansion of the definition
of a qualified veteran. In fact, the legislature unanimously
supported SJR 31 to support some of those measures. Mr. Bitney
noted that the companion House bill moved through three
committees and is currently in the House Rules Standing
Committee while the Senate bill had two Senate committee
hearings.
Number 0313
CHAIR KOTT requested that Mr. Bitney expand on the reasoning
behind the thought that this will be the last time that AHFC
will come forward with such a bond measure.
MR. BITNEY reiterated the federal definition of a qualified
veteran. Due to those federal qualifications, there are small
numbers of qualifying veterans. Therefore, this $500 million
should be more than enough to deal with all of the qualifying
veterans. In further response to Chair Kott, Mr. Bitney
explained that the net benefit to a veteran is the tax exempt
bond rate for the qualifying veteran's mortgage rate. This
exemption results in about a 1 percent discount. Furthermore,
the veterans have the benefit of a higher loan to value ratio.
A qualifying veteran can take out as much as a 95:97 loan to
value ratio, which means that the veteran has a smaller down
payment.
Number 0444
REPRESENTATIVE McGUIRE inquired as to the rationale behind
limiting the qualified veteran to those who have served prior to
January 1, 1977.
MS. BITNEY answered that when the program was established in
1979 it was intended to be a benefit to Vietnam veterans.
Although there have been other national conflicts since that
time, there has been difficulty in expanding the definition
because only five states have this program. However, with the
current mood of the country, there may be more sympathy with an
expansion of the program.
Number 0500
REPRESENTATIVE BERKOWITZ inquired as to the number of veterans
in Alaska that qualify.
MR. BITNEY informed the committee that currently AHFC does about
$70 million worth of business [for this program], which equates
to roughly a little less than 100 loans.
REPRESENTATIVE BERKOWITZ inquired as to what would happen with
the extra authorization.
MR. BITNEY explained that AHFC only uses the authorization to
issue bonds at times and in amounts that are necessary to meet
ongoing demands. Therefore, [the authorization] would
essentially be unused authority.
REPRESENTATIVE BERKOWITZ surmised then that AHFC would have
unused bonding authority.
MR. BITNEY specified that such would be correct for these
[veteran] mortgages.
CHAIR KOTT announced a conflict of interest because he benefits
from this program now.
REPRESENTATIVE PORTER noted he also qualifies for the program.
Number 0602
REPRESENTATIVE PORTER moved to report SB 268 out of committee
with individual recommendations and the accompanying fiscal
notes. There being no objection, SB 268 was reported from the
House Rules Standing Committee.
SB 371-WASTE PERMIT & COASTAL ZONE EXEMPTIONS
CHAIR KOTT announced that the next order of business would be CS
FOR SENATE BILL NO. 371(RES) am, "An Act exempting the use of
munitions in certain areas from a waste disposal permit
requirement of the Department of Environmental Conservation;
relating to general or nationwide permits under the Alaska
coastal management program and to authorizations and permits
issued by the Alaska Oil and Gas Conservation Commission; and
providing for an effective date."
Number 0644
SENATOR GENE THERRIAULT, Alaska State Legislature, testified on
behalf of the sponsor, the Senate State Affairs Standing
Committee. He explained that the first section of CSSB
371(RES)am addresses the issue of whether a solid waste disposal
permit is necessary for other active ranges [beyond the military
bombing ranges. The Department of Environmental Conservation
(DEC) testified that it has never interpreted the statute to
require a solid waste disposal permit for the operation of
"those" bombing ranges. Senator Therriault informed the
committee that the litigation over this matter deals with the
Eagle River Flats area. Section 1 attempts to enshrine the
long-standing interpretation of the administration and the
military that a solid waste disposal permit isn't necessary for
the operation of those ranges.
SENATOR THERRIAULT said that the second portion of the bill
deals with the recent Alaska Supreme Court case, which could
potentially jeopardize the state's current [decisions] on the
use of general permits. He explained that a general permit is
run through a consistency determination. After obtaining a
general permit, if someone wants to perform a particular
activity that falls under the general permit, then the general
permit is issued. For oil and gas operations, all general
permits are gathered and packaged into a project. Then there is
a consistency determination on the entire project. With the
recent court ruling, there is a question with regard to one
obtaining the general permits or whether each general permit
would have to have an independent consistency determination.
Additionally, the recent court ruling could jeopardize the
Alaska Oil and Gas Conservation Commission's (AOGCC) issuance of
its permits. The AOGCC permits are for the development of oil
and gas properties in which the pipe is placed in the ground.
The AOGCC is interested in how the underground strata and
reservoir is developed in order to ensure that things are done
in a safe manner that doesn't waste the state's resources. He
pointed out that these AOGCC permits have never gone through a
consistency determination.
SENATOR THERRIAULT characterized the consistency determination
process as complex and protracted. If this recent court ruling
is allowed to stand, then this [consistency determination]
process would potentially be duplicated for the general permit.
He turned to the impact of this court ruling on the AOGCC
permits. If there was a development project to sink four wells
and then there was a fifth well to sink, the entire [consistency
determination] process would have to happen again because of the
addition of the fifth well. Senator Therriault felt that such
is unnecessary and is a departure from how the program has
operated since its inception. In closing, Senator Therriault
reiterated that this bill merely enshrines a long-standing
interpretation of the statutes.
Number 0966
REPRESENTATIVE McGUIRE inquired as to how long DEC has been
using the process in question.
SENATOR THERRIAULT related his belief that DEC has used this
process since the program's inception in 1977. Senator
Therriault clarified that this legislation addresses the
specific fallout from the court case. If it's determined that
there are other areas that may be impacted, he said he believes
the legislature will have time to address those.
Number 1045
REPRESENTATIVE BERKOWITZ inquired as to how the state has any
authority at all in a U.S. Department of Defense (DOD) facility.
It seems that the supremacy clause would require the state to
give deference to the federal government.
SENATOR THERRIAULT related his belief that the state still has
the right to regulate some activities and discharges on lands
within the state. However, he couldn't answer whether the
supremacy clause would allow the [military] to "thumb its nose
at the state."
REPRESENTATIVE BERKOWITZ asked whether this [legislation] would
result in the relinquishment of state primacy.
SENATOR THERRIAULT replied no. In further response to
Representative Berkowitz, he specified that the munitions would
span the full range of munitions from rifles to bombs and
helicopter guns. He said he didn't believe [the munitions]
would include chemical or biological [weapons].
REPRESENTATIVE BERKOWITZ asked whether anyone could definitively
tell him that chemical and biological [weapons] aren't included.
Number 1138
JOE BALASH, Staff to Senator Gene Therriault, Alaska State
Legislature, noted that he did confer with DEC because the
question of the types of munitions was raised by the Legislative
Legal and Research Division. The department specified that
[this legislation] wouldn't apply to chemical or biological
weapons; other areas in the statute allow the department to
regulate hazardous materials. There would be no exemption.
SENATOR THERRIAULT interjected that this is very specific in
that it refers to a solid waste permit.
REPRESENTATIVE BERKOWITZ pointed out that lead is a toxin and
"if other sections apply, what are we doing?"
SENATOR THERRIAULT clarified that the litigation specifically
challenged that the state wasn't enforcing its solid waste
permit. It has never been this administration's or prior
administration's interpretation that a solid waste disposal
permit was required for the operation of these [munitions]
facilities.
REPRESENTATIVE McGUIRE recalled the same answer being provided
in the House Resources Standing Committee hearing on SB 371.
Furthermore, DEC supports this as it has always believed it to
be the law anyway.
SENATOR THERRIAULT, in response to Representative Berkowitz,
pointed out that he has a written statement from Tom Chapple,
Director, Division of Air & Water Quality, DEC. He quoted Mr.
Chapple as writing the following, "It needs to be clear that
this legislation is not intended to affect the department's
ability to deal with contamination at active range firing ranges
should contamination pose a risk to the environment." In
response to Chair Kott, Senator Therriault related his belief
that this testimony was submitted to a prior committee.
Number 1258
REPRESENTATIVE KERTTULA related that she has heard that Alaska
would be the first state to take this action concerning DOD
sites.
SENATOR THERRIAULT related his belief that Alaska would be the
first state that would require a solid waste disposal permit on
an active range.
REPRESENTATIVE KERTTULA turned to the process for the coastal
management permit and related that if one has a general permit
that covers the activity, then the coastal management permit
process doesn't occur for the particular project.
SENATOR THERRIAULT specified that the court case threatens the
underlying statutory authority to issue the general permits.
REPRESENTATIVE KERTTULA reiterated that under the current
process, pre-court decision, when there is a general permit, the
activity is reviewed and if it fits under the general permit, no
further review occurs.
MR. BALASH clarified that [in the scenario posed by
Representative Kerttula] the general permit must be one that has
already been through a prior consistency determination of its
own. Therefore, it would be an activity that has already been
found to be consistent in the coastal zone. Mr. Balash said
this is a way for the Division of Governmental Coordination
(DGC) and various other resource agencies to save time and focus
their resources on other areas that aren't the routine aspects
of a project. Therefore, it allows the DGC and various other
resource agencies to work within the time and budgetary
constraints that they have.
REPRESENTATIVE KERTTULA surmised that before the court
questioned this issue, the general permit would be reviewed and
if [an activity was added] and it fit under the general permit,
no other review occurred.
SENATOR THERRIAULT said that was correct. He reiterated that
the general permit had already gone through the consistency
determination. The court decision has jeopardized whether the
general permit can be used or whether this process has to occur
for each permit.
REPRESENTATIVE BERKOWITZ directed attention to AS 46.03.100,
which discusses wastewater. He said, "If there is any waste
carried along in a stream that discharges from a single source
point that that would be swept up under these permits, is that
right?"
SENATOR THERRIAULT related his belief that it's a separate
section that DEC would still have the ability to [regulate]
wastewater.
REPRESENTATIVE BERKOWITZ pointed out that AS 46.03.100(a) says,
"A person who conducts an operation that results in the disposal
of solid or liquid waste material or heated process or cooling
water into the waters or onto the land of the state shall
procure a permit from the department before disposing of the
waste material or water. The permit shall be obtained for direct
disposal and for disposal into publicly operated sewerage
systems."
MR. BALASH said that he wasn't aware of any munitions activity
that would result in wastewater or any kind of a liquid
discharge. The exemption applies directly to the firing or
other use of munitions.
SENATOR THERRIAULT quoted Tom Chapple as writing the following,
"More recently, the Army as worked cooperatively with DEC and
the bill sponsor to have the language include: 'meet the Army's
needs while not jeopardizing other important work done by the
same (indisc.).'"
Number 1532
JANET DANIELS, Member of the Chickaloon Tribe, provided the
following testimony:
It is the position of the Chickaloon Tribe that the
military should be held accountable for compliance
with environmental law in the same manner as any other
organization or business. It is not our intent to
interfere with issues of national security, but wish
to protect the health of the same citizens the
military has sworn to defend. For thousands of years
the Native peoples of Alaska have fished and hunted
this land. Scientists are now finding elevated levels
of contaminants in subsistence foods all over Alaska.
Cancer rates are rising all over the state. Those
numbers cannot all be related to lifestyle. The
entire population of the State of Alaska is at
increased risk for disease and death due to
contamination that migrates north from all over the
world. Any reduction in laws protecting the health of
the people of Alaska would only add to that risk.
This bill was promulgated, in part, because of a
lawsuit asking for cleanup of Eagle River Flats on
Fort Richardson. That lawsuit came about after years
of citizens requesting a remedial investigation of the
over 10,000 items of unexploded ordnances that
littered the bombing range and leached into the waters
of the Cook Inlet. We worked through the Restoration
Advisory Board, and only filed suit when it was
concluded that it was the only option left. We did
not ask for cessation of training when we filed our
intent to sue on June 15th of last year. We entered
into negotiations to settle the suit shortly after,
and continued to negotiate in good faith until the
U.S. Army severed negotiations on April 10th this
year. We only ask that the military comply with
existing laws. Environmental laws were designed to
protect (indisc.) citizens while allowing businesses
and organizations to carry on their operations. In no
way do environmental laws threaten military readiness.
The federal government, through the President and
Secretary of Defense, have the power to exempt
installations on a case-by-case basis. What greater
protection could the military ask for? In a recent
"Zadby America" poll, ... even Republicans and those
who voted for President Bush, more than 75 percent
opposed exempting the Department of Defense from the
nation's environmental laws. Even after hearing
arguments for and against the proposal to exempt the
Defense Department, voters remained overwhelmingly
opposed. Please recognize that passage of this bill
could have lasting adverse health effects on the
people of Alaska. Thank you.
Number 1710
BOB SHAVELSON, Executive Director, Cook Inlet Keeper, provided
the following testimony:
Cook Inlet Keeper was the plaintiff in the lawsuit
involving Forest Oil's Osprey platform in Cook Inlet,
where a unanimous Supreme Court held the state failed
to review toxic drilling waste discharges prior to
project start-up. Keeper is also a co-plaintiff in
the lawsuit trying to bring some accountability to
military bombing activities in the rich wetlands of
the Eagle River Flats estuary.
Let me start by saying that I'm a proud Alaskan and a
proud American. I believe in the values of justice,
democracy, accountability, and the rule of law. These
are the values which have made our nation the greatest
and most powerful country on earth. While the fall of
the Berlin wall and the defeat of communism, the
American model of democratic capitalism is without
parallel across the globe. But with technology and
international trade accelerating the process of
globalization, we Alaskans, and we Americans, have an
obligation, a duty, to promote the ideals of openness,
fairness, competition, equality and a level playing
field.
I'm here today because an oil company incorporated in
New York, doing business in Denver, and dumping toxic
wastes in the Cook Inlet fisheries, wants to
circumvent our democratic process. Forest Oil had
three years to address its dumping issues in Cook
Inlet, yet it chose to fight in court instead. And it
lost. So now, in the rush of the end of session,
Forest Oil has crafted a special interest amendment -
the Forest Oil Amendment to SB 371. The Senate took
up the issue without any public review or comment the
other day, and now, we are forced to deal with an
issue with sweeping implications for our salmon
fisheries and coastal resources with limited time and
debate. This is not the Alaskan way, and it's not the
American way. We are not a banana republic.
First off, and most importantly, there is no need for
legislation on this issue. The Alaska Coastal
Management Act already contains a process for
exempting from permitting review activities which pose
minor coastal impacts. It's called the ABC List and
it's a 3-inch think document which includes dozens and
dozens of permits and activities which do not require
individual project reviews. But industry lawyers have
created an illusion of confusion, arguing that the
Supreme Court decision will create a permitting
quagmire. We're hearing arguments that a family could
not build a basement to a home in the coastal zone
without a huge pile of red tape and permitting. But
this is false. The Supreme Court simply said that
large polluting projects such as offshore oil
platforms should undergo review to protect salmon
fisheries and our rich coastal resources.
Number 1826
At this point I'd like to divert from my written
testimony for a second and address some of the things
that [Senator] Therriault commented on. First, I'd
like to point out that when the consistency review was
done for Cook Inlet, the Osprey platform was never
envisioned. I believe the consistency review was done
in approximately 1996 and that was not even (indisc.).
We didn't know where the Osprey platform would be, we
never knew how many wells were going to be drilled,
what type of waste was going to be discharged. There
was never any of this factual information on the
table. It was not until we began to see plans of
operations and discrete ideas that we had an idea what
the specifics of this project were going to be.
It's important to note that industry has time and time
again insisted that a phased approach to oil and gas
development will ensure that each step of development
will receive meaningful environmental review. But now
the phasing shell game has been exposed, because if
the "Forest Oil Amendment" passes, oil platforms and
other large scale polluting projects will not be
reviewed against coastal laws designed to protect our
fisheries and coastal resources. Industry can't have
it both ways - it can't evade comprehensive review at
early, general stages of permitting, and then evade
review again at the project specific stage.
Forest Oil is already getting a big lift on the back
of Alaskans. At a time when we are staring down the
barrel of a widening fiscal gap, when income taxes and
PFD cuts are common options for reducing the looming
deficit, the Redoubt Shoals Unit will enjoy a royalty
reduction - from 12.5 percent to 5 percent - on the
first 25 million barrels of oil and 35 trillion cubic
feet of natural gas.
In Cook Inlet, we're embarking on an exciting new
effort to brand and market our salmon to combat the
glut of farmed fish on the world market. These
fisheries not only support important commercial
enterprises, and the families and communities they
support, but also the critical recreational and
subsistence lifestyles which make Alaska unique. Yet
a recent EPA [Environmental Protection Agency] study
shows we are starting to see problems in our fish.
That's why it makes no sense to carve out a special
interest waiver to corporations dumping toxic wastes
into our fisheries.
We do not believe the Forest Oil Amendment should be
linked to the military bombing range permit exception
bill, and we oppose removing a basic permitting
requirement from toxic bombing activities in a rich
wetlands complex - Eagle River Flats - which supports
Cook Inlet fisheries. Alaska should not be the first
state in the nation to exempt the military from
environmental laws. Congress has already considered
this proposal for federal environmental laws and
rejected it, and the President retains the authority
to intervene in the case of national security.
But in closing, we are realists, and if this
legislation does in fact have to move forward, we
could look beyond the Osprey platform exploratory
drilling litigation, and entertain an amendment to
this bill which will give future exploratory drilling
activities in the coastal zone a choice: if a company
wants to dump its drilling wastes into the fisheries
of this State, it must undergo a coastal consistency
review. In the alternative, if it opts to reinject
its exploratory drilling wastes - which has long been
technologically achievable and which is quickly
becoming the industry standard - the State could
exempt those wastes from coastal review. This is a
big concession for us but in the interest of
protecting the fisheries of Cook Inlet and beyond, we
are willing to compromise. I hope this committee can
see the logic in this proposal, and the fact that it
is a win, win, win - for Alaskans, for the oil
companies and for the fisheries and families and
communities they support. Thank you.
[Punctuation provided.]
Number 1986
SUSAN SHRADER, Lobbyist, Alaska Conservation Voters, informed
the committee that the Alaska Conservation Voters is a nonprofit
organization of 32 member groups that are all Alaska-based
environmental groups. The Alaska Conservation Voters is
dedicated to protecting Alaska's environment through public
education and advocacy. Ms. Shrader pointed out that when SB
181 went through the Senate, the committee substitute (CS)
exempted all munitions ranges, not just military ranges.
Therefore, private as well as municipal rifle ranges will be
exempt from the work DEC does to ensure that there isn't a
contaminated site when the range closes. Ms. Shrader noted that
on this issue she is a bit of a NIMBY [not in my back yard]
because she lives near Montana Creek which is near the Hank
Harman Rifle Range. As part of a proposal a few years ago for
improvements to the range, the city requested some surface water
testing. This range is in a muskeg and the water flows down the
range into some tributaries that feed Montana Creek and
ultimately Mendenhall River. The surface water samples were
done by both the Alaska Department of Fish & Game (ADF&G) and
DEC and they contained markedly elevated lead levels. Although
this is a somewhat unique situation in that this range sits in a
muskeg and the soil is very acidic, the [soil] tends to leach
the lead into the water in a form that is a bit more toxic. Ms.
Shrader stressed that DEC should have the ability to work with
folks in the community in order to ensure that steps are taken
to protect those folks living down stream from the range. When
this range closes, it will be considered a contaminated site and
the city will have to pay to deal with this contaminated site.
MS. SHRADER turned to her experience working with the
legislature on issues related to the Alaska Coastal Management
Plan (ACMP). Issues surrounding the ACMP typically receive a
lot of attention from the coastal districts around the state.
The ACMP is a way in which the locals can have input with regard
to how their coastal resources are developed. Ms. Shrader
expressed concern with the rate in which this bill is moving;
the coastal districts haven't even had much time to find out
about the bill. This didn't seem fair, she said.
Number 2189
REPRESENTATIVE McGUIRE asked, "Is it your opinion that anything
that's in this bill, on both ... munitions and the consistency
review, deviates from the current activities of DEC?"
MS. SHRADER related that her understanding is limited to Mr.
Chapple's testimony on the bill. On both aspects, the bill
seems not to alter how DEC currently does business. However,
the courts in Alaska have suggested that [current DEC practices]
aren't the way the law should be interpreted.
REPRESENTATIVE McGUIRE asked if Ms. Shrader holds the opinion
that the court has a better role in regulating the environmental
conservation laws of this state than DEC.
MS. SHRADER answered, "I would defer to the court for the legal
interpretation of the laws of this state; I think that is their
job is to interpret the laws. And the department's job is to
execute the laws." In further response to Representative
McGuire, Ms. Shrader said the legislature's job is to write the
laws.
Number 2257
REPRESENTATIVE BERKOWITZ directed attention to the language
related to training activities in Section 1. He related his
interpretation that this language wouldn't apply to someone who
is practicing on an active range while the section would apply
to someone engaged in a competition.
MS. SHRADER, from personal experience, she considered her
husband to be training when he goes out with his pistol on
Sunday mornings.
REPRESENTATIVE BERKOWITZ asked if Ms. Shrader would feel more
comfortable with Section 1 if the language "including active
ranges" was deleted.
MS. SHRADER specified that she felt more comfortable with the
language in the original bill, which merely exempted the
military. Very broad language is being used to address a
specific issue with the Eagle River Flats.
Number 2343
REPRESENTATIVE KERTTULA asked if one of the problems with the
local ranges is that they [become contaminated] with lead and
copper.
MS. SHRADER replied yes. She reiterated that the Montana Creek
area is troublesome because of the hydrology of the area, the
slope of the range, and because it drains directly into Montana
Creek.
REPRESENTATIVE McGUIRE inquired as to why the language referring
to "active ranges" was added.
TAPE 02-14, SIDE B
MR. BALASH said that language was added in order to include
other ranges in the state. From conversations with DEC, Mr.
Balash said his understanding is that this language refers to
private ranges, municipal ranges, and ranges that the Alaska
State Troopers and ADF&G use for training as well as those used
by the Division of Motor Vehicles, and the National Guard. Mr.
Balash explained that using the language in the original
legislation would specify that DOD ranges are exempt, which
implies that all the other ranges aren't and would require these
permits in order to operate. Because DEC has never interpreted
this particular section of statute to apply to gun ranges, it
was deemed necessary to clarify the language as such.
REPRESENTATIVE McGUIRE surmised then that DEC doesn't currently
require a solid waste permit for any training activities on any
range.
MR. BALASH answered that he believes that to be the case, but
deferred to DEC on that matter as well as the interpretation of
the language "training activities".
Number 2263
BECCA BERNARD, Trustees for Alaska, explained that Trustees for
Alaska is representing Cook Inlet Keeper in the Osprey
litigation that is the subject of the Forest Oil Amendment. Ms.
Bernard pointed out that the Alaska Supreme Court decision
doesn't change existing law, rather it merely interprets the law
passed by the legislature. The Alaska Supreme Court stated that
every project in the coastal zone that has been reviewed for
consistency has to be site specific, project specific, and has
to review the entire project. The [Forest Oil Amendment] would
ignore the current process and change existing law. The
amendment encompassed in CSSB 371(RES)am would ignore ACMP's
current practice that exempts activities that don't have a
significant impact on coastal resources from project specific
review. There is already a process by which minor activities
could be exempt, and therefore there is no reason for this
additional exemption.
MS. BERNARD turned to the "illusion of confusion" and the flow
chart showing a complicated process that would have to be
duplicated. That isn't correct, she charged. The Alaska
Supreme Court decision doesn't create multiple reviews.
Currently, when a general permit is issued it's reviewed for
consistency and when a project that needs that general permit is
reviewed that project is reviewed for consistency with the
coastal protection standards. The aforementioned process won't
be changed by the Alaska Supreme Court decision or this
legislation.
Number 2156
JIM EASON, Lobbyist, Forest Oil Corporation, began by saying
that he couldn't disagree more with the comments made by Ms.
Bernard. Beginning with the Hammond Administration, the law has
been consistently interpreted such that a general permit goes
through a consistency review and when it has been found to be
consistent under the provisions dictated by the general permit
and the project meets those conditions, then the general permit
is sufficient for the project. He pointed out that there are
many permits that this project and other projects have that
include things that aren't covered by general permits, and those
undergo site specific review. The combination of the two has
been interpreted as such since the adoption of the Coastal Zone
Management Act. Mr. Eason highlighted that the Alaska Supreme
Court didn't differentiate between large and small projects; it
only referred to general permits. General permits involve
projects that deal with oil and gas, mining, timber,
construction, et cetera.
MR. EASON addressed the concerns of the pollution of Cook Inlet,
and said that those concerns don't quite comport with the facts
of the case. When the injunction requested by the Trustees for
Alaska was issued, the fifth well was being drilled at the
Osprey platform without (indisc.) and the cuttings and muds were
being reinjected. The development plan, which will also be the
subject of litigation, doesn't allow for the disposal of
drilling cuttings and muds. Under the terms of the development
permit, Forest Oil has agreed to reinject those drilling
cuttings and muds, which is a significant departure from what
[the committee has been told].
MR. EASON stressed that it's important that the committee
understand that the issues don't only fall on the general
permit. The question as to whether oil and gas conservation
permits are required to undergo consistency review is also
pending. Again, since the Coastal Zone Management Act there has
been no requirement and no administrative practice of doing a
consistency review for permits to drill. However, the Trustees
for Alaska believe that permits to drill should undergo a
consistency review. In a letter to Forest Oil, the Trustees for
Alaska indicated that it's one of the two basis upon which the
development operation is illegal and thus [Forest Oil] has been
asked to cease and desist and put approximately 350 employees on
stand-by.
Number 1994
CHAIR KOTT inquired as to Mr. Eason's opinion of the expansion
of SB 371 such that it now includes all the ranges versus merely
the military ranges.
MR. EASON answered that he couldn't speak to that.
REPRESENTATIVE BERKOWITZ pointed out that the Alaska Supreme
Court vacated the DGC's consistency determination and remanded
for new consistency determination. He inquired as to how long
that process would take.
MR. EASON deferred to Mr. Galvin. From his experience, one
timeframe would be how long it would take to complete the
process. The review and appeal process that will follow and the
likely litigation have to be considered in order to adequately
determine the risk in time.
REPRESENTATIVE BERKOWITZ related his understanding that the
court has said that [Forest Oil] has to return to a specific
point in the process and begin again. He inquired as to how far
back the court is asking [Forest Oil] to go and how much is left
to complete [the process].
MR. EASON deferred to Mr. Galvin. He emphasized the need for
the committee to understand that this has implications for more
than just this project.
Number 1898
PAT GALVIN, Director, Division of Governmental Coordination,
Office of the Governor, noted that DGC is responsible for
implementing ACMP. Mr. Galvin stated that [the division] is
very interested in trying to find a solution to this issue. The
DGC believes that the court's decision won't require an
extensive change in the way the division currently does
business. The decision won't require longer time periods or
additional reviews. For example, when a consistency
determination is done similar to the one for the Osprey Project,
rather than excluding the activities that are covered by the
general permit, the division would look at those activities
[keeping in mind] that these activities have previously been
found consistent. The court is asking for these activities to
be reviewed in the context of the particular project and
determine if there is anything unique that hasn't be considered
previously. Mr. Galvin said the division doesn't consider that
to be onerous. However, the division is concerned with regard
to the decision's impact on other permitting activities of the
state such as those projects that require permits from only one
state agency and there is no federal permit involved. In such a
situation the state agency would perform a consistency review
itself and therein lies the concern because those state agencies
aren't equipped to deal with issues outside their general
purview. As of yet, there hasn't been a determination as to how
to deal with that, although the DGC is working with the
Department of Law and these agencies on that.
MR. GALVIN related that the best scenario would be one in which
DGC continues to perform the consistency determinations in the
way that the court would like. He expressed the need to ensure
that through this process that remains in DGC's discretion and
the language allows that. He recalled Mr. Shavelson's
testimony, which indicated the possibility of finding some
middle ground. Although he wasn't sure whether there was time
to explore that, he said that perhaps it could be reviewed.
MR. GALVIN remarked that this a bit more complicated than the
Alaska Supreme Court decision would indicate. While the court's
decision dealt with the consistency determination for the
exploration phase of the project, that phase is over. The
project is moving toward the development phase. As fate would
have it, the consistency determination for the development phase
was issued two days before the court decision came out.
Therefore, the division is in a situation in which it has to
review how to respond to the court's decision in light of the
exploration phase, which was vacated, and how that decision
impacts the production determination. This is another issue
that the division is working on with the Department of Law. The
current version of the legislation, CSSB 371(RES)am, appears to
resolve this matter in favor of the consistency determination
being valid based on the retroactivity of the language.
Number 1640
CHAIR KOTT asked whether [CSSB 371(RES)am] is the solution or is
there a better solution.
MR. GALVIN answered that [CSSB 371(RES)am] provides discretion
within the agencies in terms of whether these activities are
included or not. He related his belief that there are
proponents of providing less discretion, which he said he was
willing to review.
REPRESENTATIVE BERKOWITZ inquired as to whether there would be
any possibility that the proposed language would be subject to a
legal challenge and thus further hold this matter in court.
MR. GALVIN responded that the general permit language seems to
be clear that discretion is provided with the agencies that are
doing the consistency determination. Furthermore, making it
retroactive as far back as it does wouldn't seem to raise any
legal questions with the [current] projects.
REPRESENTATIVE BERKOWITZ asked whether there is any conflict
with federal statutes or constitutional provisions.
MR. GALVIN related his understanding that the retroactivity has
been said to be Okay. However, he expressed concern with regard
to the language referring to the AOGCC exemption. "I believe
that the issue that has been raised is one that, frankly, the
courts have never addressed," he pointed out. This is a
speculative argument. He noted that language in HB 439 further
clarifies whether AOGCC is subject to coastal management.
Therefore, the addition of "this" language may be cause for
pause with regard to how it can be applied.
REPRESENTATIVE BERKOWITZ remarked that if there is urgency to
resolve this question for the Osprey Project, then it might
behoove everyone to slow the project and avoid any legal
challenges.
MR. GALVIN noted his agreement.
REPRESENTATIVE BERKOWITZ inquired as to what other projects are
impacted by the August 1, 1998, retroactivity of this bill.
MR. GALVIN answered that the language would seem to cover any
project that is currently under review or is currently in a
possible appeal. In further response to Representative
Berkowitz, Mr. Galvin said that there are hundreds to thousands
of projects that would be impacted by this legislation.
However, most of those projects have passed the point [at which
this would apply]. He cited the McCovey Exploration Project on
the North Slope as the primary project that would be impacted,
and is of particular concern with regard to this court decision.
Number 1421
SUSAN WARREN, Environmental Law Attorney, Office of the Staff
Judge Advocate, Fort Richardson, U.S. Army, testified via
teleconference. Ms. Warren turned to the issue of the U.S.
Army's involvement in superfund sites. She informed the
committee that Fort Richardson and Fort Wainwright are superfund
sites, and therefore are listed on the national priorities list.
When those forts were listed, the U.S. Army undertook
negotiations and entered into agreements with the state and the
EPA to formalize a cleanup process that would include state and
federal regulators. That was done as quickly as possible. Ms.
Warren highlighted the importance of the federal facility
agreement that would be in place in order to ensure funding
priority for cleanup activities at the aforementioned locations.
When the federal facility agreements were initiated, the
superfund site was defined as the post, which made sense because
it allowed studies to be done with regard to the entirety of the
installation. At each post, several areas have been identified
as areas of concern and cleanup is beginning. She mentioned the
U.S. Army's aggressive and effective environmental installation
record.
Number 1219
CHAIR KOTT inquired as to whether DEC was involved with the
expansion of the language to include all ranges.
MARY SIROKY, Manager, Information Education & Coordination,
Division of Statewide Public Service, Department of
Environmental Conservation, confirmed that the department was
part of that discussion. The department hasn't required solid
waste [disposal] permits for military training ranges or any
other rifle range in the state, and therefore DEC wasn't opposed
to the expansion in the language. Ms. Siroky specified that
this change in statutes doesn't change DEC's ability to deal
with contaminants should they be released at any facility.
MS. SIROKY, in further response to Chair Kott, informed the
committee that DEC has maintained its belief that the Department
of Defense portion of this bill isn't necessary. The bill isn't
necessary because DEC doesn't permit these facilities to begin
with. Furthermore, this issue is being addressed at the
national level.
Number 1161
REPRESENTATIVE McGUIRE inquired as to DEC's position with regard
to the second portion of the bill regarding the consistency
review.
MS. SIROKY deferred to the governor's office.
CHAIR KOTT closed public testimony.
REPRESENTATIVE BERKOWITZ informed the committee that
Representative Kerttula has prepared some amendments for the
committee's perusal.
Number 995
REPRESENTATIVE BERKOWITZ moved that the committee adopt
Amendment 1, which reads as follows:
Page 2, line 2, following "previously been"
Insert "fully considered and"
CHAIR KOTT objected for the purposes of discussion.
REPRESENTATIVE KERTTULA said that Amendment 1 is offered to
cover the recent court case. Representative Kerttula related
her belief that what the Alaska Supreme Court said is in line
with Mr. Galvin's comments on the general permit. That is, when
there is a general permit there may be a lot of activities
occurring in the state in many different ways. That general
permit is reviewed and goes through its own consistency
determination. Representative Kerttula stressed that there is
no way to tell when reviewing something in the abstract, which
is the case with the general permit, versus when its in
application. That is what the Alaska Supreme Court recognized.
The Alaska Supreme Court said that the fact that there is a
general permit doesn't have to be ignored nor should something
that was fully considered have to be determined again. For
those things that haven't been fully considered, those should be
considered. Therefore, adoption of Amendment 1 would mean that
if a project has been fully considered, it doesn't have to be
put back through a review. If a project hasn't been fully
considered under the general permit, the [project] would have to
be reviewed again. Although Amendment 1 would [create] some
concerns for the companies that are effected, this is the way to
do it.
Number 0788
MR. BALASH said that the court ruling suggested that an activity
that was previously found to be consistent through a general
permit in the coastal zone [remains consistent] when that
identical activity is a part of the project. The court ruling
suggested that it's reasonable for the departments to rely on
the previous determination. Although Mr. Balash said he didn't
think there is disagreement on that, he pointed out that this is
before the committee today due to litigation and every
additional word to the statutes provides another opportunity for
litigation.
REPRESENTATIVE McGUIRE asked if Amendment 1 deviates from what
DEC is already doing in its consistency determination process.
MR. BALASH replied no. The crucial language is the word
"determined". He expressed concern with the "fully considered"
aspect, which provides for every minute detail within the area
covered by the general permit. For example, in the Cook Inlet
the depth of the water might vary in various parts of the inlet.
Therefore, if the department hadn't "fully considered" the
effect of the water flow and the tides at the varying depths,
there could be grounds for a decision that not every detail was
fully considered.
REPRESENTATIVE KERTTULA pointed out that the ability of the
reviewing entity to "exclude" or not is important. However, by
inserting the language of Amendment 1, the issue that the court
looked at would be resolved while still allowing the agency the
authority to exclude or not. She recognized that the companies
probably won't feel comfortable with this.
Number 0481
REPRESENTATIVE BERKOWITZ asked if there is some concern that the
permit for the Osprey Project wasn't fully considered.
MR. GALVIN said that was what the court implied in its opinion.
REPRESENTATIVE BERKOWITZ interjected that it wasn't expressly
stated that way by the court. "Is there any indication that it
wasn't fully considered," he asked.
MS. BERNARD agreed that the implication is that the wastewater
discharges of the [Osprey Project's] general permit weren't
considered during the project specific consistency review. The
court decision specified that the discharges of the entire
project had to be reviewed.
The committee took an at-ease from 5:45 p.m. to 6:05 p.m.
Number 0370
CHAIR KOTT announced that the committee would stand in recess
until 9:00 a.m. tomorrow. He requested that both sides get
together and review the amendments in order to find middle
ground on these issues.
ADJOURNMENT
There being no further business before the committee, the House
Rules Standing Committee meeting recessed at 6:07 p.m. [This
meeting reconvened at 9:10 a.m. on May 13, 2002.]
| Document Name | Date/Time | Subjects |
|---|