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
                    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 -                                                                        
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,                                                                    
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                                                                
05/07/02                (S)        FIN AT 9:30 AM SENATE FINANCE                                                                
05/07/02                (S)        Heard & Held -- Time Change -                                                                
05/09/02     3255       (S)        FIN RPT 8DP                                                                                  
05/09/02     3255       (S)        DP: DONLEY, KELLY, GREEN,                                                                    
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                                                                   
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                                                                    
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 -                                                                        
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 -                                                                        
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                                                                   
05/03/02                (S)        MINUTE(RES)                                                                                  
05/03/02                (S)        MINUTE(RES)                                                                                  
05/06/02     3175       (S)        RES RPT CS 4DP 2DNP SAME                                                                     
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                                                                    
05/10/02     3315       (S)        ELLIS NOTICE OF                                                                              
05/10/02     3313       (S)        READ THE THIRD TIME CSSB
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                                                                          
05/10/02     3314       (S)        AUTOMATICALLY IN THIRD                                                                       
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                                                                    
05/11/02     3350       (S)        PASSED ON RECONSIDERATION Y16                                                                
05/11/02     3350       (S)        EFFECTIVE DATE(S) SAME AS                                                                    
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 -                                                                      
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                                                               
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                                                               
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                                                               
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]                                                               
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                                                               
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                                                               
SENATOR  THERRIAULT  related  his  belief that  it's  a  separate                                                               
section  that DEC  would  still have  the  ability to  [regulate]                                                               
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                                                               
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                                                                    
     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                                                               
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                                                               
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                                                               
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                                                               
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                                                               
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                                                               
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                                                               
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                                                               
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                                                               
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                                                               
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.                                                                                                         
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