Legislature(1997 - 1998)
02/18/1998 01:35 PM Senate CRA
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* first hearing in first committee of referral
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+ teleconferenced
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SENATE COMMUNITY & REGIONAL AFFAIRS COMMITTEE
February 18, 1998
1:35 p.m.
MEMBERS PRESENT
Senator Jerry Mackie, Chairman
Senator Dave Donley
Senator Randy Phillips
Senator Lyman Hoffman
MEMBERS ABSENT
Senator Gary Wilken, Vice Chairman
COMMITTEE CALENDAR
SENATE BILL NO. 28
"An Act relating to the unincorporated community capital project
matching grant program; and providing for an effective date."
SENATE BILL NO. 190
"An Act relating to eminent domain and to negotiations to purchase
property before it is taken through eminent domain; and providing
for an effective date."
SENATE BILL NO. 191
"An Act relating to the exchange of state tide and submerged land
to protect municipal watersheds and provide for airports and marine
transportation facilities; and providing for an effective date."
PREVIOUS SENATE COMMITTEE ACTION
SB 28 - See Community & Regional Affairs minutes dated 2/18/98.
SB 190 - See Community & Regional Affairs minutes dated 2/18/98.
SB 191 - See Community & Regional Affairs minutes dated 2/18/98.
WITNESS REGISTER
Senator John Torgerson
State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Prime Sponsor of SB 28
Ms. Kim Metcalfe-Helmar, Special Assistant
Department of Community & Regional Affairs
P.O. Box 112100
Juneau, AK 99811-2100
POSITION STATEMENT: No position on CSSB 28(STA)
Rick Harris, Senior Vice President
Sealaska Corporation
One Sealaska Plaza
Juneau, AK 99801
POSITION STATEMENT: Testified in support of SB 190 & SB 191
Ms. Lisa Blacher
Alaska Conservation Voice
P.O. Box 22151
Juneau, AK 99802
POSITION STATEMENT: Voiced concerns with SB 190 & SB 191
John Jensen, Chief Right-of-Way Agent, Central Region
Department of Transportation & Public Facilities
P.O. Box 196900
Anchorage, AK 99519-6900
POSITION STATEMENT: Commented on SB 190 & SB 191
Ms. Jane Angvik, Director
Division of Land
Department of Natural Resources
3601 C St., Suite 1122
Anchorage, AK 99503-5947
POSITION STATEMENT: Department has significant concerns with
SB 191
Dick Mylius
Division of Land
Department of Natural Resources
3601 C St., Suite 1122
Anchorage, AK 99503-5947
POSITION STATEMENT: Has concerns with SB 191
ACTION NARRATIVE
TAPE 98-4, SIDE A
Number 001
SB 28 - UNINCORP. COMMUNITY MATCHING GRANTS
CHAIRMAN MACKIE called the Senate Community & Regional Affairs
Committee meeting to order at 1:35 p.m., and noted the presence of
Senators Phillips, Hoffman, Donley and Mackie.
CHAIRMAN MACKIE announced SB 28 would be taken up as the first
order of business. He noted there was a draft committee substitute
which is substantially different than the original bill and is the
result of his working with Senator Torgerson on several issues.
SENATOR JOHN TORGERSON, prime sponsor of SB 28, speaking to the
committee substitute, said the thrust behind the bill was to let
unincorporated communities that are in organized boroughs also
participate in the unincorporated community matching grant program.
Currently, that grant money is only available if the community is
outside of a borough.
Senator Torgerson outlined the following revisions to the
Unincorporated Community Capital Project Matching Grant Program:
. The legislation provides that the unincorporated communities
in an organized area must come up with a 30 percent match in
money similar to the way boroughs do for their Capital
Matching Grant Program. This does not change the existing
unincorporated communities outside the boroughs from the
current required match of 5 percent;
. It changes the program so that a community must have a
project in order to be granted the money. Currently, a grant
is given regardless if there is a project on the books or not;
. It revises the fund distribution so projects can be based on
health and safety considerations subject to a ranking system
put together by the department. It is anticipated that the
ranking system would be something similar to the Department of
Environmental Conservation's ranking process for water
projects, as well as other ranking criteria that's used across
the board in other departments;
. It requires the governor to include projects in his capital
projects which would then come to the Legislature for final
appropriation; and
. It changes the lapse time of the program from five years to
four years. If a community has a project approved, it can
accumulate money for up to four years for a same project since
the maximum that be granted in one fiscal year is $25,000.
Senator Torgerson directed attention to backup information
containing a list of incorporated areas by Senate district, the
communities that are currently in the program by Senate district,
and the communities that would be added to the program. He noted
that it roughly doubles the number of entities that could be
eligible for this program.
Number 090
CHAIRMAN MACKIE asked Senator Torgerson what happens if the
projects that are submitted to the Legislature by the governor and
agencies are funded below the amount requested for the $25,000
grants to these communities. SENATOR TORGERSON responded that is
where they anticipate the ranking system would kick in and projects
would be ranked by the departments based on health and safety
considerations. He also noted that unincorporated areas inside of
boroughs must have borough assembly approval for projects and the
borough assemblies must recognize a nonprofit entity that's going
to represent that area.
Number 115
SENATOR HOFFMAN said the legislation seems to treat all of the
unincorporated communities much more fairly, but he expressed
concern that Section 2 changes the amount of the grant from a
minimum of $25,000 to a maximum of $25,000, so a community can
accumulate up to $100,000 over a four-year period, but in many
rural areas of the state it is conceivable that $100,000 wouldn't
even cover a forty by sixty building. SENATOR TORGERSON responded
that there are other processes to go through to receive grant
money, and this was never intended to be everything for an
unincorporated community to pick projects without having some
kind of fiscal restraint on it. He said this levels the playing
field, and by going to the maximum, probably more communities can
be squeezed in if they have smaller requests to begin with.
Number 180
SENATOR PHILLIPS directed attention to page 2, line 2 and the
phrase "social unit," which he thought should be defined in the
legislation. SENATOR TORGERSON replied that it was a good point,
and that he would check with the drafter to see if it should be
further defined.
Number 200
Responding to an inquiry by Chairman Mackie, SENATOR TORGERSON
explained that the original legislation included recognized
nonprofits within the state of Alaska, but it was taken out in a
sponsor substitute, and he has no intention of expanding the
legislation. He added that some entities aren't communities as
defined by unincorporated community and filed under the state as a
recognized unincorporated community, and that might be why "social
unit" was included in the legislation.
Number 256
KIM METCALFE-HELMAR, Special Assistant, Department of Community &
Regional Affairs, said the department had not had a chance to look
over the new committee substitute, but she thought the
establishment of a ranking system would change program
administration significantly.
There being no further testimony on SB 28, CHAIRMAN MACKIE
requested a motion to adopt the committee substitute and to move
the bill out of committee.
SENATOR PHILLIPS moved the adoption of CSSB 28(CRA) and to move
CSSB 28(CRA) out of committee with individual recommendations.
Hearing no objection, it was so ordered.
Number 285
SB 190 - ATTEMPT TO PURCHASE BEFORE EMINENT DOMAIN
CHAIRMAN MACKIE brought SB 190 before the committee as the next
order of business. As the prime sponsor of the legislation, he
turned the gavel over to Senator Phillips while he made his
presentation on the bill.
SENATOR MACKIE said he introduced SB 190 to bring fairness and
expediency to state and municipal government actions which require
the acquisition of private lands for public uses. The usual
practice is to acquire private property through condemnation
proceedings. This is a process where the governmental entity
exercises the power of eminent domain to take the property and
compensate the owner with or without the private owner's consent or
agreement. The only recourse for an unwilling owner is to
challenge in court the validity of the taking's public purpose and
the amount of compensation. In most cases the court's
consideration is principally to determine the appropriate level of
compensation. For both the governmental entity and the private
property owner, this can be an expensive and time consuming
procedure. For many land owners, the prospect of contesting a
condemnation proceeding in court is often beyond the landowner's
financial abilities to pursue. In these situations the landowner
is at the mercy of the governmental entity, the extent of its
property desires, and its method of determining compensation.
Senator Mackie said SB 190 would simply require that prior to
condemnation, a reasonable and diligent effort is made to purchase
private property through negotiations with the property owner. He
pointed out that at least 23 states have similar requirements. He
said he thinks it is reasonable to ask that the government entity
that's going to take the land makes every diligent effort to
negotiate with the person on a value and price prior to just taking
it because someone that doesn't have any money or an understanding
of the legal process could be overwhelmed with the bureaucracy and
be at a disadvantage in trying to protect his or her property
rights.
Number 325
SENATOR PHILLIPS invited Rick Harris to the table to testify on SB
190 and then turned the gavel back over to Chairman Mackie.
RICK HARRIS, Senior Vice President of Sealaska Corporation, said
the corporation has 330,000 acres of fee estate scattered
throughout Southeast Alaska, and eminent domain has become an
important issue to them, not because they are an ANCSA corporation
but because they are a private land holder within the state.
However, Sealaska has found that current eminent domain laws do not
provide the protections that they would like to have in their
dealings with the government.
Mr. Harris said SB 190 would add some additional protections to the
private landowner by requiring the government and other condemning
authorities to diligently attempt, in good faith, to purchase
private land before taking that land through the power of eminent
domain. Two prerequisites that would be critical to improve the
eminent domain law would be to require a diligent, good faith
effort to purchase, and to justify the particular property interest
that is being taken.
In his closing comments, Mr. Harris said Sealaska believes that SB
190 will level the playing field. The landowner and the state will
begin with an arms-length bargaining relationship. The landowner
will have the benefit of full disclosure of information used by the
state to determine the public purpose for the taking and value of
the interest taken.
Number 364
SENATOR PHILLIPS questioned why this is a problem because he has
been involved with a few of these situations in his own district
and they worked out fairly well. MR. HARRIS responded that
Sealaska has had several situations where eminent domain has been
used against them. He cited as an example the Kake Airport where
the Department of Transportation wanted to purchase the right-of-
way and required that the trees be cut down and retained at a low
level. Sealaska effectively has a piece of property that can no
longer be commercial forest land. He said they need a better
negotiating process in terms of how the state comes to them to
negotiate using their eminent domain authorities.
SENATOR DONLEY pointed out that if they've got a legitimate claim
and the state is not negotiating with them, they can go to court.
However, MR. HARRIS replied that the cost of litigation becomes
just as difficult as the negotiation. He said they are trying to
avoid going to court, but he suggested the legislation could be
strengthened further by requiring that when the condemning makes a
declaration of eminent domain that they have to pay that amount of
money and the landowner can use that money as a vehicle to
litigate.
Number 472
CHAIRMAN MACKIE commented that there are a lot of different
examples that can be used and the large private landowners, in most
cases, would always have the resources to negotiate, but the small
landowners may not have the resources, attorneys, etc., to
challenge the government. He questioned what is unreasonable about
asking the government to make a reasonable effort to negotiate with
the person prior to taking their land.
SENATOR DONLEY stated he agreed with the Chairman's philosophy, but
his fear exists in creating a new statutory test the Judiciary can
interpret in ways that were never intended be interpreted that way.
CHAIRMAN MACKIE said the committee would continue to take testimony
on the bill, but he acknowledged some work needed to be done on the
legislation to see if some language can be crafted that would not
create serious burdens of proof in the courts.
Number 540
LISA BLACHER, representing the Alaska Conservation Voice, stated
her group commends the intent of the bill, but they do have some
concerns with it. They question the term "interest to be taken,"
which appears three times in the bill, and believe the way it is
used is ambiguous and they question what it refers to. It is
suggested that the language either be deleted or defined more
clearly. She said it also appears that the bill may establish a
new level of right of compensation similar to regular proposed
regulatory takings legislation, and if so, they don't think it is
wise to open the door to the possibility of such financial
liability to the state.
Number 560
JOHN JENSEN, Chief Right-of Way Agent for the Central Region,
Department of Transportation and Public Facilities, stated he was
present to answer questions the committee may have about the
eminent domain process as it has been practically applied.
SENATOR PHILLIPS asked Mr. Jensen if there was a problem in
southeast as far as attitude or approaches is concerned. MR.
JENSEN acknowledged there may be a problem of attitude, but he
believes the department does make a good faith effort; however,
their differences typically and usually in compensation lead to
the frustrations addressed by Mr. Harris.
Number 579
SENATOR HOFFMAN asked Mr. Jensen if he thought the legislation
would assist in the eminent domain process. MR. JENSEN replied
that like Senator Donley he has some concern with the
interpretation of some of the language in the bill and the
possibility that it may delay the process.
TAPE 98-4, SIDE B
Number 567
CHAIRMAN MACKIE agreed that the language may need to be reworked,
but he questioned why the fear of something in the nature of a good
faith effort if they are already doing so. He doesn't believe it
will cause delays, but sometimes if it does cause a delay for a
short time, he thinks it is reasonable to protect an individual's
rights to property that they he may worked all his life to secure.
MR. JENSEN said he agreed with Senator Mackie, but his only
reservation is the unknown on how that language will be interpreted
even though they already do that.
Number 535
CHAIRMAN MACKIE stated SB 190 would be held in committee for
further work on its language.
SB 191 - EXCHANGE OF STATE TIDE AND SUBMERGED LAND
CHAIRMAN MACKIE brought SB 191 before the committee as the final
order of business. He turned the gavel over to Senator Phillips
while he made a presentation on his bill.
SENATOR MACKIE, prime sponsor of SB 191, said it was introduced as
a companion bill to SB 190 to deal with some of these land issues.
He explained that if a municipality needs an area for a watershed
to the protect the community's water supply, or for a ferry
terminal, or for an airport, etc., the legislation gives DNR the
option of exchanging tide and submerged lands for privately owned
lands needed by a municipality. He said it is another option that
would allow DNR to have a little more flexibility to work with the
private landowners to accomplish a public good.
Number 508
RICK HARRIS, Senior Vice President, Sealaska Corporation, said
approximately 10 percent of the land in Southeast Alaska is in
private ownership, but most of that land is disproportionately
located in and around the state's municipalities. Frequently,
these lands needed by the municipalities for essential municipal
services are held in private ownership. Sealaska supports
creating a new mechanism that would allow the state to acquire
those essential municipal lands and at the same time allow the
private landowners to receive some other value that would serve
their purposes and needs.
Mr. Harris said that under current law, DNR is already authorized
to negotiate land exchanges, but these general land exchange
statutes are quite discretionary, and there is no vehicle through
which either a municipality or another state agency can compel DNR
to commit state-owned lands to improve public purposes. Also, the
existing law lacks a clear statement of legislative priorities to
guide DNR in the types of exchanges which the agency should focus.
Concluding, Mr. Harris said Sealaska thinks SB 191 will provide an
excellent opportunity to resolve some of the issues dealt with on
a daily basis throughout the state.
Number 475
Responding to SENATOR PHILLIPS, MR. HARRIS explained Sealaska
Corporation owns municipal watersheds in Hydaburg, has selection
rights in the municipal watershed of Craig, and owns municipal
watersheds in Kake and Hoonah. On three different occasions,
Sealaska has attempted to find vehicles to create land exchanges
that would allow them to move away from those watersheds and get
them back into public ownership, and in all cases, those efforts
have been thwarted for a variety of reasons.
Number 440
JANE ANGVIK, Division of Land, Department of Natural Resources,
testifying via teleconference from Anchorage, said DNR has some
significant concerns about SB 191 in general, particularly with the
prospect of transferring tidelands to private ownership. The state
has a legal responsibility under the public trust doctrine to
retain most tidelands and submerged lands. This is because DNR is
required, through the public trust doctrine, to manage the
shoreline lands for the use and enjoyment of all Alaskans. She
pointed out that most other states do not allow private individuals
to acquire shore lands, and in the past, many that did so have
spent millions of dollars to reacquire these public lands.
Ms. Angvik said that while existing statutes allow DNR to transfer
tidelands to municipalities, the Legislature specifically
prohibited municipalities from selling these lands. She pointed
out that in the areas Mr. Harris made reference to, Hydaburg,
Craig, Kake, Hoonah, the state has very little land so that the
possibility for land exchanges is very slim simply because they
don't have anything to exchange.
Ms. Angvik said the notion of public trust requires that access to
the water, water allocation, and marine activities are protected in
perpetuity in order to provide for the common use of the land.
Ms. Angvik also expressed concern with the issue of valuing
tidelands and trying to ascertain the value of tidelands relative
to the value of uplands. This is a challenge because there aren't
very many tidelands that have actually been conveyed.
Ms. Angvik pointed out that Section 14(c)(3) of Alaska Native
Claims Settlement Act provided for local governments to have up to
1,280 acres to use for municipal purposes, so while DNR is very
supportive of providing some surety for municipal governments,
particularly in Southeast Alaska, to controlling their watersheds
for example, they do not believe that conveying the tidelands is
the methodology to pursue.
Number 364
CHAIRMAN MACKIE pointed out that Section 14(c)(3) applies to
village corporations, not regional corporations like Sealaska. The
fact is that Sealaska Corporation physically owns the land and the
watersheds of those other communities. He questioned how Sealaska
is supposed to be compensated or treated fairly in giving up those
lands for a public purpose if DNR doesn't have any land to exchange
and they are not able to do a land exchange with them. He added
that the purpose of SB 191 is to give DNR an option to deal with
this issue, an option that they would have available to them in
cases that make sense for absolute public need for essential public
services. MS. ANGVIK responded that the capacity of DNR to be able
to evaluate the public interest and the long-term interests of the
state is removed by the legislation and it is a mandatory
requirement. While she understands the difficulty associated with
community development, in particular Southeast Alaska where the
vast majority of the land is owned by the federal government, she
doesn't have alternative ways of compensating a private landowner
if what they owned is the watershed.
DICK MYLIUS, Division of Land, Department of Natural Resources ,
also pointed out that if DNR transferred title it is no longer land
managed by the department, and even though the landowner may
currently allow public use or access by the public, once it is
their land they can change that policy in the future. In other
states the courts have actually gone back and reacquired public
trust lands where the public has lost access to the shoreline.
Number 301
JOHN JENSEN, Department of Transportation & Public Facilities, said
eminent domain proceedings are a tool DOT uses that provides the
least cost to the public, and it is most often the most expedient
way to acquire lands.
CHAIRMAN MACKIE asked Mr. Jensen if he saw this legislation as
something positive where DOT wouldn't have to come up with the
cash; that by working with the municipality and DNR they exchange
some tidelands adjacent to an upland ownership which is all private
anyway. MR. JENSEN responded that it may be appropriate in some
instances, but he agrees with Ms. Angvik that if the agency is
required to do that then it becomes somewhat of an obstacle to
development of that particular project. He suggested it should be
voluntary between both parties.
Number 205
LISA BLACHER, representing the Alaska Conservation Voice, stated
their support for the protections in current law that ensure public
access to navigable and public waters of the state. They are
concerned that the proposed changes in SB 191 will weaken those
protections by allowing state tide and submerged lands to become
privately owned through land exchanges.
Ms. Blacher stated that the Alaska Conservation Voice's concern is
with access because right now Alaska does have public access to all
of these state tide and submerged lands. At the very least, they
would like the bill to limit the transfer of state tide and
submerged lands within municipal boundaries so as to not open up
the entire state for that type of transfer opportunity.
There being no further testimony on SB 191, CHAIRMAN MACKIE said it
was his intention to move the bill on to the Resources Committee.
SENATOR DONLEY moved SB 191 and the accompanying fiscal note be
passed out of committee with individual recommendations. Hearing
no objection, it was so ordered.
There being no further business to come before the committee, the
meeting adjourned at 3:02 p.m.
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