Legislature(1993 - 1994)

03/24/1993 01:47 PM Senate JUD

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                   SENATE JUDICIARY COMMITTEE                                  
                         March 24, 1993                                        
                            1:47 p.m.                                          
  MEMBERS PRESENT                                                              
  Senator Robin Taylor, Chairman                                               
  Senator Rick Halford, Vice-Chairman                                          
  Senator George Jacko                                                         
  Senator Dave Donley                                                          
  Senator Suzanne Little                                                       
  MEMBERS ABSENT                                                               
  COMMITTEE CALENDAR                                                           
  SENATE BILL NO. 67                                                           
  "An Act amending provisions of ch. 66, SLA 1991, that relate                 
  to reconstitution of the corpus of the mental health  trust,                 
  the  management of  trust  assets,  and  to  the  manner  of                 
  enforcement of the  obligation to compensate the  trust; and                 
  providing for an effective date."                                            
  CS FOR HOUSE BILL NO. 64(FIN)                                                
  "An Act creating  the crimes  of stalking in  the first  and                 
  second degrees  and providing penalties for their violation;                 
  providing  a  peace  officer with  the  authority  to arrest                 
  without a warrant a person the peace officer has  reasonable                 
  cause to  believe has  committed stalking;  relating to  the                 
  release  before  trial  of  a  person accused  of  stalking;                 
  prohibiting the suspension  of imposition  of sentence of  a                 
  person  convicted  of  stalking; relating  to  the  crime of                 
  assault  in the third degree; and providing for an effective                 
  SCHEDULED BUT NOT HEARD THIS DAY.                                            
  SENATE BILL NO. 152                                                          
  "An Act changing the frequency  of certain state inspections                 
  of  weights and  measures  and relating  to the  issuance of                 
  citations for weights and measures violations."                              
  SCHEDULED BUT NOT HEARD THIS DAY.                                            
  CS FOR SENATE BILL NO. 101(HES)                                              
  "An Act relating  to eligibility for and  payments of public                 
  assistance; and providing for an effective date."                            
  SCHEDULED BUT NOT HEARD THIS DAY.                                            
  PREVIOUS SENATE COMMITTEE ACTION                                             
  SB 67 - See Resources minutes dated 2/3/93 and 2/5/93.                       
          See Judiciary minutes dated 3/1/93 and 3/8/93.                       
  HB 64 - See Judiciary minutes dated 3/22/93 and 3/24/93.                     
  SB 152 - See Labor and Commerce minutes dated 3/16/93.                       
           See Judiciary minutes dated 3/22/93 and 3/24/93.                    
  SB 101 - See HESS minutes dated 3/10/93, 3/12/93, and                        
           3/15/93.  See Judiciary minutes dated 3/22/93                       
            and 3/24/93.                                                       
  WITNESS REGISTER                                                             
  Rick Johannsen, Attorney                                                     
  Coalition Drafting Counsel                                                   
  1029 West 3rd Ave., #300                                                     
  Anchorage, Alaska 99501                                                      
    POSITION STATEMENT: Worked on SB 67.                                       
  Timothy Mabery                                                               
  1664 Montana Road                                                            
  Fairbanks, Alaska 99709                                                      
    POSITION STATEMENT: Listened to SB 67.                                     
  Mrs. Rebecca Knight                                                          
  P.O. Box 1331                                                                
  Petersburg, Alaska 99833                                                     
    POSITION STATEMENT: Listened to SB 67.                                     
  Brian Bjorkquist, Asst. Atty. General                                        
  P.O. Box 110300                                                              
  State Capitol                                                                
  Juneau, AK 99811-0300                                                        
    POSITION STATEMENT: Worked on SB 67.                                       
  Lois Ann Reeder                                                              
  9600 Slalom Drive                                                            
  Anchorage, Alaska 99516                                                      
    POSITION STATEMENT: Listened to SB 67.                                     
  David Walker, Attorney                                                       
  417 Harris                                                                   
  Juneau, Alaska 99801                                                         
    POSITION STATEMENT: Worked on SB 67.                                       
  Tom Koester, Contract Attorney                                               
  Department of Law                                                            
  229 Fourth Street                                                            
  Juneau, Alaska 99801                                                         
    POSITION STATEMENT: Worked on SB 67.                                       
  R. B. Stiles, President/Owner                                                
  D. & R. Ventures                                                             
  1227 W. 9th Ave., Suite 210                                                  
  Anchorage, Alaska 99501                                                      
    POSITION STATEMENT: Testified on SB 67.                                    
  ACTION NARRATIVE                                                             
  TAPE 93-30, SIDE A                                                           
  Number 001                                                                   
  Chairman Robin Taylor called the Judiciary Committee meeting                 
  to order at 1:47 p.m.                                                        
  SENATOR  TAYLOR   returned  SB  67   (MENTAL  HEALTH   TRUST                 
  AMENDMENTS) introduced by the  Senate Resources Committee to                 
  the Judiciary Committee.                                                     
  SENATOR TAYLOR  reviewed a number of amendments  in the bill                 
  packet submitted to the committee.  He queried those wishing                 
  to  testify  on  the  teleconference  network  if  they  had                 
  Amendments A.3 and  A.4 contained in an  attached memorandum                 
  dated March  18, 1993 from  the Division  of Legal  Services                 
  from JACK CHENOWETH, Legislative Counsel.                                    
  SENATOR TAYLOR noted the  memorandum, "Comments on  Proposed                 
  Amendments  to  SB  67"  from  BRIAN  BJORKQUIST,  Assistant                 
  Attorney General for  the Department of Law,  dated 3/23/93.                 
  In  addition  to  comments,  the  letter  contained proposed                 
  amendments to be considered in SB 67.                                        
  SENATOR TAYLOR also reviewed amendments  from CHENOWETH, A.5                 
  and A.1, dated  3/11/93 and  3/23/93.  He  then assured  the                 
  teleconference sites they would have the amendments faxed to                 
  them now.                                                                    
  SENATOR  TAYLOR  asked   who  would  be  first   with  their                 
  amendments, and RICK JOHANNSEN, the attorney for a coalition                 
  of intervener plaintiffs, came forward to testify.                           
  Number 068                                                                   
  MR.  JOHANNSEN  explained  he  had  been advising  two  coal                 
  company clients, Usibelli  Coal Mine and the  Dimond Chuitna                 
  project  proposed  for South  Central  Alaska, and  had been                 
  asked to work with the other  attorneys and parties that are                 
  members of the coalition supporting changes to Chapter 66.                   
  MR. JOHANNSEN began  by listing  those in  the coalition  as                 
  being  two  of  the  four  plaintiff  groups  in  the  Weiss                 
  litigation,  including  the  Alaska  Coal  Association,  the                 
  Alaska  Miners  Association,  and  the resource  Development                 
  Council,  the   oil   company  intervenors   in  the   Weiss                 
  litigation,  Marathon  and  UNICAL, and  all  of  the public                 
  interest intervenors  in the Weiss  litigation, eight groups                 
  represented by the Sierra Club Legal Defense Fund, Inc.  MR.                 
  JOHANNSEN  also  mentioned a  representative  of the  Alaska                 
  Environmental Lobby, who  has participated in the  coalition                 
  Because of the complicated legal aspects of the dispute, MR.                 
  JOHANNSEN said all of the coalition interests have attorneys                 
  who have participated in the deliberations of the coalition.                 
  He drew  attention to  amendments A.1  and A.3  in the  bill                 
  packets  as  the  work   of  the  coalition.    With   these                 
  amendments, the coalition  believes SB 67 would  solve most,                 
  if  not all,  of the  legal problems  with Chapter  66.   In                 
  addition,  he  explained  the amendments  were  intended  to                 
  address  specific  legal  questions  raised  by  the  Alaska                 
  Department of Law. He  noted a companion bill in  the House,                 
  HB 201.                                                                      
  MR.  JOHANNSEN began  by  addressing  Amendment  A.1,  which                 
  SENATOR TAYLOR  explained as 8-LSO409\A.1,  CHENOWETH, dated                 
  Number 118                                                                   
  MR.  JOHANNSEN said the first  change on the amendment would                 
  be to eliminate Section 3 of SB 67,  leaving AS 37.14.031 in                 
  its  original  form  in  Chapter 66,  and  he  explained the                 
  background  behind  their  recommendation.     He  said  the                 
  plaintiffs  in  the  coalition  had  initially  wanted   the                 
  incoming proceeds of  original Mental Health Trust  Lands to                 
  go to the trust corpus, but the  Department of Law felt this                 
  could  violate  the terms  of  the  1956 Enabling  Act.   To                 
  eliminate this potential problem, he  said the coalition has                 
  agreed to  have all of the incoming proceeds go to the Trust                 
  Income Account as currently designated by Chapter 66.                        
  MR. JOHANNSEN explained the second change in A.1 would amend                 
  the collateral  provision of the  bill, which in  turn would                 
  amend   Chapter   66,  by   clarifying   that   the  pledged                 
  legislatively  designated  areas,  LDA, can  continue  to be                 
  developed  by the  state  to the  extent  the law  currently                 
  allows  development. The  Department  of  Law had  expressed                 
  concern the pledge  of these lands as security could prevent                 
  the state from doing anything  that could diminish or impair                 
  the value of the collateral.                                                 
  MR.  JOHANNSEN  said the  proposed  revision is  intended to                 
  clarify the  state can continue  to take actions  that would                 
  otherwise be allowed  by the legislative designation  - even                 
  though the LDA land is pledged as collateral.                                
  SENATOR TAYLOR asked for a brief explanation,                                
  Number 156                                                                   
  MR. JOHANNSEN  explained that  SB 67  would generate  income                 
  into a  trust fund from  a mixed  land cash trust  and would                 
  secure the payment of  the cash in the trust  income account                 
  each year.  He said the plaintiffs are requiring collateral,                 
  which  would be  the LDA  lands  and original  mental health                 
  trust lands set aside in previous years in parks, recreation                 
  areas, forests, and critical habitat lands.                                  
  MR. JOHANNSEN said the concerns of the coalition were if the                 
  lands were collateral, the state would be unable to carry on                 
  activities that would  normally be allowed.   He gave as  an                 
  example the harvesting of  a forest area, saying the  use as                 
  collateral wouldn't prevent the harvesting of the timber.                    
  SENATOR  TAYLOR wanted to hear  if there was opposition from                 
  the committee on Amendment A.1.                                              
  SENATOR LITTLE  clarified A.1 as allowing present activities                 
  to continue on the trust lands.  MR. JOHANNSEN explained the                 
  legislatively  designated areas  and original  mental health                 
  lands would be pledged  as collateral, so these  lands would                 
  not  be  part of  the trust,  but  collateral to  secure the                 
  state's payment  each year.    They discussed  restrictions,                 
  business as usual, and change of ownership.                                  
  Number 218                                                                   
  SENATOR TAYLOR polled persons in the  audience as to who was                 
  opposed  to  Amendment  A.1, those  supportive,  and  anyone                 
  opposed  on  the teleconference  network.   He  checked with                 
  TIMOTHY MABERY in  Fairbanks, but he  didn't have a copy  of                 
  the  amendments,  and  neither did  MRS.  REBECCA  KNIGHT in                 
  SENATOR TAYLOR turned to MR. BJORKQUIST in Anchorage for his                 
  comments or opposition to the amendment.                                     
  MR. BJORKQUIST said the comments  from the Department of Law                 
  dealt with A.1 on  page 3, subsection (2) and  were outlined                 
  in their letter.   He  expressed concerns over  A.1 in  that                 
  there is  a  potential  for  ambiguity  as  to  whether  the                 
  provision  that  allows  the  use  of lands  in  legislative                 
  designated areas would also include restrictive use of trust                 
  MR. BJORKQUIST suggested  a modification to add  language to                 
  the  Amendment  A.1, and  MR.  JOHANNSEN explained  he would                 
  support  the   insertion  of   additional  language   to  8-                 
  LSO409\A.1,CHENOWETH  dated  3/11/93.    This  would  be  an                 
  amendment to Amendment A.1.)                                                 
  It would read on Page 2, line 31, after "and,";                              
            "(1)  notwithstanding the  pledge  of the  land as                 
  security or that the land was granted to the state under the                 
  Alaska Mental Health  Enabling Act of 1956,  P.L. 84-830, 70                 
  Section  709,  the   state  may  continue  to   conduct  all                 
  activities on the land that are authorized by law; and                       
  SENATOR TAYLOR surveyed  all parties to the  legislation and                 
  to  the  LIO in Anchorage  to hear  from LOIS REEDER,  CLIFF                 
  EAMES, BILL BOBRICK, and KANDIE  LITTLER for their opinions.                 
  MS. REEDER  had polled everyone  in Anchorage, and  they all                 
  agreed with the amendment to the Amendment A.1.                              
  Number 283                                                                   
  SENATOR LITTLE moved to pass the amendment to Amendment A.1.                 
    Without objections, so ordered.                                            
  MR.  JOHANNSEN  was asked  to  explain Amendment  A.3, dated                 
  3/18/93, give an overview, and answer questions.                             
  MR. JOHANNSEN  explained that Amendment  A.3 contained three                 
  substantive  provisions,   with  the  first  being   a  land                 
  management   provision,  the   second,  a   public  interest                 
  safeguard  provision,  and   the  third,  a  definition   of                 
  unrestricted  general   fund  revenue.    He  explained  the                 
  importance  of the land  management provision which requires                 
  the  trust to  take back original  mental health  trust land                 
  subject to  existing third  party interest  such as  leases,                 
  gravel  sale  contracts, or  land  use  permits.   It  would                 
  require the Department of Natural  Resources to manage these                 
  lands  with the rules and regulations  under which the third                 
  party bargained.                                                             
  In exchange for allowing their land  to return to the mental                 
  health trust, MR. JOHANNSEN said  the lessees he represented                 
  would be guaranteed that the rules  would not change as long                 
  as their third party interests were in effect.  He explained                 
  AS  38.04  and AS  38.05 would  continue  to apply  to these                 
  lands, and these  will be called  Section 802 lands  because                 
  they would be managed under a new Section 802 in the bill.                   
  All  other original  trust  lands, MR.  JOHANNSEN  explained                 
  would  be returned  to  the  reconstituted trust,  including                 
  those lands  that  are  truly  vacant,  unappropriated,  and                 
  unreserved,  and not  subject to third  party interest.   He                 
  further  explained   these  lands  would  be  managed  under                 
  whatever management standards the trust authority may adopt,                 
  and there was  a presumption that  the trust authority  will                 
  contract with the Department of  Natural Resources to manage                 
  lands under the Trust Authority's fiduciary obligations.                     
  MR.  JOHANNSEN  discussed  possible  arrangements  for   the                 
  management of these lands which  he called Section 9  lands,                 
  because they would  be managed pursuant  to Section 9 of  AS                 
  37.14, except these lands would not  be subject to any third                 
  party interest at this time - vacant, unused, and unreserved                 
  lands.  He  emphasized the  Trust Authority could  do as  it                 
  wished with  the lands, in contrast to  the 802 lands with a                 
  third party interest.                                                        
  Number 333                                                                   
  SENATOR  LITTLE  clarified the  difference  between the  two                 
  types of land.                                                               
  MR. JOHANNSEN addressed the second  of the three substantive                 
  provisions in Amendment A.3,  the public interests safeguard                 
  provision.  He explained that  reconstituted trust land, not                 
  Section  802 land, would be  managed by the Trust Authority,                 
  and he  reviewed the safeguards  in the statutes  that would                 
  not apply  to the Section 9 land.   To protect the bill from                 
  constitutional challenges, MR. JOHANNSEN  said Amendment A.3                 
  would require  multiple purpose use of Section 9 trust land,                 
  while recognizing trust  principals as  the priority in  any                 
  conflict with the objective of multiple use.                                 
  SENATOR TAYLOR  asked for  any questions on  the aspects  as                 
  MR.  JOHANNSEN addressed  the  third substantive  provisions                 
  which  is  reflected in  Amendment  A.3 as  a  definition of                 
  "unrestricted general  funds."  He  explained the definition                 
  tied the meaning of the phrase  to the manner in which money                 
  is categorized under the statewide accounting system.                        
  MR. JOHANNSEN said there would be no limitation on the power                 
  of  the people, or the  legislature to restrict general fund                 
  revenue, and he described  the calculations of the 6%  to be                 
  paid to  the trust  income account  based on  the way  state                 
  funds are categorized today.                                                 
  Number 380                                                                   
  SENATOR JACKO expressed concerns the legislation  would bind                 
  future  legislators  to  use  the   general  fund,  but  MR.                 
  JOHANNSEN  said  the bill  really  provides that  6%  of the                 
  unrestricted  general  fund from  the  revenue of  the state                 
  would  be allocated each  year to the  trust income account.                 
  He explained the  definition of  unrestricted revenue  would                 
  help to categorize the mental health funds.                                  
  SENATOR TAYLOR mulled  over the  concept and clarified  this                 
  law would be  gaining status as  opposed to all future  laws                 
  without  change.   MR.  JOHANNSEN  said  he  was correct  in                 
  relation to the  6% allocation, and he explained the process                 
  for each year.                                                               
  SENATOR  TAYLOR  considered the  problems  with categorizing                 
  general  funds  in   opposition  to  the  Governor   in  the                 
  settlement of administrative  litigation of  old taxes.   He                 
  discussed  the  concerns of  the  legislature on  the proper                 
  designation of the funds.                                                    
  MR. JOHANNSEN had  no opinion on  the dispute but  expressed                 
  some understanding on  the problem.   As to the debate  over                 
  mental  health  funds  and  the  unrestricted  general  fund                 
  revenue, he  said it may  have to be resolved  by the courts                 
  and would  follow the outcome  from the problem  outlined by                 
  SENATOR TAYLOR.                                                              
  Number 420                                                                   
  SENATOR TAYLOR  wanted to preclude future  legislatures from                 
  changing  the  definition  of general  fund  income,  but he                 
  wasn't  sure  it was  possible to  provide  a high  level of                 
  security for the litigants.                                                  
  MR.  JOHANNSEN  said  SENATOR  TAYLOR  was  correct  in  his                 
  surmise,  since   any  legislation  could   be  reversed  or                 
  corrected by a subsequent legislature, but the bill  did not                 
  attempt to prevent  that.  He  also said SENATOR TAYLOR  was                 
  correct in noting  the discomfort of some of the plaintiffs,                 
  which was why they wanted collateral.                                        
  MR.  JOHANNSEN  returned  to  SENATOR  JACKO'S  question  to                 
  explain  the bill  talked about  an allocation to  the trust                 
  income  account, but,  he explained,  the legislature  still                 
  must  appropriate  money  from that  account  to  the mental                 
  health programs, pursuant  to the procedures in  Chapter 66.                 
  He said  the coalition  would welcome  suggestions from  the                 
  legislative staff on such a complicated  accounting subject.                 
  MR. JOHANNSEN  made a  general comment  on both  amendments,                 
  explaining the coalition  had kept the other  plaintiffs and                 
  the Department of  Law informed of the  coalition activities                 
  and positions.   He indicated the wish  to work with  all of                 
  the parties to resolve the problem in a fair and responsible                 
  manner but, since the matter is incredibly complicated, they                 
  would welcome constructive ideas.                                            
  MR. JOHANNSEN reviewed  two other  amendments, A.4 and  A.5,                 
  which he said  were technical  amendments identified by  the                 
  legislative drafter, but do  not alter the substance of  the                 
  bill or the two  amendments supported by his coalition.   At                 
  some point he wanted to address  the materials received from                 
  the Department of Law.                                                       
  Number 469                                                                   
  SENATOR TAYLOR noted that DAVID  WALKER had arrived, but  he                 
  hadn't seen either JEFFREY JESSEE or JIM GOTTSTEIN.                          
  SENATOR TAYLOR asked MR. JOHANNSEN  to review Amendment A.3,                 
  and  he  suggested  going  page  by  page.    MR.  JOHANNSEN                 
  discussed the first provision that  he thought was necessary                 
  to  show there  are two  types of land,  Section 9  land and                 
  Section 802 land.   He explained  the first insert would  be                 
  placed in Section 9 to make  the reader aware there would be                 
  a different land management program under Section 802.                       
  MR. JOHANNSEN  referred to the second insert, which takes up                 
  the remainder  of page 1,  as the public  interest safeguard                 
  provision proposed by the  coalition.  He also  referred the                 
  committee to  the letter from  the Department of  Law letter                 
  which  speaks  to  the  provision  in  the  second  part  of                 
  Amendment A.3.                                                               
  MR. JOHANNSEN said it was  important to understand that  all                 
  the  coalition had  proposed was there  be a  preference for                 
  multiple  purpose use  for Section  9 land, whenever  it was                 
  consistent  with  the  trust   fiduciary  obligations.    He                 
  explained  it  was  already followed  by  the  Department of                 
  Natural Resources for all state land, and he believed it was                 
  the minimum the Alaska Supreme Court would require.  He also                 
  explained  the  Department of  Law  was concerned  that more                 
  might be required by the Alaska Supreme Court, or the public                 
  interest language could generate litigation.                                 
  MR. JOHANNSEN  warned if the state and the plaintiffs, still                 
  supporting Chapter 66 in its current form without any public                 
  interest protection, think that the courts  are going to let                 
  them run rough  shod in  their development of  reconstituted                 
  trust land, they're being totally unrealistic.  He cited the                 
  supreme court  as  imposing some  balance  between  managing                 
  trust land to maximizing revenue to the trust and protecting                 
  the broader public interest.                                                 
  Number 500                                                                   
  MR. JOHANNSEN  quoted the  Department of  Law as  generating                 
  litigation, and  he acknowledged it  might, but he  said the                 
  threat of litigation always exists and  is no worse than the                 
  threat that currently exists each time  the DNR makes a land                 
  management disposal decision.   He described the limitations                 
  placed on a challenger by the safeguards of the legislation,                 
  and he considered the limited safeguard a reasonable balance                 
  between the  trust desire to  manage trust land  without any                 
  consideration of the broader public interest and the need to                 
  protect the broader  public interest  of the  people of  the                 
  State of Alaska.                                                             
  MR. JOHANNSEN quoted the Department of Law letter saying the                 
  public  interest  interveners  should  publicly  testify  to                 
  accepting the  present  standard and  promise not  to go  to                 
  court over more public safeguards.  He rejected the  state's                 
  suggestion and  explained it  was currently  the subject  of                 
  litigation in the Weiss case.   He explained the interveners                 
  expected more from the  courts if the litigation  is allowed                 
  to run its course.                                                           
  SENATOR TAYLOR invited BRIAN  BJORKQUIST, Assistant Attorney                 
  General, to respond to the remarks from MR. JOHANNSEN.                       
  MR. BJORKQUIST disputed the positions taken by the coalition                 
  as to the proposed  amendments taking care of the  potential                 
  challenges to Chapter 66.  He referred to a statement by MR.                 
  JOHANNSEN later saying  that might not  be the case, and  he                 
  offered the  state's concerns  over potential  challenges to                 
  management  by the Trust  Authority.  He  gave some examples                 
  under Article E,  Section 10 of  the Alaska Constitution  in                 
  relation to safeguards.                                                      
  MR. BJORKQUIST thought any  litigation should resolve  those                 
  issues dealing with the management obligations to the mental                 
  health trust.   He disagreed with MR.  JOHANNSEN over issues                 
  of multiple use and restrictions  imposed under the proposed                 
  amendments as  well as a  trust principle  exception to  the                 
  multiple  use provisions.  He referred the committee to page                 
  3 of the letter from the  Department of Law and reviewed the                 
  comments on  SB 67  to the  committee in  i) regarding  what                 
  would become  AS 37.14.009(b)(1),  which he  said should  be                 
  referenced  in multiple use management.                                      
  SENATOR   TAYLOR  referred   the  committee   to  CHENOWETH,                 
  Amendment A.3, page 1, and asked MR. BJORKQUIST if he agreed                 
  with the sentence  ending with  "... trustee set  out in  AS                 
  37.14.007:.  MR. BJORKQUIST agreed  and suggested adding "or                 
  AS 37.14.009.  He described an aspect of unpredictability to                 
  those coming to  DNR or  the Trust Authority  with ideas  on                 
  developing those  lands.   He  spoke  of ways  to  encourage                 
  people to come forth to develop those lands.                                 
  TAPE 93-30, SIDE B                                                           
  Number 001                                                                   
  SENATOR  TAYLOR queried  TIM MABERY  Fairbanks, MRS.  KNIGHT                 
  from Petersburg, JOHN  MALONE from Bethel, and  LOIS REEDER,                 
  but all had no comment.                                                      
  MR.  WALKER,  speaking  from  the  audience, asked  how  the                 
  amendments were going to  be moved.  SENATOR TAYLOR  said it                 
  was his intention to  move the amendment, either in  part or                 
  whole,  as  soon  the discussion  has  been  completed.   He                 
  invited MR. WALKER to make his comments at this time.                        
  MR.  WALKER  explained he  was  the  lead  counsel  for  the                 
  settling plaintiffs in the litigation, those who support the                 
  provisions in Chapter  66 and the present  settlement before                 
  the court now  awaiting approval.  He indicated he was aware                 
  of  the  actions  of the  coalition,  but  he  explained the                 
  original  plaintiffs, the  Alaska Mental  Health Association                 
  and  Vern Weiss, were  not part of the  coalition and do not                 
  support another approach  at the expense of  the settlement,                 
  while maintaining  it should  be approved by  the court  and                 
  supported by the legislature.                                                
  MR. WALKER said his  purpose at the meeting is not  to react                 
  to  any of  the amendments, because  some of  the amendments                 
  cause  him  considerable concern.    He was  concerned there                 
  needed to  be a process that worked for everybody.  If there                 
  is  to  be  a   new  settlement,  MR.  WALKER   thought  the                 
  Administration should  be negotiating with the  parties, but                 
  he  didn't think the legislature and the coalition should be                 
  negotiating  a  settlement  agreement.     He  termed  it  a                 
  dangerous proposition and said the  committee needed to keep                 
  aware  the  settling   plaintiffs  were  not  part   of  the                 
  Number 058                                                                   
  SENATOR  TAYLOR   expressed  frustration  by   MR.  WALKER'S                 
  testimony and  how long  the resolution of  Chapter 66  will                 
  take.    He then  called on  TOM  KOESTER, Attorney  for the                 
  settling plaintiffs, for his testimony.                                      
  MR. KOESTER said  everyone was looking  for a solution  that                 
  works  and  censured  a remark  by  MR.  JOHANNSEN  that the                 
  interveners  were confident  that the  Alaska Supreme  Court                 
  will require more than  this bill provides.  He felt  it was                 
  unfair for MR. JOHANNSEN to suggest to the committee that it                 
  was a solution.  MR. KOESTER said the interveners can't have                 
  it both ways, and  he said this was of great  concern to the                 
  SENATOR TAYLOR also expressed some grave concerns as to  the                 
  management proposal  and was reluctant to accept some of the                 
  compromises  in the  spirit  of achieving  a  solution.   He                 
  didn't think the  legislature could  mandate a multiple  use                 
  concept on a coal mine or a gold mine.                                       
  BOB  STILES  of the  Dimond  Chuitna Coal  project  asked to                 
  Number 107                                                                   
  MR. STILES explained to  SENATOR TAYLOR how a coal  mine was                 
  an example of  multiple use, and  he used his Wishbone  Hill                 
  project as  a specific example.   He described  the Wishbone                 
  Hill project as  being within the  MatSu Moose Range and  an                 
  LDA.  MR.  STILES further explained a  gold mine could be  a                 
  temporary  land use, and in his  case the land would go back                 
  into wildlife habitat.                                                       
  MR. JOHANNSEN  gave an  other illustration  of multiple  use                 
  when land  was harvested  of its  timber and  then used  for                 
  mining.  He explained these were  principles in AS 38.05.285                 
  presently  used  by  DNR and  would  be  used  by the  Trust                 
  Authority.  He explained the job  of the Trust Authority was                 
  to  maximize  revenue, and  he  outlined some  of  the risks                 
  involved in litigating development.   MR. JOHANNSEN said the                 
  interveners would prefer to compromise rather than litigate.                 
  SENATOR TAYLOR discussed with MR. JOHANNSEN the amendment to                 
  add AS 37.14.009  to Section 3  (1), and MR. JOHANNSEN  said                 
  his clients  had no problem  with it.   He thought it  was a                 
  good  suggestion  and the  result  of compromise  within the                 
  Number 150                                                                   
  SENATOR  LITTLE moved  to  amend page  3  of Amendment  A.3,                 
  Section  3,  (1)  after "AS  37.14.007(;)  or  AS 37.14.009;                 
  Without objections, so ordered.                                              
  SENATOR TAYLOR asked  MR. JOHANNSEN to  move on to his  next                 
  proposed amendment.                                                          
  Before going  further  with the  amendment,  SENATOR  TAYLOR                 
  expressed concern  that within the old Chapter  66 the trust                 
  properties in the reconstituted mental health trust would be                 
  received  by a  board with  the greatest  level of  autonomy                 
  possible in the management of the lands.  He gave the Beluga                 
  Coal Fields as an example.                                                   
  MR. JOHANNSEN directed the next amendment to the top of page                 
  2  of  Amendment A.3,  and  the definition  of "unrestricted                 
  general  fund revenue."    SENATOR  TAYLOR asked  what would                 
  happen to the interest income in present endowments such  as                 
  the Science and Technology Endowment and the Railbelt Energy                 
  Fund within the general fund.                                                
  MR. JOHANNSEN asked if it was revenue restricted by a law to                 
  a  specific use,  and SENATOR  TAYLOR  explained it  was not                 
  designated but was restricted.  He  explained it was done by                 
  putting a fence around the account within the general funds.                 
  He  also  gave the  example  of the  Anchorage International                 
  Airport Account.                                                             
  SENATOR  TAYLOR  was concerned  all  of the  revenue streams                 
  would  be  tapped  for 6%  under  the  legislation, and  MR.                 
  JOHANNSEN suggested  it was probably  the case with  what he                 
  presently  knew, and if  it was not  presently restricted by                 
  law to a specific use.   SENATOR TAYLOR concluded by calling                 
  the  discussion  an accounting  exercise  in regards  to the                 
  Mental Health  Trust  Fund within  the general  fund out  of                 
  which, as  a legislature, make  appropriations for  programs                 
  recommended  by  the  Mental Health  Board.    MR. JOHANNSEN                 
  thought that was correct.                                                    
  MR. JOHANNSEN read the next proposed  amendment on page 2 of                 
  Amendment A.3 for the definition of "conveyed or encumbered"                 
  Number 198                                                                   
  SENATOR  TAYLOR  invited  MR.  BJORKQUIST   to  address  any                 
  comments  or concerns  to the  committee on  the subject  of                 
  unrestricted general fund revenue of the state.  He said the                 
  state had no comment at this time on the issue.                              
  SENATOR TAYLOR directed MR. JOHANNSEN to continue.                           
  MR. JOHANNSEN  returned to  the definition  of "conveyed  or                 
  encumbered" to  explain why these were lands  that would not                 
  be  returned to  the trust,  and he further  explained these                 
  lands were described under the intent of Chapter 66, but was                 
  never  specified  in  Chapter 66.    He  thought  it was  an                 
  improvement  on  Chapter   66  and   settled  some  of   the                 
  ambiguities of Chapter 66.                                                   
  Again, SENATOR TAYLOR checked with  MR. BJORKQUIST as to any                 
  problems  with  the  proposed  amendment  on   "conveyed  or                 
  MR. BJORKQUIST had some suggested additions to the amendment                 
  to clarify, and he referred to page 4 of the letter from the                 
  Department of  Law to  add to  the meaning  of "conveyed  or                 
  encumbered."  He explained the reasons for the addition of:                  
       "(F)    is subject  to  an interagency  land management                 
  agreement, interagency land management  transfer, management                 
  agreement  or  management right  but  does not  include land                 
  unnecessary to carry out the purpose of the interagency land                 
  management agreement, interagency land  management transfer,                 
  management agreement or management right."                                   
  SENATOR  DONLEY suggested  a  proposed committee  substitute                 
  should be written by the Judiciary staff to be  adopted as a                 
  work draft.   SENATOR TAYLOR  thought that was  an excellent                 
  idea since the legislation has become more complex.  He said                 
  he would try to have it completed for the next meeting.                      
  SENATOR  TAYLOR  asked  MR.  JOHANNSEN  for his  opinion  of                 
  Subparagraph (F), and MR. JOHANNSEN expressed agreement with                 
  the  amendment to Amendment A.3.  He thought it was a change                 
  that would continue the intent of the bill.                                  
  Number 279                                                                   
  SENATOR LITTLE moved to amend Amendment A.1 to include a new                 
  Subsection  (F) on  page 3,  line 12, under  Subsection (E).                 
  Without objections, so ordered.                                              
  SENATOR TAYLOR returned the meeting to MR. JOHANNSEN.                        
  MR. JOHANNSEN referred  the committee to page 2 of Amendment                 
  A.3  to  "Page 3,  line  14"  and  said  it was  a  drafting                 
  provision in the definition section  of the bill to  include                 
  the definition of "a lease."                                                 
  MR. JOHANNSEN said  it was the  same procedure for "Page  3,                 
  line 16," and  would clarify  that mining  claims were  also                 
  mining  leasehold locations.  He explained  that in the same                 
  place,  "Page 3, line  19," was intended to  add to the list                 
  exactly  those  kinds  of  lands   subject  to  third  party                 
  interests and make it consistent with AS 38.05.802.                          
  SENATOR TAYLOR asked MR. BJORKQUIST for any concerns on  the                 
  proposed amendments, and MR. BJORKQUIST said  the Department                 
  of Law had additional suggested amendments to Amendment A.3.                 
  He explained his  suggested changes  to allow  sold land  to                 
  include conversion rights to sale, and he explained the sale                 
  contracts.    He referred  the committee  to  page 5  of the                 
  letter from the Department of Law which would be:                            
       (F)  "(G)   is  subject  to  a land  lease  issued with                 
  conversion rights to sale."                                                  
  MR. BJORKQUIST explained  there would need to  be conforming                 
  amendments later in the bill with  reference to AS 38.05.809                 
  (3)  which  would   clarify  the  lease  amendment   without                 
  conversion rights to sale.                                                   
  MR. BJORKQUIST suggested under Subsection (C), designated as                 
  "Page 3, line 12," on page 2 of Amendment A.3, it  should be                 
  amended to read:                                                             
            "(C)  has  been selected  by a Native  corporation                 
  under 43 U.S.C. 1611;"                                                       
  SENATOR TAYLOR clarified  he wanted both that  amendment and                 
  the  previous  suggestion  of  a  new Subsection  (G)  under                 
  "conveyed or encumbered."                                                    
  SENATOR TAYLOR asked MR. JOHANNSEN for his comments, and  he                 
  said the proposed Subsection (G) had been discussed with one                 
  of the plaintiff's lawyers.  The lawyer disagreed it was the                 
  best  way  to  handle  land   subject  to  those  particular                 
  interests, and  he elaborated  on the  disagreement.   After                 
  some discussion,  SENATOR TAYLOR  suggested they  work on  a                 
  better place to put the proposed amendment.                                  
  Number 358                                                                   
  After some discussion of the placement of the word "Native,"                 
  SENATOR   LITTLE   moved    to   include   "Native"   before                 
  "corporation"  in  "Page  3,  line  12," Subsection  (C)  of                 
  Amendment A.3.  Without objections, so ordered.                              
  SENATOR DONLEY praised SENATOR  TAYLOR'S tenacity in working                 
  on the legislation,  but renewed his suggestion  to have the                 
  staff and all parties to the legislation work on a committee                 
  substitute.    They discussed  the  technical nature  of the                 
  legislation, and SENATOR TAYLOR asked MR. JOHANNSEN how much                 
  more detail would be needed to complete his dispute with the                 
  MR.  JOHANNSEN  thought   SENATOR  DONLEY'S  suggestion  was                 
  correct,  and  said he  would be  available  to work  on the                 
  legislation, since he  thought it was important  to move the                 
  bill forward.   He stressed  the need for  a vehicle  during                 
  this session to prevent more litigation.                                     
  SENATOR TAYLOR  suggested MR.  JOHANNSEN work  directly with                 
  both legislative and committee staff, MR. KOESTER, and other                 
  Department of Law staff to draft two committee substitutes -                 
   one sponsored by the  state and one by  the coalition.   In                 
  addition, SENATOR TAYLOR wanted a specific chart to show the                 
  significant differences  between the original Chapter 66 and                 
  the  amendments  as  proposed.    He didn't  preclude  other                 
  interests offering their amendments, also.                                   
  Number 464                                                                   
  SENATOR  TAYLOR  charged  the  participants with  using  the                 
  remainder  of  the  week  to  draft the  proposed  committee                 
  substitutes  to  SB 67  to  be brought  before  committee on                 
  Monday, March 29, 1993.                                                      
  MR. WALKER thought the process would  be helpful also to the                 
  settling  plaintiffs.      MR.   JOHANNSEN   indicated   his                 
  willingness to work  on the  proposed committee  substitute.                 
  MR. STILES, as a  business man, explained the  coalition had                 
  resolved  all of the changes suggested  by the Department of                 
  Law  in  concept,  and  he   suggested  a  single  committee                 
  substitute could be drafted.                                                 
  SENATOR  LITTLE  agreed  with MR.  STILES  and  implored the                 
  participants to agree  on a  single committee substitute  to                 
  move forward on the bill.                                                    
  SENATOR TAYLOR  reiterated his  request to  have the  matter                 
  resolved,   and  he   thanked   the  participants   on   the                 
  teleconference network in Anchorage, Bethel, Petersburg, and                 
  Fairbanks for their participation.                                           
  There  being  no   further  business  to  come   before  the                 
  committee, the meeting was adjourned at 3:15 p.m.                            

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