Legislature(1993 - 1994)

02/22/1994 12:00 PM Senate RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                   SENATE RESOURCES COMMITTEE                                  
                        February 22, 1994                                      
                          12:00 P.M.                                           
                                                                               
 MEMBERS PRESENT                                                               
                                                                               
 Senator Mike Miller, Chairman                                                 
 Senator Loren Leman, Vice Chairman                                            
 Senator Steve Frank                                                           
 Senator Drue Pearce                                                           
 Senator Dave Donley                                                           
 Senator Fred Zharoff                                                          
                                                                               
  MEMBERS ABSENT                                                               
                                                                               
 Senator Al Adams                                                              
                                                                               
  OTHER LEGISLATORS PRESENT                                                    
                                                                               
 Senator Suzanne Little                                                        
 Senator Jay Kerttula                                                          
 Representative Joe Green                                                      
                                                                               
  COMMITTEE CALENDAR                                                           
                                                                               
 SENATE BILL NO. 215                                                           
 "An Act relating to and redesignating the oil and hazardous                   
 substance release response fund and to its use in the event of a              
 disaster emergency; repealing the authority in law by which marine            
 highway vessels may be designed and constructed to aid in oil and             
 hazardous substance spill cleanup in state marine water using money           
 in the oil and hazardous substance release response fund; amending            
 requirements relating to the revision of state and regional master            
 prevention and contingency plans; altering requirements applicable            
 to liens for recovery of state expenditures related to oil or                 
 hazardous substances; amending the authority to contract to provide           
 personnel to respond to a release or threatened release of oil or             
 a hazardous substance and to contract to conduct spill related                
 research; reassigning responsibility for the oil and hazardous                
 substance response corps and for the emergency response depots to             
 the Department of Environmental Conservation, and for the operation           
 of the state emergency response commission and its attendant                  
 responsibilities for the local emergency planning commissions to              
 the Department of Military and Veterans' Affairs; and modifying               
 definitions of terms relating to the preceding provisions;                    
 terminating the nickel-per-barrel oil conservation surcharge;                 
 levying and collecting two new oil surcharges; and providing for              
 the suspension and reimposition of one of the new surcharges; and             
 providing for an effective date."                                             
                                                                               
 SENATE BILL NO. 308                                                           
 "An Act modifying administrative procedures and decisions by state            
 agencies that relate to uses and dispositions of state land,                  
 property, and resources, and to the interests within them, and that           
 relate to land, property, and resources, and to the interests                 
 within them, that are subject to the coastal management program;              
 and providing for an effective date."                                         
 HB 232 (BOW HUNTING STAMP & BOW HUNTING SAFETY) WAS SCHEDULED, BUT            
 NOT HEARD THIS DATE.                                                          
                                                                               
  PREVIOUS ACTION                                                              
                                                                               
 SB 215 - See Resources minutes dated 11/19/93, 1/19/94,                       
          2/7/94, and 2/16/94.  See Labor & Commerce minutes                   
          for 2/22/94.                                                         
                                                                               
  SB 308 - See Resources minutes dated 2/14/94.                                
                                                                               
 HB 232 - No previous action to record.                                        
                                                                               
  WITNESS REGISTER                                                             
                                                                               
 Representative Mike Navarre                                                   
 Capitol Building                                                              
 Juneau, Ak. 99801-1182                                                        
  POSITION STATEMENT:   Opposed SB 215.                                        
                                                                               
 Marla Berg, Legislative Aide                                                  
 c/o Senator Al Adams                                                          
 Capitol Building                                                              
 Juneau, Ak. 99801-1182                                                        
  POSITION STATEMENT:   Commented on an amendment to SB 215.                   
                                                                               
 Robert Poe, Director                                                          
 Division of Information and Administrative Services                           
 410 Willoughby Ave., Suite 105                                                
 Juneau, Ak. 99801-1795                                                        
  POSITION STATEMENT:   Opposed SB 215.                                        
                                                                               
 Mike Conway, Director                                                         
 Division of Spill Prevention and Response                                     
 Department of Environmental Conservation                                      
 410 Willoughby Ave., Suite 105                                                
 Juneau, Ak. 99801-1795                                                        
  POSITION STATEMENT:   Opposed SB 215.                                        
                                                                               
 Jim Eason, Director                                                           
 Division of Oil and Gas                                                       
 Department of Natural Resources                                               
 P.O. Box 107034                                                               
 Anchorage, Ak. 99510-7005                                                     
  POSITION STATEMENT:   Supported SB 308.                                      
 Charlie Johnson                                                               
 P.O. Box 948                                                                  
 Nome, Ak. 99762                                                               
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
 Steve Porter                                                                  
 P.O. Box 100360                                                               
 Anchorage, Ak. 99510                                                          
  POSITION STATEMENT:   Supported SB 308.                                      
                                                                               
 Walt Furnace                                                                  
 Alaska Support Industry Alliance                                              
 4220 B St.                                                                    
 Anchorage, Ak.  99503                                                         
  POSITION STATEMENT:   Supported SB 308.                                      
                                                                               
 Loren Flagg, Executive Director                                               
 Kenai Peninsula Fishermen's Association                                       
 34824 K Beach Rd.                                                             
 Soldotna, Ak. 99669                                                           
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
 Theo Matthews, Administrative Assistant                                       
 United Cook Inlet Drift Association                                           
 P.O. Box 69                                                                   
 Kasilof, Ak. 99610                                                            
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
 Irv Carlisle                                                                  
 P.O. Box 2349                                                                 
 Soldotna, Ak. 99669                                                           
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
 Tom Lohman                                                                    
 North Slope Borough                                                           
 P.O. Box 69                                                                   
 Barrow, Ak. 99723                                                             
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
 Kristin Stahl-Johnson                                                         
 Kodiak Conservation Network                                                   
 P.O. Box 2661                                                                 
 Kodiak, Ak. 99615                                                             
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
 Linda Freed                                                                   
 Kodiak Island Borough                                                         
 710 Mill Bay                                                                  
 Kodiak, Ak. 99615                                                             
  POSITION STATEMENT:   Commented on SB 308.                                   
                                                                               
 Mike Chihuly                                                                  
 P.O. box 39294                                                                
 Ninilchik, Ak 99639                                                           
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
  Stan Stephens                                                                
 P.O. Box 1297                                                                 
 Valdez, Ak. 99686                                                             
  POSITION STATEMENT:   Commented on SB 308.                                   
                                                                               
  Nancy Lethcoe                                                                
 Alaska Wilderness and Recreational Citizens Association                       
 P.O. Box 1313                                                                 
 Valdez, Ak. 99686                                                             
  POSITION STATEMENT:   Commented on SB 308.                                   
                                                                               
  John Oscar                                                                   
 Soldotna, Ak. 99669                                                           
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
  Richard Tyler                                                                
 Homer, Ak. 99603                                                              
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
 Mike O'Maera                                                                  
 P.O. Box 1125                                                                 
 Homer, Ak. 99603                                                              
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
 Riki Ott                                                                      
 United Fishermen of Alaska                                                    
 P.O. Box 1430                                                                 
 cordova, Ak. 99574                                                            
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
 James Mykland                                                                 
 P.O. Box 1241                                                                 
 Cordova, Ak. 99574                                                            
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
 John Bocci                                                                    
 P.O. Box 939                                                                  
 Cordova, Ak. 99574                                                            
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
 Jon Isaacs                                                                    
 308 G Street                                                                  
 Anchorage, Ak. 99501                                                          
  POSITION STATEMENT:   Wanted more time to consider SB 308.                   
                                                                               
 Fran Bennis                                                                   
 Alaska Conservation Counsel                                                   
 P.O. Box 101145                                                               
 Anchorage, Ak. 99510                                                          
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
 Joe McGill                                                                    
 Bristol Bay L. A.                                                             
 P.O. box 322                                                                  
 Dillingham, Ak. 99576                                                         
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
 Alice Ruby                                                                    
 P.O. Box 121                                                                  
 Dillingham, Ak. 99576                                                         
  POSITION STATEMENT:   Wanted more time to evaluate SB 308.                   
                                                                               
 Chuck Degnan                                                                  
 Unalakleet, Ak.                                                               
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
 Eric Smith                                                                    
   731 East 8th                                                                
 Anchorage, Ak 99501                                                           
  POSITION STATEMENT:   Opposed SB 308.                                        
                                                                               
  Nancy Wainwright, Attorney                                                   
 Anchorage, Ak.                                                                
  POSITION STATEMENT:   Commented on SB 308.                                   
                                                                               
 Sue Flensburg                                                                 
 P.O. Box 349                                                                  
 Dillingham, Ak. 99576                                                         
  POSITION STATEMENT:   Commented on SB 308.                                   
                                                                               
 Barbara Fullmer                                                               
 1031 W. 4th, Suite 200                                                        
 Anchorage, Ak. 99501-1994                                                     
  POSITION STATEMENT:   Commented on SB 308.                                   
                                                                               
  ACTION NARRATIVE                                                             
                                                                               
  TAPE 94-11, SIDE A                                                           
 Number 001                                                                    
 CHAIRMAN MILLER called the Senate Resources Committee meeting to              
 order at 12:00 p.m. and announced  SB 215  (OIL/HAZARDOUS SUBS.               
 RELEASE RESPONSE FUND) to be up for consideration.  He explained              
 there was a proposed CS, dated 2/15/Resources/U version.  They                
 briefly discussed the changes from the "O" version.                           
                                                                               
 Number 97                                                                     
                                                                               
 SENATOR LEMAN moved to adopt the U version.  There were no                    
 objections and it was so ordered.                                             
 REPRESENTATIVE MIKE NAVARRE spoke in opposition to SB 215 and gave            
 the history of the 470 Fund.  He said he was co-sponsor of the                
 original bill.  He said because of lack of detailed records many              
 times it was hard to determine who was responsible for oil spills.            
 It will be impossible to find the responsible party for a number of           
 contaminated sites and the burden of cleaning will fall on the                
 state.  The estimate was significant.  He was looking for a way to            
 provide for eventual cleanup and protection from ground water.  At            
 the time, there was a lot of concern about who was going to be                
 ultimately liable for an independent contractor who had accepted              
 hazardous waste for disposal.                                                 
                                                                               
 He explained the 470 Fund was passed before Exxon Valdez spill and            
 it wasn't funded adequately before then.  His primary concern was             
 what if there was another big spill.  Had the nickel been split at            
 the time, it would have been adequate, but the legislature                    
 substantially changed what can be appropriated out of that fund               
 with respect to prevention, monitoring, contingency plans, etc.               
 Some of the things that might save money haven't been enacted.  For           
 instance, if there was one contingency plan, instead of having                
 numerous ones.                                                                
                                                                               
 The legislature recognized there would be an on/off provision.  He            
 thought the accounting was flawed.  He also noted they did not know           
 all the expenses involved in an adequate prevention program.                  
                                                                               
 He concluded that there is a legitimate concern that this has been            
 made an additional nickel per barrel tax to the industry.  On the             
 other hand, the fund is appropriated by the legislature.  The focus           
 of the debate should not be how to limit spending specifically, but           
 what is needed to provide the programs that we want to monitor and            
 have proper oversite for oil and hazardous substance.  He thought,            
 given the philosophy of the current administration regarding ANWR,            
 it would be good for Alaska to have proper oversite.                          
                                                                               
 He also noted that at the time they established the catastrophic              
 fund, the $50 million was a goal; although they realized it                   
 wouldn't be adequate for a catastrophic spill.                                
                                                                               
 Number 298                                                                    
                                                                               
 SENATOR ZHAROFF proposed the following amendments for Senator Adams           
 who was not able to attend.  He noted they were based on the "O"              
 version of the bill.                                                          
                                                                               
 SENATOR ZHAROFF moved amendment #1.  SENATOR MILLER objected for              
 purposes of discussion.  This removes "the big stick" meaning if              
 the legislature doesn't appropriate funds the surcharge would be              
 suspended, SENATOR ZHAROFF explained.                                         
                                                                               
 SENATOR DONLEY asked if the subcommittee got a legal opinion on the           
 constitutionality of such a "dedication of funds" provision?                  
 SENATOR MILLER responded that Mr. Chenoweth, who drafted the                  
 legislation, did not raise that as an issue.  He would get an                 
 opinion on it, however.                                                       
                                                                               
 SENATOR ZHAROFF moved the amendment and asked for unanimous                   
 consent.  SENATOR MILLER maintained his objection.  SENATOR ZHAROFF           
 just moved the amendment then.  Senators Zharoff and Donely voted             
 yes; Senators Leman and Miller voted no and the amendment failed to           
 pass.                                                                         
                                                                               
 Number 376                                                                    
                                                                               
 SENATOR ZHAROFF moved amendment #2 which would allow the fund to be           
 tapped to provide a safe drinking water source should the existing            
 source be polluted.  He said this issue has come up and sometimes             
 it is cheaper and faster to drill a new well than to clean up the             
 existing source.                                                              
                                                                               
 MARLA BERG, Aide to Senator Adams, said since the 470 Fund can't be           
 used for capital projects, and if a community didn't have enough              
 money to drill a new water source themselves, they would go through           
 village safe water to get funding and clean up the existing water             
 source which would cost a lot of money.  It would be a lot cheaper            
 to just drill a new well if they could have access to the 470 Fund.           
 SENATOR MILLER said he supported the amendment, but it was just a             
 little too broad.  Senators Donley and Zharoff voted yes; Senators            
 Leman and Miller voted no and the amendment failed.                           
                                                                               
 Number 420                                                                    
                                                                               
 SENATOR ZHAROFF moved amendment #3 which puts hazardous substances            
 back into the catastrophic fund.  Senators Donley, Zharoff, and               
 Leman voted yes; Senator Miller voted no and the amendment passed.            
                                                                               
 Number 431                                                                    
                                                                               
 SENATOR ZHAROFF moved amendment #4 which deletes the accrued                  
 interest from being part of the contingency and abatement account.            
 Senator Miller said he would get an opinion on the dedicated funds            
 issue.  Senator Zharoff voted yes; Senators Donley, Leman, and                
 Miller voted no and the amendment failed.                                     
                                                                               
 Number 480                                                                    
                                                                               
 SENATOR ZHAROFF moved amendment #5.  SENATOR MILLER objected.                 
 Senators Donley and Zharoff voted yes; Senators Leman and Miller              
 voted no and the amendment failed.                                            
                                                                               
 Number 493                                                                    
                                                                               
 SENATOR DONLEY said he also had some amendments at Senator Adams'             
 request.  He moved amendment #9 which deletes section 9 from the              
 bill.  SENATOR MILLER objected for discussion purposes.                       
                                                                               
 ROBERT POE, Department of Environmental Conservation, said they               
 supported the original language stating that a responsible party              
 would have to actually contain or clean up and not just take                  
 containment "action."  Deleting section 9 would accomplish that.              
                                                                               
 SENATOR LEMAN commented he thought the language in section 9 meant            
 that action would have to be taken to mitigate a spill which would            
 be substantial.                                                               
                                                                               
 SENATOR DONLEY said the Department of Environmental Conservation              
 supports the status quo, but he asked to hear why someone wanted to           
 change it.                                                                    
                                                                               
 SENATOR MILLER removed his objection and the amendment passed.                
                                                                               
 Number 590                                                                    
                                                                               
 SENATOR DONLEY said the next amendment requested by Senator Adams             
 was to delete sections 26 and 28 which was requested by the DEC.              
 MR. POE said these two items define when a release is imminent.               
 This part of the law is acted upon a couple of times a week.                  
                                                                               
  TAPE 93-11, SIDE B                                                           
  Number 590                                                                   
                                                                               
 MR. POE said the further refinements of the definition of imminent            
 release could call into question a lot of suits after the fact.               
 SENATOR MILLER said he thought the new language gave them more                
 flexibility.  SENATOR LEMAN agreed.  MR. POE reiterated that for              
 DNR, generally worded guidance has been best.                                 
                                                                               
 SENATOR FRANK asked for specific examples of this situation.                  
                                                                               
 MIKE CONWAY, Director, Division of Spill Prevention and Response,             
 said they deal with many times with the potential for a spill, for            
 example a fishing vessel on the rocks whose tank has not been                 
 punctured, but given the weather you take action to pump off the              
 tanks.  And then the weather changes and it never happens.  The new           
 language would allow more "Monday morning quarterbacking" which               
 would imply bad judgement was used.                                           
                                                                               
 SENATOR LEMAN said he would consider the example he cited as an               
 imminent release.                                                             
                                                                               
 SENATOR DONLEY asked if they had engaged in any litigation over the           
 existing statute?  MR. CONWAY answered that he hadn't while he                
 worked for the state, but as Federal On-Scene Coordinator with the            
 Coast Guard whenever they took action to mobilize gear and then go            
 back to the responsible party, yes, they had that problem.                    
                                                                               
 REPRESENTATIVE GREEN asked if that was before or after the Exxon              
 Valdez?  MR. CONWAY said it was before.  REPRESENTATIVE GREEN said            
 he didn't think that after the Exxon Valdez it would be a problem             
 to err on the side of prevention.                                             
                                                                               
 SENATOR ZHAROFF asked for another example.  MR. CONWAY couldn't               
 think of one at the moment.                                                   
                                                                               
 SENATOR PEARCE said she thought the new language gave them                    
 increased flexibility by expanding the definition to reasonably               
 expect there could be a problem instead of saying it's going to               
 happen.                                                                       
                                                                               
 MR. CONWAY said with the discussion on the intent of this issue as            
 a matter of record, the language would be acceptable.                         
                                                                               
 SENATOR DONLEY withdrew amendment #7.                                         
                                                                               
 Number 418                                                                    
                                                                               
 SENATOR LEMAN moved amendment #8 and asked for unanimous consent.             
 SENATOR MILLER objected for purposes of discussion.                           
                                                                               
 SENATOR LEMAN explained this is the inflation proofing provision              
 for the catastrophic oil release response account in which the $50            
 million will be placed.                                                       
                                                                               
 Senators Donley, Zharoff, Frank, Pearce, and Leman voted yes;                 
 Senator Miller voted no and the amendment passed from Committee.              
                                                                               
 Number 395                                                                    
                                                                               
 SENATOR ZHAROFF moved to adopt amendment #9.  SENATOR MILLER                  
 objected for purposes of discussion.  SENATOR ZHAROFF explained a             
 report from the Commissioner is to be submitted in the first 120              
 hours, then the Governor does not need to do anything to let the              
 efforts continue.  However, by administrative order he could                  
 suspend use of the fund.  Now the Governor has to respond with an             
 executive order allowing the work to continue.                                
                                                                               
 Senators Donley and Zharoff voted yes; Senators Frank, Pearce,                
 Leman, and Miller voted no and the amendment failed.                          
                                                                               
 SENATOR ZHAROFF moved amendment #10 which lets some of the funds be           
 used for the part of the construction of the ferries that have                
 spill equipment.                                                              
                                                                               
 Senators Donley and Zharoff voted yes;  Senators Frank, Pearce,               
 Leman, and Miller voted no and the amendment failed.                          
                                                                               
 SENATOR ZHAROFF moved amendment #11 which puts hazardous materials            
 back in and restores the mechanism by which municipal grants can be           
 made from the fund.  He said he is not certain what they did to               
 rural communities and the funding they need to be able to respond             
 to a spill.  SENATOR MILLER said this issue did need clarification.           
 However, the drafter couldn't be here today.  SENATOR ZHAROFF asked           
 to have this amendment forwarded.  SENATOR MILLER agreed.                     
                                                                               
 Number 272                                                                    
                                                                               
 SENATOR DONLEY pointed out that SB 215 is essentially a very large            
 spending bill, because it removes a source of revenue from the                
 state.  He is very concerned about how it is going to be rolled               
 into an overall spending plan that hasn't been developed, yet.                
 According to testimony, the tax is approximately 1% of the profit             
 for the industry and all kinds of Alaskans are going to have to               
 take very significant reductions in state assistance to them.                 
                                                                               
 He stated that there are conflicting opinions about the uses of the           
 fund and a lot of people have testified that it is being used                 
 exactly they way they intended it to be used.                                 
                                                                               
 Number 200                                                                    
                                                                               
 SENATOR LEMAN moved to discharge CSSB 215 U version, as amended,              
 with individual recommendations and accompanying fiscal notes.                
 Senators Donley and Zharoff voted no; Senators Frank, Pearce,                 
 Leman, and Miller voted yes and CSSB 215 passed from Committee.               
 SENATOR MILLER announced  SB 308  (ADMIN ACTION RE                            
 LAND/RESOURCES/PROPERTY) to be up for consideration.                          
                                                                               
 JIM EASON, Director, Division of Oil and Gas, said several concerns           
 had been expressed about whether the state has the legal authority            
 to condition, once they issue an oil and gas lease, future                    
 activities including and up to a prohibition on surface entry.  An            
 opinion from the Department of Law says they do have that                     
 authority, because it is pivotal to their proposal for phased                 
 consideration in consistency determinations and best interest                 
 findings of lease sales.  He said this CS would accommodate the               
 concerns raised by public testimony.                                          
                                                                               
 This CS also makes clear the scope of the phases.  The term non-              
 speculative was replaced with "reasonably foreseeable, significant,           
 direct affects" which is the federal standard.  "The law" was                 
 replaced with the applicable statutes and regulations so it is                
 clear they will be in conformance with those laws and regulations             
 which apply to the best interest finding and the coastal zone                 
 consistency determination.                                                    
                                                                               
 MR. EASON said that section 2 had been redrafted to clarify the               
 intent not to require the public or an agency meet all three of the           
 standards.                                                                    
 Number 69                                                                     
                                                                               
 SENATOR LEMAN moved to adopt the CS to SB 308 Resources, J version            
 with the handwritten changes that are noted.  There were no                   
 objections and it was so ordered.                                             
                                                                               
  TAPE 94-12, SIDE A                                                           
  Number 001                                                                   
                                                                               
 CHARLIE JOHNSON, Nome, said this legislation was a reaction to the            
 court's decision on lease sale 78.  He said it's not needed; it's             
 bad legislation.                                                              
                                                                               
 STEVEN PORTER, Anchorage, supported full analysis of all issues               
 associated with a best interest finding process for each sale which           
 current statutes and regulations do.  The DNR scope of review                 
 should be defined during the administrative review process and not            
 by the court.  This bill is directed at providing certainty for               
 DNR.  They appreciate DNR's efforts to accommodate the public's               
 concerns.                                                                     
                                                                               
 WALT FURNACE, the Alaska Support Industry Alliance, said he was               
 concerned with the court injunction on lease sale 78.  They support           
 this legislation which attempts to clarify the authority of the               
 Commissioner in contracting for lease of land under the State of              
 Alaska Oil and Gas Lease Sale Program.                                        
                                                                               
 LOREN FLAGG, Executive Director, Kenai Peninsula Fishermen's                  
 Association, testified that SB 308 is bad legislation.  It looks              
 like the administration is trying to coverup for DNR's incompetence           
 in handling lease sale 78.  He said most sales have occurred                  
 without court delays.  When DNR fails to address overriding public            
 concerns in sensitive areas, they are successfully challenged.                
                                                                               
 THEO MATTHEWS, United Cook Inlet Drifters Association, opposed SB
 308.  He said it basically turns public interest findings into                
 industry interest findings.  It represents a radical change in                
 public policy that affects all land disposals.  He thought it                 
 should have a judiciary reference.  SB 308 is fiscally                        
 irresponsible, he said.                                                       
                                                                               
 SENATOR LEMAN noted that the Chairman for the Judiciary Committee,            
 as well as two members were present and participating in the                  
 meeting.                                                                      
                                                                               
 Number 205                                                                    
                                                                               
 IRV CARLISLE, Soldotna, opposed SB 308 for most of the reasons                
 already stated.  It gives the power to limit the concerns to be               
 addressed on an issue that affects so many Alaskans.                          
                                                                               
 TOM LOHMAN, North Slope Borough, agreed with all the comments made            
 before him in opposition to SB 308.                                           
                                                                               
 KIRSTIN STAHL-JOHNSON, Kodiak, said they are adamantly opposed to             
 SB 308.  She said it tries to limit legitimate public concerns.               
 The burden of proof should lie with the industry.                             
                                                                               
 SENATOR MILLER said they would recess for a session on the floor              
 and would reconvene at 5:00 p.m.                                              
                                                                               
 Number 255                                                                    
                                                                               
 SENATOR MILLER called the meeting back to order at 5:00 p.m.                  
                                                                               
 LINDA FREED, Acting Mayor of Kodiak, said there is improvement over           
 the original bill, especially deleting non-speculative.  However,             
 she said they have not had adequate time to review the amendments             
 to the bill.  They would like additional time to address their                
 concerns with the discrete phasing language.  They support a                  
 process that brings together government and industry special                  
 interest groups to identify appropriate language to use in the best           
 interest of the state and all its residents.                                  
                                                                               
 Number 289                                                                    
                                                                               
 MIKE CHIHULY, Ninilchik, said he is a recreationist.  He hunts,               
 fishes, digs clams, and he has a charter service.  He adamantly               
 opposed SB 308.  He said our present laws were designed to allow              
 meaningful public participation in protecting resources from                  
 detriment by oil and gas activities.  SB 308 will give DNR a                  
 license for oil development anywhere, at any time, at any cost.               
                                                                               
 STAN STEPHENS, Valdez RCAC, said they respect the process that                
 allows for public input.  He said they are concerned that SB 308              
 limits the public review process and hoped they would have more               
 time to review it.                                                            
                                                                               
 SENATOR DONLEY noted that most of the people testifying say they              
 want more time to review the bill and asked what the intention of             
 the Committee was.                                                            
                                                                               
 SENATOR MILLER answered that it had been a week since the bill was            
 introduced and it was his intent to deal with the legislation this            
 week.                                                                         
                                                                               
 Number 377                                                                    
                                                                               
 NANCY LETHCOE, President, Alaska Wilderness, Recreational, and                
 Tourism Association, encouraged them to slow down and look closely            
 at the legislation to see what it does to the whole state and not             
 just certain aspects of it.  She said they needed more time to                
 analyze the bill.  She urged them to separate legislative problems            
 from management problems.                                                     
 JOHN OSCAR testified that SB 308 was haphazard irresponsibility.              
 It gives full authority to the Commissioner of DNR to destroy land            
 from hundreds of miles away.  This bill provides no opportunity for           
 rural people to say something about development if it's going to be           
 severely affecting their economy.  This bill provides no meaningful           
 permitting process.                                                           
                                                                               
 RICHARD TYLER, Homer, said the court stopping lease sale 78 was the           
 law working as it should.  He thought they were trying to fix                 
 something that wasn't broken.                                                 
                                                                               
 MIKE O'MAERA, Homer, said SB 308 was a waste of time and would                
 create even more law suits.  He said it might be more productive to           
 modify administrative procedures.  He did not think it would help             
 establish a predictable and consistent program for the oil                    
 industry.  Administrative procedures should be revised, so that               
 divisions like the Divisions of Oil and Gas and Forestry, no longer           
 evaluate their own project proposals.  Best interest findings                 
 should go to a balanced disinterested evaluation authority.                   
                                                                               
 RIKI OTT, United Fishermen of Alaska, testified in opposition to SB
 308.  It allows DNR to ignore resource use conflicts,                         
 transportation issues, and environmental issues during the initial            
 administrative review - prior to disposal of lands.  It is not so             
 much a matter of which issues are addressed as when they are                  
 addressed.  A multi-phased process will force the state during                
 later stages into a position of either proceeding with an unsound             
 project or expensive buy backs of the sale or lease, including                
 interest and any expenditures made by the lessee.                             
                                                                               
 This bill favors development, MS. OTT said.  Although "non-                   
 speculative" has been removed, the intent has not changed.                    
 "Direct" is still in it and there are many rules against using it             
 because it limits itself to paper transactions.  DNR should                   
 anticipate risks, such as oil spills, and work out resolutions                
 before any leases are issued.                                                 
                                                                               
 MS. OTT continued saying that this bill limits local control over             
 local development and increases federal control over federal lands.           
 It concentrates the power to determine land disposals in the hands            
 of mid-level bureaucrats.  She said this bill would increase law              
 suits because of public frustration and lack of clarity.  The                 
 Coastal Zone Management is not the problem.  The public needs to              
 discuss and resolve issues up front to make sure its projects are             
 allowed to proceed, that they are done responsibly, and with                  
 minimal impact on other resource users and the environment.                   
                                                                               
 JAMES MYKLAND, Cordova, said he realized development was necessary            
 to insure the financial survival of our state, but he wants                   
 environmentally safe development.  This legislation will allow DNR            
 to ignore resource use conflicts and environmental issues during              
 the initial administrative review prior to disposal of these lands.           
 He strongly supported delaying SB 308 until all citizens from                 
 around the state have a chance to respond to it if they want to.              
                                                                               
 JOHN BOCCI, Cordova, opposed SB 308 for all the reasons already               
 mentioned today.                                                              
                                                                               
  TAPE 94-12, SIDE B                                                           
                                                                               
  He doubted that the oil industry could handle a catastrophe.                 
                                                                               
 JON ISAACS said he is a planning consultant and has worked with               
 communities and the oil, mining, and timber industries.  He said              
 there has been the need to change the Coastal Zone Management                 
 program over the past year regarding oil spills, contingency plans,           
 and coastal zone planning.  He has helped to develop solutions                
 everyone could live with.                                                     
                                                                               
 He appreciated the problems DNR has with the court decision on                
 lease sale 78 with best interest findings and coastal consistency.            
 There has not been adequate time to evaluate the implications of              
 the bill or the amendments.                                                   
                                                                               
 SB 308 as it stands is not a solution for a number of reasons.                
 Procedural problems with best interest findings resulting from                
 shortage of staff could have been avoided with assistance from                
 Division of Governmental Coordination and other agencies.  It gives           
 broad discretion to Division Directors with implications that are             
 not wholly related to oil and gas decisions.  It reduces the local            
 government coastal district role in decision making.                          
                                                                               
 In conclusion, he urged the Committee to not take hasty action on             
 SB 308 and allow proper consideration of the proposed amendments              
 and other appropriate alternatives to this problem.                           
                                                                               
 FRAN BENNIS opposed SB 308.  She said the Coastal Zone Management             
 Program is important to those on the coast and they strongly oppose           
 legislation that undermines the substance of the Act by reducing              
 public involvement by limiting the effects of the scope of                    
 evaluating in the review process.  They support the ecosystem                 
 management concept.  Potential effects on lands adjacent to lease             
 sales must be considered in the review process.                               
                                                                               
 JOE MCGILL, Dillingham, opposed any change in administrative                  
 procedures.  People in Dillingham depend on the fishing industry,             
 he stated.                                                                    
                                                                               
 ALICE RUBY, Chairman, Bristol Bay --- Association, said they want             
 to continue working with the state in developing policies and                 
 support legislation.  They realize there needs to be certainty in             
 the leasing process and other decisions in Title 38.  They have not           
 had time to review the bill and there are very intense opinions on            
 both sides.  As a result they do not oppose or support the bill.              
 SENATOR ZHAROFF asked why the court said the state can't continue             
 with lease sale 78.  SENATOR MILLER explained that the court said             
 that the state in using their best findings used reasoning  they              
 shouldn't have.  MR. EASON explained that the Superior Court issued           
 an injunction against lease sale 78, because the judge determined             
 that the plaintiffs would likely prevail on a claim when the case             
 is finally adjudicated by the court on an issue of whether or not             
 the Division of Oil and Gas would be in compliance with the Coastal           
 Zone Management Program consistency determination by presuming you            
 can condition future permitting activities to assure that they are            
 consistent.                                                                   
                                                                               
 SENATOR ZHAROFF asked how the state knows what to do.  MR. EASON              
 explained that this bill does not propose to do away with the                 
 public process.  It's being mischaracterized to say that it would.            
 It defines the ability of the director, under a delegation from the           
 Commissioner, to define the scope and, most importantly, to define            
 the ability to make a decision to proceed with a lease sale on a              
 phased basis.  SB 308 would allow the process of issuing a lease              
 (the paper transaction) to take place with less than total                    
 certainty of what may happen in the future, but with a guarantee              
 that the lease is conditioned so that whatever activity is proposed           
 in the future, there will be ACMP review, review by the public, and           
 review by the agencies.                                                       
                                                                               
 He said it is wrong that this is a dramatic departure in policy.              
 To illustrate this he read the Code of Federal Regulations:                   
 930.37(c):  "In cases where the Federal agency has sufficient                 
 information to determine the consistency of a proposed development            
 project from planning to completion, only one consistency                     
 determination will be required.  However, in cases where major                
 federal decisions related to a proposed development project will be           
 made in phases, based upon developing information with each                   
 subsequent phase subject to federal agency discussion to implement            
 alternative decisions based upon such information, for example                
 planning, citing, and design decisions, a consistency determination           
 will be required for each major decision.  In cases of phased                 
 decision making, federal agencies shall insure that the development           
 project continues to be consistent to the maximum extent                      
 practicable with the state's management program."                             
                                                                               
 He summarized that they are simply asking the state legislature to            
 put into law what is already in federal statutes and regulations.             
 He said if you can make a good enough decision to condition all the           
 things you want to happen in the future, you only do one                      
 consistency determination.  He thought that truly would be cutting            
 the public out of the process.                                                
                                                                               
 SENATOR ZHAROFF commented that he didn't think it was good to model           
 the state's policy after federal policy, because they have kind of            
 a dictatorial type of approach.  Because there were a lot of                  
 complications with the Bristol Bay oil lease sale, he said it was             
 important to be cautious and move slowly.                                     
                                                                               
 MR. EASON said there is no retroactive provision in the                       
 legislation.  He pointed out that this is not intended to affect              
 the process where people review permits for development.  There is            
 no intent to restrict or exclude from consideration the public or             
 their participation in that consideration.                                    
                                                                               
 He explained the problem DNR finds itself in with the court                   
 decision is a history that extends from 1959, in the case of Cook             
 Inlet where there have been 26 oil and gas lease sales in the sale            
 78 area.  The court bought an allegation of a conflict and yet                
 there is no record of it.  There is a record of claims that there             
 will be conflicts, but that is balanced against 26 lease sales                
 where there has been compatible development, fishing, and                     
 recreational use.                                                             
                                                                               
 He said there is a lot of discussion about the discomfort of                  
 delegating the responsibility of making a decision of this                    
 importance to the Commissioner.  It is inevitable that someone will           
 make that decision for Alaska where it's the Commissioner or the              
 courts.  Based on the process, he didn't think they really wanted             
 the courts making resource disposal decisions.  It's a very time              
 consuming and contradictory process.                                          
                                                                               
 Number 363                                                                    
                                                                               
 CHUCK DEGNAN, Unalakleet, opposed SB 308, because it narrowly                 
 defines project impact areas or phases of projects.  This bill                
 would effectively neutralize public citizens' and coastal                     
 districts' input into the state decision making process.  It also             
 puts the decision making on the director level rather than the                
 commissioner level.                                                           
                                                                               
 SENATOR LITTLE pointed out that SB 308 could very narrowly limit              
 the scope of a consistency determination.  It could therefore,                
 limit input from the public.                                                  
                                                                               
 MR. EASON explained that the responsibility would be upon the                 
 department to address in writing any comment or concern raised by             
 the public, as it is today.  But it is correct that relevant                  
 comments and concerns to the disposal would be the focus of the               
 scope.  It is quite likely, and based upon past experience, that              
 they will receive comments that are neither related or relevant, or           
 in some cases, can't be understood, to apply to the issue they are            
 considering.  Those cases would be identified and discussed and if            
 they aren't truly relevant, it will be explained why in writing.              
 The legislature would have the continuing ability as an oversite              
 body to make sure that process is not abused.  At the same time,              
 the courts would have some guidance from the legislature about the            
 process it intends to have in place and the level of inquiry it               
 expected of a decision maker to proceed with a lease sale.                    
 SENATOR DONLEY said a lot of people have said they need more time             
 to deal with this issue and he asked if they were from extremist              
 groups.  MR. EASON answered no, he thought it an issue that needed            
 to be addressed quickly.  He explained that this legislation has              
 been characterized as an immediate reaction to a one time, special            
 problem.  It is, in fact, a reaction to a series of litigation                
 results that began in 1987 that have clearly established a pattern            
 of the court in picking up the jurisdiction and authority to make             
 leasing policy.  That is a seven year process and we are facing a             
 situation where literally every sale that is scheduled for which              
 there is a finding and a consistency determination under the                  
 current law will be, if it's challenged, enjoined, in his opinion.            
                                                                               
 MR. EASON said there has been a great deal of testimony, a lot of             
 it has been misdirected and inaccurate.  He is trying to clarify              
 the inaccuracies.                                                             
                                                                               
 ERIC SMITH, Anchorage, said this legislation is DNR trying to get             
 the legislature to tell DNR they don't have to consider the impacts           
 of mining or oil and gas development at the lease sale stage or at            
 the exploration stage.  He said the government never turns anyone             
 down if they find something.  He said the federal government looks            
 at all stages, not just the lease stage.                                      
                                                                               
 NANCY WAINWRIGHT, Anchorage attorney, said the working groups with            
 Coastal Zone Management have been a very positive development.  She           
 said Mr. Eason has not indicated a willingness to meet with many of           
 these groups who have been working together for perhaps 15 years.             
 She said that impacts have to be looked at broadly.  She thought              
 this bill should be allowed to go through the process that has                
 worked well in the past.                                                      
                                                                               
 SUE FLENSBURG, Dillingham, made two observations.  She said there             
 definitely needs to be certainty for all concerned with respect to            
 the decision making process.  She thought the amendments are a step           
 in the right direction, but they need additional work.  She                   
 appreciated Senator Donley's remarks about slowing the bill down,             
 because the public has a genuine interest in it and needs the time            
 to comprehend what the amendments mean.                                       
                                                                               
 Number 75                                                                     
                                                                               
 MR. EASON responded to a number of points by saying that this is              
 not just a recent phenomenon, but it is real and it creates a                 
 conflict between facts and speculation which is why they had a                
 standard of "non-speculative" - originally.  They are finding that            
 the mere allegation of a conflict is accepted by the courts,                  
 although there are 26 lease sales that suggest the contrary.  He              
 said the bill has an immediate effective date and is not                      
 retroactive.  It is not set up to bypass the public process.  It is           
 set up to get guidance from the legislature for both them and the             
 judiciary on what they expect so everyone knows the rules and can             
 proceed with the orderly development of Alaska's resources.  DNR is           
 not asking to avoid the hard questions.                                       
                                                                               
 One of the most important comments was made by Mr. Isaacs who said            
 that he hadn't participated in any or almost no projects which                
 weren't susceptible to being worked out.  Here we are dealing with            
 a process the courts have now adopted where we don't get the                  
 opportunity to try to work on projects - where things are really              
 proposed, under real time situations, under real locations, with              
 real analysis of the things that may be conflicts.  The courts are            
 stopping them short at the paper transaction.  Nothing happens at             
 a lease sale but the transfer of  a right which is further                    
 conditioned to assure that there is a consistency determination               
 review and agency and public review of anything that is proposed.             
                                                                               
                                                                               
 He said under AS 38.05.180(c) they already consider cumulative                
 impacts.  That is required and it still would be required.  This              
 does not represent a radical change in policy.  It's the policy               
 followed by federal agencies.  It is the policy they think is                 
 important for the Alaska Court to recognize.                                  
                                                                               
 He said the only time the state has had to buy back a lease is when           
 the legislature made a decision that it did not want leasing in               
 Kachemak Bay.  It was very appropriate.  The legislature has also             
 chosen to withhold from leasing all the submerged and tidelands in            
 Bristol Bay.  In no other instance has there been the need to buy             
 back a state lease.  It is important to note there has been                   
 numerous occasions when state lessees did not get to do exactly               
 what they wanted to do on their lease.  It's not a question of                
 whether they can or cannot condition that use.  Using the example             
 of Lisburne and Niakuk, he said the state conditioned those two               
 developments extensively.                                                     
                                                                               
  TAPE 94-13, SIDE A                                                           
 Number 001                                                                    
                                                                               
 SENATOR LITTLE asked if any developers had not been allowed to do             
 anything on their lease.  MR. EASON answered not that he was aware            
 of.                                                                           
                                                                               
 SENATOR ZHAROFF asked what affect passage of this legislation would           
 have on lease sale 78.  MR. EASON said it was due to go to trial in           
 September and that process has to go through the court system                 
 unless the Supreme Court overturns the injunction which the state             
 has appealed.  If this legislation passed, the court would be aware           
 of it, but he didn't know if it would have an impact on their                 
 decision making.                                                              
                                                                               
 SENATOR LEMAN said he thought the effective date would probably be            
 90 days after the Governor would sign the bill and asked how he               
 thought it would affect the current process for an August lease               
 sale.  MR. EASON said they had issued the preliminary finding and             
 consistency determination last week or the week before.  It is out            
 for public comment now.  Based on public comment they will revise             
 both of those decisions as necessary.  Those findings will go out             
 on May 14.  Technically anyone has a right to object from that                
 point until the sale in late August or early September.                       
                                                                               
 Number 131                                                                    
                                                                               
 SENATOR ZHAROFF said the way he understood this bill the public               
 process was going to change to the extent that now the concerns of            
 the public and Coastal Zone Management people start from the bottom           
 and work up.  The passage of this bill reverses the process so all            
 of the public interests are considered.  Only the interests                   
 identified by the Department come back down for public review.                
                                                                               
 MR. EASON said that was not correct.  The intent is not to narrow             
 the scope of what people can say.  It's to make clear they will               
 take all comments from the public regardless of where or whom they            
 are.  The decision making in support of the written finding will              
 address those comments and will also have the burden of showing               
 which of those comments are relevant to the sale proposed and to              
 the phase of the disposal.  It's with the understanding that those            
 subsequent events that might happen will go through the same public           
 review.                                                                       
                                                                               
 MR. EASON said he has struggled to try and make the process more              
 understandable to people.  He apologized for any failure in that,             
 but gave an example with drivers licensing.  Using the reasoning              
 behind the court's injunction, if he were issuing a drivers license           
 he is being asked to determine where everyone he's giving a license           
 is going to drive for the rest of their life; what kind of car they           
 are going to drive in; whether or not they might hit someone; and             
 whether or not they might drive under the influence of alcohol.  If           
 he were the drivers license director, he couldn't do that.  Yet he            
 is being asked to do that for something that is more important to             
 the state's long term health.  He can't do that, but he assures               
 them, if they allow him to issue the lease, he will make sure the             
 lease has the conditions in it that will make them come back to the           
 public and the agencies with a specific proposal.                             
                                                                               
 With this legislation he is telling them there is a serious                   
 problem.  If the problem is unaddressed, there will be no more                
 leasing.  That is not necessarily good under the fiscal                       
 circumstances the state finds itself in.                                      
                                                                               
 He explained they do not give a lease unless the people are                   
 qualified and there are already laws saying what the qualifications           
 have to be.  They can't do a thing until they post a bond.  That's            
 not the end of it.  They still must get contingency plan approvals            
 from DEC; they must get Title 16 approvals by ADF&G; they must                
 undergo consistency determination; if they are lucky enough to find           
 something and it's offshore or in wetlands, they must do a federal            
 Environmental Impact Study, etc.  The system of permitting and                
 processing is huge and extensive and consumes years.                          
                                                                               
 SENATOR ZHAROFF noted that sometimes the sales have taken place               
 within a core section of fishing grounds - as in Shelikof Straits.            
 At the time the industry was able to work with them to modify plans           
 and came up with something agreeable.  Passing this bill throws all           
 that aside.                                                                   
                                                                               
 MR. EASON said this bill doesn't do that.  The process he described           
 at Shelikof Straits is exactly the process they had at sale 78.               
 Several provisions in the lease put them on notice that a whole               
 range of alternatives existed for restricting activities including            
 timing restrictions, restricting their access to certain surface              
 locations, or requiring the use of directional drilling.                      
                                                                               
 SENATOR ZHAROFF said he can't see where the process has been                  
 broken.  He felt they were going too far too fast.  He said he was            
 concerned with sale 79 which is in Cape Yakataga in his district.             
 MR. EASON said if that sale is allowed to happen, it does not                 
 provide the lessee an opportunity to go anywhere at any time he               
 wants.  Any proposal to do anything will go through public review             
 as well as state agency reviews.  If this bill passes, there will             
 be one difference.  The courts would understand that whoever makes            
 the decisions cannot foresee into the future after a lease sale and           
 can not tell in advance if there will be 1 well or 30 wells or                
 3,000 wells.                                                                  
                                                                               
 Number 330                                                                    
                                                                               
 SENATOR ZHAROFF asked if this bill takes away any tool an                     
 individual or user group might have in the future?  MR. EASON                 
 explained that it's ultimately the policy decision the legislature            
 has to make whether they want a decision making process that is               
 based upon someone's vague discomfort or a feeling that something             
 might be wrong.  If that's the standard, they can adopt that and              
 DNR can do their best working with it.  He advised that is not a              
 very good standard for making decisions.                                      
                                                                               
 SENATOR ZHAROFF said he didn't think the courts would allow                   
 frivolous concerns for an injunction.                                         
                                                                               
 MR. EASON responded the bill is not limiting public comment.  As a            
 matter of law they could not prevail in a litigation without some             
 certainty within the process that defines the standards that both             
 have to live by.  And some person has to ultimately make the                  
 decision.                                                                     
                                                                               
 SENATOR LITTLE said the decision should be made within the Coastal            
 Zone Management Process.  MR. EASON said that is a matter for the             
 legislature.  Currently that decision is relegated to the                     
 Commissioner.                                                                 
 SENATOR DONLEY said he would feel better and might be convinced if            
 there was more time to understand the issues and asked for the bill           
 to be held for one more week.                                                 
                                                                               
 Number 371                                                                    
                                                                               
 SENATOR DONLEY moved to table SB 308 for one week or to the                   
 Chairman's discretion after one week to comply with what people are           
 asking for.  SENATOR MILLER objected to the motion.  Senators                 
 Zharoff and Donley voted yes; Senators Leman, Pearce, and Miller              
 voted no and the motion failed.                                               
                                                                               
 SENATOR PEARCE asked if he could do a side by side schematic for              
 the process they go through and the timing as it stands now and as            
 it would be under SB 308.                                                     
                                                                               
 MR. EASON said there is a simple answer.  There will be no change             
 in the process.  There was some discussion of the schedule with               
 BARBARA FULLMER, Department of Law in Anchorage.                              
                                                                               
 SENATOR PEARCE said she understood people saying they wouldn't have           
 an opportunity to have input and she heard him saying the public              
 would have input, but he is trying to bring the scope back from an            
 entire universe of trying to guess what might happen somewhere                
 maybe to something they can say with some amount of reliability may           
 or may not take place.  She asked how long a lease sale was valid.            
 MR. EASON said most of the leases are for 10 years.  That's the               
 primary term.  If production is discovered, there are lives that              
 are much longer than 10 years.  Some go back into the early sixties           
 and may be producing still in 30 years.                                       
                                                                               
 SENATOR PEARCE noted that drilling techniques and production                  
 techniques are changing so quickly, she didn't know how anyone                
 could know with any certainty what the possible ramifications of              
 leasing might be in a few years time.  MR. EASON said he                      
 appreciated her comments on this issue - that systems are designed            
 to accommodate people's concerns.  It comes at a cost to industry,            
 but it is something that can and is done.                                     
                                                                               
 Number 494                                                                    
                                                                               
 SENATOR DONLEY moved amendment #1.  SENATOR LITTLE explained it               
 would confirm what DNR has been stating about not being compelled             
 to go ahead with a project if they later determined the project was           
 not in the best interests of the state.  It also says that                    
 liabilities and benefits will be considered at that particular                
 phase without greater weight necessarily being given to the long              
 term benefits.                                                                
                                                                               
 SENATOR PEARCE noted that they have already proved they have the              
 right to not go ahead, although she didn't understand the second              
 part.                                                                         
 Senators Donley and Zharoff voted yes; Senators Frank, Pearce,                
 Leman, and Miller voted no and the amendment failed to pass.                  
                                                                               
 Number 567                                                                    
                                                                               
 SENATOR DONLEY moved amendment #2.  SENATOR LITTLE explained this             
 amendment would enable the state to revoke a permit without having            
 to buy back the lease.                                                        
                                                                               
 SENATOR MILLER asked what the guidelines would be for cancelling a            
 lease.  SENATOR LITTLE said that would be up to the Department.               
 MR. EASON explained there is a process for buying back leases.  He            
 also didn't think amendment #2 would hold up under court review.              
                                                                               
 Senators Donley and Zharoff voted yes; Senators Frank, Leman,                 
 Pearce, and Miller voted no and the amendment failed to pass.                 
                                                                               
 SENATOR DONELY moved amendment #3.  SENATOR LITTLE explained it               
 deletes language exempting permits or other authorization revokable           
 by the Commissioner from a written best interest finding                      
 requirement.                                                                  
                                                                               
  TAPE 94-13, SIDE B                                                           
 Number 595                                                                    
                                                                               
  MR. EASON asked if this would require a written finding before a             
 permit or authorization.  SENATOR LITTLE answered yes.  MR. EASON             
 said they have a staff that does nothing but written findings and             
 requiring it for every authorization they do could simply not be              
 done.  It would also significantly increase the budget.  SENATOR              
 LITTLE explained the intent was to confirm the public's                       
 participation in the process.                                                 
                                                                               
 Senators Donley, Zharoff, Frank, Pearce, Leman, and Miller voted no           
 and the amendment failed to pass.                                             
                                                                               
 SENATOR ZHAROFF asked if the first two amendments could accompany             
 the bill to the next committee.  SENATOR MILLER agreed to do that.            
                                                                               
 SENATOR LEMAN asked what would be the impact of the first part of             
 the first amendment that was offered.  MR. EASON said he thought it           
 was unnecessary.  They decided to work on the language and send it            
 along with the bill.                                                          
                                                                               
 SENATOR ZHAROFF moved that a new section 5 be added reading this              
 bill would sunset in 5 years.  SENATOR MILLER objected for purposes           
 of discussion.  MR. EASON said it was a legislative prerogative.              
                                                                               
 Senators Donley, Zharoff, and Leman voted yes; Senators Frank,                
 Pearce, and Miller voted no and the amendment failed to pass.                 
                                                                               
 Number 468                                                                    
 SENATOR FRANK moved to pass CSSB 308 (Resources) from Committee               
 with individual recommendations and asked for unanimous consent.              
 SENATOR DONLEY objected.                                                      
                                                                               
 Senators Pearce, Leman, Frank, and Miller voted yes; Senator Donley           
 and Zharoff voted no and CSSB 308 (Resources) passed from                     
 Committee.                                                                    
 SENATOR MILLER adjourned the meeting at 5:35 p.m.                             
                                                                               

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