Legislature(1993 - 1994)
04/13/1994 04:15 PM Senate RES
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SENATE RESOURCES COMMITTEE
April 13, 1994
4:15 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
COMMITTEE CALENDAR
SENATE BILL NO. 371
"An Act providing for exploration incentive credits for activities
involving locatable and leasable minerals and coal deposits on
certain land in the state; and providing for an effective date."
SENATE BILL NO. 374
"An Act extending the period of regulation of material sites used
for timber operations under the Forest Practices Act and extending
a corresponding exemption from provisions regulating mining
reclamation; and providing for an effective date."
HOUSE BILL NO. 462
"An Act repealing certain provisions of the laws, other than those
in the Alaska Land Act, relating to recording requirements, labor
and improvement requirements, and size requirements for mining
claims and providing for the suspension or waiver of state annual
mining labor requirements when the federal government has suspended
or waived federal annual mining labor requirements administratively
or by statute; and providing for an effective date."
PREVIOUS ACTION
SB 371 - No previous action to record.
SB 374 - No previous action to record.
HB 462 - No previous action to record.
WITNESS REGISTER
Gerry Gallagher, Director
Division of Mining
Department of Natural Resources
P.O. Box 107016
Anchorage, Ak. 99510-7016
POSITION STATEMENT: Commented on SB 371 and supported SB 374 and
HB 462.
David Rogers, Esq.
Producers Council
Juneau, Ak. 99801
POSITION STATEMENT: Commented on SB 371.
David Stone, President
Producers Council
3100 Channel Dr.
Juneau, Ak. 99801
POSITION STATEMENT: Supported SB 371.
Steve Borrel, Executive Director
Alaska Miners Association
501 W. Northern Lights, #203
Anchorage, Ak. 99503
POSITION STATEMENT: Supported SB 371.
Mary Nordale, President
Alaska Miners Association
501 W. Northern Lights, #203
Anchorage, Ak. 99503
POSITION STATEMENT: Supported SB 371.
Representative Gene Therriault
State Capitol
Juneau, Ak. 99801-1182
POSITION STATEMENT: Sponsor of HB 462
ACTION NARRATIVE
TAPE 94-35, SIDE A
Number 001
CHAIRMAN MILLER called the Resources Committee meeting to order at
4:15 p.m. and announced SB 371 (MINERAL EXPLORATION INCENTIVE
CREDITS) to be up for consideration.
GERRY GALLAGHER, Director, Division of Mining, said they have a
problem with granting exploration incentive credits to the industry
which is strictly a fiscal concern. There is not much money coming
in and they are very concerned with opening the back door on the
general fund with anything that would lessen it.
He said that mental health and school trust lands needed to be
exempted specifically so the Department doesn't end up in
litigation. This could be fixed on page 1, line 8 after the word
"grant" insert ",unless otherwise provided by law," so the
Department could identify these lands and exempt not all of the
credit, but the royalty portion of the credit.
He explained they had to make some projections about the number of
new mines that would happen in the next 15 years to come up with
the fiscal note.
SENATOR FRANK asked if he considered any taxes and royalties that
might accrue because of the credit. MR. GALLAGHER said that was
not considered, but he didn't know how to put it in a fiscal note.
He believed the fiscal notes were realistic in terms of royalties
and where they were going to go.
SENATOR MILLER asked Mr. Gallagher to testify on SB 374 (MATERIAL
SITES FOR TIMBER OPERATIONS).
Number 111
MR. GALLAGHER explained that the Mine Reclamation Act and the
Forest Practices Act both require the reclamation of material
gravel sites. If one agency is doing the same thing as another,
cooperative agreements are used. When the DNR put the Mine
Reclamation regulations out to notice, they relied on the Forest
Practices Act, because they were more rigorous so they didn't have
to double permit. He said they couldn't complete the regulations
for the Mining Reclamation Act because the regulations for the
Forest Practices Act got hung up in some controversy and
difficulties. The regulations on mining reclamation now need to
defer back to the Forest Practices Act regulations which are in
place. This bill simply gives them 6 months to finish doing that.
If they don't do this, the forest operators will have to get two
permits for the same gravel pit. It is not a good use of our time
or theirs and it doesn't change the regulatory requirements.
Number 155
SENATOR MILLER thanked Mr. Gallagher and announced SB 371 to be up p
for consideration again.
DAVID ROGERS, Counsel for the Producers Council, said the primary
element of the bill authorizes exploration incentive credits which
can be used by qualified applicants to offset tax and royalty
obligations. It applies to coal and leasable and locatable mineral
exploration activities. The activities which qualify for credits
include geophysical and geochemical surveys, drilling exploration
holes, aerial photography, and other exploratory work. The earned
credits can be applied against general corporate income taxes,
mining license taxes, and royalties. Qualified exploration
activities must be documented. The maximum credit available is
equal to 60% of direct labor costs for Alaska residents and 50% of
other eligible costs as defined in the bill.
SENATOR LEMAN noted that this should be checked with SB 151 to see
if it is consistent with the credits.
DAVID STONE, President, Council of Alaska Producers, supported SB
371. He said throughout the world, countries are actively courting
mining companies by offering economic incentives and other
inducements and it has been particularly successful in Chile and
Mexico where privatization and tax incentives have revitalized
their mining industries. At the same time obstacles in the lower
48 are forcing many companies to look elsewhere. SB 371 is one of
the things we should do to draw more industry attention to Alaska
and compete in the increasing competitive global market place.
STEVE BORREL, Executive Director, Alaska Miners Association,
supported SB 371. It would allow credit for a percentage of
certain specified direct expenditures that are made during the
early exploration stage. The credit cannot be taken until the
project actually begins to be an operating mine. The credits can
be transferred which is important for a future sale of the mine.
He concluded by saying that SB 371 will send a positive message to
the international mining industry that Alaska is improving the
investment climate and is working to encourage mineral development.
SENATOR MILLER said they would hold SB 371 for a quorum and
announced HB 462 (MINING REQUIREMENTS:RECORDING/LABOR/SIZE) to be
up for consideration.
Number 350
REPRESENTATIVE GENE THERRIAULT, sponsor of HB 462, said it clears
up inconsistencies that exist between our Title 27, dealing with
mining on federal land, and federal regulations.
GERRY GALLAGHER, DNR, supported HB 462. It makes necessary changes
in state law to conform with federal law. It would eliminate some
confusion.
MARY NORDALE, President, Alaska Miners Association, supported HB
462. She recommended they consider a repeal of AS 27.10.120,
because it is archaic and relates to staking of claims by a person
holding a power of attorney. It is a practice that has worn out
the need at this time.
SENATOR MILLER said they would work on this issue and announced SB
374 (MATERIAL SITES FOR TIMBER OPERATIONS) to be up for
consideration. He announced a recess from 4:44 p.m. - 4:49 p.m.
SENATOR ZHAROFF moved to pass SB 374 from committee with individual
recommendations. There were no objections and it was so ordered.
SENATOR MILLER announced SB 371 to be up for consideration. He
said there was a proposed amendment on line 8, page 1 after the
word "grant" to add "unless otherwise provided by law."
SENATOR LEMAN moved the amendment. There were no objections and it
was so ordered.
SENATOR LEMAN moved to pass SB 371 from committee with individual
recommendations. There were no objections and it was so ordered.
SENATOR MILLER adjourned the meeting at 4:50 p.m.
| Document Name | Date/Time | Subjects |
|---|