HB 273-MUNICIPAL GENERAL GRANT LAND  9:38:10 AM CO-CHAIR HERRON announced that the next order of business would be HOUSE BILL NO. 273, "An Act relating to general grant land entitlements for the City and Borough of Wrangell; and providing for an effective date." 9:38:15 AM REPRESENTATIVE P. WILSON, Alaska State Legislature, speaking as the sponsor of HB 273, explained that HB 273 would correct a deficit in the formation process that resulted in a minimal land entitlement, 1,952 acres, for the City & Borough of Wrangell (CBW). The aforementioned would be accomplished by increasing CBW's municipal land entitlement. The land grant requested in HB 273 was derived from the average percentage of the land grants that were given to other boroughs. However, the legislation was held in the House Community and Regional Affairs Standing Committee in order to allow CBW and the Department of Natural Resources (DNR) to agree on a specific acreage that would be appropriate for the CBW's municipal land grant. Negotiations between CBW and DNR resulted in a proposed amendment that would entitle CBW to 6,506 acres. The additional acreage, she related, is important to provide for the needs of the borough and address the economic, cultural, and resource- based goals of the CBW residents. Therefore, she encouraged the committee to adopt the amendment and report the legislation from committee. 9:40:51 AM CO-CHAIR MUNOZ moved that the committee adopt the amendment labeled 26-LS1292\A.1, Cook, 2/24/10, which read: Page 2, line 6: Delete "18,675" Insert "6,506" CO-CHAIR HERRON objected for discussion purposes. 9:42:37 AM TIMOTHY ROONEY, Borough Manager, City and Borough of Wrangell, related his belief that all would believe that CBW shouldn't be penalized because of the lack of state land in Southeast Alaska. The existing formula for land grant entitlements worked for other communities because there was enough available state land. However, CBW is unique and thus he requested the committee's support for the legislation. 9:43:46 AM CAROL RUSHMORE, Economic Development Director, City and Borough of Wrangell, informed the committee that since its last meeting on HB 273, CBW has met with DNR numerous times to work out the entitlement amount. The CBW had selected about 9,000 acres, but about a week ago the issue of the sustainable yield calculation for the annual allowable timber harvest arose. Since CBW is a timber community, it understands the state's need for the aforementioned. Therefore, CBW carefully reviewed the [9,000 acres] of land it selected in terms of how it could work with DNR. There were three areas of concern to DNR. One area of concern was the Bradfield area, which has some state forest lands. The CBW has been pursuing the Bradfield Road for over 60 years; the area is extremely important to CBW from a port and road corridor standpoint. Another area of concern for DNR was the Crittenden Creek area, which has some valuable timber. However, it's right across from the Wrangell community and thus would be a logical expansion for the borough from a commercial, settlement, and recreational standpoint. Still, CBW decided to reduce its selection in that area. The agreement was that as DNR pursues timber sales in the Crittenden Creek area, the log transfers to roads may help CBW in accessing its area. The CBW will continue to discuss the aforementioned with DNR. The third area of concern was Wrangell East, which is commonly referred to as the Back Channel. This area is a long strip of land that DNR, over the last few years, has used for timber sales to benefit CBW. The CBW is still looking at some pockets of timber and there is an existing settlement and the potential for other settlements. Moreover, the Wrangell East area is 10 minutes from town and two roads from town access the area. She related that CBW is working with DNR regarding potentially linking the two roads and providing access to some of the lands CBW is considering in that area. Mr. Rushmore opined that CBW has worked with DNR to provide the sustainable yield calculation as well as the things that CBW needs to move forward in the future. 9:46:42 AM CO-CHAIR HERRON asked if CBW has, through the aforementioned negotiations, reserved acreage for discussion in the future, or is the 6,506 acres all CBW will receive. MS. RUSHMORE related her understanding that this is CBW's one chance to select the lands that it's seeking. REPRESENTATIVE HARRIS commented that CBW is giving up a lot. MS. RUSHMORE interjected that she doesn't know the mechanics of this and thus would defer to Representative P. Wilson. 9:47:41 AM CO-CHAIR MUNOZ explained that the land grant allocations are set at 10 percent of vacant [unappropriated unreserved (VUU)] state lands, which for CBW would've originally amounted to approximately 1,800 acres. The CBW went through a process to identify additional lands outside of those VUU lands that resulted in CBW's request for 18,675 acres. The department voiced serious concern for that large amount of acreage. The requested land entitlement in the earlier offered amendment recognizes a compromise between all of the parties. Therefore, Co-Chair Munoz related her support for the change embodied in the amendment. 9:48:37 AM CO-CHAIR HERRON pointed out that in 50 years things could change and CBW may have a serious need for land. Therefore, he questioned why CBW would forever give up acres to which it has a right merely because of these negotiations. CO-CHAIR MUNOZ deferred to DNR regarding the process that led to the [6,506 acres]. 9:49:59 AM REED HARRIS, Staff, Representative Peggy Wilson, Alaska State Legislature, reminded the committee that there is a formula by which when boroughs are formed they receive 10 percent of VUU designated land. The difficulty in CBW is that 97.28 percent of the land in Wrangell is federal land as most of the island is part of the Tongass National Forest. Therefore, CBW's land grant entitlement was very small, approximately 1,900 acres. Upon research by CBW's consultant, it was discovered that on average boroughs receive 1.13 percent of the lands within the borough as the entitlement. However, CBW's land grant entitlement was .12 percent and thus significantly less than that average. Using CBW's total land plus the 1.13 percent resulted in the request for 18,675 acres. 9:51:34 AM DICK MYLIUS, Director, Division of Mining, Land and Water, Department of Natural Resources, began by thanking CBW for being willing to work out this issue. The acreage in the amendment works for DNR and CBW. He reminded the committee that DNR was concerned with the formula utilized to arrive at the 18,675 acres because it established a troubling precedent. A precedent that the department feared may result in other boroughs seeking larger land entitlements. Furthermore, DNR believes that the original request in HB 273 would've consumed too much state land, 57 percent, and would've caused a tremendous impact on the state's timber program throughout Southeast Alaska. The meetings between CBW and DNR educated DNR regarding CBW's needs and CBW regarding the impacts of the land selections on the state's timber program and other programs. The two parties came to an agreement as related in the earlier offered amendment. Mr. Mylius related that DNR supports the 6,506 acre request by CBW. He clarified that the aforementioned acreage amount doesn't reduce the borough's entitlement per the formula in statute. In fact, the 6,506 acres is about three times the land entitlement it would receive per existing law. 9:54:16 AM CO-CHAIR HERRON withdrew his objection to the amendment. There being no further objection, the amendment [text provided previously] was adopted. 9:54:32 AM CO-CHAIR MUNOZ moved to report HB 273, as amended, out of committee with individual recommendations and the accompanying zero fiscal note. There being no objection, CSHB 273(CRA) was reported from the House Community and Regional Affairs Standing Committee.