3:24:15 PM HOUSE BILL NO. 306 "An Act making certain land available for selection by the Matanuska-Susitna Borough." Representative Stoltze, sponsor, spoke in support of the legislation. He observed that the Mat-Su Borough requested the legislation. The legislation would transfer land out of a public use area as part of the borough's land entitlement to facilitate a proposed development. The legislation was amended in the previous committee with the addition of a 600 feet set back on the Little Susitna River and an requirement of a vote in the MatSu Borough prior to conveyance. RICK THOMPSON, ACTING DEPUTY DIRECTOR, DIVISION OF MINING LAND AND WATER, DEPARTMENT OF NATURAL RESOURCES, testified via teleconference in support of the legislation. He observed that the department worked with the borough to achieve the objectives set out in the legislation. In response to a question by Representative Kerttula, Mr. Thompson noted that the public use area was set aside in either 1984 or 1986. He thought the margin was approximately a half a mile. Public use areas sustain all uses and do not restrict public use for hunting, fishing or other recreational uses. The ski area activities were not thought to conflict with the public use at the time of its conception. He thought that the planned ski area would be 10,000 acres. JOHN DUFF, BOROUGH MANAGER, MAT-SU BOROUGH, testified via teleconference in support of the legislation. He observed that the legislation would convey 200 acres, which would provide access to other borough properties and is critical to the success of the Hatcher Pass Ski Area project. The borough has 3,000 acres immediately west of the 200 acres being proposed for transfer. The addition would allow for development on the northern part, supplemental parking for the alpine ski area, and community picnic area and trails. The project provides public and private partnership and fulfills long-term economic objectives for diversification of the tax base and recreational opportunities. The Hatcher Pass Management Unit, which is open for public use is 200,000 acres in size. Local and state funds have been used to provide infrastructure improvements such as electrical power and parking. The borough has conducted numerous public hearings on various aspects of the project. The borough anticipates further public hearings. Northern Economics has completed an economic assessment, which identified 1,600 jobs would be created and a public and private investment of approximately $41 million in investments. The legislation contains lands to be transferred that are critical to the success of the project. 3:33:58 PM Representative Kerttula asked how many acres were developable. Mr. Duffy noted that there are 3,000 on the south side of Government Peak, where most of the residential village development would take place. An additional 5 - 10 acres would be used for the lodge. He clarified that they are only asking for 200 acres at this time. He observed that the entire area borders the Lower Susitna River. The Hatcher Pass Management Plan has a setback of 200 feet. The House Resource Committee added a 600 foot setback, which is the river corridor. 3:36:13 PM Representative Kerttula asked if the negotiation price was public. Mr. Duffy observed that the price has not been negotiated. There is a joint venture between the borough and JL Properties, where the borough would provide the real property assets and JL Properties would provide the majority of the funding (approximately $31 million) to invest in the alpine ski area and the south side residential/commercial development. 3:37:24 PM RON SWANSON, COMMUNITY DEVELOPMENT DIRECTOR, MATSU BOROUGH, pointed out that the Hatcher Pass Public Use Area was created in 1986. The management plan was created the same year, but amended in 1989, in response to a proposal to build a ski area. The ski area for a seasonal resort was not considered for three years. The lease area does cover public use, anywhere from one half to three-quarters of a mile wide on either side of the river. He maintained that the request is within their municipal land entitlement and objective of recreational and economic diversity. An extensive public process was in its final stages, including two advisory board public hearings. Any actions will receive scrutiny from the public. He proposed that the current plan was a great deal more restrictive than the 1989 plan. 3:40:05 PM JAY NOLFI, BIG LAKE, testified via teleconference. She expressed concern about conveying the properties for economic development. She suggested that designated public use property was being given to a private company for development and that this was a case of imminent domain. She also noted that the longevity bonus was taken due to non sustainability. She applied this term to the current situation. She stressed that it was the intention when the area was designated that it be used for public use and benefit all people. She stated that the residents of the area were not in support of the project, and suggested that the entire project should be placed on the ballot. She noted that setback projections were not adequate to meet borough requirements. 3:43:48 PM Representative Stoltze agreed that these concerns should be worked out in further public process. Co-Chair Meyer closed public testimony on the bill. Representative Hawker noted that the Alaska Outdoor Council testified in opposition in the previous Committee. 3:45:00 PM Co-Chair Meyer noted that the bill would be held until Wednesday, at which time amendments would be heard. HB 306 was HEARD AND HELD in Committee for further consideration.