HB 41-TRANSFER HABITAT DIV FROM DNR TO F&G 9:27:31 AM CHAIR SEATON announced that the final order of business would be HOUSE BILL NO. 41, "An Act returning certain duties regarding habitat management from the Department of Natural Resources to the Department of Fish and Game; and providing for an effective date." LANCE TRASKY, fisheries biologist, began by informing the committee that for 31 years he was a fisheries research biologist, habitat biologist, and regional supervisor for the former Division of Habitat within the Alaska Department of Fish & Game (ADF&G). Mr. Trasky paraphrased from the following written remarks [original punctuation provided]: I am testifying today to voice my strong support for House Bill 41 which would reverse former Governor Murkowski's Executive Order 107 and returns the responsibility to protect salmon streams and prevent blockages of fish streams to the Department of Fish & Game where it rightfully belongs. Such an action will accomplish two things. First, it will help to restore public confidence in the state's regulatory system which was badly eroded during the Murkowski administration. Secondly, it will place the authority on how to protect our socially, economically, and culturally valuable fisheries resources back in the hands of Department of Fish & Game fisheries biologists with a statutory mandate and the expertise to protect, preserve, maintain and where possible extend the fish and wildlife resources in the interest of the economy and well being of the state, as the founding fathers of this state intended. Alaska's founders witnessed decades of fisheries and fisheries habitat mismanagement when other interest trumped conservation. The founders also witnessed the final demise of the once great salmon fisheries of the Pacific Northwest in the 1950's and had predicted that the loss of habitat as a result would be the biggest long-term threat facing Alaska's fisheries as well as the subsistence, commercial and sport fishers who depend upon them. As the framework of state government was taking shape, a heated debate ensued between Alaskan fishermen and those involved in mining, logging, and hydropower development regarding how state government would be organized in addition to deciding what functions various agencies would have. Miners and loggers wanted a traditional system with a Department of Natural Resources and a simple fish and game management division having no authority in critical habitat decisions. Fish interests wanted a separate Department of Fish & Game. They also wanted this department to have an equal voice in state resource management decisions, a constitutional mandate for sustained yield, and the statutory authority to prevent the destruction of anadromous fish habitat on public and private lands, as well as to prevent blockage of fish passage from dams and other obstructions. Fisheries interest won out and for 43 years this was the law of the land. Unfortunately in 2003, Governor Murkowski was able to do what our founding fathers feared most. By transferring the Anadromous Fish Act and the Fish Ways Act to the Alaska Department of Natural Resources (ADNR) and implementing a Memorandum of Agreement granting ADNR oversight of the Federal Fish and Wildlife Coordination Act, and radically changing the Alaska Coastal Management Program; Governor Murkowski was able to funnel all of the authority to approve development projects into the ADNR. He also appointed manager who shared his views to implement his vision. He set Alaska on the same dead-end road that the former salmon producing western states followed. The transfer of these statutory authorities and programs has directly affected the consideration that fish habitat and subsistence, commercial, and sport fishermen receive in state resource development and permitting decision in several ways: 1. ADF&G and ADNR have very different missions. ADF&G has the statutory mandate to protect and maintain fish resources, while ADNR has the mandate to develop the states' renewable and non-renewable resources. Removing the responsibility to protect fish habitat from ADF&G makes it much easier for ADNR to inappropriately sacrifice fish habitat to facilitate non-renewable resource development. 2. The balance that state founders sought in resource development decisions has been lost. Some people have tried to make the argument that ADNR employees would protect fish as diligently as they did at ADF&G. These people must not have heard of corporate culture. The transfer of staff and authorities is akin to moving the Mercedes design team to Hyundai and then expecting that they will still be building Mercedes. 3. Over my career I was involved with many different development projects where the Department of Fish & Game and ADNR had very different positions on ADNR projects and activities affecting fish, wildlife and public use. Examples include: · One example was the issue of requiring logging operations on state and private lands to follow the law and submit plans for stream crossing structures to review for adequacy before construction. Loggers and ADNR did not want ADF&G's Habitat Division to require loggers to obtain permits from ADF&G to build roads across fish streams. ADF&G asserted its authority under the Anadromous Fish Act and Fish Ways Acts and continued to require loggers to get permits. · A second example is mixing zones in spawning areas. The Alaska Department of Environmental Conservation (ADEC) proposed to change their regulation's to allow mixing zones for harmful substances in fish spawning areas during both the Hickel and Knowles Administration. Habitat Division led the ADF&G's opposition to the change and it was withdrawn both times. After the Habitat and Restoration (H&R) Division was transferred to ADNR and the change [ADEC proposed regulations on mixing zones] was supported by ADNR; no one in ADF&G fought it. 9:33:59 AM MR. TRASKY continued: 4. One question which comes up often is how has permitting changed now that it is administered by ADNR? Because there is no public notice requirement for the thousands of ADNR fish habitat permits issued annually, the only people who know if these permits effectively protect fish habitat are the ADNR person issuing the permit and the applicant. The same is true for violations of these permits. I do not have access to these permits but asked this question of a number of state, federal and private biologists who have experience in ADF&G fish habitat permitting and are knowledgeable about fish habitat permitting before and after the transfer of ADF&G's permit authority to ADNR. I won't disclose their names or positions because of concerns about retaliation. However, here is what I was told about the differences: A. Comments from Federal Biologists: 1. I review federal projects affecting fish and wildlife and do not see ADF&G or ADNR-Office of Habitat Management and Permitting (OHMP) as a player in projects any more. Often no one from ADF&G or OHMP even attends project meetings. 2. My agency has no relationship with ADF&G or ADNR- OHMP any more. Staff at one OHMP office does not even return calls. 3. The policy at OHMP seems to be to narrowly interpret their responsibilities to permitting within the banks of anadromous streams and stream blockages. Overshadowing issues such as activities which may impact a watershed seem to be ignored. There is little interest in wildlife issues. 4. The few former ADF&G H&R staff that remains at OHMP seems to be trying to do a good job. The new hires that attend project meetings rarely open their mouths. Most of them do not seem to know much about the issues that they are dealing with. 5. Consultants have asked me why ADF&G and OHMP no longer asks any tough questions related to environmental documents for the road, oil and gas, and mining projects they are working on. 6. Some of the best biologists have left OHMP when they had an opportunity to return to ADF&G or retire. 9:36:12 AM MR. TRASKY continued: B. Comments from State Biologists: 1. OHMP staff has lost the close working relationship with ADF&G staff and the information that they provided on projects. There is no priority in OHMP to solicit ADF&G input on projects, particularly projects that ADF&G may not like. 2. Regional OHMP staff does not receive any support on enforcement actions. 3. The permits that the OHMP leadership wants us to write do not contain project specific conditions and are largely unenforceable. The emphasis is on reducing review time and increasing permit numbers, not a high level of fish habitat protection. 4. For a fisheries or wildlife biologist, working at ADNR is a dead end. For career advancement they will need to go elsewhere. 5. A number of experience habitat biologists left ADNR when the opportunity arose. They were replaced with people with little or no experience. 6. ADNR-OHMP biologists are discouraged from participating in multi-agency working groups which are working on means to avoid impacts on fish and wildlife and from attending project meetings. Biologists don't do coastal reviews, or review subdivision plats that the Borough sends over even though the development would affect a salmon stream. 9:37:38 AM MR. TRASKY summarized as follows: In summary I believe that the changes that former Governor Murkowski made during his administration substantially reduced the protection that fish habitat receives both at the policy level and the issuance of permits for individual projects. It also increases the risk that large projects will be approved. Projects that will have very significant short and long-term impacts on fish and wildlife resources as well as commercial, subsistence and sport fishermen who depend on these resources. I urge you to restore the balance in state resource decisions and pass HB 41. 9:38:25 AM KERRY HOWARD, Executive Director, Office of Habitat Management and Permitting (OHMP), Department of Natural Resources (DNR), mentioned that committee members should have a book of background information on OHMP. She related her understanding that the committee has a copy of the letter Governor Palin sent to the Board of Fisheries indicating her intent not to move the habitat office back to DNR. Therefore, Ms. Howard said that she would provide some background about OHMP in hopes that it would help explain some of the things Governor Palin considered in her decision. 9:39:39 AM MS. HOWARD turned the committee's attention to the first page of the book provided by OHMP, which specifies the agency's mission statement as follows: "The mission of the Office of Habitat Management and Permitting is to protect Alaska's valuable fish and wildlife resources and their habitats as Alaska's population and economy continue to expand." She highlighted that the agency's mission is derived from the Alaska State Constitution. Article VIII specifically addresses the state's natural resources, Section 1 specifies: "It's the policy of the state to encourage the development of its resources by making them available for maximum use consistent with the public interest." Section 4 specifies: "Fish and all other replenishable resources belonging to the state shall be utilized, developed, and maintained on the sustained yield principle." Therefore, OHMP's mission is intended to acknowledge and implement the aforementioned constitutional responsibilities. Some interested parties have asserted that DNR and ADF&G have very different mission statements and that having the habitat office at DNR, habitat won't be protected as well. However, both agencies must abide by the constitution and both have statutes that refer to "conservation and development". Ms. Howard highlighted that AS 44.37.020(a) says, in part: "The Department of Natural Resources shall administer the state program for the conservation and development of natural resources" while AS 44.39.020 specifies, in part: "The Department of Fish and Game shall administer the state program for the conservation and development of the state's commercial fisheries, sport fish, birds, game, and fur-bearing animals." Additionally, AS 16.05.020(2) requires the commissioner of ADF&G "to manage, protect, maintain, improve, and extend the fish, game and aquatic plant resources of the state in the interest of the economy and general well-being of the state." Ms. Howard pointed out that the statutes of the former habitat division were unchanged when it was moved to DNR. Therefore, the biologists at OHMP implement the exact same statutes that are implemented at ADF&G. Furthermore, biologists at DNR work closely with biologists at ADF&G in implementing duties and routinely consult with them on matters for which they have data and expertise and incorporate that information into permitting decisions. The aforementioned is specified in a memorandum of understanding (MOU) between the two agencies. She then pointed out that the second page of the book reviews the division's statutory responsibilities and priorities. The division's priorities are the issuance of fish habitat permits, active participation in the Forest Resources and Practices Act, participation in the Alaska Coastal Management Program, participation as a team member with multi-agency reviews that involve large project, and maintain and update the anadromous waters catalog. 9:42:41 AM MS. HOWARD then directed attention to the organizational chart, which illustrates that OHMP is a small organization. The division has 37 full-time positions statewide, which are delineated into 7 area offices. There is also an OHMP staff position in the Joint Pipeline Office. Ms. Howard acknowledged that there was a great amount of turnover when OHMP was moved to DNR. However, 42 percent of OHMP's staff are former habitat and restoration employees and since vacancies have been filled, over 79 percent of OHMP's staff are from ADF&G. Additionally, the qualifications for a habitat biologists are the same as those for being a habitat biologist in ADF&G. Ms. Howard highlighted that in addition to OHMP there is a habitat office in ADF&G, which is called Region V Habitat. Essentially the Region V office in ADF&G has the same number of staff as OHMP. The two divisions, she said, work together professionally and collegially in order to ensure there's no duplication of duties and share information and knowledge. 9:44:18 AM MS. HOWARD highlighted that the book she provided includes a PowerPoint presentation that provides additional information regarding what OHMP does as well as additional missions and measures. The book also includes a short white paper that provides additional information regarding Executive Order (EO) 107 and the changes that accompanied it. Ms. Howard then directed attention to the MOU between ADF&G and DNR regarding reviews of land and water use activities. The MOU was originally signed in October 2003 and has been amended four times to provide additional clarity and specificity as well as delineate how coordination between OHMP and ADF&G is accomplished. She explained that OHMP, in addition to its Title 41 permit responsibilities, has the lead role reviewing resource development projects unless they are within or significantly impacting a legislatively designated special area for which ADF&G has the lead. However, she acknowledged that other divisions at ADF&G have information and expertise that would be useful in making permit decisions on large projects. Page 6 of the MOU specifies that OHMP either directly coordinates with ADF&G staff, Category 2, or Region V Habitat is asked to consolidate ADF&G comments, Category 3, and provide to OHMP. The categorization of the project is dependent upon the activity itself and the potential significant adverse impacts. Significant adverse impacts always result in the project being a Category 3. The following are examples of Category 3 projects: South National Petroleum Reserve-Alaska (NPR-A), Abbott Loop Extension, Beluga Coal, Juneau Access, Knik Arm Crossing, and a general placer permit. The Pebble Project was initially a Category 3 project, but last fall it was decided that ADF&G should have a full seat at the table, entirely separate from OHMP and the MOU was amended to do so. Ms. Howard confirmed that OHMP isn't reviewing subdivision plans, but pointed out that it's because the MOU gives that responsibility to biologists at ADF&G. 9:46:49 AM MS. HOWARD highlighted that Governor Palin's letter [dated February 8, 2007] says that she will have the commissioners of ADF&G and DNR review the MOU in order to ensure that interagency cooperation, responsibilities, and exchange of information are working well. In fact, the first meeting for the aforementioned is the coming Thursday. In conclusion, Ms. Howard recalled Representative Gara's opening remarks on HB 41 when he said that the state has an important duty to protect the fisheries. The aforementioned duty, she said, was taken seriously when the habitat division was housed in ADF&G and it continues to be taken seriously by biologists at DNR. 9:47:25 AM REPRESENTATIVE JOHANSEN related his understanding that OHMP is an awful place to work and staff are afraid to speak their mind. He asked Ms. Howard to comment on that. He then asked if most of OHMP's employees are classified employees and members of the state employee's association. MS. HOWARD commented that reasonable people can disagree. She guaranteed the committee that there are no sideboards, constraints, or threats to her staff. She explained that only two employees of OHMP, herself and the operations manager, are partially exempt and the remainder are classified employees. Ms. Howard opined, "When people disagree, it's often easy to resort to second hand information to try to construct an argument about how bad you think that they are. But I would welcome anyone to bring forward a specific project where they think my staff has not done their job, they're not participating, they're shirking their duties, and let's talk about specifics. Let's not talk about generalities and innuendos because just last week ... I had a two-day meeting with my area managers and they were, quite frankly, offended that some parties were saying that they felt like they weren't doing their job." 9:49:12 AM REPRESENTATIVE JOHANSEN asked if OHMP's classified employees have a grievance process if they feel they are being kept quiet. MS. HOWARD confirmed that there is a process, but deferred to union representatives. She informed the committee that there hasn't been a single grievance filed. She said she would welcome the committee to invite any of her staff to testify in regard to how they feel about their jobs. 9:50:13 AM REPRESENTATIVE JOHNSON related his understanding that anyone who came forward with a grievance would be protected under the state's whistleblower's statute. MS. HOWARD noted her agreement. She reiterated that she is offended to hear that she and her operation's manager threatened retribution, which she said was unfounded and ungrounded. She also said that she would happily speak with members about specifics. 9:50:43 AM REPRESENTATIVE JOHNSON cautioned the committee with regard to unnamed sources. If someone has a grievance, then he/she should come forward and state it. 9:51:11 AM CHAIR SEATON reminded members that when someone testifies, members should consider the source and its reliability and work through what it means. 9:52:29 AM REPRESENTATIVE JOHANSEN related that the concern with regard to the working environment at OHMP came from the opening remarks of the sponsor as well as from public testimony. 9:52:54 AM REPRESENTATIVE HOLMES recalled testimony regarding the level of transparency of the discussion, depending upon the location of the habitat division. She further recalled that the notion was that when the division was under ADF&G, there would be a commissioner-level discussion between the division through ADF&G and the commissioner of DNR with regard to permits and other decisions in question. With the division within DNR, that debate will now occur within a single department and ADF&G may not be involved at all. Representative Holmes requested comment on the aforementioned transparency issue. MS. HOWARD acknowledged that business was done differently when two different departments were involved in the decision-making. However, all of the decisions remain public documents and public information. She recalled that [prior to the division's transfer to DNR], on large projects, particularly coastal zone projects, ADF&G, DNR, and DEC would all forward comments to the governor's office in the Alaska Coastal Management Program to be put forward as a state position. There were informal elevation procedures should the finding be objectionable to any of the commenters. The same process still happens, it merely occurs within DNR. Ms. Howard said that she and her staff submit comments to the Office Project Management and Permitting (OPMP), which consolidates comments from the various divisions of DNR. She emphasized that any project larger than a bed box results in the staff of OHMP communicating with biologists at ADF&G, and therefore the comments forwarded [by OHMP] incorporate comments from ADF&G. Again, the [comments are submitted to OPMP, there's an elevation process, and informal discussions. Ms. Howard said she didn't believe there have been many elevations, which she interpreted to mean that staff are coming to agreement on projects between discussions among themselves. She noted that she routinely discusses projects with her staff and if it's important enough, it's brought to the commissioner's attention. Almost 2,500 permits a year are reviewed and although she said she doesn't know about every project and permit, she does know about the ones with potential for controversy. She related that most recently she briefed the commissioner on a project in which ADF&G proposed to use explosives within Trinity and Shell Creek, anadromous fish streams, to remove beaver dams. This permit was denied because OHMP staff didn't believe the use of explosives in an anadromous fish stream was protective of the fish or the habitat. Ms. Howard then related that she has worked in the habitat division under both departments, and opined that the staffs of both offices have done a good job representing the state's interests on fish and fish habitat. 9:57:24 AM REPRESENTATIVE HOLMES inquired as to how often there are commissioner-level discussions between DNR and ADF&G with OHMP in DNR versus when the division was located in ADF&G. MS. HOWARD said that she doesn't have exact numbers, but opined that it's less [with OHMP under DNR] which she attributed to changes in the coastal management program. Under the old coastal program, the habitat standard specified that the division "shall maintain or enhance" and if that couldn't occur, then there was a three-part test to reach a different outcome. The changes to the coastal management program included an attempt to streamline the standards by eliminating any standards that already duplicated what other state and federal agencies did. Therefore, changing the threshold and eliminating duplication, OHMP has less on which to comment under the habitat standard. 9:59:10 AM REPRESENTATIVE EDGMON commented that with budget cuts and the need to move development projects forward while protecting fisheries, the two departments should be merged. He said that although he is saying it facetiously, he recalls being a former employee of an agency and that departments have different missions and cultures. Furthermore, there isn't a regulation or statute that doesn't carry a certain amount of discretion while upholding the process. Representative Edgmon opined, "I find it hard to believe that ... the habitat division has the same makeup or the same outlook in the Department of Natural Resources as it would in the Department of Fish & Game." Furthermore, the division is physically located in a different place and thus doesn't interact with the directors of the divisions within ADF&G as before. The division is now interfacing with department employees, many of which are political employees whose background is in the industry and whose mission it is to make natural resource development take place. He reiterated that there have to be some differences. With regard to earlier statements regarding the governor's position, Representative Edgmon related his understanding that Governor Palin will revisit the decision to house the division within DNR after a year has elapsed. MS. HOWARD noted that in the past there has been the notion to merge all three resource agencies, on which point she deferred to the legislature. She then pointed out that over half of the area offices [of OHMP] are located within ADF&G buildings. 10:03:06 AM REPRESENTATIVE LEDOUX asked if, either when the division was under ADF&G or DNR, the public was able to receive internal memorandums in regard to particular projects. She posed a scenario in which the commissioners of ADF&G and DNR disagreed with each other, and asked if that would be open to the public. MS. HOWARD answered that everything OHMP does is available to the public. Although all state agencies have the ability to have certain things that are deliberative confidential, that doesn't enter the realm of the permitting world, she said. In fact, [OHMP] routinely copies whoever wants to be copied on any permit comments or decisions. The ADF&G always receives a copy of everything OHMP writes. 10:04:29 AM REPRESENTATIVE JOHNSON recalled prior testimony that indicated permits were issued and only the permitter and the permittee knew about it and that there wasn't public testimony or notice. He asked if the aforementioned actually happens. MS. HOWARD said that Title 41, under which OHMP operates, doesn't have a public notice requirement which was the case under the former habitat division, Title 16. However, that doesn't mean that the public can't obtain documents or aren't made aware of them. 10:05:43 AM JOHN BITNEY, Legislative Liaison, Governor's Legislative Office, Office of the Governor, returned attention to the letter from Governor Palin to the chair of the Board of Fisheries, dated February 8, 2007. To clarify the letter, he stated that despite this letter, the governor is concerned about habitat protection. When Governor Palin took office, some of the acting commissioners were charged with reviewing options and making recommendations regarding the best course of options. The following three options were presented to the governor for consideration: the status quo, evaluate the MOU and place it in review between DNR and [ADF&G], or return the habitat division back to ADF&G. The governor chose to keep the habitat division at DNR, but asked the departments to review the MOU in order to evaluate what changes are necessary to improve interagency cooperation. The aforementioned could be done over the course of a few weeks or months and include some outreach to the stakeholders and interested parties. Mr. Bitney related that although the governor is sympathetic to the concerns regarding the move to DNR, she also recognizes that simply moving offices back and forth is disruptive. The governor, he further related, is willing to review the protection issues and reconsider anything necessary following a full review of the MOU. 10:10:51 AM CHAIR SEATON asked if, regardless of the fate of HB 41, there is a timeframe that limits the governor's authority to change the departments by EO. MR. BITNEY said that's his understanding. 10:11:45 AM REPRESENTATIVE HOLMES asked if the governor's office is making any particular request as to how the committee treats HB 41. MR. BITNEY reiterated that if more information comes to light, the governor's office will remain open. He further reiterated that the governor doesn't want to be disruptive. 10:13:06 AM CHAIR SEATON announced that HB 41 would be held for further testimony and committee discussion.