SB 2-INTERSTATE MINING COMPACT & COMMISSION  1:07:08 PM CO-CHAIR SADDLER announced that the first order of business would be SENATE BILL NO. 2, "An Act enacting the Interstate Mining Compact and relating to the compact; relating to the Interstate Mining Commission; and providing for an effective date." 1:07:54 PM SENATOR CATHY GIESSEL, Alaska State Legislature, sponsor, informed the committee SB 2 allows Alaska to become a full member in the Interstate Mining Compact Commission (IMCC), which is a coalition of mining states that joins together to share best practices, discuss issues, and work to better protect the environment, public safety, and employees, as well as develop mining resources. She emphasized Alaska's vast resources are not just in oil and gas, but in many minerals such as gold, silver, and zinc. At this time, Alaska is an associate member in IMCC, however, becoming a full member gives the state a broader voice nationally and allows for collaboration with other states on issues related to the best practices in mining. 1:09:20 PM ED FOGELS, Deputy Commissioner, Office of the Commissioner, Department of Natural Resources (DNR), expressed DNR's support for SB 2. Mining activity in Alaska has been increasing - there are now seven operating mines that contribute economically to their regions - and which DNR successfully regulates, manages, and oversees. All of the mines have excellent environmental records. However, DNR seeks to improve its permitting system and its collaboration and relationship with the federal government. For seven years, Alaska has been an associate member of IMCC, an organization that brings together the regulatory and environmental programs from twenty-five mining states. In this forum, states exchange information on successful programs and learn from each other, and most importantly, bring the full weight of influence from member states to bear on Congress and federal agencies. Further, IMCC has been instrumental in many federal and state issues affecting permitting and regulatory processes; for example, IMCC is meeting with the U. S. Environmental Protection Agency (EPA) to address the possible impacts of its initiative to regulate bonding for hard rock mining throughout the nation. This initiative has the potential to reduce each state's mining regulatory and permitting processes, and IMCC is working to maintain strong state programs. In addition, IMCC has arranged that states meet regularly with the director of the Mine Safety and Health Administration (MSHA), U.S. Department of Labor, to ensure efficient and reasonable safety regulations. As the governor's current designee to IMCC, Mr. Fogels has seen the benefits membership has brought to the state, and full membership will allow the state to become a voting member, help set the policy direction of the organization, and contribute to its voice in Washington, DC. He encouraged the committee to support the bill. 1:13:06 PM GREGORY CONRAD, Executive Director, Interstate Mining Compact Commission (IMCC), stated his support of SB 2 and expressed his belief the bill arose from Alaska's experience as an associate member of IMCC since 2006. In today's regulatory climate, it is important for state governments to be heard in Washington, DC, and for their concerns to be understood, particularly when related to mining and environmental issues. His organization is recognized by many for its experience and expertise; for example, IMCC testimony on behalf of member states has been requested for Congressional hearings on topics such as Good Samaritan protections for hard rock abandoned mine cleanup, stream protection requirements, hard rock financial assurance requirements, legislation, and state grant programs. Other agencies and organizations utilize IMCC also. Mr. Conrad referred to IMCC's annual report which was included in the committee packet, noting IMCC is called upon to provide member states' recommendations to Congress and federal regulators and agencies. He stated that full and active participation by full members carry IMCC forward, and Alaska's full membership will ensure its vote in guiding the direction of the IMCC and thereby lead the organization; Alaska will also continue to garner its present benefits that include communications, meetings, programs and initiatives. In addition, Alaska's full membership will be recognized by Congress and federal agencies, and entitle the state to heard and supported by the other member states. He concluded that IMCC's focus allows it to delve deeper into the concerns of mining and related environmental protection issues. Mr. Conrad encouraged the committee to approve the proposed legislation. 1:18:20 PM REPRESENTATIVE JOHNSON asked Mr. Conrad to explain the IMCC dues structure. MR. CONRAD explained the member states' dues are calculated by apportioning the dues based on IMCC's anticipated budget through two mechanisms: equal shares among the full member states and pro-rata shares based upon the value of both coal and hard rock mineral production. The production values, equal shares, and pro-rata shares are used to calculate the total dues for each state, which are reduced by other revenue sources such as registration and publication fees. In further response to Representative Johnson, he said the percentages are intended to reflect the total percentages for all of the full member states. REPRESENTATIVE TARR asked if Alaska's first year of dues would be approximately $40,000. 1:22:33 PM MR. FOGELS advised there is a cap on the dues, even if production goes up. MR. CONRAD added he has calculated the total value of mineral production for Alaska, based upon figures from the U.S. Geological Survey (USGS) and the Energy Information Administration (EIA), U.S. Department of Energy, for non-coal and coal, is about $3.5 billion. Therefore, he estimated dues for Alaska are approximately $35,000, depending on how many full member states are participating. REPRESENTATIVE TUCK asked whether gravel pits are included in IMCC's purview. MR. CONRAD believed USGS figures do include aggregate. CO-CHAIR SADDLER inquired as to the location of the other member states. MR. CONRAD answered that the member states are located as follows: the Western states are Alaska, Colorado, New Mexico, Utah, Wyoming, Nevada, and North Dakota; the Mid-continent states are Texas, Oklahoma, Arkansas, Illinois, Indiana, Louisiana, and Missouri; and the balance are in the East. Some states only have non-coal production such as New York, North Carolina, South Carolina, and Nevada. In response to Co-Chair Saddler, Mr. Conrad assured the committee that IMCC represents the full panoply of issues, although in the 1970s IMCC was primarily focused on issues pertaining to coal. In fact, IMCC recently hosted hard rock minerals symposiums in Salt Lake City and in the East. 1:27:56 PM REPRESENTATIVE TARR asked whether IMCC participated in events sponsored by the Council of State Governments or the National Conference of State Legislatures. MR. CONRAD said yes, IMCC is involved with a number of other state government organizations, including a close relationship with the Council of State Governments. Other connections include the Western Governors Association, the National Governors Association, the National Association of Abandoned Mine Land Programs - EPA, the Association of Clean Water Administrators, and the Environmental Council of the States. 1:29:41 PM CO-CHAIR SADDLER opened public testimony. 1:29:52 PM MIKE SATRE, Executive Director, Council of Alaska Producers, said he is a resident of Juneau and the Council of Alaska Producers is a nonprofit trade association representing large producing metal mines and major metal developmental projects in the state. His organization is in support of SB 2 and participation by the state in IMCC as a full member. His organization supports the bill because Alaska is a global leader in permitting and regulation of the mining industry and participation in IMCC will keep state officials informed. Also, he advised that local, state, and federal mining regulations can be troublesome, and IMCC deals with the federal government from a position of strength. 1:32:15 PM DEANTHA CROCKETT, Executive Director, Alaska Miners Association (AMA), stated AMA is a statewide industry association that represents the six large metal mines in the state, the coal mine, exploration projects, placer miners, contractors, engineering firms, and others. She agreed with previous testimony in support of SB 2, adding that federal regulation is becoming increasing difficult and IMCC provides a powerful voice in Washington, DC. Ms. Crockett said her research revealed that other Western states have benefitted greatly from their membership in IMCC. She reminded the committee that the mining industry is the second largest industry in the state. 1:34:23 PM MARLEANNA HALL, Project Coordinator, Resource Development Council for Alaska, Inc. (RDC), stated that RDC is a membership- funded, statewide business association representing the tourism, forestry, oil and gas, mining, and fishing industries. Her organization supports the passage of SB 2 and she pointed out the state should encourage investment and worldwide interest in Alaska's mineral potential. Joining IMCC will show leadership in advocating for a healthy and stable permitting regulatory system. The importance of mining is recognized nationwide, and RDC believes IMCC will bring a collective voice to Washington, DC, to advocate for states' rights. Full membership in IMCC will allow Alaska to benefit in many ways, such as partnering on federal and state issues and promoting the mining industry in Alaska and nationwide. She urged for the timely passage of SB 2. 1:35:42 PM CO-CHAIR SADDLER, after ascertaining no one else wished to testify, closed public testimony. REPRESENTATIVE JOHNSON offered his strong support for SB 2, and provided an example to illustrate that individual state resolutions and letters are not as effective as those from an organized group of states with like concerns, such as the Council of State Governments-WEST. He encouraged the committee to support the bill because partnering in this type of organization is invaluable. REPRESENTATIVE P. WILSON relayed her personal experience as a member of a group from several states that made a difference. CO-CHAIR FEIGE has heard it said that "the federal government is not your friend," and expressed his support for the proposed legislation in order to accumulate friends for Alaska. REPRESENTATIVE SEATON recalled reviewing the compact at the time Alaska became an associate member of IMCC. He observed that there is nothing in the compact that would override Alaska state law. He restated the benefits of joining IMCC as a full member and offered his support for SB 2. 1:41:22 PM CO-CHAIR FEIGE moved to report SB 2 out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, SB 2 was reported out of the House Resources Standing Committee.