HJR 38-AK RAILROAD TRANSFER ACT; CONVEYANCES    4:07:04 PM CHAIR KREISS-TOMKINS announced that the next order of business would be HOUSE JOINT RESOLUTION NO. 38, Relating to certain conveyances to the Alaska Railroad Corporation under the Alaska Railroad Transfer Act of 1982. 4:07:57 PM REPRESENTATIVE CHUCK KOPP, Alaska State Legislature, as prime sponsor of HJR 38, relayed that the proposed resolution represents a "singular voice" of the legislature to comment on a matter of such an important public policy as property rights. He referred to the testimony of the Alaska Railroad Corporation (ARRC) [Andy Behrend, Chief Counsel, ARRC] during the 3/1/18 House State Affairs Standing Committee meeting, which stated that there was no connection between the Alaska Railroad Act of 1914 ("1914 Act") and the General Railroad Right-of-Way Act of 1875 ("1875 Act"). He said, "That's a profoundly important statement, because it is profoundly wrong." REPRESENTATIVE KOPP referred to the 1982 decision of the [U.S. Department of Interior's (USDOI's)] Interior Board of Land Appeals (IBLA), included in the committee packet [IBLA 81-426]. The Alaska Railroad (ARR) appealed a selection of state lands on the ARR right-of-way (ROW) asserting that this property had been appropriated, reserved, or otherwise set aside based on what it had claimed was a fee simple interest ownership; therefore, it was not available for state appropriation. The IBLA decision reported the following: the page labeled 65 IBLA 376 summarizes ARR's claim that the property was set aside; the page labeled 65 IBLA 377 mentions the Alaska Statehood Act of 1958 allowing for the selections of these lands along the Fairbanks meridian and comments that the initial [USDOI] Bureau of Land Management's (BLM's) decision stated that the lands were available for appropriation by the state; they were entirely appropriate for the ROW; and they could be acquired as state property; and it also states that this determination was made under the 1914 Act. REPRESENTATIVE KOPP quoted from the pages labeled 65 IBLA 377 and 65 IBLA 378 of the IBLA decision, beginning with the last sentence on the first of the two pages, which read: The issue raised by this appeal is whether the land within the right-of-way granted to the Alaska Railroad is occupied, appropriated, and/or reserved so as to be exempt from State selection. Neither counsel for appellant nor counsel for the State of Alaska have cited any cases on point and this appears to be a case of first impression. REPRESENTATIVE KOPP said that IBLA then addressed the issue by citing cases; he referred to the first paragraph under [1] on the page labeled 65 IBLA 378, which read in part: [1] Consideration of the nature of the right-of- way granted by similar statutes provides guidance. The General Railroad Right of Way Act of March 3, 1875, ch. 152, 18 Stat. 482 (1875), 2/ granting a similar right-of-way for railroad across the public lands outside Alaska has been held to convey only an easement and not a fee interest in the land. REPRESENTATIVE KOPP stated that IBLA also cited the U.S. Supreme Court case of 1942, Great Northern Railroad Co. v. U.S. He continued quoting the first paragraph of [1], which read in part: The Court held that the reserved right to dispose of the lands subject to the right-of-way is inconsistent with the grant of a fee and persuasive that the grant of an easement was the intent of the statute. REPRESENTATIVE KOPP relayed that in this case, the court concluded that even under a more restrictive standard, which existed before the 1875 Act, it was the intent of Congress that the state - in this case the State of Wyoming - would be allowed to take the subsections in its statehood appropriations subject to the ROW. He added that under the ROW Acts of 1862 and 1864, there were limited fee interests and railroads did own some land. REPRESENTATIVE KOPP quoted from the third paragraph under [1] of the IBLA decision, on the page labeled 65 IBLA 379, which read: These cases decided under other railroad right-of-way statutes persuade us that the lands embraced in appellant's right-of-way should not be considered to be appropriated or reserved at the time of State selection so as to be excluded therefrom. The decision correctly held that a right-of-way for railroad shall be reserved in any State selection patent issued. REPRESENTATIVE KOPP explained that IBLA directly referred to the 1875 Act, under which Congress ended land grant railroads and allowed only surface easements for rail, telegraph, and telephone. He asserted, "That was the easement ... of the 1914 Alaska Railroad Act." 4:12:22 PM REPRESENTATIVE KOPP relayed that HJR 38 would not have an impact on federal property already in a federal interest; but only on property upon which there was an unlawful infringement in the transfer. He stated that the federal government owned an exclusive-use easement in Denali National Park and Preserve (DNPP) and an exclusive-use easement on Native lands under contested land claims. He emphasized that the federal government never owned an exclusive-use easement on Homestead Act [1862] ("homestead") patent properties. REPRESENTATIVE KOPP said that the ARRC's position is that there is settled law in the matter: railroads have either full simple title or an exclusive-use easement. He emphasized that there is no settled law in that regard; 80 percent of railroads in the U.S. have a simple easement only, a claim supported by the U.S. Supreme Court three years ago in Brandt Revocable Trust v. U.S. The court ruled that a railroad ROW granted under the 1875 Act is an easement; therefore, if a railroad abandons such easement, the landowner regains his/her unburdened use of the land. He stated that it is difficult to understand why a limited interest surface easement, which ARR has, is insufficient for ARR to safely operate, like most other railroads in the country. REPRESENTATIVE KOPP stated that whatever property the federal government lawfully owned at the time of the transfer [to the state in 1982] would not be affected by HJR 38. He relayed that HJR 38 would only apply to right titles and interests owned by other parties; it is focused on the homestead patentees and a claim of ARRC to own more than it owns. He offered that he has requested from ARRC a list of conflicting land claims that the secretary of USDOI has adjudicated to demonstrate that ARRC followed due process when taking exclusive-use easement interest on all homestead patent properties; ARRC maintained it would respond. He added that he has no indication of conflicting land claims other than those in DNPP and those for which village corporations and other Native claimants were competing. He expressed his belief that the secretary of USDOI has made some determinations on those lands. REPRESENTATIVE KOPP asserted that homestead patents were never subject to competing claims; they were entirely owned by the homesteaders; the federal government had completely divested itself of ownership in those lands. He relayed that HJR 38 would make it clear that if an entity says it has title to land, then it should prove that title; any lawyer would tell a client to clear his/her title unless the title is not clear. He maintained that every lawyer he has consulted in this matter has informed him that the extent of the ROW must be determined on a case-by-case, parcel-by-parcel basis; and the title recording system can provide with certainty the history of the interest of any parcel. 4:15:41 PM REPRESENTATIVE KOPP concluded that ARRC has made a "sweeping" claim to an exclusive-use easement without doing the work necessary to justify that the federal government had that interest to give to the state at the time of transfer. He referred to Section 1202(10) of the Alaska Railroad Transfer Act (ARTA) of 1982 [45 USC Ch. 21], included in the committee packet, which states that the definition for rail properties of ARR includes the exclusive-use easement within DNPP. He offered that there would be no reason to specifically mention this exclusive-use easement if it was de facto for the entire ROW. He added that exclusive-use easement on federal lands is specified three times [in ARTA]. He maintained that it was clearly never the intent of Congress to impose that on the homestead patent properties. REPRESENTATIVE KOPP referred to testimony by Bill O'Leary, Chief Executive Officer (CEO), ARRC, during the House State Affairs Standing Committee meeting of 3/1/18, who quoted Alaska's former U.S. Senator Ted Stevens as saying that the interest along the ROW would be an exclusive-use easement. Representative Kopp said that the quote was out of context; Senator Stevens said that the interest on federal lands - lands for which the federal government had the interest to give - would be an exclusive-use easement. REPRESENTATIVE KOPP maintained that a disagreement exists, and ARRC recommends resolving it in court. He offered that "justice is not free." The ARRC has asserted that the federal government is bound to defend claims against the ROW; however, it is not clear if that would involve all claims. He expressed that it is upsetting to hear testimony that the legislature does not have a legitimate role in addressing matters of such serious importance to the state and that affect so many land owners; any individual land owner would be financially destitute upon pursuing such a case [in court]. REPRESENTATIVE KOPP maintained that the legislature has a duty and responsibility to disclaim any unlawfully acquired property that was transferred; the legislature would not be identifying that land, but merely asking for proof of ownership for land claimed. He stated, "We're not going to aid and abet in any unlawful taking of property. It's the most important thing Alaskans have." He said that under HJR 38, the legislature would be asking ARRC to prove that the federal government had the exclusive-use easement at the time of the land transfer, if ARRC is making a claim of property ownership based on that. 4:19:10 PM REPRESENTATIVE BIRCH stated that he supports the proposed resolution and maintained that the issue has been "unfinished business" for many years. He mentioned that there has been an attempt on the municipal level to resolve the issue, and the legislature is the appropriate body to put forward such a resolution. 4:19:51 PM REPRESENTATIVE WOOL moved to report HJR 38 out of committee with individual recommendations and the accompanying zero fiscal note. There being no objection, HJR 38 was reported from the House State Affairs Standing Committee.