SB 278-TAKING PROPERTY BY EMINENT DOMAIN  KIM OGNISTY, Staff to Senator Torgerson, read the following sponsor's statement into the record: SB 278 is concerned with the eminent domain and declaration of taking proceedings in Alaska statute. The bill introduces a "reasonable and diligent effort" clause that attempts to place the condemner of land and the private landholder in an equal negotiating position. The bill is not trying to remove the authority of the state to acquire land by eminent domain or in any way complicate existing proceedings. Currently, Alaska law does not require the state to engage in a good faith effort to negotiate with private landowners. Without an incentive to negotiate, state officials are free to make only an unreasonable offer or none at all. They can end discussions at their caprice and they are under no obligation to take the landowner seriously. Initiating communication from an equitable bargaining position will promote productive negotiations, facilitate dialog over reasonable concerns and encourage suggestions from all parties involved. The phrase, "reasonable and diligent effort" or similar language has been adopted by at least 23 other states. This clause will reduce the amount of litigation by encouraging more cases to be settled up front thereby promoting expediency in government. PHIL EVANS testified via teleconference as the representative and president of the Northgate Square Mall in Fairbanks. He wanted to tell about his experience with land taking and then his reaction to SB 278. He read the following into the record: The State of Alaska, Department of Transportation recently took a portion of my commercial property to use for a road construction project. I would like to make you aware of the experience I had with them. Prior to condemnation being filed, the person representing the state was courteous but misleading in attempting to convince me to accept the settlement that was completely unfair. Also prior to the condemnation being filed, the state appraiser provided no meaningful information. She was quite insistent about her authority to be on my property and utilized a space in a business in the mall for her office. She was deceptively courteous and misleading in her attempt to promote an unfair evaluation of the property. The state did not provide me with a copy of her completed appraisal record and market data book. I was unable to settle with the state, based on that appraisal, because of the compensation being inadequate and unfair. The appraisal did not fairly set forth the value of the taking and the consequences to the remainder property. In the appraisal of my property, the "before the taking" value was based on the current use of the property rather than the highest and best use of that property. The following items were not fairly considered when analyzing the affects of the right-of-way taking on my property: loss of parking, change in highest and best use, decline in market appeal, change in business use of the property, decline in market value. But when it became apparent the state was misleading and unfair in their attempts to reach settlement, I hired an attorney and an appraiser to provide me accurate and fair counsel. The state appraiser concluded that just compensation for the property taken and damages was $80,000. The appraiser for Northgate Square and myself concluded the just compensation for the property taken and damages was $676,000, eight times more than the state's appraisal. As a consequence, we proceeded to hearing. Frank King, an appraiser, was appointed by the state to preside over the masters hearing. At the conclusion of the hearing, Mr. King rendered a decision awarding $324,000 for property taken and damages. Although this was approximately half of the amount sought, I decided rather than continue with litigation, I would settle. The state subsequently appealed. The state's decision to appeal will significantly increase costs not only for me, but also for the state. 2:05 p.m. He said SB 278 is encouraging, but he would like to see more change. He feels the state is able to totally take over private property with no respect or concern for the rights of the owner. RON WOLF, Sealaska Corporation Corporate Forester, testified in favor of the bill. They had some suggestions on the language concerning how the bill defines "reasonable and diligent effort" but it could be brought up in the Judiciary Committee. CHAIRMAN TORGERSON agreed. There was no further testimony. SENATOR KELLY made a motion to move SB 278 from committee with individual recommendations. There being no objection, SB 278 moved from committee.