SB 190-KENAI RIVER SPECIAL MANAGEMENT AREA  CHAIR GARY STEVENS announced SB 190 to be up for consideration. He advised that committee substitute (CS) 23-LS0961\H was offered and asked for a motion to adopt it as the working document. SENATOR GRETCHEN GUESS motioned to adopt the \H version of SB 190 as the working document. There was no objection and it was so ordered. CHAIR GARY STEVENS asked Senator Wagoner to step forward. SENATOR THOMAS WAGONER, sponsor, introduced Amy Seitz and said that she worked on SB 190 when she was staff to Representative Lancaster. He explained that the issue has some history. In 2001, Representative Lancaster introduced a bill to add nearly 8,000 acres to the Kenai River Special Management Area. Because of problems with a federal energy regulation commission, 3,500 acres in the Kenai Lake area were removed. In subsequent hearings, the acreage was further reduced to 536 acres, most of which were acquired as habitat recreation lands with Exxon Valdez Oil Spill (EVOS) money. SENATOR WAGONER pointed out that SB 190 includes the provision that makes agency personnel ex officio or non-voting members. State and federal employees are valuable for their expertise, but he said he firmly supports the concept of a true citizen's advisory council. CHAIR GARY STEVENS clarified that the only difference between the original bill and the \H version is the composition of the advisory board. The change is on page 5, lines 11-13 and says that employees, elected officials or representatives of a state or federal government who were members of the advisory board would serve as ex officio or non-voting members. SENATOR GRETCHEN GUESS noted that "adjacent to the Kenai River" was added after "municipalities" on page 5, line 9 to clarify that the advisory board represents specific municipalities. SENATOR WAGONER advised that provision was added to preclude the difficulty the Aquaculture Association experienced when an interpretation became too broad. SENATOR JOHN COWDERY commented that catching a salmon fishing on the Kenai River is a large industry. SENATOR WAGONER agreed saying it's a big part of the summertime economy of Kenai, Soldotna and the upper river area. In particular, the upper river area is becoming world known for float trips and fly-fishing and the resource needs to be protected. He pointed out that SB 190 is basically the same bill that the Senate Resources Committee passed in 2002 [HB 165] at which time there was considerable public comment regarding adding land to the Kenai River Special Management Area. He noted that most of the land under consideration is not suitable for development because of wetland issues, but any additional development on the Kenai River threatens the continued viability of the salmon runs. To address the concern regarding removing federal and state employees from the board, he pointed out that they were made ex officio members and would continue to provide expertise and guidance. He described the bill as " all in all, a pretty good bill " and noted that the controversial lands had been removed. He asked if there were any questions. CHAIR GARY STEVENS referred to page 5, lines 2-5 and asked for clarification that this allows for oil and gas leasing. SENATOR WAGONER asked that Department of Natural Resources (DNR) representative to elaborate. CHAIR GARY STEVENS announced that Gary Morrison and Pete Panarese from Anchorage and Chris Degernes from Soldotna were available via teleconference and asked whether any of the men would like to address oil and gas questions. PETE PANARESE, Division of Parks and Outdoor Recreation, DNR, reported that he reviewed the language in the CS and determined that the wording was simply reworked to make a more readable document. CHAIR GARY STEVENS observed that the bill states that oil and gas leasing is open on the lands and follows state law. MR. PANARESE agreed saying, "The state lands." SENATOR GUESS asked Senator Wagoner to explain the duties and authority of the Kenai River Special Management Area Advisory Board. SENATOR WAGONER acknowledged that he wasn't an expert and was carrying the bill at Representative Lancaster's request. He said he knows they are instrumental in reviewing the Kenai River system from the mouth up through Kenai Lake. They work closely with the Division of Parks and Outdoor Recreation and the Kenai River Center. It is a user group advisory board that is composed of citizens at large, commercial fishermen, and sport fishing guides. With regard to their exact authority, he admitted he was unsure because most of the actual enforcement and regulation authority rests with the state parks. SENATOR GUESS referred to page 5, line 9 and asked if there is a definition for "user groups" in the by laws so that it would be easier to determine who is and is not a user group. SENATOR WAGONER said that user groups are those that he previously defined: the general public including several municipalities, sports fishing guides, and commercial fishermen. "That pretty well covers the whole gauntlet of those of us who are interested in preserving the pristine beauty and viability of the Kenai River system and the fish runs that are in it." Also, the board members are appointed every four years and half are rotated every two years. SENATOR GUESS asked for elaboration regarding why areas were removed from Representative Lancaster's original bill and why some of the lands were controversial. SENATOR WAGONER said the largest controversy was with Chugach Electric and related to access to the flume, the road, and the rights of way. Also, some land was to be purchased or traded, but the state is no longer purchasing additional property to include in reserves. SENATOR GUESS asked if it was correct that those lands were included initially because they were important to the river system. SENATOR WAGONER said they were undeveloped properties and it was desirable to keep them that way. He admitted that he agreed to carry the bill with the EVOS lands because they were lands that the state had already purchased and it would protect them from future development. SENATOR GUESS questioned whether some of the land that was excluded is critical to ensure the habitat of the Kenai River system. SENATOR WAGONER opined they aren't as critical as they used to be because development restrictions are more stringent than they used to be. He stated that he isn't interested in controlling what another person may do with their property, but property rights on the Kenai River affect far more people than just those along the river. It is a valuable system and no one wants to lose it. SENATOR GUESS asked if there is a reason for the immediate effective date. SENATOR WAGONER replied it isn't a burning issue and continued to describe this as a non-partisan issue. SENATOR BERT STEDMAN noted that SB 190 applies to just 536 acres, but that it has a broader reach, as it would protect the Kenai River for generations to come. SENATOR WAGONER agreed. SENATOR STEDMAN asked that Senator Wagoner explain the EVOS acronym and how it relates to the Exxon Valdez. SENATOR WAGONER explained that EVOS stands for Exxon Valdez Oil Settlement. Close to a $1 billion settlement was reached between Exxon, the State of Alaska and the federal government. A large percentage of that money was used to buy private sector lands and return them to the state, but the current governor halted the practice. SENATOR STEDMAN observed that these lands would be held in perpetuity as untouched lands for future generations to enjoy. SENATOR WAGONER agreed and said that although most of the lands are wetlands or have wetlands on them, SB 190 ensures their protection by placing them in the park system. CHAIR GARY STEVENS called on Ted Wellman to give testimony. TED WELLMAN from Anchorage testified via teleconference. He advised that he was speaking for himself, but that he has served on the Kenai River Special Management Area Advisory Board for eight years. He spoke in support of the bill with regard to the acreage, but disagreed with making some of the members ad hoc. Initially he was not in favor of allowing agency members to vote but has since changed his mind. They have a stabilizing quality and provide regular and ongoing information to the board. He expressed concern that a special interest group might gain control of the board and drive it in the wrong direction. MR WELLMAN stated no objection to the Department of Natural Resources and the Department of Fish and Game having no vote because they are "too close." However, he believes that the refuge and Forest Service should be voting members because they prevent any user group among the public members from gaining control of the board. In his eight years on the board, there was no problem with the agencies voting and he could recall no instance in which the agency member made a determining vote. To clarify any misunderstanding, he explained that the Chugach Electric property was a small part of the land selected for inclusion in the park. Most of the land slated for inclusion did not have to be purchased. There was some objection about commercial development around Kenai Lake and after an extensive public process, the board recommended including the areas in the park to protect the river. In particular, exchanges regarding commercial and non-commercial development in the Cooper Landing area were fiery, but the board thought that commercial development was incompatible with the river. He expressed pleasure that SB 190 would add 536 acres, but stated his belief that the other land should be included as well. He then acknowledged that Chugach Electric's objections were legitimate. He said he would be happy to answer questions about how the board works. CHAIR GARY STEVENS asked Mr. Wellman to comment on the board responsibilities and what it accomplishes. MR. WELLMAN explained that in the mid 1990s, the board was charged with redeveloping the comprehensive plan for the Kenai River. They did so through an extensive public hearing process. The plan addresses all activity on the river. They review and comment on permit applications for building on the river, they participate in water quality monitoring studies, they review enforcement issues related to guiding activities, they advise the park on guide stipulations and numbers, and they review and comment on any other uses related to the river that might affect the public. Generally, they are very active and aggressive in protecting the river. 4:00 pm    CHAIR GARY STEVENS asked Mr. Vincent-Lang to give testimony. DOUG VINCENT-LANG, Department of Fish and Game, testified via teleconference to say that the land under discussion was specifically purchased to be set aside. They are EVOS purchases and most are wetlands that form critical habitat to sustain the fisheries. SENATOR WAGONER remarked that Mr. Wellman brought up a point that might benefit from additional clarification. The water quality study on the Kenai River that the Department of Environmental Conservation (DEC) was involved in was not funded last year. He advised that he is working to re fund that program so that the water quality study can be completed in the next year or two. SENATOR GARY STEVENS noted that the bill would move to the Senate Resources Committee next. Fiscal notes from the Department of Natural Resources and the Department of Fish and Game were attached and the bill did not have a referral to the Finance Committee. SENATOR JOHN COWDERY made a motion to move CSSB 190(STA) from committee with individual recommendations and attached fiscal notes. There was no objection and it was so ordered.