SB 382-EMINENT DOMAIN/REPLAT OF BOUNDARY CHANGES  CO-CHAIR WAGONER announced SB 382 to be up for consideration. 2:15 - 2:17 - at ease CO-CHAIR COWDERY moved to adopt the CS to SB 382, version /D. There were no objections and it was so ordered. MR. JEFF OTTESEN, Department of Transportation and Public Facilities (DOTPF), said that two lawsuits have erupted using the same legal argument, both regarding bonded projects that voters approved two years ago. If the lawsuits are upheld by the courts, it has the potential to shut down and delay projects all across the state. The issue before you is a statute that has been on the books for a long time - since '75. It's never been litigated before until now. AS 09.55.275 requires the platting authority, which is basically borough or city governments, to require the state, on a condemnation related lawsuit, to go through that plat as if it were a private landowner. Inherently, a replat involving condemnation is going to be different than a replat that's done voluntarily... By it's very nature condemnation is not a voluntary act. You can't get the landowners to put a signature on the application for replat. They are simply not ready to do that; they're in no mood to do that. The argument being held up in the courts is that we have to go through exactly the same procedure as a voluntary subdivision. To give you some idea of the magnitude of the problem - the project at Kenai River, Soldotna, that is slated to go to construction this summer - is now in litigation. We think it will be held up. The C Street extension in Anchorage would also be held up; it's in litigation. The North Pole interchange in Fairbanks, our right-of-way staff believe is at risk. Even a project in Bethel - about a year ago the city attorney saw this conflict and had the Bethel City Counsel pass an ordinance that exempted that particular project... so this can be a rural problem as well. SENATOR LINCOLN asked how the CS is different from the original bill and how does it prevent further litigation. CO-CHAIR COWDERY explained the original bill was just a beginning and that further DOT research provided the update. MR. OTTESEN said the intent of the earlier draft has not changed, but the language is better. MR. PETER PUTZIER, Department of Law (DOL), said that most of the changes were in style and he reviewed those. In a real nutshell, AS 09.55.275 has a sentence that says that the platting authority typically in a municipality shall apply the standards in the same manner between DOTPF and private landowners. The conflict or the problem is what "in the same manner" means. The argument is being made in court that essentially in '75 there's a legislative intent to put what I would describe as a legislative straight jacket on municipalities to require a particular procedure.... For instance someone who wants to subdivide property and a right-of-way acquisition - the two proceedings as Mr. Ottesen pointed out - a right-of-way acquisition is quite a different animal than what goes on with respect to your typical subdivision.... SENATOR THERRIAULT asked if the 1975 language actually said there would be one uniform standard. If we fix this problem for DOTPF, do the municipalities still have a problem that they've got a variety of standards... or are we fixing it for DOTPF and the municipalities at the same time? MR. PUTZIER explained that the fix intends to say that municipalities can apply a variety of standards in their discretion to how they want to treat the requests for replat approval. The legislature is not demanding a particular process, but is giving local governments discretion to deal with it in a variety of ways. SENATOR THERRIAULT asked if the state and a private landowner have to go through the same process to subdivide and sell under this bill. MR. PUTZIER said that would be a different analysis. Section 3 only applies this bill to right-of-way acquisitions only. TAPE 04-14, SIDE B    CO-CHAIR WAGONER asked if these projects had been on the books for 10 years or more and if someone is trying to obstruct them. MR. PUTZIER replied with an explanation of the process. When DOTPF is unable to come to an agreement with a particular landowner, the project will file a condemnation action. The landowner then has the right to file an authority and necessity challenge, which says the DOT didn't follow the steps it was supposed to and, therefore, can't take the property. SENATOR LINCOLN asked if this legislation is retroactive, would that help communities go forward with their projects. MR. PETZIER replied that both cases are in Superior Court now. One has an oral argument scheduled for next week and a decision could come out at any time; the other one has yet to be scheduled for briefing and argument. This legislative clarification would be presented to the court as additional evidence as to what legislative intent was. "Our hopes is that both of the lawsuits would be defused...." SENATOR OLSON asked if this bill passes, how will the public be protected from the government acting as a bully to go ahead and take property that may have been in a family for centuries or property that most people would want to stay were it is. MR. PUTZIER answered that the eminent domain process has stood on its own for years. It has a myriad of restrictions and hoops that DOTPF always has to jump through - a design process with public notice and an environmental process with public notice. The municipal role is to have input. "This isn't in any way diminishing existing eminent domain rights that are already on the books and followed by DOTPF." SENATOR OLSON wanted to make sure that a public individual who has to hire an attorney to represent him is protected against eminent domain proceedings that may being used unduly against him. MR. OTTESEN reiterated that eminent domain is a very heavy- handed power of government. Consequently, both state and federal law heavily regulate the application of that power. He spoke with the right-of-way chief in the northern region who was in the department when this was passed in 1975 who said that DOT was being heavy handed with its replats at that time. It was taking property; it wasn't filing the paperwork with local governments or replacing monuments and property stakes that were officially installed by registered land surveyors. The analysis was a reaction to the wrongs of the department 30 years ago. "We don't want to do away with those protections...." SENATOR OLSON said his last concern is if there is any resistance from the municipalities on the proposed legislation. MR. OTTESEN replied that this legislation literally started 10 days ago and this is its first public hearing. CO-CHAIR COWDERY moved to pass CSSB 382(TRA) from committee with individual recommendations and accompanying fiscal note and asked for unanimous consent. There were no objections and it was so ordered.