HOUSE RESOURCES STANDING COMMITTEE January 19, 1994 8:00 a.m. MEMBERS PRESENT Representative Bill Williams, Chairman Representative Bill Hudson, Vice-Chairman Representative Con Bunde Representative John Davies Representative Joe Green Representative Jeannette James Representative Eldon Mulder Representative David Finkelstein MEMBERS ABSENT Representative Pat Carney COMMITTEE CALENDAR Briefing by Department of Natural Resources, Division of Lands on selection of land under the Alaska Statehood Act. WITNESS REGISTER RON SWANSON, Director Division of Land Department of Natural Resources P.O. Box 107005 Anchorage, Alaska 99510-7005 Phone: 762-2692 Position Statement: Briefing on selection of land under the Alaska Statehood Act ACTION NARRATIVE TAPE 94-1, SIDE A Number 000 The House Resources Committee was called to order by CHAIRMAN BILL WILLIAMS at 8:10 a.m. Members present at the call to order were Representatives Williams, Hudson, Bunde, Davies, Green, James, Finkelstein and Mulder. Representative Carney was absent. CHAIRMAN WILLIAMS announced that RON SWANSON was present to update the committee on the recent completion of the state selection of lands under the Alaska Statehood Act. Number 021 RON SWANSON, DIRECTOR, DIVISION OF LAND, DEPARTMENT OF NATURAL RESOURCES (DNR), stated the land selections process was completed in December, after 35 years of statehood. He said the state was granted approximately 106 million acres of land and resources under the Statehood Act and various territorial grants. MR. SWANSON informed the committee that 89 million acres have been conveyed to date, leaving approximately 17 million acres yet to be transferred to state ownership. He advised that DNR filed the remaining land selections on December 17, 1993. He noted DNR participated with other state agencies and interest groups in the process of setting their priorities for ownership and making selections. MR. SWANSON stated DNR is presently in the process of establishing priorities for the conveyance of DNR's selections, adding that DNR currently has 40 million acres of selections on the books. He advised DNR's effort to this point, has been to identify the best land available with a variety of different resources which the state could possibly attain. Mr. Swanson said as land is conveyed to the state, land must also be relinquished since the state is allowed to carry only 25 percent over the remaining entitlement. Number 038 MR. SWANSON explained following the 24 million acres selections, DNR's activities this past year have been mainly clean up and technical type work. He said under the general grant, DNR has selected 625,000 acres, primarily small pieces overlooked during earlier selections. DNR has been conducting a land audit of all land records over the past three years, with many pieces being identified during the audit. Mr. Swanson stated DNR made a few selections on high value lands, which are currently withdrawn by the federal government, that will need to be worked on in order to get the withdrawals lifted. MR. SWANSON stated under the community grant, DNR selected 191,00 acres, including land on the Susitna Crossing on the Denali Highway, land along the Yukon River and land nominated by the Northwest Arctic Borough for their municipal entitlement. He said under the community national forest grant, 13,000 acres were selected in 20 various areas. Number 055 MR. SWANSON said under the university grant, DNR worked with the university to fulfill their entitlement, including small parcels less than 20 acres near Girdwood, Petersburg and Haines and a few larger parcels on the Kenai Peninsula and at the Susitna Crossing. He stated the Alaska National Interest Lands Conservation Act (ANILCA) School grant entitled 75,000 acres and land was selected near the Denali Highway and the (inaudible) area. MR. SWANSON continued that in fiscal 1993, DNR filed 24 million acres in selections, most of which was new acreage for oil and gas, minerals, transportation corridors and surface resources. He said prior to recent filings, DNR had 16 million acres on the books which have not yet been transferred, due to topfilings with Native corporations and federal withdrawals. He stated that last year the Bureau of Land Management (BLM) conveyed 1.7 million acres of land to the state, which is the most in any year since 1984. Number 075 MR. SWANSON stated the selections filed include five million acres of high value oil and gas and 2.6 million acres of moderate value oil and gas; 10.6 million acres of high value minerals and 11.2 million acres of moderate value minerals; 15.9 million acres of high value surface resources; and 3.6 million acres high value access corridors. Referring to a wall map, Mr. Swanson pointed out new selections, land already owned, selections made last year and selections made prior to that year. MR. SWANSON said in making selections, DNR had three categories: subsurface, surface, oil and gas and minerals. Again, referring to a wall map, he pointed out subsurface and surface selections. He reviewed another map showing surface and subsurface priorities combined. He stated DNR has a steering committee comprised of various state agencies who are currently determining a priority system. Number 106 MR. SWANSON remarked DNR's basic portfolio of state owned land can be broken down into approximately 12 resource categories: four million acres selected for settlement; one million acres for agriculture; 20 million acres for grazing; six million acres for forestry; 13 million acres for public recreation; 22 million acres for wildlife habitat; 13 million acres for minerals; 25 million acres for oil and gas; 8.5 million acres for coal; 23 million acres for general uses, including transportation corridors; and 13.5 million acres for miscellaneous and overvalues. Number 119 REPRESENTATIVE CON BUNDE asked if selections included greater acreage for grazing than forestry. MR. SWANSON said what was being given was the primary values and the vast majority involves multiple use. MR. SWANSON continued that the total entitlement was 106 million acres, with 89 million acres received to date and 17 million acres of land still owed to the state. He said DNR has selected 40 million acres and of that 40 million acres, 21 million acres are conveyable; 19 million acres are not conveyable including topfilings with Native corporations of 14 million acres, military bases of two million acres, utility corridors of 2.5 million acres and other withdrawals of .5 million acres. MR. SWANSON stated, important to DNR, is the fact that lands not conveyable do not count against the state's entitlement, which gives the department time to prioritize, and work with Native corporations and the federal government to determine who is really going to own the land. He noted that particularly important in relation to Native corporations, DNR wants an Alaskan to own the 14 million acres, whether it be a Native corporation or the state. Number 144 CHAIRMAN WILLIAMS asked if the 19 million acres count against the 106 million acres. MR. SWANSON said if DNR gets conveyance, it will count. Number 150 REPRESENTATIVE JOE GREEN asked how long the state can carry the overselection. MR. SWANSON replied DNR is allowed to carry 25 percent over remaining entitlement, and stressed it is very important that DNR determine the most valuable 19 million acres desired, determine a conveyance priority list and then control the rate of conveyance to ensure the land can be obtained. Number 175 REPRESENTATIVE BILL HUDSON referred to a handout (on file) and asked with regard to lands conveyed, tentatively approved and patented, when the DNR anticipates the transfer of the title for the 89 million acres to the state. (REPRESENTATIVE DAVIES arrived.) MR. SWANSON replied that prior to ANILCA, the federal government considered a tentative approval to be just an equitable title they could take away, but with ANILCA that was changed so when the federal government issues a tentative approval, the state has a working title. He stated patents will probably not be completed in his lifetime as only 500,000 to 700,000 acres are surveyed annually. He added that the federal government gets approximately $12 million a year for surveying in the state. Number 198 REPRESENTATIVE HUDSON inquired, if the state has a working title, does that permit development of a land program, giving the purchaser a proper indicia of ownership? Number 205 MR. SWANSON replied yes, and a patent is issued which is basically the same as a statutory warranty deed guaranteeing the title is good. REPRESENTATIVE HUDSON said he would be interested in the status of any ongoing land release programs. Number 223 REPRESENTATIVE JOHN DAVIES clarified the federal government has the primary responsibility of surveying land during the transfer process and asked if the state interacts with them in regard to the schedule of which lands they survey. Number 235 MR. SWANSON said DNR totally controls the conveyance priority list getting tentatively approved or patented, and in the patent process, survey windows are used involving geographic blocks. He stated that the idea behind survey windows is to determine every claim, adjudicate it, and then survey it. He noted in regard to using survey windows, DNR basically gives up surveying that the federal government might do on state land in order to get the Native conveyances completed and Native allotments identified, which in turn gives DNR a better idea on the status of land, and surveys can be directed later. Number 255 REPRESENTATIVE GREEN said when making priorities, he suspects there may be pressure to complete the Native topfilings, oil and gas and minerals and lands desirable for private ownership, and asked how priorities are established. MR. SWANSON said there is a conveyance committee comprised of representatives from various state agencies and interests which meets every other month to review the list of selections and determines a list of conveyances which will meet needs. REPRESENTATIVE GREEN remarked, in looking at one of the maps, that the north/south corridor is readily seen, but a continuous east/west corridor is not visible. He said there has been talk about trying to develop the mineral interests in the Brooks. He asked if there is a way to make changes once the land is finalized. Number 284 MR. SWANSON replied DNR did select all of the transportation corridors and agreed the east/west corridors were not visible on the map. He said DNR cannot make any more selections. Number 300 REPRESENTATIVE DAVID FINKELSTEIN asked how the corridors close to Norton Sound meet the compact and contiguous requirements. MR. SWANSON answered the corridors do meet the requirements in that they are three sections wide and nine sections long. He added that DNR will obtain more land than is needed for a highway. REPRESENTATIVE FINKELSTEIN stated he is encouraged by the consolidation of selections in the South Central area. (REPRESENTATIVE ELDON MULDER arrived.) Number 333 REPRESENTATIVE HUDSON wondered if the state has ownership of any submerged lands, navigable rivers and coastal shelf. MR. SWANSON said the Submerged Lands Act and the Alaska Statehood Act confirmed the state owns tide shore and submerged lands, which are three nautical miles out and total approximately 60 million acres. He added there are contentions on where the three miles begin and on navigability. Mr. Swanson stated ultimately the state will own and manage 165 million acres including tide shore and submerged lands. Number 357 REPRESENTATIVE GREEN said his definition of a navigable river is having the ability to get a boat up it, but added that the Corps of Engineers stretches the definition of navigability to having water in it, etc. He questioned if the definitions are invoked, would the state be getting title to land which may not have water on it. MR. SWANSON replied there are three definitions for navigability including the Coast Guard, Corps of Engineers, which is tied more to wetlands, and ownership. Number 401 REPRESENTATIVE FINKELSTEIN asked a question regarding a Yakataga area selection (referring to the map) and asked if there was a river corridor showing. MR. SWANSON said it is a river corridor and was selected for wildlife values. He added that the university owns trees in the area and stated in the Uni-Uni settlement, the university only got first time cutting rights for timber. Number 420 REPRESENTATIVE FINKELSTEIN asked about a new selection in the (inaudible) area. MR. SWANSON said he did know the answer to his question. (REPRESENTATIVE JEANNETTE JAMES arrived.) Number 430 REPRESENTATIVE BUNDE asked if winter travel is considered when defining navigability and ownership. MR. SWANSON said after the court defined a rubber raft and canoes, the winter argument was dropped, because if a raft can go up, it can be used for winter use as well. Number 452 MR. SWANSON continued that DNR disposed of between 500,000 and one million acres per year up until two years ago. He stated currently DNR disposes reoffers of 200,000 acres a year; reoffers being parcels which have been identified in the past for settlement and people never took the offers or took them and gave them up enabling DNR to offer them to someone else. MR. SWANSON noted DNR would like to bring the disposal acreage back up to at least 500,000 acres by the fall, but cautioned the acres offered by the state will not be the best and will be more homestead type disposals. He added the failure rate on homestead and home site disposals is about 80 percent, due to various reasons and requirements. Number 494 REPRESENTATIVE HUDSON asked if the federal government has ever offered land for disposal. Number 505 MR. SWANSON stated BLM is the only entity which could offer land disposals and they only own about 56 million acres, much of which is in designated areas where they cannot do disposals and most acreage is very remote. Number 523 REPRESENTATIVE ELDON MULDER asked about the current situation with Fort Rich. MR. SWANSON stated Eklutna, Inc. was not able to obtain their entitlement because of the numerous withdrawals, so a settlement was accorded in the North Anchorage Land Agreement, providing that if Fort Rich ever comes out, anything this side of the line goes to the Native corporation first and anything the other side of the line goes to the state first. He is convinced that much of what Eklutna wants, the state would not want because it is land primarily in the firing ranges. Number 550 REPRESENTATIVE BUNDE stated there is concern in Anchorage regarding Eklutna Lake. He said there is a disposal in process and at one time Anchorage had it. He thought the process had been transferred to the Eklutna Corporation. MR. SWANSON said the Eklutna Lake disposal is also a part of the North Anchorage Land Agreement, which specified that if the Department of Transportation or the state submitted an application, the land would be conveyed to the state. He believed the application was submitted, but it still had not been transferred, and added the purpose of the conveyance is for float plane expansion. REPRESENTATIVE MULDER asked who has overlays on the buildings at Fort Rich. MR. SWANSON stated the buildings could not be obtained in the Statehood Act as it needs to be vacant, unappropriated and unreserved; meaning the buildings would have to go through the GSA disposal process. Number 585 REPRESENTATIVE FINKELSTEIN stated municipalities are beginning to get into the disposal process, and asked if there are others besides Kenai and Mat-Su who have begun disposing their own land. MR. SWANSON said about five million acres have been conveyed to municipalities for disposal and development purposes. He stated the Fairbanks North Star Borough, Kenai Borough, and the Mat-Su Borough are the only three who actively have land disposal programs. He added urban boroughs are selecting land for different reasons than rural boroughs and once the land is obtained, it can be managed as they desire. Number 613 REPRESENTATIVE HUDSON asked if the oil pipeline corridor from Fairbanks to Haines is an ownership situation. MR. SWANSON replied there is no corridor, but is a condition of multiple land ownership subject to a right-of-way. REPRESENTATIVE HUDSON inquired, if there was a desire to put a line through, would there be a need to go back and establish relations with the owners? Number 625 MR. SWANSON replied that is correct and said it would not be a problem when it's across state land. He stated where the withdrawal has been lifted, it crosses Native conveyed land. Number 635 REPRESENTATIVE DAVIES noted there are two kinds of disposals ongoing in the Fairbanks North Star Borough: subdivision development and a lottery. MR. SWANSON noted the Mat-Su Borough also started doing the lottery and it has been very popular. Number 670 MR. SWANSON stated the division's tasks for the next few months include prioritizing their most important selections and determining their order. He said currently the agencies have evaluated and ranked all of the existing selections with the results to be publicly released and public comments will be requested. Number 700 MR. SWANSON concluded that as a result of the land selection effort, the state has the best GIS land record system anywhere in the United States. Number 722 REPRESENTATIVE DAVIES asked if there is the capability of attaining all land ownership records. MR. SWANSON replied DNR has the ability to use the BLM computer and ask questions, but there is not one place to go. TAPE 94-1, SIDE B Number 000 MR. SWANSON stated with regard to the 17 million acres, DNR will submit a conveyance priority list to BLM who directs the conveyances and added that DNR totally controls the list. He noted the current conveyance priority list contains about two million acres, including corridor and oil and gas and minerals lands selected in 1992, and noted that DNR expects to have a conveyance rate of 500,000 to 800,000 acres a year. Number 018 REPRESENTATIVE HUDSON asked if there are other state land acquisitions currently in process other than Kachemak Bay and the Prince William Sound. Number 025 MR. SWANSON said in Kachemak Bay, the state acquired land, timber and minerals and the cost was 22 million acres. He stated the Prince William Sound acquisition involved timber and much of the land selected was from the National Forest Community Grant. Number 033 REPRESENTATIVE HUDSON asked if lands were being swapped in the Yakutat and Yakataga areas. MR. SWANSON said DNR is currently in an area planning process for that area and it has not been completed because of land ownership questions. Number 064 REPRESENTATIVE DAVIES commended DNR for a job well-done. CHAIRMAN WILLIAMS asked in regard to the overselection of 19 million acres, will there still be an opportunity to adjust areas? MR. SWANSON said that is correct. CHAIRMAN WILLIAMS stated he went through a land selection, having a deadline date in the year 1975, and the selection still has not been completed. He asked if the state could go back and adjust the number of acres. MR. SWANSON replied the only way to do that would be to go back to Congress and have Congress authorize DNR to make additional selections. He stated there have been several amendments to the Alaska Native Claims Settlement Act since 1971, allowing additional selections to occur. He added one of the differences between Native selections and state selections is that with Native selections there is no cap. Number 117 MR. SWANSON stated with Native selections and DNR's selections on the books, there is a need to get together and compare resource data and knowledge, and not engage in any arguing since the ultimate goal for both parties is Alaskan ownership. REPRESENTATIVE GREEN asked how first-cut is administered in regard to timber entitlement. MR. SWANSON said the first-cut issue is only in Yakutat and involves the settlement with the university. He added the state owns the land, but the university gets to cut the timber first and has to follow the Forest Practices Act. Number 138 ANNOUNCEMENTS CHAIRMAN WILLIAMS announced the committee will meet Friday, January 21 to consider SB 132 regarding state loans for the purchase of individual fishing quotas. He introduced the new committee secretary, Gail Ford. ADJOURNMENT There being no further business to come before the House Resources Committee, Chairman Williams adjourned the meeting at 9:05 a.m.