HOUSE RESOURCES STANDING COMMITTEE February 25, 1997 1:36 p.m. MEMBERS PRESENT Representative Bill Hudson, Co-Chairman Representative Scott Ogan, Co-Chairman Representative Beverly Masek, Vice Chair Representative Ramona Barnes Representative Fred Dyson Representative Joe Green Representative William K. ("Bill") Williams Representative Irene Nicholia Representative Reggie Joule MEMBERS ABSENT All members present COMMITTEE CALENDAR SENATE JOINT RESOLUTION NO. 8 Urging the United States Congress to give an affirmative expression of approval to a policy authorizing the state to regulate, restrict, or prohibit the export of unprocessed logs harvested from its land and from the land of its political subdivisions and the University of Alaska. - MOVED SJR 8 OUT OF COMMITTEE HOUSE BILL NO. 28 "An Act repealing the Alaska Coastal Management Program and the Alaska Coastal Policy Council, and making conforming amendments because of those repeals." - HEARD AND ASSIGNED TO SUBCOMMITTEE (* First public hearing) PREVIOUS ACTION BILL: SJR 8 SHORT TITLE: PRIMARY MFG OF PUBLICLY OWNED TIMBER SPONSOR(S): SENATOR(S) TORGERSON, Pearce, Taylor, Duncan; REPRESENTATIVE(S) Grussendorf, James JRN-DATE JRN-PG ACTION 01/23/97 114 (S) READ THE FIRST TIME - REFERRAL(S) 01/23/97 115 (S) RESOURCES 02/05/97 (S) RES AT 3:30 PM BUTROVICH ROOM 205 02/10/97 (S) RES AT 3:30 PM BUTROVICH ROOM 205 02/10/97 (S) MINUTE(RES) 02/11/97 282 (S) RES RPT 5DP 1NR 02/11/97 282 (S) DP: GREEN, TAYLOR, TORGERSON, LEMAN, 02/11/97 282 (S) DP: SHARP; NR: LINCOLN 02/11/97 282 (S) ZERO FISCAL NOTE (S.RES) 02/13/97 (S) RLS AT 10:45 AM FAHRENKAMP RM 203 02/13/97 (S) MINUTE(RLS) 02/14/97 355 (S) RULES TO CALENDAR 2/14/97 02/14/97 359 (S) READ THE SECOND TIME 02/14/97 359 (S) COSPONSOR(S): TAYLOR 02/14/97 359 (S) ADVANCED TO THIRD READING UNAN CONSENT 02/14/97 359 (S) READ THE THIRD TIME SJR 8 02/14/97 359 (S) COSPONSOR(S): DUNCAN 02/14/97 359 (S) PASSED Y17 N- E3 02/14/97 361 (S) TRANSMITTED TO (H) 02/17/97 370 (H) READ THE FIRST TIME - REFERRAL(S) 02/17/97 370 (H) RESOURCES 02/17/97 377 (H) CROSS SPONSOR(S): GRUSSENDORF, JAMES 02/25/97 (H) RES AT 1:00 PM CAPITOL 124 BILL: HB 28 SHORT TITLE: REPEAL COASTAL ZONE MGMT PROGRAM SPONSOR(S): REPRESENTATIVE(S) THERRIAULT, Kelly JRN-DATE JRN-PG ACTION 01/13/97 34 (H) PREFILE RELEASED 1/3/97 01/13/97 35 (H) READ THE FIRST TIME - REFERRAL(S) 01/13/97 35 (H) RESOURCES, FINANCE 02/13/97 (H) RES AT 1:00 PM CAPITOL 124 02/13/97 (H) MINUTE(RES) 02/20/97 (H) RES AT 1:00 PM CAPITOL 124 02/20/97 (H) MINUTE(RES) 02/22/97 (H) RES AT 1:00 PM CAPITOL 124 02/22/97 (H) MINUTE(RES) 02/25/97 (H) RES AT 1:00 PM CAPITOL 124 WITNESS REGISTER MARY JACKSON, Legislative Assistant to Senator John Torgerson Alaska State Legislature Capitol Building, Room 514 Juneau, Alaska 99801 Telephone: (907) 465-2828 POSITION STATEMENT: Presented sponsor statement for SJR 8. ACTION NARRATIVE TAPE 97-20, SIDE A Number 0001 CO-CHAIRMAN BILL HUDSON called the House Resources Standing Committee meeting to order at 1:36 p.m. Members present at the call to order were Representatives Hudson, Ogan, Masek, Dyson, Green and Joule. Representatives Nicholia, Williams and Barnes arrived at 1:39 p.m., 1:41 p.m. and 1:50 p.m., respectively. SJR 8 - PRIMARY MFG OF PUBLICLY OWNED TIMBER Number 0048 CO-CHAIRMAN HUDSON announced the first order of business was Senate Joint Resolution No. 8, urging the United States Congress to give an affirmative expression of approval to a policy authorizing the state to regulate, restrict, or prohibit the export of unprocessed logs harvested from its land and from the land of its political subdivisions and the University of Alaska. He noted that Senator Torgerson was the prime sponsor. Number 0096 MARY JACKSON, Legislative Assistant to Senator John Torgerson, presented the resolution. She said SJR 8 is the same as the previous year's SJR 37, which had passed both the House and Senate unanimously. Its premise is simple. At the present time, the State of Alaska does not have the authority to regulate, restrict or prohibit the export of its timber, which resulted from a 1984 U.S. Supreme Court ruling. In 1990, the U.S. Congress had corrected in part that ruling for 11 western states, but that did not include Alaska. Ms. Jackson said SJR 8 requests the congressional delegation to look at that issue again, reopen it and add Alaska to it, so that Alaska can also regulate, restrict or prohibit its timber resources. MS. JACKSON said SJR 8 applied to more than just Senator Torgerson's district. The issue had also been raised in Seward, where the mill had been shut down. Those logs were being exported, in one case to another western state that did not even allow its own logs to be exported to Alaska. Ms. Jackson indicated SJR 8 would allow some economic development. She expressed hope that the congressional delegation would listen and take action on it. Number 0259 REPRESENTATIVE REGGIE JOULE asked where the logs would be processed and whether Alaska had the facilities to process them. MS. JACKSON replied, "The premise is that you would have the ability to restrict or prohibit or regulate. There may be some areas in Alaska where you want to restrict it. And there may be some where you just want to regulate it. Obviously, the ones where you'd want to regulate it are ones where you'd have the ability to process. The problem and the point right now is we don't have any of that authority, and this asks Congress to give Alaska that authority." CO-CHAIRMAN SCOTT OGAN commented that in light of severe cutbacks of timber harvest, especially in the Tongass National Forest, the least they could do was allow value-added primary manufacturing. Number 0378 REPRESENTATIVE JOE GREEN made a motion to move SJR 8 from the committee with individual recommendations. There being no objection, SJR 8 moved from the House Resources Standing Committee. CO-CHAIRMAN HUDSON turned the gavel over to Co-Chairman Ogan. HB 28 - REPEAL COASTAL ZONE MGMT PROGRAM Number 0435 CO-CHAIRMAN OGAN announced the next order of business was House Bill No. 28, "An Act repealing the Alaska Coastal Management Program and the Alaska Coastal Policy Council, and making conforming amendments because of those repeals." CO-CHAIRMAN OGAN said although no testimony would be taken, comments could be submitted in writing. He advised that HB 28 was being assigned to a subcommittee. Following that, further testimony would be taken before the committee acted on the bill. Number 0476 CO-CHAIRMAN OGAN said to provide direction to the subcommittee, he was seeking members' opinions on whether the program should be abolished, partially retained or left alone. He appointed Representatives Green, Joule and Barnes as subcommittee members, with Representative Green as chairman. He indicated that Representative Barnes, who was not present, had agreed to serve on the subcommittee. Co-Chairman Ogan said he himself would play an active role but not be a member of the subcommittee. Number 0561 CO-CHAIRMAN HUDSON indicated upon first hearing HB 28, he agreed with its intent. However, the more he heard, the more he realized there were "potential values there that need to be uplifted and perhaps redesigned." He suggested careful consideration of the testimony heard thus far. "Perhaps we don't need to necessarily get rid of something that is working in some fashion but to modify it so that it works better," he stated. "And if there's some actions within there that are arbitrary or perhaps excessive, then those are the types of things that should be gotten out." CO-CHAIRMAN HUDSON noted that all members were welcome to attend subcommittee meetings and provide input. He said after the subcommittee presented its recommendations, perhaps there would be hearings on those. Number 0667 REPRESENTATIVE IRENE NICHOLIA concurred. She hoped the subcommittee would contact people who had testified, especially those familiar with the program, including Diane Mayer, Director of the Division of Governmental Coordination (DGC) in particular. Number 0726 REPRESENTATIVE JOULE asked whether there would be notice for subcommittee meetings so that communities could follow the process. REPRESENTATIVE GREEN said the meetings would be noticed. He asked whether the question was whether the meetings would be teleconferenced so people could hear. REPRESENTATIVE JOULE said either to hear or testify. He expressed concern that because of the recent shootings in Bethel, at least one community may have missed out on the process. He suggested that an opportunity be afforded to provide testimony, even if it was in writing. REPRESENTATIVE GREEN concurred. However, he was uncertain whether telecommunications would be possible throughout all the meetings. Number 0773 CO-CHAIRMAN OGAN requested members' comments on their perceptions thus far, as there had been a lot of testimony but little committee discussion. He said on the plus side, the program provided coordination between people applying for permits and government bureaucracies. It also provided an avenue for local input. He cautioned that it might be subjective as to how much local input would remain if the program were abolished. CO-CHAIRMAN OGAN noted that the Department of Natural Resources (DNR), the Department of Fish and Game (ADF&G) and the Department of Environmental Conservation (DEC) were already obligated to take public input on any action they took. He also believed there was a sense of ownership with committees working in these small communities and involved in the process. CO-CHAIRMAN OGAN said on the minus side, it could provide a special interest group or "somebody with an agenda" the avenue to stop a project, which perhaps would not happen if just the DNR or another department took testimony. CO-CHAIRMAN OGAN said the program put federal money into the economy. He expressed uncertainty over whether that was a plus. Although the leverage of that money was nice to have, he believed the legislature, as policy-setters, needed to get out of the mind- set of "well, let's just spend X amount so we can get more." He advised, "Anytime you get any money from the federal government or any other source, there's strings attached. And so with that federal money comes federal regulation and federal intervention. And it's certainly nice for local governments and the local economy to have some people on staff that are doing these things, but government shouldn't, in my opinion, be in the position of just providing jobs for the sake of providing jobs." Number 0931 REPRESENTATIVE BEVERLY MASEK said the federal government had so many holdings in the state that when this policy was created, it actually gave up some sovereign authority. She believed it was important that state and local governments play a greater role in development and other issues in their areas. She suggested that the subcommittee look closely at the permitting process and the role of the DGC. REPRESENTATIVE MASEK said the program offered a greater level of protection to the public where access concerns arose relating to large corporate holdings. She believed that should not be thrown away because of problems in the permitting area of the program. She offered to work closely with the subcommittee and to follow up on some of the recommendations as well. Number 1105 REPRESENTATIVE GREEN noted that although some members thought one thing when the title came to them, they had changed their minds after hearing testimony. "You may still want to throw it out," he said. "But at least you have a better idea of what it does, why it was instigated." He said many things not yet discussed would be addressed in the subcommittee, including the intended purpose of the program and whether it was doing what it was supposed to. REPRESENTATIVE GREEN pointed out that Alaska has more shoreline than the rest of the Lower 48 together. Tinkering with the program, or considering getting rid of it, was a tremendous undertaking. He stated, "The nation felt that it was a reasonable thing to do. The way it's handled by the various states varies considerably." REPRESENTATIVE GREEN believed Alaska may be able to learn from other states. Compared to other states, Alaska had been restricted as far as the number of applications coming under the coastal zone purview. He suggested finding out what tinkering by other states had not worked out, for example. "And if we find that this was the thrust and yet we're askew from the rest, maybe it's the way we're interpreting it," he said. Maybe it would be better to actually try and make some tweaks within the purview of not losing the whole program." Number 1227 REPRESENTATIVE GREEN asked what avenue people would have for input if the program were abolished. He believed the most onerous prospect was the potential litigation to stop activities in mid- stride, as he said occurred with the Northstar project. He believed dissatisfied individuals would be free, or less inhibited, to stop projects, whether justified or not. This might happen if they did not fully understand a project or did not think it had been fully reviewed before it occurred. REPRESENTATIVE GREEN suggested the main thing the subcommittee might accomplish was establishing that area of confidence between the applicants, the state and federal governments, and those people affected either directly or indirectly. An example of the latter was people with an interest in maintaining Alaska's beautiful coastline. "And so that's a fairly broad amount of people that we're going to possibly impact," he said. REPRESENTATIVE GREEN stated, "We may find that the job is bigger than a subcommittee, or certainly that it's bigger than a subcommittee over a short period of time. I would hope to come back to you with a lot more, a litany of things, that we should be doing, and if we can't resolve those in subcommittee, a charge to be done over the interim." Number 1326 CO-CHAIRMAN HUDSON urged Representative Green to look into the appeals process to the Alaska Coastal Policy Council. He wondered whether it moved issues forward in a deliberate fashion and how much it cost. In addition, he suggested talking to Diane Mayer about her ideas. He cited an instance of a small contractor in his district running into large costs in dealing with the U.S. Army Corps of Engineers. He asked what affect these people had on the smaller developers. Number 1417 REPRESENTATIVE GREEN said that was an excellent concept to consider. He noted that earlier testimony indicated one agency may actually overlap into another agency's jurisdiction or be able to hold up a project, either arbitrarily or a because of feeling a need for additional information that perhaps no one else in the regulatory arena would subscribe to. Number 1456 REPRESENTATIVE RAMONA BARNES commented that this law was put on the books around 1977. She said it had not stopped lawsuits nor prevented people from being anti-development. She believed people had used this law to stop development of any project they could find in the coastal areas to stop. Number 1530 REPRESENTATIVE JOULE questioned whether the mentioned lawsuits had originated in the areas to be developed or elsewhere. He suggested that people in coastal areas supported development of the resources in those areas because of this vehicle to help them reach some level of comfort about their concerns. "In rural areas, it usually has to do with subsistence activities," he noted. "And once they feel those are put to rest, then usually I think they climb on board." REPRESENTATIVE JOULE referred to discussion at earlier hearings about adjacent areas being in and out of the coastal zone. "But there's that throughout the state," he said. "We have different game management units throughout this state, as an example where rules change, depending on where you happen to be inside those boundaries. Local option laws." Number 1653 CO-CHAIRMAN OGAN referred to earlier testimony about Fort Knox. He suggested the subcommittee look at that project because, to the best of his knowledge, Fort Knox got its permits in record time without oversight by the DGC. He noted that the program enabled "anti-development folks" to stop a project and said, "There's already a safety net of agencies that cover these concerns." CO-CHAIRMAN OGAN advised that the bottom line, and what they needed to look at in this committee, was not so much the finance aspects but whether Alaska's resources would be compromised if this either was abolished or modified. CO-CHAIRMAN OGAN pointed out that the Majority Caucus had an agenda to reduce the size and scope of state government. He endorsed looking for programs to eliminate rather than just making cuts. ADJOURNMENT Number 1770 CO-CHAIRMAN OGAN adjourned the House Resources Standing Committee meeting at 2:06 p.m.