HOUSE RESOURCES STANDING COMMITTEE February 24, 1998 1:08 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 PRESENTATION BY GREGORY FRANK COOK: PUBLIC TRUST DOCTRINE HOUSE BILL NO. 406 "An Act relating to subsistence uses of fish and game." - SCHEDULED BUT NOT HEARD (* First public hearing) PREVIOUS ACTION No previous action to record WITNESS REGISTER GREGORY FRANK COOK, Attorney At Law P.O. Box 240618 Douglas, Alaska 99824 Telephone: (907) 586-9719 POSITION STATEMENT: Gave a presentation on the public trust doctrine and answered questions of the committee members. ACTION NARRATIVE TAPE 98-16, SIDE A Number 0001 CO-CHAIRMAN SCOTT OGAN called the House Resources Standing Committee meeting to order at 1:08 p.m. Members present at the call to order were Representatives Hudson, Ogan, Masek, Barnes, and Dyson. Representatives Williams, Joule, Nicholia, and Green arrived at 1:13 p.m., 1:14 p.m., 1:15 p.m. and 2:09, respectively. PRESENTATION BY GREGORY FRANK COOK: PUBLIC TRUST DOCTRINE CO-CHAIRMAN OGAN announced the first order of business was a presentation by Gregory Frank Cook on the public trust doctrine. Number 0109 GREGORY FRANK COOK, Attorney At Law, explained the public trust doctrine is not simple or pure. It is a common law doctrine - a product of what judges say as they decide individual cases. It is not a creature of statute and it is constantly evolving. In addition, each state formulates what the public trust doctrine means within its own border. Alaska's version draws on many different sources including the state of Arkansas. CO-CHAIRMAN OGAN announced the presence of Representatives Joule and Williams. MR. COOK further stated another important part of Alaska's public trust doctrine is Article VIII, Section 3, "common use," of the state constitution. He cited about 15 years ago the Sage Brush Initiative was passed and codified in statute - AS 38.05.502. The public trust was integrated into it. But, to his knowledge, it has never been the subject of any decision by the Alaska Supreme Court or even cited. Nonetheless, it is a very powerful statute because it makes it clear that the public trust doctrine in Alaska does not end at tidelands, but extends upland and to unappropriated minerals. Thus, there are lands, waters, tidelands, uplands, unappropriated minerals, and many natural resources that are part of the public trust doctrine. Number 0586 MR. COOK further stated the purpose of the public trust doctrine is, generally speaking, to limit the legislative and executive branches in the sales or other dispositions of certain types of property. It also requires the management of certain types of property which comprises the corpus of the trust, according to a certain standard. The types of properties covered by the public trust doctrine are "jus privatum" and "jus publicum." "Jus privatum" is law applying to private types of property such as chairs, desks, cars, and computers. "Jus publicum" is law applying to the public trust such as waters, land beneath navigable waters, fishery resources, and wildlife. Number 0732 REPRESENTATIVE RAMONA BARNES stated Alaska is unique because it is the only state that holds subsurface rights to its minerals for the people. She asked Mr. Cook to comment on the right. Number 0783 MR. COOK replied the right is addressed in AS 38.05.502, which specifies that all unappropriated minerals in the state are held in trust for the benefit of the people. Later, he will discuss the obligations of the legislative and executive branches, the restrictions on disposing of the assets, and the requirement to obtain top dollar for them. Number 0835 CO-CHAIRMAN OGAN stated a good example of the public trust is the oil in the state. Citizens own the oil collectively and receive a dividend off of its earnings representing their shares. He asked Mr. Cook whether it is a fair analysis. Number 0860 MR. COOK replied, "Yes." The public trust doctrine does not prohibit leases of minerals or oil. According to the Alaska Supreme Court, leases are of finite duration, they do not convey a fee-simple interest, they are subject to competitive bidding, and they do not constitute an irrevocable alienation of assets forbidden by a trust. Number 0892 CO-CHAIRMAN OGAN stated, in terms of the distribution, the United States Supreme Court has ruled that the state can not discriminated based on length of residency and equal protection. MR. COOK replied by nodding his head affirmatively. Number 0937 MR. COOK further said, in reference to the public trust doctrine, the state does not act as a proprietor; it acts as a trustee. It acts on behalf of somebody else. In addition, the public trust doctrine guarantees equality of access to fish, wildlife, and water. Thus, the public trust doctrine and the equal access clauses together - Article VIII, Sections 3, 15, and 17 - prohibit special privileges or exclusive rights. One of the privileges that has been addressed by the Alaska Supreme Court is the rural-urban distinction - McDowell. The principle of equal access is often blended with equal protection and public trust considerations. Number 1058 CO-CHAIRMAN OGAN announced that Representative Nicholia joined the meeting some time ago. Number 1065 REPRESENTATIVE FRED DYSON asked Mr. Cook to define the word "indefeasible." MR. COOK replied it means one that can not be taken away. Number 1084 MR. COOK further explained, in reference to the public trust doctrine, that the government acts as the fiduciary while the public is the beneficiary. The fiduciary is someone who stands in a special relationship to a beneficiary. A fiduciary must be scrupulously fair, deal with the beneficiary at all times in the upmost of good faith, and act with the full knowledge and consent of the beneficiary. The fiduciary in this case, the state, holds legal title to the assets covered by the trust. The beneficiary is someone who holds the equitable interest in the body of the trust. The beneficiary in this case is all the people of the state and the consideration of future generations. The corpus is the body of assets held by the trustee that are managed according to fiduciary duties. Number 1234 MR. COOK further explained the fiduciary duties of a trustee - the legislature - are loyalty (no self-profit or deals) and to not delegate common law. The legislature, however, delegates to the executive branch. There is a duty to furnish information to the beneficiary such as the value and status of a resource. It is a duty that other legislatures have not paid sufficient attention to, especially in terms of planning what the future holds. The legislature has defined the sustained yield principle, but only in terms of timber. He is not aware of any legislative definitions or administrative regulations that comes close to defining sustained yield in terms of fisheries or wildlife. Number 1347 REPRESENTATIVE BARNES asked Mr. Cook whether the issue of fiduciary responsibility in the context of public trust would be analogous to the Permanent Fund Dividend Program's corpus and the legislature determining how the interest is used. MR. COOK replied it is directly applicable. The legislature is charged with the management of the resource, while at the same time, there are broad parameters to guide actions for its equitable and wise management. Number 1408 REPRESENTATIVE IRENE NICHOLIA referred to the issue of fiduciary responsibility in terms of planning for the future, and asked Mr. Cook whether the public trust doctrine will not resolve the federal-state impasse according to Ostrosky. Number 1432 MR. COOK replied he has not read Ostrosky in a few years. Number 1460 REPRESENTATIVE NICHOLIA stated it says that the public trust doctrine will not resolve the federal-state impasse. Number 1478 MR. COOK further explained another duty of the legislature as a fiduciary is to deal impartially with all of the beneficiaries of the trust. It dovetails closely with several of the provisions in the state constitution requiring equal protection of the laws. As the trustee, the legislature is not allowed to favor one subset of the beneficiaries. Classifications can be made, but they must be done for proper purposes and pass muster under equal protection analysis. The trend has been to forbid preference for one subset of state residents based on where they reside - the rural preference. Number 1588 CO-CHAIRMAN BILL HUDSON asked Mr. Cook how limited entry fits into the public trust doctrine. It grants Alaskans and non-Alaskans an exclusive right to fish in exclusive areas. Number 1628 MR. COOK replied the Alaska Supreme Court says there is tension between the limited entry system and the equal access clauses - Article VIII, Sections 3, 15 and 17. It fits in, however, because of the language in Section 15 and because of the constitutional amendment. The court has sought to harmonize Section 15 with Sections 3 and 17 because of the tension. In addition, there have been statements made by the state supreme court expressing concern as the price of a limited entry permit escalates that it perhaps does not fit improperly. Number 1706 MR. COOK further stated the public trust doctrine does not prevent an amendment to the constitution. The Constitution of the State of Alaska guarantees, in his opinion, to the people the right and the specific procedures to be amended. It is not an unqualified right, however. The constitution could not be amended to remove the right of liberty, for example, because it is a fundamental part of a republican government. There is an argument that the public trust doctrine only describes inherent and vested property rights that can not be divested. He does not think that the public trust doctrine would prevent an amendment to the constitution that would limit the common use clause either. Number 1789 CO-CHAIRMAN OGAN stated the United States Supreme Court said in Illinois Central Railroad Company (1892), "the state could no more advocate its trust over property in which the whole people are interested in, and that it can advocate its police powers and administration of government for the preservation of the peace." Number 1815 MR. COOK stated there is more to the case than what was read. There are exceptions and circumstances in which a state can convey some portion of a public trust asset. In CWC Fisheries v. Bunker (1988), the Alaska Supreme Court discussed the two-part test for alienating items that are part of the public trust in terms of revocation. The court said the legislature could transfer a portion of tidelands to a private owner if he was building a wharf for public use, for example. Therefore, the state has the ability to favor one public trust use over another, but it can not favor private interests over the public's interest. Number 1923 REPRESENTATIVE BILL WILLIAMS asked Mr. Cook how the public trust doctrine affects what was negotiated in 1971 under the Alaska Native Claims Settlement Act. Language in the conference committee report expected both the Secretary of Interior and the state to take any action necessary to protect the subsistence needs of Alaskan Natives. He wondered whether the public trust doctrine would protect the state's right that was negotiated away. Number 1962 MR. COOK replied it is a very good question. He did not want to give a casual answer to such a complicated question. Nonetheless, it would be beyond the power of a congressional meeting to make a statement that would change the Constitution of the State of Alaska. Number 1998 REPRESENTATIVE WILLIAMS replied, given that it was a statement and its inadequate implementation resulted in the Alaska National Interest Lands Conservation Act (ANILCA), he asked Mr. Cook how it affects the public trust doctrine. Number 2035 MR. COOK replied the public trust doctrine at the state level does not alter the supremacy clause of the Constitution of the United States. If Congress acts according to the authority granted to it by the Constitution, then those laws would be the supreme laws of the land. Number 2060 REPRESENTATIVE WILLIAMS asked Mr. Cook whether he is saying that Title VIII of ANILCA is the supreme law of land. MR. COOK replied he will stick with the words he used. REPRESENTATIVE WILLIAMS asked Mr. Cook to make it clearer then. MR. COOK stated, if Congress acts pursuant to authority granted to it by the Constitution of the United States, then such law is the supreme law of the land. Number 2081 REPRESENTATIVE WILLIAMS stated Title VIII of ANILCA is the supreme law of the land then. Number 2086 MR. COOK stated whether or not Title VIII of ANILCA was properly adopted is under litigation now which is the reason he can not answer Representative Williams with certainty. Number 2117 REPRESENTATIVE REGGIE JOULE asked Mr. Cook whether the legislature should attempt to trust the public for advise on how to administer the public trust doctrine. He wondered whether a constitutional amendment is seeking advise on how to administer the public trust doctrine. Number 2173 MR. COOK replied it is the job of the legislature to determine whether or not it should go to the ballot. But, yes the legislature can trust the public, and yes it should seek the advise of the public on how to administer the resources as part of the public trust doctrine. The legislature at the same time should recognize that the public does not have all the answers. But, this is a representative government and legislators act on behalf of their public. The concurring opinion of the Fairness in Salmon Harvest (F.I.S.H.) initiative was that an initiative is not the appropriate way to manage fish and wildlife resources. It turns the role of a beneficiary into a trustee. Number 2271 CO-CHAIRMAN OGAN read the following from the book, Putting the Public Trust Doctrine to Work - Second Edition: "When a state attempts to protect its public trust resources, it is less likely to loose on claims of federal preemption because the state is acting in an area of its traditional power." CO-CHAIRMAN OGAN stated the United States Supreme Court has ruled that traditional state powers include the right to manage indigenous fish and game within its borders. CO-CHAIRMAN OGAN further read the following: "The 'supreme' court maintains its presumption against federal preemption when Congress legislates an area of traditional state power." CO-CHAIRMAN OGAN referred to case in Wyoming and asked Mr. Cook to comment on the obligation of the trustees to manage as a traditional state power versus the federal supremacy clause. Number 2331 MR. COOK replied the question is very similar to Representative Williams' question in that it is extremely complex. There is a presumption against preemption and a test to determine whether or not preemption should be applied. And, yes the management of fish and wildlife is traditionally within the purview of a state's authority. However, the Eighth Circuit Court of Appeals in Brown (Minnesota) found that the federal government was held to have the authority to regulate hunting on state lands and over state waters because it would affect nearby federally owned lands. Number 2418 CO-CHAIRMAN OGAN noted, for the record, the case in Wyoming dealt with migratory water fowl, a non-indigenous species to the state in which traditionally the federal government has had more authority in managing. Number 2426 REPRESENTATIVE NICHOLIA asked Mr. Cook whether the legislature is really asking the people.... TAPE 98-16, SIDE B Number 0000 REPRESENTATIVE NICHOLIA continued. She referred to the issue of federal law as supreme over public land and the December 1, 1998 deadline to comply with federal law, and asked Mr. Cook whether the legislature is asking the people in the state to manage these lands, rather than what type of management they want - a dual system of federal government on federal lands and state government on state lands - or come into compliance with federal law and place federal management on all laws. Number 0043 MR. COOK replied it is a political question, not a legal question. Therefore, she is better placed to answer it. Number 0054 REPRESENTATIVE NICHOLIA replied it is not only a political question. There are legal aspects because of Title VIII provisions in ANILCA. "You stated that the federal law has supremacy over public lands in the state of Alaska and so that supremacy law has a supremacy over state laws." Number 0069 MR. COOK replied there is nothing in ANILCA that requires Alaska to amend the constitution. Number 0074 REPRESENTATIVE NICHOLIA replied yes there is. Title VIII of ANILCA places a rural priority. MR. COOK replied it simply says "if" the state wants to manage within certain parameters then it must provide for a rural priority. And, if the state does not accept the federal government's parameters then the federal government will manage those lands. There is nothing in ANILCA that says the state "must" adopt a constitutional amendment. Number 0099 REPRESENTATIVE NICHOLIA asked Mr. Cook, if the state does not adopt an amendment to the constitution for a rural priority, will the state be out of compliance with federal law. Number 0111 MR. COOK replied, "Right." Number 0116 REPRESENTATIVE JOULE wondered whether the legislature could place a subsistence constitutional amendment on the ballot, without violating the public trust doctrine, just as the legislature passed a resolution to place an amendment on the ballot for limited entry. Number 0164 MR. COOK replied he does not see any prohibition on amending the constitution. In his opinion, the common use clause is subject to amendment, but not the equal protection clauses. Equal protection is included in the Fourteenth and Fifth Amendments of the Constitution of the United States. It is a different matter than the public trust doctrine even though they interface and dovetail. They are legally and conceptually distinct. In his opinion, equal protection could not be taken out of the constitution. Number 0210 CO-CHAIRMAN OGAN stated there is legislation, House Bill 406, that would give a use-preference based on the sustained yield principle in Article VIII, "subject to preferences among beneficial uses." He asked Mr. Cook to explain the difference of a preference based on "uses" versus "users" - users being the rural priority and uses being the use of fish and game - in terms of equal protection. Number 0248 MR. COOK replied the written material provided would be a better source to answer the question. Nonetheless, Article VIII, Section 4, requires the state to manage fish, wildlife, waters, and other replenishable resources according to the sustained yield principle subject to preferences among beneficial uses. The Alaska Supreme Court made it clear in McDowell that "uses" rather than "users" were intended to be addressed by the provision. Decisions since 1992 have addressed the issue referring to McDowell. In addition, the Alaska Supreme Court has said over and over again, as-long-as access or category of use to the resource is not denied, the equal access clauses of the constitution are not implicated and there is no violation. For example, the Alaska Supreme Court has said in a variety of cases that beneficial uses can be defined in terms of the use made of the resource such as commercial, subsistence, and sport fishing. The term "beneficial uses" actually comes from the world of water law where it is described in terms of agricultural, domestic, household, and municipal use of water, for example. They are uses that require a diversion of water from its natural place and an appropriation by a user in order to perfect a right to the water. "Users" on the other hand, are a class of Alaskans such as the urban-rural dichotomy. The Alaska Supreme Court has expressly said it is all right for the boards to make allocation decisions; discriminate for a valid purpose - resource conservation; and, treat different subgroups differently - State v. Gilbert. In Gilbert, the Board of Fisheries was allowed to treat Chignik seiners differently than Stepovak setnetters. The state supreme court had to recognize that the board must make allocation decisions inherent to conservation and management of the resources. But, the way the resource is allocated is fundamental, the distinction between uses and users. "As-long-as you're not setting up a closed category of users and you've got a resource conservation purpose, then the discrimination, with other things being equal, should pass muster." Number 0481 CO-CHAIRMAN OGAN asked Mr. Cook whether the legislature is well within its constitutional authority to set up a preferential use for sustenance in a time of shortage to further the sustained yield principle. Number 0504 MR. COOK replied it is be beyond most people's debate that subsistence uses is a beneficial use of the resources, therefore, the legislature is entitled to adopt statutes that prefer subsistence use. At the same time, the equal access clauses make it clear that the legislature can not create a closed class of people. He referred to the document that he provided to the committee members today. It describes the historical reasoning of other states' decisions in terms of Balkanization as a violation of equal protections. Number 0568 REPRESENTATIVE WILLIAMS asked Mr. Cook how the public trust doctrine affected the Katie John case. Number 0579 MR. COOK replied he has not reviewed the Katie John case. He preferred not to give a snap response. Number 0598 CO-CHAIRMAN HUDSON referred to "uses" versus "users" and asked Mr. Cook, if the legislature established beneficial uses, which can only be affected by users, wouldn't the users also have to also fit the concept of beneficial trust. Number 0631 MR. COOK replied the term "exclusive use" is expressly prohibited by Article VIII, Section 15 - a derivative of the White Act from the 1920s. It has also been interpreted by the Supreme Court in Hines v. Grimes Packing Company. It is the kind of prohibition that the Alaska Supreme Court relied on to invalidate the intrastate residential preference in McDowell. Therefore, as the state constitution now stands, the prohibition on exclusive uses and special privileges (the common use clause) and the special guarantee of equal protection in Article VIII, combine to prohibit that kind of discrimination. Number 0707 REPRESENTATIVE JOULE asked Mr. Cook whether a rural preference is really a closed class because there is no prohibition against somebody moving to a rural area or somebody moving out of a rural area. Number 0739 MR. COOK replied the precise issue was addressed by Justice Rabinowitz in his dissenting opinion in McDowell. Number 0764 REPRESENTATIVE JOULE asked Mr. Cook, in regards to the public trust doctrine, how does it work with Article XII, Section 12. Number 0788 MR. COOK replied, "I don't know." Number 0800 REPRESENTATIVE BARNES referred to the issue of limited entry and stated the people decided to give away a portion of their resources to a particular group of people when they voted on it. The arguments presented at the time were concerns about out-of-state fishermen, a depressed resource, Alaskans holding the limited entry permits, and the benefits remaining within Alaska. "We all know that a large number of those permits today are held by people outside of Alaska and were sold to them early on by many of them from the rural areas of the state because they didn't understand, I think, the value of those fishery permits as it related to the future of the economy of the areas." She wondered, if the question was placed before a court today of general jurisdiction in terms of the promise made to the people, and the fact that an exclusive number of people hold permits (mostly outsiders), their high value, and the issue of migratory fish controlled by the National Oceanic and Atmospheric Administration, how it would hold together under the public trust doctrine. The scenario that led the people to vote one way no longer exists. Number 0932 MR. COOK replied the question has a lot of out-of-state commercial fishers nervous. Clearly, the question could be decided differently under the facts present today. There is no advantage to speculate how it would come out, but it is a concern that has been raised by the Alaska Supreme Court. In addition, consistent with the public trust doctrine, a state may prefer its residents as a whole over nonresidents. It would not be a violation of the public trust doctrine to say that only Alaskan residents can hunt for moose when it is for a legitimate conservation purpose. The issue is addressed in the materials that he provided to the committee members today. Number 1041 REPRESENTATIVE BARNES stated it is troubling because the state, through the legislative branch, holds the fish and wildlife in the public's trust, and spends a great deal of money to manage a portion of the fisheries resource for a large number of out-of- state fishermen. Number 1066 MR. COOK stated it is one of the reasons that justifies charging out-of-state fishermen higher fees. Number 1090 REPRESENTATIVE BARNES replied the state can charge a higher fee on certain game permits, for example, because there is a clear nexus between the cost of management and the cost of the outsiders to hunt. Number 1126 CO-CHAIRMAN OGAN asked Mr. Cook to continue his presentation. Number 1147 MR. COOK stated the public trust doctrine applies to tidelands, either washed by the tide or filled in and no longer washed by the tide; navigable lakes and streams; uplands, a result of the Sage Brush Initiative; and beds of navigable lakes and streams, a result of a 1995 special and temporary act passed by the legislature. MR. COOK further stated the public trust doctrine protects the right of equal access to the sea for the purposes of commerce, navigation, and fishing. It protects fish and wildlife and the equal access to them, including the conservation of fish and wildlife habitat which is often more important than harvest restriction such as bag limits, open, and closed seasons. Habitat is every bit as important to protect because without it, the population is gone. The public trust doctrine is also seen to protect recreational uses such as swimming, fishing, hunting, viewing, and science. There has not been an explicit ruling from the state supreme court yet on recreational uses, but the temporary act passed in 1985 by the legislature extended the public trust doctrine to those types of uses. In addition, the state should also look at the quality and quantity of the resources left for the future generations. Number 1260 MR. COOK stated, in conclusion, the public trust doctrine is potentially a powerful tool, but it is not a panacea. It is not a universal cure. It is not a guarantee against federal management of any kind. The state has lived with varying degrees of federal management of resources without any undue effect for a long time. He cited migratory water fowl as an example; and the International Pacific Halibut Commission as an effective body for fisheries management. It is a mixed bag because nobody wants to go back to the bad-old-days of federal management of Seattle interests and fish traps. The public trust doctrine does not answer the confrontation between sovereigns. The public trust doctrine, however, is a constitutional guarantee that the state government will not violate its fiduciary duties, including the duty of impartiality. The public trust doctrine is of very little use unless the legislature recognizes and understands it and the judicial branch is willing to enforce it. The public trust doctrine, as it blends with the equal protection clauses in the state constitution, requires that the resources are open to the public on equal terms without a preference. Thus, any contrary state or municipal action is impermissible, except for conservation restrictions and preferences among beneficial uses. The public trust doctrine does not prevent the Board of Game or the Board of Fisheries from conserving or allocating scarce resources, but it does prevent allocating them through devises that limit user groups. The state constitution can be amended. The common use clause can be amended - a concurring opinion by Justice Compton (ph). "I believe that the public trust doctrine probably, may be, diminished. It may be modified. It may even be emasculated through the constitutional amendment process, but it certainly does not have to be done." The public trust doctrine may not be entirely eliminated any more than equal protection could be fully denied. The public trust doctrine is simply the name given to the rationale that is relied on that limits the power of the people who temporarily occupy the seats of government when they seek to transfer the assets that belong to the public as a whole to private hands. Number 1524 MR. COOK further stated, "My own preference is that the state, through you, would pay more attention to the duty to give information to the public. I don't think we know enough about our fish and wildlife resources, and our water resources. In particular, I don't think we know enough about what those populations are, what kind of harvest they can sustain, and what kind of yield you want them to sustain or the public might want them to sustain. I would like to see the legislature consider, perhaps not decide, what it means in our constitution to say sustained yield outside of the context of timber which is the only place you've looked at it. I would like the legislature to pay particular attention to the issue of our waters. Our state waters often receive short shrift, in particular, the reservation of in- stream flow for the benefit of fish and wildlife, and for the benefit of public recreation, and commercial use, and subsistence use has to some extent run into a brick wall. Applications by the state to speak to that reservation of water issue are simply not processed by the Department of Natural Resources and that is in many ways a failure of the state to properly take care of this public trust resource." MR. COOK thanked the committee members for looking at the state constitution and the public trust doctrine. He called their attention to an article written in December of 1994 in the Alaska Law Review. Number 1665 REPRESENTATIVE BARNES commented the issue of reserved water rights is going to become a tremendous issue in the state. She asked Mr. Cook whether he is aware of any federal law on the books that specifically reserve water rights to the federal government in Alaska. Number 1702 MR. COOK replied he is aware of "supreme" court decisions that constitute federal common law. However, statutory laws that govern reserved federal water rights is an area beyond his area of expertise, but he is familiar with federal case law. Number 1727 REPRESENTATIVE BARNES stated there is a whole process under federal law to reserve a water right in Alaska. "I don't believe that there has ever been a time when the federal government has ever gone through that regulatory process to reserve any water rights in this state." Therefore, the Ninth Circuit Court of Appeals or any other court that reaches a conclusion on reserved water rights needs to be challenged in the Supreme Court of the United States. Number 1775 REPRESENTATIVE BARNES further stated the legislature holds the common property resources in trust and delegates a portion of its responsibilities to different agencies through statutes. She asked Mr. Cook his opinion on an agency undermining the law or making a statement that a law is a floor and not a ceiling. Number 1835 MR. COOK replied the Ninth Circuit Court of Appeals is not alone in its decisions on federal reserved water rights. The United States v. Cappaert case is the original decision on the issue from the United States Supreme Court. There is also another court case dealing with puff fish in the Death Valley Natural Monument in regards to federal reservations. Number 1908 REPRESENTATIVE BARNES asked Mr. Cook whether he would agree that there is only one federally recognized reservation in the state - Metlakatla. Number 1921 MR. COOK replied yes at this point in time, pending a decision from the United States Supreme Court on Venetie. Number 1945 REPRESENTATIVE BARNES stated there can be federally reserved water rights without going through a litany process. MR. COOK stated the term "reservation" in the law is broader than the meaning of an Indian reservation. It speaks broadly to areas of land that the federal government owns and manages for specific purposes. For example, the Tongass National Forest was the first forest reservation in the country. Number 2064 REPRESENTATIVE BARNES asked Mr. Cook whether the federal government would have to go through a specific provision to reserve the water within the reservation. Number 2078 MR. COOK replied he does not know, but he does not think so. There is still the doctrine of implied federal reserved water rights. MR. COOK further replied, in regards to the standard delegation analysis, the state supreme court would look to whether or not the agency was acting in a way that was reasonably necessary for the purposes of the effectuation of the statute. If an agency exceeded its authority, a claim under the Administrative Procedure Act would be upheld. An agency's interpretation of the statute would also get some weight. Number 2168 REPRESENTATIVE BARNES asked Mr. Cook what if the statute is clear on its face. MR. COOK replied clarity is always in the eye of the beholder. If a court feels that a statute is clear on its face, there would be no room for interpretation. It would be an administrative and executive function. Number 2218 CO-CHAIRMAN HUDSON asked Mr. Cook whether the same trustee responsibility of the legislative and executive branches exists at the federal level. He wondered whether Congress and the President have a public trust over all of the federal lands in Alaska along with the state legislative and executive branches. Number 2266 MR. COOK replied, "Yes." But, it is not just like a state's public trust doctrine. There are at least 51 different public trust doctrines from the individual states, and the federal public trust doctrine is less developed. Number 2300 CO-CHAIRMAN HUDSON referred to ANILCA and asked Mr. Cook, if a federal law requires a particular handling of a public trust that is in conflict with a state's constitution, could it be amended and still be within the purview of the public trust doctrine. Number 2360 MR. COOK replied the federal government can do things that state governments can not because of the Fourteenth Amendment. The federal government can treat different groups of citizens in ways that state governments can not. The federal government plays by different rules when executing trust responsibilities. Number 2410 CO-CHAIRMAN HUDSON referred to the Alaska Statehood Act, and wondered whether the federal government has violated the state's statehood rights. TAPE 98-17, SIDE A Number 0027 MR. COOK replied the court decision regarding the 90/10 split would answer the question. But, he has not found legal arguments that rely on the compacts theory persuasive. Instead, he has been more persuaded with the arguments that Congress has the right to pass legislation further down the road to change what an earlier congress has done. It does not sound fair, but that is the more persuasive legal argument. Number 0206 REPRESENTATIVE BARNES commented the Alaska Statehood Act and the constitution were voted on by the people as a compact between the people and the federal government. She, therefore, wondered how one could change it while the other one could not. Number 0235 MR. COOK replied it seems to be the way it works. Congress is supreme. There was no doubt about who bought and owned who at the time and how Alaska became a sovereign state. It is easy to accept legally, not emotionally, that Congress can change a statute previously adopted. The option at the time was to remain as a territory, but the Territorial Commission was managing the fish and wildlife. The rights given through the Alaska Statehood Act, legally, could be to some extent taken away. He is not fully versed on the compacts theory, however. Number 0401 REPRESENTATIVE JOE GREEN wondered whether the federal government could break contracts with other countries. He also wondered whether a state could break a contract with a company, and would the breaker of a contract be subject to the damages. Number 0459 MR. COOK replied the questions are beyond the scope of what he is prepared to discuss today. But, yes the United States breaks agreements with other countries and other countries break agreements with the United States and sometimes there are damages available. It is a matter of international law. And, yes the United States breaks contracts with private companies and sometimes there are damages available. Number 0551 CO-CHAIRMAN OGAN referred to the 1953 Submerged Land Act in which states were granted the title to submerged lands beneath water. The Act gave a fair amount of authority to the federal government for the "use, development, improvement or control arising from the constitutional authority of Congress to regulate or improve navigation to provide for flood control or the production of power." The Act also affirms the right and the power of the states to "manage, administer, lease, develop, and use the said lands and natural resources in accordance with all applicable state law." The dissenting opinion from Judge Cynthia Hall in Katie John quoted the Submerged Land Act and begged the legislature to fix it. In addition, it was unthinkable a number of years ago that the federal government would even consider it had the right to manage fisheries on navigable waters. He asked Mr. Cook to comment on the case law. Number 0711 MR. COOK replied federal fisheries management has traditionally occurred in the sea beyond the three-mile limit inscribed to the state. The concept of navigability has been vague over the years and subject to pulsating definitions. Federal management of fish and wildlife inside the state, outside of federal reservations, has not been the norm in the past. Nonetheless, the federal government has powers that it does not need to exercise. But, sometime it does not know it has powers until the Supreme Court says so. He looks forward to a statement by the Supreme Court that might give a greater measurement of state management authority over fisheries on navigable streams of which the bed is owned by the state. Number 0861 CO-CHAIRMAN HUDSON stated, in the even the state loses single management and the federal government takes over, how accountable would the federal government be for the mismanagement of the common resources. Number 0903 MR. COOK replied it would be incorrect to say that the state has sole management authority right now in light of the extensive federal responsibilities exerted for a number of years over marine fisheries, fishing and hunting on federal lands, the Migratory Bird Treaty Act, the Fur Seal Protection Act, and the Marine Mammal Protection Act. Therefore, if the state does not conform to ANILCA, it stands to lose its limited amount of management authority that it now has on federal lands. The state would still retain management authority over state lands and some state waters. MR. COOK further replied, in reference to accountability, the state would not get anything. The state has a very broad standard of equitable and wise management, according to the Metlakatla decision. He does not know, however, whether there are enforceable and justiciable management standards that pertain to the federal government. It would be tough to make a case against the federal government to get relief in general, but maybe in a specific situation. Number 1115 CO-CHAIRMAN OGAN noted the latest amendment to ANILCA says, "In accordance with Title VIII of this Act, the Secretary of Interior is 'required' to manage fish and wildlife for subsistence uses on 'all' public lands in Alaska because of the failure of state law to provide a rural preference." It is interesting to note that contrary to Senator Stevens' comments, the subsection would only be repealed on the date a law is not adopted. Therefore, a rural priority would also extend authority, not just judicial or implied authority, to the Secretary of Interior. He asked Mr. Cook whether the state is slowly being reduced to territorial status. Number 1183 MR. COOK replied there is not anything inherently evil about federal management, but the state's perspective is generally superior to the federal's perspective. He is proud to have been a members of the Department of Fish and Game; it is the operation that should be in charge of the state's resources. CO-CHAIRMAN OGAN thanked Mr. Cook for his time today and for the time it took to prepare for the meeting. Number 1223 REPRESENTATIVE NICHOLIA asked Co-Chairman Ogan when the committee members will receive a sectional analysis for the new proposed committee substitute. CO-CHAIRMAN OGAN replied a partial sectional analysis has been provided. He does not want to order more than one as the bill changes. Number 1253 REPRESENTATIVE JOULE asked Co-Chairman Ogan whether a fiscal not is being developed. CO-CHAIRMAN OGAN replied a fiscal note is forthcoming. A bill can not be passed out of a committee without one. Number 1269 CO-CHAIRMAN OGAN recessed the meeting to the call of the chair at 3:03 p.m.