Legislature(2009 - 2010)BARNES 124


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08:01:02 AM Start
08:02:05 AM HB74
09:59:24 AM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Heard & Held
HB  74-COASTAL MANAGEMENT PROGRAM                                                                                             
8:02:05 AM                                                                                                                    
CO-CHAIR HERRON announced  that the only order  of business would                                                               
be HOUSE  BILL NO.  74, "An  Act relating  to the  Alaska coastal                                                               
management program;  and establishing  the Alaska  Coastal Policy                                                               
CO-CHAIR HERRON informed  the committee that HB 74  would be held                                                               
over today.                                                                                                                     
8:02:33 AM                                                                                                                    
REPRESENTATIVE REGGIE  JOULE, Alaska State  Legislature, speaking                                                               
as one of the  prime sponsors of HB 74, began  by sharing a photo                                                               
map entitled  "Oil Development  in Alaska's  Arctic."   The photo                                                               
illustrates the amount of oil  development from 1968 when oil was                                                               
first discovered  in Prudhoe Bay and  there was a single  well to                                                               
1977.    In  1977  coastal   zone  management  began.    In  1989                                                               
[development]  began [to  reach into]  the coastal  areas of  the                                                               
North  Slope and  around Prudhoe  Bay.   By 1999  there was  much                                                               
activity in  the North Slope  region.   In 2003 how  coastal zone                                                               
management was  done in  the North  was changed.   The  point, he                                                               
emphasized, is  that at  that time  coastal zone  management with                                                               
the  involvement  of local  communities  was  very successful  in                                                               
exploration  and  development of  the  state's  resources.   This                                                               
legislation  attempts  to  return  the  coastal  zone  management                                                               
process to one  in which there is local involvement.   The notion                                                               
that  local  community  involvement  would  stop  development  is                                                               
inaccurate  because much  development successfully  occurred when                                                               
local communities  were involved  in the coastal  zone management                                                               
plan.   He recalled only  in one  or two instances  that projects                                                               
were  slowed down  and to  his  knowledge no  project was  halted                                                               
because of the coastal zone  management in place.  Representative                                                               
Joule  opined, "One  of  the brags  we have  in  this state  with                                                               
development is that we do it right."                                                                                            
8:06:49 AM                                                                                                                    
ELIZABETH  HENSLEY, Intern,  Representative Reggie  Joule, Alaska                                                               
State Legislature,  explained that  HB 74  seeks to  amend Alaska                                                               
Coastal  Management  Plan  (ACMP)  statutes  to  accomplish  four                                                               
objectives.   She then turned to  the history of the  ACMP, which                                                               
was created pursuant to the  1972 federal Coastal Zone Management                                                               
Act.  The intent, in part, of the aforementioned act is:                                                                        
     to preserve,  protect, develop, and where  possible, to                                                                    
     restore  and  enhance  the resources  of  the  nation's                                                                    
     coastal zone  for this  and succeeding  generations; to                                                                    
     encourage  the  participation  and cooperation  of  the                                                                    
     public, state, and local governments  as well as of the                                                                    
     federal agencies;  to provide for the  coordination and                                                                    
     simplification  of   procedures  in  order   to  ensure                                                                    
     expedited   governmental   decision  making   for   the                                                                    
     management   of   coastal   resources;  and   to   give                                                                    
     opportunities   for   public   and   local   government                                                                    
     participation in coastal management decision making.                                                                       
MS. HENSLEY reminded the committee  that in 1977 the Alaska State                                                               
Legislature  enacted the  Alaska  Coastal  Management Act,  which                                                               
created the  ACMP.  The  program was federally approved  in 1979.                                                               
Although  originally a  17-member board  oversaw the  program, in                                                               
2003  the  Murkowski  Administration  concentrated  much  of  the                                                               
decision-making  power in  the  Department  of Natural  Resources                                                               
(DNR).   This legislation,  HB 74, has  four objectives  with the                                                               
first being  to restore  the Alaska  Coastal Policy  Board, which                                                               
would be composed  of nine members.  Of those  nine members, five                                                               
would  be  appointed by  the  governor  to represent  the  public                                                               
representing  coastal districts  and the  remainder would  be the                                                               
commissioners of the state's resource  agencies.  The board would                                                               
be  responsible for  approving district  coastal programs,  grant                                                               
programs,  and regulations  pertaining  to the  ACMP.   She  then                                                               
pointed out  that the  process in HB  74 would  frontload dispute                                                               
resolution by  encouraging districts  to resolve issues  with DNR                                                               
prior to  the plan  being reviewed by  the Coastal  Policy Board.                                                               
The process  would also  involve all  three resource  agencies in                                                               
pre-decision appeals.   Furthermore, DNR would  maintain all day-                                                               
to-day management  of all ACMP matters  and retain responsibility                                                               
for project consistency  reviews.  The second objective  of HB 74                                                               
is  to streamline  the  ACMP consistency  review  process and  to                                                               
promote  agency cooperation  related  to issue  resolution.   Ms.                                                               
Hensley highlighted that one of the  main ideas behind ACMP is to                                                               
have a one-stop shop for those  who want to conduct activities by                                                               
the  coast.     Therefore,  HB  74  returns   the  Department  of                                                               
Environmental  Conservation  (DEC)  permitting  to  the  process.                                                               
This legislation also streamlines  the consistency review process                                                               
by encouraging coordination  of municipal Title 29  with the ACMP                                                               
process, which  reduces the chances  of conflicts  between state,                                                               
federal, and local permit conditions.                                                                                           
MS. HENSLEY then  specified that the third objective of  HB 74 is                                                               
to  restore the  role of  coastal districts  by allowing  them to                                                               
establish  local, enforceable,  and  meaningful  policies.   This                                                               
legislation would  empower coastal districts without  giving them                                                               
veto authority,  which is critical  to building  partnerships and                                                               
engaging in responsible development.   Ms. Hensley opined that HB
74 recognizes that  local people have local knowledge  that is of                                                               
importance  when managing  coastal resources.   Furthermore,  the                                                               
federal  law upon  which  the ACMP  is  based emphasized  coastal                                                               
districts, which was  also the case in Alaska law  prior to 2003.                                                               
The fourth  objective of HB  74 is  to restore state's  rights by                                                               
reinstating   certain   provisions   eliminated   by   the   2003                                                               
legislation.  For  example, HB 74 allows for an  extension of the                                                               
90-day review  limit for those  consistency reviews  that include                                                               
permits  from federal  agencies.   The aforementioned  allows for                                                               
more  input from  the  state  and the  public  during the  review                                                               
period.   The legislation also  allows review of  projects inland                                                               
of  coastal  zones  if  there   may  be  coastal  impacts.    The                                                               
legislation,  she   pointed  out,  also  allows   for  review  of                                                               
individual  oil and  gas  lease sales  in  federal Outer  Counter                                                               
Shelf (OCS) waters.   She noted that there is  no other mechanism                                                               
for the state to have such  extensive input in what occurs in the                                                               
8:12:56 AM                                                                                                                    
REPRESENTATIVE GARDNER,  recalling that the  legislation empowers                                                               
local communities, inquired  as to the limits of  the power local                                                               
communities would hold under HB 74.                                                                                             
MS.  HENSLEY  related  that   currently  coastal  districts  have                                                               
difficulty in  obtaining approval of their  enforceable policies,                                                               
which  has limited  their  ability to  have a  say  in their  own                                                               
communities.    This  legislation,  she  explained,  would  allow                                                               
communities  to write  enforceable policies  that become  part of                                                               
the review process.   However, the local  communities wouldn't be                                                               
responsible  for determining  whether the  project is  consistent                                                               
with the standards as that responsibility lies with DNR.                                                                        
8:14:16 AM                                                                                                                    
CO-CHAIR MUNOZ  inquired as  to what the  new timeframe  would be                                                               
for federal projects.                                                                                                           
MS. HENSLEY offered to obtain that answer for the committee.                                                                    
8:14:49 AM                                                                                                                    
REPRESENTATIVE  HARRIS asked  if the  sponsor has  formulated any                                                               
answers to  the issues raised  in the letter  from ConocoPhillips                                                               
Alaska,   Inc.  ("ConocoPhillips").      He   pointed  out   that                                                               
ConocoPhillips requests that the  existing [ACMP] program stay in                                                               
MS.  HENSLEY, regarding  the DEC  carve  out and  ConocoPhillips'                                                               
desire to maintain two separate  processes, opined that generally                                                               
the streamlining effect is more beneficial to developers.                                                                       
8:18:54 AM                                                                                                                    
REPRESENTATIVE JOULE  directed the committee's attention  back to                                                               
the map he presented earlier,  which illustrates the activity [on                                                               
the North  Slope] from  the implementation of  the ACMP  to 2003.                                                               
He,  again, told  the  members  that much  of  the  time the  map                                                               
illustrates was  a time when much  of what HB 74  proposes was in                                                               
place.  During that time  when local communities were involved in                                                               
the  process,  development  was successful,  with  a  minimum  of                                                               
8:21:12 AM                                                                                                                    
RANDY BATES, Director, Division  of Coastal and Ocean Management,                                                               
Department of  Natural Resources (DNR), related  that DNR doesn't                                                               
support HB  74 as  the department  has two  substantive concerns.                                                               
First, HB  74 creates a new  oversight body that has  the ability                                                               
to  override  agency  authority, which  effectively  renders  the                                                               
legislative   establishment   of   laws  relative   to   resource                                                               
management and  protection moot.  The  second substantive concern                                                               
of DNR  is that HB 74  doesn't balance or represent  all the ACMP                                                               
participants  and stakeholders,  but  rather is  specific to  the                                                               
issues  of a  group of  ACMP participants.   Mr.  Bates mentioned                                                               
that  he had  additional concerns  that  he could  detail if  the                                                               
committee saw fit.  He then  noted that DNR has attached a fiscal                                                               
note to HB 74.                                                                                                                  
8:22:47 AM                                                                                                                    
REPRESENTATIVE GARDNER  inquired as  to who isn't  represented in                                                               
the legislation.                                                                                                                
MR. BATES explained that DNR views  the ACMP as a stool with four                                                               
legs that  consist of  the following:   coastal  districts, state                                                               
agencies,  interested public,  and  industry.   This  legislation                                                               
primarily represents  the interests  of the coastal  districts in                                                               
coastal management.   The concern is that a change  to one leg of                                                               
the stool makes the stool unstable.                                                                                             
REPRESENTATIVE   GARDNER  then   asked  whether   the  department                                                               
believes the existing ACMP is stable.                                                                                           
MR. BATES  related that  DNR has been  evaluating changes  to the                                                               
ACMP because  the department realizes that  for many participants                                                               
the program has been challenging  since 2003.  The department, he                                                               
further  related,  is  trying  to  find  ways  to  stabilize  the                                                               
program.   However,  the department  hasn't reached  consensus on                                                               
what those changes could be.                                                                                                    
8:24:20 AM                                                                                                                    
REPRESENTATIVE  GARDNER inquired  as  to the  ways  in which  DNR                                                               
believes the ACMP is currently unstable.                                                                                        
MR.  BATES   pointed  out  that   HB  74  illustrates   how  some                                                               
participants would  like to see  the program stabilized,  such as                                                               
through the creation  of the Coastal Policy  Board, the expansion                                                               
of  districts' ability  to write  enforceable  policies, and  the                                                               
expansion of the coastal zone inland.                                                                                           
REPRESENTATIVE  GARDNER surmised  then that  one of  the ways  in                                                               
which the status quo is  unstable, from the department's view, is                                                               
the  opportunity for  coastal zone  districts  to make  decisions                                                               
regarding inland areas.                                                                                                         
MR. BATES  said the aforementioned  has been  represented through                                                               
HB  74.   The department  believes  that the  ACMP is  relatively                                                               
functional and  stable to  the point of  being able  to implement                                                               
it.   Although DNR recognizes  the desire to change  the program,                                                               
the  department  hasn't reached  a  conclusion  as to  what  that                                                               
change could  or should be or  even the form in  which the change                                                               
would be.                                                                                                                       
8:25:57 AM                                                                                                                    
REPRESENTATIVE GARDNER asked if there  are areas of the ACMP that                                                               
DNR  believes is  unstable or  does DNR  acknowledge the  view of                                                               
some stakeholders  that the ACMP  is unstable while  DNR believes                                                               
the program is stable.                                                                                                          
MR. BATES explained  that a year ago DNR  committed to reevaluate                                                               
the  ACMP   statutes  and  regulations,  and   that  process  was                                                               
initiated in  July 2008.   The goal  was to evaluate  whether the                                                               
program is stable  and whether there is change  that could result                                                               
in  a more  stable  program.   He reiterated  that  to date,  DNR                                                               
hasn't come  to consensus regarding  whether change  is necessary                                                               
and  what  the change  could  look  like.    Mr. Bates  said,  "I                                                               
wouldn't put  forward the  idea that the  program is  unstable at                                                               
this point.  Certainly, I know  that there is a desire for change                                                               
on certain participants' parts."                                                                                                
8:27:29 AM                                                                                                                    
REPRESENTATIVE HARRIS inquired as  to what the administration, in                                                               
general,  and DNR  is doing  to sit  down with  those who  desire                                                               
change  and want  local  issues to  be  taken into  consideration                                                               
within the ACMP.                                                                                                                
MR.  BATES specified  that  the department  engaged  in a  fairly                                                               
robust public  process to  engage all  participants in  the ACMP;                                                               
that process began in July 2008.   Comments and public input were                                                               
solicited  in  regard  to  what  changes  could  be  accomplished                                                               
generally  with the  program.   To that  end, DNR  put out  draft                                                               
statutes/regulations to  gather input,  garner ideas,  and engage                                                               
participants in  what the ACMP is  and how it could  be improved.                                                               
A number  of meetings were held  over the months of  July through                                                               
December during  which issues  were discussed  in depth.   Still,                                                               
the department hasn't come to  consensus with the participants at                                                               
the table  regarding what changes  could be achieved.   Mr. Bates                                                               
pointed  out  that  the  ACMP   is  a  complicated  program  that                                                               
represents many factions, and therefore  there is a difference in                                                               
opinion as  to what is  best and  how to effectively  implement a                                                               
coastal program.                                                                                                                
8:32:11 AM                                                                                                                    
REPRESENTATIVE  HARRIS  surmised  then that  the  department  has                                                               
ongoing dialogues  with the impacted  parties.  Referring  to the                                                               
map of the  North Slope presented by  the sponsor, Representative                                                               
Harris inquired as to [what is  going on within the ACMP process]                                                               
in  other  areas of  the  state  where  there is  development  or                                                               
possible development.                                                                                                           
MR.  BATES specified  that the  coastal program  goes around  the                                                               
coast  of  Alaska.   There  are  28  coastal districts  that  are                                                               
actively  participating   in  coastal   management.     From  his                                                               
perspective,  the  department  has  a good  dialogue  with  those                                                               
coastal districts.   In fact,  a representative from  Valdez sits                                                               
on  the  working group  with  whom  the department  communicates.                                                               
That  representative  from  Valdez communicates  with  the  South                                                               
Central Region.   He noted  that the department has  held ongoing                                                               
meetings over the  past six months and a  full coastal conference                                                               
is scheduled for March.                                                                                                         
8:34:03 AM                                                                                                                    
REPRESENTATIVE  CISSNA   recalled  the  development   of  coastal                                                               
management  in the  early 1970s.   She  further recalled  that it                                                               
took  a long  time for  all communities  to develop  a plan  that                                                               
achieved  balance  and  brought   in  all  the  stakeholders,  in                                                               
comparison to  a six-month process.   The current time  in Alaska                                                               
is  unparalleled in  terms of  trauma on  communities.   She then                                                               
expressed the need  to be more thoughtful with the  process.  For                                                               
instance,  choosing  times  to   meet  or  obtain  comments  from                                                               
communities when the residents are able to participate.                                                                         
MR. BATES  pointed out  that the  six-month process  he described                                                               
wasn't the  only process DNR  went through.   In fact,  since the                                                               
2003 changes  to the  ACMP there has  been regular  dialogue with                                                               
all   participants,    particularly   the    coastal   districts.                                                               
Furthermore, there  was a district  planning process with  all 28                                                               
districts  in which  they revised  their plans  according to  the                                                               
2003 changes.   He noted that the three  remaining districts that                                                               
haven't  secured approval  of  their plans  are  the North  Slope                                                               
Borough,  the Northwest  Arctic Borough,  and the  Bering Straits                                                               
Coastal Resource Service Area.   The first two boroughs requested                                                               
mediation of their  plans almost two years ago.   As part of that                                                               
mediation,  the department  traveled to  those coastal  districts                                                               
and  other areas  of the  state.   Therefore, the  department has                                                               
been discussing whether coastal  districts can secure approval of                                                               
enforceable properties, what topics  they can address, and what's                                                               
important to  the communities.   Mr.  Bates emphasized  that this                                                               
process  has been  ongoing,  not  just in  the  last six  months.                                                               
However, in  the last  six months  the department  has formalized                                                               
its effort  to evaluate the  coastal zone management  program and                                                               
determine if change is possible.   He acknowledged that this is a                                                               
critical time in the state's  history and local governments would                                                               
like greater involvement  and say in the  permitted activities in                                                               
their region.   He highlighted  that under the  existing program,                                                               
local communities  have the ability to  have enforceable policies                                                               
and  have   the  opportunity  to   participate  in   the  state's                                                               
permitting process  and comment  on those activities  through the                                                               
state  agencies or  the coastal  zone management  program.   "The                                                               
issues  are  not  lost  even  if a  district  does  not  have  an                                                               
enforceable policy to apply to a project," he remarked.                                                                         
8:40:04 AM                                                                                                                    
REPRESENTATIVE GARDNER  inquired as  to the changes  DNR proposed                                                               
in the  statutes and  regulations it put  out for  public comment                                                               
and whether those address any of the matters addressed by HB 74.                                                                
MR.  BATES  clarified  that  DNR   didn't  engage  in  regulation                                                               
promulgation  through the  Administrative Procedures  Act, rather                                                               
input from  the participants was  solicited from  which potential                                                               
statutory  changes were  crafted.   In  order  to illustrate  how                                                               
those statutory  changes would be  reflected in  the regulations,                                                               
the department put out amended  regulatory language as an example                                                               
of the possible comprehensive change  to coastal management.  Mr.                                                               
Bates commented that there are  some statutory changes that could                                                               
be made  to the regulations  in order  to accomplish some  of the                                                               
issues coastal districts and others have raised.                                                                                
REPRESENTATIVE GARDNER  remarked that  she is very  interested in                                                               
knowing what kinds of changes are being contemplated by DNR.                                                                    
8:42:27 AM                                                                                                                    
CO-CHAIR MUNOZ  pointed out that one  of the concerns with  HB 74                                                               
is  that it  could lead  to costly  delays and  litigation.   She                                                               
asked  if  there  are  examples   prior  to  2003  in  which  the                                                               
involvement of  the coastal  districts added  cost to  or delayed                                                               
the projects.                                                                                                                   
MR. BATES said  that he doesn't have an answer.   Part of coastal                                                               
zone management  in Alaska, as  a voluntary program, has  been to                                                               
include  local communities  in the  decision-making process.   He                                                               
opined  that  local  communities  have  always  been  a  valuable                                                               
participant in the  process and had the ability  to influence the                                                               
outcome of  projects.  He  said he didn't believe  the department                                                               
has  ever reviewed  whether  local community  involvement/coastal                                                               
district involvement is  costly.  The aforementioned  may be best                                                               
addressed  by an  industry representative.   Any  time a  coastal                                                               
district raises  a legitimate  issue that  needs to  be addressed                                                               
through  the   state  permitting   process  or   through  coastal                                                               
management,  the  department  addresses   it  and  brings  it  to                                                               
satisfaction, he stated.                                                                                                        
8:45:17 AM                                                                                                                    
REPRESENTATIVE  GARDNER inquired  as  to who  determines what  is                                                               
MR.  BATES  clarified  that  all   issues  are  legitimate.    He                                                               
explained that if an enforceable  policy or statewide standard is                                                               
implicated,  it's considered  under coastal  management.   If the                                                               
issue  isn't implicated  under coastal  management, the  issue is                                                               
shared with the agency that  has responsibility or expertise with                                                               
the issue.  Therefore, if  the issue falls under the jurisdiction                                                               
of the department, it addresses  the issue otherwise the issue is                                                               
shared with [those under whose jurisdiction it falls].                                                                          
8:46:47 AM                                                                                                                    
TOM    OKLEASIK,  Planning Director,  Northwest  Arctic  Borough,                                                               
related the Northwest  Arctic Borough's support for  HB 74, which                                                               
would   really  restore   the  coastal   districts'  ability   to                                                               
effectively participate  in the  ACMP.  Since  Alaska is  a large                                                               
and  unique   state,  local  input  for   statewide  programs  is                                                               
important.   The  best way  to accomplish  the aforementioned  is                                                               
with a  board of Alaskans, as  proposed in HB 74,  to oversee the                                                               
major aspects of  the ACMP.  The board, he  opined, would restore                                                               
effective  public  engagement  in  the  program.    As  mentioned                                                               
earlier,  the  Northwest  Arctic  Borough has  been  involved  in                                                               
mediation over its  plan, which is still yet to  be approved.  He                                                               
noted that the plan  is in year five or six of  the process.  The                                                               
borough, he  related, believes the  mediation has  been one-sided                                                               
and very frustrating.  Despite  all the efforts of the [borough],                                                               
the plan  was denied by  the state.   This legislation  would fix                                                               
some  of  the  mediation  process by  providing  a  fair  review.                                                               
Currently, the only recourse is to  go to the commissioner of DNR                                                               
for a decision  that has already been made.   There is no ability                                                               
to obtain a  third party review, he  pointed out.  In  the way of                                                               
background,  Mr.  Okleasik  informed the  committee  that  during                                                               
mediation  the  coastal  district  was required  to  provide  its                                                               
analysis of  state statutes and  regulations and  interpret those                                                               
and their application  by the legislature.  In  fact, during that                                                               
five-year period, the borough's plan  may have been rewritten 10-                                                               
15  times   and  policies  continued   to  be   rewritten  during                                                               
mediation, and still  no resolution.  He related  that often when                                                               
the state was  asked to explain its position, it  refused with no                                                               
explanation    or   interpretation    of   regulations.       The                                                               
aforementioned  was frustrating  because  there  is no  recourse.                                                               
Therefore,  the situation  is before  the legislature  to address                                                               
and  provide  state  staff  clear   criteria  and  direction  for                                                               
approval of district policies and  ensure there is involvement of                                                               
a  board.    The  Northwest  Arctic  Borough  also  approves  the                                                               
addition  of  subsistence to  the  ACMP  objectives.   Until  the                                                               
changes of the  Murkowski Administration, the ACMP  program was a                                                               
very  effective  tool  in   balancing  resource  development  and                                                               
protecting  coastal  resources  to support  healthy  subsistence.                                                               
When development comes forward the  reality of subsistence should                                                               
be recognized and  there should be a process  through which local                                                               
coastal districts  can be  involved.   The aforementioned  is why                                                               
local policies  are so important.   With regard to  whether local                                                               
involvement  slows  down  a project,  Mr.  Okleasik  related  his                                                               
experience that the  more a company can work with  a community to                                                               
avoid long-term adverse impacts  the better the relationship with                                                               
all  parties  involved.   Furthermore,  local  involvement  would                                                               
likely  result  in   the  project  being  designed   to  be  more                                                               
effective.   In  closing,  he said  that  the borough  encourages                                                               
responsible  resource development  of  its  natural resources  as                                                               
illustrated by the  Red Dog Mine, the world's  largest zinc mine.                                                               
He related  that the borough  recognizes the  economic importance                                                               
of development, but emphasized that  local coastal districts need                                                               
to  have a  role in  voicing valid  concerns in  order to  ensure                                                               
resource development is performed appropriately.                                                                                
8:52:51 AM                                                                                                                    
STEVE de  ALBUQUERQUE, Director,  Health and  Safety Environment,                                                               
ConocoPhillips Alaska, Inc.,  related that ConocoPhillips Alaska,                                                               
Inc.  (ConocoPhillips)  is  opposed  to HB  74.    ConocoPhillips                                                               
doesn't  believe that  ACMP legislative  reform  is necessary  at                                                               
this time  and questions the  significant changes proposed  by HB
74.   During  the hearing  of the  Senate companion  legislation,                                                               
there was  testimony that the  proposed changes  would streamline                                                               
the  permitting process  and save  the  applicant time.   As  the                                                               
person in  charge of permitting  for ConocoPhillips,  the state's                                                               
largest  oil  and  gas  explorer,  developer,  producer,  Mr.  de                                                               
Albuquerque opined that's not the case.                                                                                         
MR.  de ALBUQUERQUE  then addressed  the  existing ACMP  process.                                                               
Alaska,  he stated,  is one  of the  most complex  and rigorously                                                               
regulated  permitting and  business  environments  in the  world.                                                               
ConocoPhillips  closely  works  with local,  state,  and  federal                                                               
agencies  as  well  as  private  land  owners,  Native  villages,                                                               
regional  corporations, communities,  and the  public on  a daily                                                               
basis to seek input on  all of ConocoPhillips' permit activities.                                                               
Furthermore, ConocoPhillips  can't point  to any of  its projects                                                               
in  which  any  coastal  district's  input  or  concerns  weren't                                                               
adequately addressed in the project  decision.  Moreover, he said                                                               
he couldn't  think of an  instance during  his four years  as the                                                               
permitting director  with ConocoPhillips in  which ConocoPhillips                                                               
and the coastal districts weren't  able to satisfactorily resolve                                                               
an issue.  He highlighted  that in 2003 the legislature concluded                                                               
that the  ACMP is intended  to function  with a minimum  of delay                                                               
and   avoid   regulatory   confusion,  costly   litigation,   and                                                               
uncertainty regarding  the feasibility  of new investment  in the                                                               
state.   The legislature also  specified that the  standards must                                                               
be clear,  concise, and provide  the needed predictability  as to                                                               
the  application, scope,  and timing  of  the consistency  review                                                               
program.     The   aforementioned   resulted   in  the   existing                                                               
streamlined  process.    He  opined  that  from  the  applicant's                                                               
perspective the  existing ACMP process provides  the assurance of                                                               
an efficient  permitting process.   Existing  statewide standards                                                               
are clear  and concise  and ConocoPhillips  is able  to establish                                                               
relatively  firm  timelines for  its  projects.   Still,  coastal                                                               
districts have  the ability to propose  enforceable policies that                                                               
conform to the district plan  approval criteria and requirements.                                                               
Coastal  districts,  he  related, can  also  propose  enforceable                                                               
policies that  aren't duplicative,  don't restate  existing state                                                               
or  federal  policies, and  don't  redefine,  replace, or  modify                                                               
existing  standards.   However, HB  74 would  allow districts  to                                                               
restrict selected activities within  the coastal district.  These                                                               
activities would  involve uses of state  concern, matters already                                                               
adequately addressed by existing regulatory programs.  Decision-                                                                
making  authority  concerning the  management  and  use of  state                                                               
resources is vested  with the state, the  current approach avoids                                                               
enforceable  policies   that  may  be  conflicting   between  the                                                               
districts,  state and  federal agencies,  and could  result in  a                                                               
loss  of conformity  of district  policies that  currently exist.                                                               
Mr.  de Albuquerque  stated that  ConocoPhillips desires  a clear                                                               
and concise  permitting process in  order to  accurately estimate                                                               
project   timelines.     He   reminded   members  that   resource                                                               
development  in Alaska  is already  burdened  with many  seasonal                                                               
constraints and  uncertainties due  to weather  and environmental                                                               
8:57:54 AM                                                                                                                    
MR.  de  ALBUQUERQUE  turned the  committee's  attention  to  the                                                               
creation  of  the  coastal  policy  board,  which  ConocoPhillips                                                               
believes to  be unnecessary  and merely  adding another  layer of                                                               
complexity.    The  existing  process  provides  clear,  concise,                                                               
consistent  statewide  standards   for  resource  development  in                                                               
Alaska.   Therefore,  the existing  process prevents  conflict in                                                               
the regulatory  process and provides applicants  and stakeholders                                                               
with  the assurance  of  an efficient  permitting  process.   The                                                               
creation of the coastal policy  board with approval and decision-                                                               
making  authority  could  lead   to  an  inconsistent  permitting                                                               
landscape  and  much  uncertainty.   He  opined  that  interested                                                               
stakeholders  have ample  opportunity  to review  and comment  on                                                               
proposed  projects during  the  mandated  public comment  periods                                                               
associated  with obtaining  local,  state,  and federal  permits.                                                               
Applicants  already   have  to   comply  with   municipal  codes,                                                               
enforceable district policies,  statewide standards, and existing                                                               
state  and   federal  regulations   in  order  to   obtain  final                                                               
8:59:07 AM                                                                                                                    
MR. de ALBUQUERQUE then addressed  the retention of the DEC carve                                                               
out.  He related that  ConocoPhillips doesn't support elimination                                                               
of  the  DEC  carve  out  as there  seems  to  be  a  significant                                                               
misunderstanding among  stakeholders on  this matter.   Approvals                                                               
from environmental  permits, including air and  water permits and                                                               
oil  spill  contingency  plans, have  well-documented  and  clear                                                               
public notice  and comment requirements.   The public  notice and                                                               
comment requirements haven't been  negatively impacted by the DEC                                                               
carve out.   Again, he reiterated that the  current process works                                                               
well.  He opined that elimination  of the DEC carve out would re-                                                               
introduce  conflicting regulatory  mandates between  DEC and  the                                                               
ACMP.  Mr.  de Albuquerque emphasized that the ACMP  is a process                                                               
and  the permits  are  received from  other  agencies.   Adequate                                                               
public participation  and opportunity  for review by  the coastal                                                               
districts is  provided in the  existing streamlined program.   He                                                               
highlighted that adequate environmental  review and protection is                                                               
being provided by DEC as  part of the consistency review process.                                                               
In  closing, Mr.  de Albuquerque  reiterated that  ConocoPhillips                                                               
desires    a   clear    and   consistent    permitting   process.                                                               
ConocoPhillips isn't trying to reduce  the level of environmental                                                               
protection  or  the  subsistence  resources upon  which  so  many                                                               
stakeholders depend.  Mr. de  Albuquerque questioned why HB 74 is                                                               
necessary  since, as  of 2003,  the  existing consistency  review                                                               
process  has  ensured  that  both   state  and  local  districts'                                                               
concerns  have  been  met  prior  to  permits  being  issued  for                                                               
development of  projects in a  coastal zone.   Therefore, changes                                                               
to the existing, working program aren't necessary or desirable.                                                                 
9:01:31 AM                                                                                                                    
JOHNNY  AIKEN, Planning  Director, North  Slope Borough,  related                                                               
the  North Slope  Borough's support  for HB  74, which  he opined                                                               
would  fix many  of the  problems  the borough  faced during  the                                                               
amendment process for  its coastal management plan.   He informed                                                               
the  committee that  although the  [North  Slope Borough  coastal                                                               
district] was  recently in mediation  with DNR, no  agreement was                                                               
reached and thus there is an  impasse.  This legislation makes it                                                               
clear  that  the  coastal  districts  can  establish  enforceable                                                               
policies so long as they are  clear and concise, don't restate an                                                               
existing law,  and don't address  a matter preempted by  state or                                                               
federal law.   The 2003 changes to the ACMP  allowed districts to                                                               
establish policies for those matters  not adequately addressed by                                                               
state and federal  law.  Although the  administration ensured the                                                               
legislature that districts would  be able to establish reasonable                                                               
policies  concerning such  critical  matters  as subsistence  and                                                               
activities  in federal  waters,  almost all  [of the  district's]                                                               
enforceable  policies were  denied/rejected by  DNR.   He related                                                               
that the review process for  the plan was frustrating because the                                                               
rules kept  changing.  He opined  that the reasons DNR  put forth                                                               
to deny the district's policies  weren't supported by statutes or                                                               
regulations.   This  legislation would  establish clear  criteria                                                               
for approving district policies.                                                                                                
MR. AIKEN  emphasized that  the neither  the North  Slope Borough                                                               
nor  any  other  district  wants to  adopt  policies  that  would                                                               
obstruct  future development.    The North  Slope  Borough is  as                                                               
dependent  on  oil and  gas  as  the state  is,  he  said.   This                                                               
legislation  would bring  DEC back  into  the consistency  review                                                               
process  because many  coastal  resources and  uses are  directly                                                               
related to  air and water  quality, which were removed  under the                                                               
DEC carve  out.   Additionally, one of  the largest  concerns for                                                               
the North  Slope Borough is the  impact of a potential  oil spill                                                               
on the subsistence  resources and uses, which  can't be addressed                                                               
under the  existing program.   With regard to the  coastal policy                                                               
board created under  HB 74, Mr. Aiken pointed out  that the board                                                               
would  be  composed  of coastal  district  [representatives]  and                                                               
state  agency [representatives].   He  opined  that the  proposed                                                               
coastal policy board isn't intended  to be a separate stakeholder                                                               
group but  rather is  intended to  represent those  who implement                                                               
the  program.   The 2003  changes  to the  ACMP concentrated  all                                                               
decision making  into a single  agency, which is  problematic, he                                                               
opined.   This  legislation  would provide  the proposed  coastal                                                               
policy  board  oversight  in the  following  areas:  approval  of                                                               
coastal  district plans,  approval of  major grant  programs, and                                                               
approval   of  proposed   changes   to   the  ACMP   regulations.                                                               
Furthermore, this  proposed board would be  a streamlined version                                                               
of the former  coastal policy council as it would  be smaller and                                                               
wouldn't  be  involved  in  project   consistency  reviews.    He                                                               
highlighted  that  nothing in  HB  74  gives the  proposed  board                                                               
authority  to overrule  an agency's  decision-making power.   The                                                               
aforementioned   changes  proposed   by  the   legislation  would                                                               
streamline the  ACMP because it  would encourage  stakeholders to                                                               
work together early in the process to solve problems.                                                                           
MR.  AIKEN acknowledged  that  the  [Department of  Environmental                                                               
Conservation]  may state  that only  three  districts don't  have                                                               
approved programs.   However, the reality is  that most districts                                                               
didn't  have the  funds  to  fight for  a  meaningful and  useful                                                               
program;  otherwise  they  would  be  in  the  same  position  as                                                               
[Barrow].  He opined that most  of the districts [with plans] are                                                               
as  frustrated  as  those  without.   In  fact,  he  opined  that                                                               
although  Juneau  has an  approved  plan,  the people  of  Juneau                                                               
remain unhappy with  the process.  Mr. Aiken  further opined that                                                               
[Barrow]  has really  tried to  work  with DNR  on this  process.                                                               
However,  he related  that  [Barrow's  coastal district]  doesn't                                                               
believe  in  or  agree  with  DNR's  interpretations,  which  are                                                               
believed to  be arbitrary and  capricious.  The process  has been                                                               
frustrating; therefore he said he  is anxious for changes so that                                                               
[the process] could  move forward.  Many of  the changes proposed                                                               
in HB 74 would, he opined,  restore faith in the state government                                                               
and the ACMP.                                                                                                                   
9:11:34 AM                                                                                                                    
CAROL SMITH,  Coastal Coordinator,  City of Valdez,  informed the                                                               
committee that prior  to the 2003 regulation  changes, the Valdez                                                               
coastal management  plan had 41  enforceable policies.   However,                                                               
that  decreased to  14 after  the  changes.   The Valdez  coastal                                                               
management  plan was  approved after  the changes  because Valdez                                                               
felt it was  important to remain part of the  ACMP, although many                                                               
of the  area's important policies had  been lost.  The  hope, she                                                               
related,   was  that   new  regulations   would  be   introduced,                                                               
regulations  that  provided for  meaningful  local  input.   With                                                               
regard to  the DEC carve  out, Ms.  Smith related her  support of                                                               
Section 37, which eliminates the DEC  carve out.  At the November                                                               
workshop  in  Anchorage, DNR  and  other  state agencies  related                                                               
problems with the review process  that they attributed to the DEC                                                               
carve  out.   The  city  has also  had  problems  with regard  to                                                               
coordinating and responsibilities for  a DEC project.  Therefore,                                                               
Ms. Smith  said she  supports the  legislation making  a one-stop                                                               
shop.    Furthermore,  Ms.  Smith  related  her  support  of  the                                                               
elimination  of  the requirement  to  update  the plan  every  10                                                               
years.    Updating  the  plan   is  costly  and  time  consuming,                                                               
particularly when no changes are  necessary.  She related support                                                               
for the  proposed coastal  policy board.   The  legislation makes                                                               
the  criteria  for  district enforceable  policies  much  clearer                                                               
because districts should be able  to write meaningful enforceable                                                               
policies  that address  local concerns.    The legislation  would                                                               
also allow  coastal districts  to establish  policies so  long as                                                               
they don't duplicate  an existing law and don't  address a matter                                                               
by a  state or federal  agency.   Ms. Smith highlighted  that the                                                               
Alaska coastline is  vast and different and one  size doesn't fit                                                               
all situations.  For instance, there  is a gap with regard to the                                                               
Clean  Air Act,  and  although  the city  wanted  to implement  a                                                               
policy  to address  the  gap, the  regulations  didn't allow  for                                                               
9:16:31 AM                                                                                                                    
TERI  CAMERY, Planner,  Planning  Division,  Office of  Community                                                               
Development, Department of Community  Development, City & Borough                                                               
of Juneau, informed the committee  that she has been working with                                                               
the ACMP for  approximately eight years now.   Ms. Camery related                                                               
her  support  for  HB  74.    The  ACMP,  she  emphasized,  is  a                                                               
management program  not a regulatory program.   Furthermore, most                                                               
district coastal  management plans include a  variety of policies                                                               
that promote  development and the protection  of sensitive areas.                                                               
In fact, Juneau has a series  of policies for special water front                                                               
areas.   Juneau has used  the coastal zone management  program to                                                               
develop  the city's  cruise ship  ports,  marine facilities,  and                                                               
various  loading areas.    The ACMP  is the  way  in which  local                                                               
priorities are carried through the  review process with state and                                                               
federal  agencies.   As mentioned  earlier, the  coastal district                                                               
role was  drastically reduced in  2003.   In the case  of Juneau,                                                               
its 99  policy plan was reduced  to 16 after a  lengthy course of                                                               
MS.  CAMERY,  in response  to  the  earlier  comment that  HB  74                                                               
represents   a  specific   group,   highlighted  that   districts                                                               
represent  27  coastal  districts  throughout  the  state.    The                                                               
policies presented through the  coastal management review process                                                               
begin with local participation.   Therefore, she opined that it's                                                               
a misrepresentation to say that  the public and the districts are                                                               
separate.    Districts   represent  local  government;  districts                                                               
represent  the   public  and   work  constantly   with  industry.                                                               
Therefore, she said  coastal districts aren't a  separate leg, as                                                               
represented by  DNR.   Ms. Camery related  that when  Juneau lost                                                               
its  policies through  the review  process, the  city decided  to                                                               
maintain  those policies  within the  local land  use code.   The                                                               
aforementioned resulted in a separate  review process rather than                                                               
a  coordinated  review  process,  and therefore  added  time  and                                                               
expense  for  the developer.    This  proposed legislation  would                                                               
restore an integrated review process.                                                                                           
MS. CAMERY  then informed  the committee  that when  Juneau first                                                               
developed its coastal management program  in the 1980s, the focus                                                               
was on  the Wetland Management  Program.  The  Wetland Management                                                               
Plan was the  result of very restrictive permitting  by the Corps                                                               
of  Engineers.   That program,  she explained,  was developed  to                                                               
promote  scientifically   supported  development  on   low  value                                                               
wetlands versus  the single brush  review the Corps  of Engineers                                                               
has to do.   Later on the  Corps of Engineers took a  lax role in                                                               
permitting wetland  fill.   Ms. Camery  suggested that  under the                                                               
current federal administration, the  pendulum is likely to return                                                               
to tighter  regulation.  Coastal  management is the way  in which                                                               
districts can bring their local  concerns forward and ensure that                                                               
those  are   heard  throughout  the  federal   and  state  review                                                               
processes,  which is  why she  opined that  HB 74  helps all  the                                                               
stakeholders.  Ms. Camery noted  that this legislation, while not                                                               
perfect, would seem to work  toward the concerns expressed during                                                               
a recent three-week meeting of all the stakeholders.                                                                            
9:23:03 AM                                                                                                                    
MARILYN  CROCKETT,   Executive  Director,  Alaska  Oil   and  Gas                                                               
Association  (AOGA),  reminded  the  committee  that  AOGA  is  a                                                               
private  nonprofit  trade   association  whose  member  companies                                                               
account for the majority of oil  and gas operations in the state.                                                               
Since virtually  all of the  state's oil and gas  operations take                                                               
place  adjacent  to or  within  Alaska's  coastal zone,  AOGA  is                                                               
actively engaged  in the  Alaska Coastal  Management Act  and the                                                               
subsequent program  since its inception  in 1979.  Over  the past                                                               
30 years, there  has been a significant evolution  in federal and                                                               
state environmental laws and regulations.   In the late 1990s and                                                               
early  2000s,   it  became  clear   that  the  ACMP   had  become                                                               
unmanageable in terms  of process and scope.   The aforementioned                                                               
led to  confusion, misinterpretation,  and significant  delays in                                                               
the  processing  of  permits,  which   was  largely  due  to  the                                                               
evolution  of environmental  laws.   The 2003  revisions resolved                                                               
these  challenges  and  transformed  the program  into  one  that                                                               
provides certainty for the state,  local districts, and regulated                                                               
community,  she  opined.   Unfortunately,  HB  74 eliminates  the                                                               
certainty provided by the 2003 changes.                                                                                         
MS. CROCKETT  provided the following testimony  regarding the DEC                                                               
carve  out,   which  she  characterized   as  one  of   the  most                                                               
problematic aspects of HB 74.  She said:                                                                                        
     This provision in existing  law implements the original                                                                    
     intent of the ACMP, that  being that the air, land, and                                                                    
     water standards  and permits administered by  the state                                                                    
     are  inherently   consistent  with  the   Coastal  Zone                                                                    
     Management Program,  and therefore the  additional step                                                                    
     of   securing   a   consistency   determination   isn't                                                                    
     necessary.   These standards were developed  over years                                                                    
     of technical input and  are implemented through permits                                                                    
     that  are comprehensive  and  time consuming,  carrying                                                                    
     with  them statutory  and  regulatory requirements  for                                                                    
     extensive public comment period  falling outside of the                                                                    
     ACMP  review schedule.   As  in  the previous  program,                                                                    
     elimination   of  the   carve   out   will  result   in                                                                    
     consistency  determinations on  projects being  held up                                                                    
     until permits with  the long lead times  are issued and                                                                    
     finalized;   resulting   in  considerable   delays   in                                                                    
     projects  moving forward  and  a  tremendous amount  of                                                                    
     certainty in terms of final  approval for applicants to                                                                    
     move  forward.    Our second  concern  relates  to  the                                                                    
     coastal policy  ... board.  We're  very concerned about                                                                    
     the re-establishment  of this  board and the  extent of                                                                    
     responsibilities  that will  be  vested with  it.   The                                                                    
     bill  empowers  the  board   to  approve  all  district                                                                    
     programs  and  enforceable  policies,  changes  to  the                                                                    
     boundaries,  statewide standards,  and  changes to  the                                                                    
     program.    The  Department of  Natural  Resources  may                                                                    
     still  adopt regulations,  but only  after approval  of                                                                    
     the board, which will result  in endless back and forth                                                                    
     as DNR attempts to ...  mesh its requirements under the                                                                    
     Administrative Procedures Act with  board approval.  We                                                                    
     are  concerned about  the predictability  and timelines                                                                    
     being eliminated.  One of  the most challenging aspects                                                                    
     of any  permitting program  is the  ability to  rely on                                                                    
     timelines  for   decision  making   and  this   is  ...                                                                    
     obviously true  in Alaska where we're  often faced with                                                                    
     operating during  ... limited seasons.   Unfortunately,                                                                    
     HB 74  eliminates the decision timeline  activities ...                                                                    
     for  activities   proposed  by  a  federal   agency  or                                                                    
     permitted  by a  federal  agency with  no end  timeline                                                                    
     identified.    Virtually,  every  project  requires  at                                                                    
     least  one  federal  permit  for  the  impact  of  this                                                                    
     provision  is dramatic  and  frankly,  will not  affect                                                                    
     just  only  oil  and  gas activities,  but  many  other                                                                    
     development  activities  including  homebuilding  given                                                                    
     the breadth  of wetlands  coverage in the  state, which                                                                    
     will  require a  permit  from the  Corps of  Engineers.                                                                    
     Finally,  I'd  like  to talk  about  expansion  of  the                                                                    
     coastal boundaries.   The bill  would expand  the reach                                                                    
     of activities not only to  the coastal zone but also to                                                                    
     inland  of the  coastal  zone if  the activities  would                                                                    
     cause direct  and significant impacts to  a coastal use                                                                    
     or  resource.   At  last  week's  hearing, we  heard  a                                                                    
     representative from one of  the coastal districts state                                                                    
     that  it's  their  desire  to   weigh  in  on  projects                                                                    
     adjacent to their  district, even if it  means over the                                                                    
     mountain.  Such an expansion  of the boundary was never                                                                    
     envisioned  by the  federal program  nor  in the  state                                                                    
     program,  and is  another  example  of the  uncertainty                                                                    
     that  faces  project  applicants  in  determining  when                                                                    
     their project  is in or  out of  the coastal zone.   At                                                                    
     the  end  of  the  challenges   facing  all  of  us  is                                                                    
     achieving the necessary  balance between development of                                                                    
     state-owned resources  for the benefit of  all Alaskans                                                                    
     while  protecting  important  coastal  resources.    We                                                                    
     believe  the  program  in   place  today  strikes  that                                                                    
     appropriate and important balance.                                                                                         
9:28:31 AM                                                                                                                    
CARL ANDREW,  Chair, Cenaliulriit Coastal Resource  Service Area,                                                               
informed  the committee  that the  local coastal  district covers                                                               
the Yukon  Kuskokwim Delta  and includes about  40 villages.   He                                                               
then  related that  Cenaliulriit  Coastal  Resource Service  Area                                                               
(CRSA) supports  HB 74.   Although  Cenaliulriit CRSA's  plan was                                                               
approved last August,  it wasn't very helpful and HB  74 would be                                                               
helpful in  fixing many  of the  problems experienced  during the                                                               
years it  took to get  the plan approved.   He then  informed the                                                               
committee  that  he  is  a  volunteer and  no  funding  has  been                                                               
received  from DNR  over the  past few  years.   The Cenaliulriit                                                               
CRSA has no  paid staff and the former program  director left the                                                               
program  due  to frustration  with  how  state was  treating  the                                                               
[district] in terms  of its enforceable policies.   He emphasized                                                               
that consistency  is the  most important  concern.   Although the                                                               
previous plan [prior  to 2003] allowed for the  discussion of the                                                               
impacts of development on subsistence,  under the existing plan a                                                               
district  can't comment  on  subsistence  during project  review.                                                               
Before comment on potential impacts  on subsistence, DNR requires                                                               
the designation  of areas for each  type of subsistence use.   He                                                               
related that  the former program  director went to  every village                                                               
and  developed  detailed  GIS maps  specifying  the  location  of                                                               
subsistence  uses.   However,  DNR didn't  approve  the maps  and                                                               
denied  the seven  enforceable policies  related to  subsistence.                                                               
Therefore,  subsistence   can't  be   discussed  at   all  during                                                               
consistency reviews.   This legislation  would allow  policies on                                                               
subsistence  so long  as those  policies don't  address something                                                               
addressed  by the  state.   The  legislation  also establishes  a                                                               
coastal policy board,  which is necessary since  it hasn't worked                                                               
for DNR  to make all the  decisions.  He concluded  by expressing                                                               
the hope that the committee would forward HB 74.                                                                                
9:33:05 AM                                                                                                                    
KAROL  KOLEHMAINEN, Program  Coordinator, Aleutians  West Coastal                                                               
Resource Service  Area (CRSA), related  that Aleutians  West CRSA                                                               
is largely in support of HB  74.  She informed the committee that                                                               
Aleutians West CRSA represents the  entire western Aleutian area,                                                               
an  area  with  a  wealth  of natural  resources.    She  further                                                               
informed the committee that Aleutians  West CRSA became effective                                                               
in 2007  and only 10  of the 44  enforceable policies it  held at                                                               
the  beginning of  the revision  process  remain.   There are  no                                                               
longer  any habitat  policies, mitigation  policies, or  policies                                                               
that mention air, water, or  land quality.  Furthermore, although                                                               
there  are  designated  subsistence   use  areas,  there  are  no                                                               
enforceable  subsistence  use policies.    Many  of the  previous                                                               
enforceable  polices  have  been relegated  to  an  unenforceable                                                               
appendix and classified  as advisory policies.   Prior to [2003],                                                               
the ACMP was  a network program in which local  reviewers were on                                                               
par   with   federal  and   state   reviewers.     Although   the                                                               
centralization of  the program in  DNR has resulted  in silencing                                                               
the local  voice and  creating a  disconnected program,  she said                                                               
she didn't believe  that to have been the intent.   Passage of HB
74  will return  the  [coastal districts]  to  a more  meaningful                                                               
position within  a network  program.  She  then related  that the                                                               
Aleutians West  CRSA is  in support of  the coastal  policy board                                                               
that  incorporates the  positive  aspects of  the former  coastal                                                               
policy  council.    The  proposed   policy  board  would  include                                                               
representation from the coastal  district, resource agencies, and                                                               
DCCED.   She  noted  agreement that  the  board's mission  should                                                               
include  the  approval   local  district  plans,  program-related                                                               
funding, and program and regulatory  changes.  The Aleutians West                                                               
CRSA  also  agrees,  she  related, that  the  board  wouldn't  be                                                               
responsible for consistency  review.  The new  board, she opined,                                                               
would serve as  a public forum that should result  in more public                                                               
involvement and  a more equitable decision-making  process, while                                                               
providing an outreach component that  is sorely lacking now.  Ms.                                                               
Kolehmainen  said  that  the  DEC  carve  out  has  confused  the                                                               
consistency  review process,  especially  when the  scope of  the                                                               
project requires permits from more  than one agency.  The removal                                                               
of the DEC  carve out has been interpreted as  the removal of any                                                               
matter  relating  to air,  water,  or  land quality  through  the                                                               
program implementing  regulation.   As stated earlier,  it became                                                               
impossible to  craft acceptable policies  related to  air, water,                                                               
or land  quality or that  even mentioned  the words air  or land.                                                               
The   aforementioned   negated   policies  clearly   within   the                                                               
regulation  of DEC,  but also  policies related  to habitat  that                                                               
might  touch  on  water  issues.   "The  return  of  DEC  to  the                                                               
coordinated ACMP program is integral  to a meaningful program and                                                               
the AWCRSA  supports the inclusion  of DEC in network  ACMP," she                                                               
opined.   However, the  AWCRSA doesn't support  the change  in AS                                                               
46.40.190 relating to cooperative  administration as the proposed                                                               
language totally  reverses the meaning  of the paragraph  and has                                                               
the  potential  of  undermining  the existence  of  CRSAs.    Ms.                                                               
Kolehmainen related  appreciation to  the sponsor  for addressing                                                               
the problems in  the existing ACMP.   Passage of HB 74  will go a                                                               
long way  to restore the role  of coastal districts in  the ACMP,                                                               
increase public involvement and  oversight, and bring consistency                                                               
reviews back into a coordinated network program.                                                                                
9:38:11 AM                                                                                                                    
GARY  WILLIAMS,  Coordinator,  Kenai  Peninsula  Borough  Coastal                                                               
District, testified  in support of  HB 74.  He  characterized the                                                               
reinstitution of a board to offer  a modest level of oversight to                                                               
the ACMP  as a positive step.   Without an oversight  board there                                                               
is  no  opportunity  for  coastal   districts  to  appeal  agency                                                               
decisions when  there is disagreement over  the interpretation of                                                               
statutes  and regulations,  which  was a  common  problem in  the                                                               
rewrite  of coastal  district plans.   The  proposed language  on                                                               
page   13,   lines   9-11,  is   extremely   important   in   the                                                               
implementation of  a resource management  program.   The language                                                               
calls for consideration of the  impacts of activities that "would                                                           
cause  direct  and  significant  impacts  to  a  coastal  use  or                                                           
resource."  However,  under current law a  coastal district can't                                                           
consider  the cumulative  impact of  activities that  would cause                                                               
damage  to a  resource  if  the activity  occurs  outside of  the                                                               
boundaries of  coastal resources.   Therefore, an activity  in an                                                               
upland that could damage a  nearby wetland couldn't be considered                                                               
in  a district  consistency review.   "The  proposed language  in                                                               
this section  must be part  of any rational  management program,"                                                               
he said.  Mr. Williams then  pointed out that the Kenai Peninsula                                                               
Borough Coastal program is part  of the Kenai River Center, which                                                               
is  a  multi-agency  one-stop  permitting  entity  with  borough,                                                               
state, and federal resource managers  working together to process                                                               
permit applications  and manage  compliance.   The aforementioned                                                               
is  a  process   and  relationship  that  works.     Through  the                                                               
aforementioned  process   it's  evident  that  bright   lines  of                                                               
authority and  responsibility don't  always exist,  and therefore                                                               
it's  valuable   to  have  a   certain  amount  of   overlap  and                                                               
regulations.   Furthermore, it's  important that  the legislature                                                               
require the  [coastal districts]  to be inclusive  in interagency                                                               
and  intergovernmental  relationships  and to  communicate  their                                                               
common  concerns and  understandings  regarding resource  issues.                                                               
If, in  crafting HB 74,  local and state agencies  are encouraged                                                               
to  work  together  to  ensure   that  development  and  resource                                                               
protection are  in balance, this  will be fine legislation.   Mr.                                                               
Williams opined that HB 74 is a step in that direction.                                                                         
9:41:14 AM                                                                                                                    
MILLI MARTIN,  clarified that  although she  is the  president of                                                               
the Kenai Peninsula Borough Assembly,  she is speaking on her own                                                               
behalf  today.    Ms.  Martin   recalled  her  concern  when  the                                                               
Murkowski Administration  "literally gutted what had  been a very                                                               
good program  for Alaska's coastal  zones."  She opined  that the                                                               
program  wasn't  broken and  didn't  need  fixing at  that  time,                                                               
although it  does now.   She emphasized that the  various regions                                                               
of the state  differ, and therefore local  oversight is critical.                                                               
Ms. Martin  related her support of  the idea of a  coastal policy                                                               
board as  it seems to  reinstate what  existed prior to  the 2003                                                               
changes.   With  this board,  coastal districts  can appeal  when                                                               
there  are differences  of opinion  or  interpretations of  DNR's                                                               
decisions, among  other things.  Furthermore,  the board restores                                                               
the voice  of the local communities.   She then pointed  out that                                                               
Section  9 would  allow  districts to  adopt  policies that  more                                                               
clearly reflect their needs, local  conditions, and science.  She                                                               
suspected  that  the  aforementioned  may  be  controversial  and                                                               
require  compromise.   She  expressed  the  hope that  the  trend                                                               
toward more  local input and  control can be preserved.   Section                                                               
19,  she  highlighted,  would   restore  the  consistency  review                                                               
process for  those projects inland  of the coastal zone  if there                                                               
is significant  impact to the  coastal uses.  Ms.  Martin related                                                               
her concern  with regard to any  impact to the rivers,  which she                                                               
characterized  as the  [state's]  economic engines.   She  opined                                                               
that restoration of this section as  vital.  Ms. Martin noted her                                                               
support  of   many  of  the  previous   speakers'  testimony  and                                                               
requested passage of HB 74.                                                                                                     
9:43:52 AM                                                                                                                    
ANDREW DEVALPINE, Director, Bristol  Bay Coastal Resource Service                                                               
Area (BBCRSA),  pointed out that  [BBCRSA] is not a  borough, and                                                               
thus [BBCRSA] relies  heavily on its own  enforceable policies as                                                               
they can  be made locally relevant  to the program.   The current                                                               
program has  devastated local programs  because it  doesn't allow                                                               
local,  relevant policies.   Therefore,  [coastal districts]  are                                                               
reliant   on  statewide   standards  that   are  one-size-fit-all                                                               
standards.   Furthermore,  BBCRSA believes  the proposed  coastal                                                               
policy board is  a good idea because  it decentralizes authority.                                                               
Mr. DeValpine then highlighted the  case in which the 9th Circuit                                                               
Court  of Appeals  decided  that  Mineral Management  Corporation                                                               
didn't  meet  the  requirements  of  the  National  Environmental                                                               
Policy Act  of 1969 partially  because it didn't  adequately take                                                               
into account  subsistence whaling  of the local  people.   If the                                                               
program had worked as it  should, such that local communities had                                                               
the necessary  input, the aforementioned lawsuit  would've likely                                                               
not  have  happened  and  exploration  would've  occurred.    The                                                               
lawsuit  also illustrates  the instability  of the  existing ACMP                                                               
program  because the  local district  wasn't heard  regarding its                                                               
concerns on subsistence.                                                                                                        
9:48:19 AM                                                                                                                    
KAREN KEESECKER, Planner, Coastal  Zone Planning, Municipality of                                                               
Anchorage,  testified in  support of  HB 74  as it  would resolve                                                               
some of the  issues [the Municipality of Anchorage]  has had with                                                               
the  ACMP  since  the  2003   revisions.    The  Municipality  of                                                               
Anchorage  received  approval  for its  coastal  management  plan                                                               
revision in  December 2007 after  a rather lengthy process.   The                                                               
revision reduced the over 100 enforceable  policies to 5.  One of                                                               
the  largest  problems  after  the  2003  revision  to  ACMP  was                                                               
approval  of the  proposed enforceable  policies.   Prior to  the                                                               
2003  revisions  coastal  districts  could  develop  policies  to                                                               
address effects for unique coastal  resources.  However, the 2003                                                               
regulations  made it  practically impossible  to establish  well-                                                               
crafted enforceable policies  based on local knowledge.   The new                                                               
criteria  [embodied in  HB  74] would  also  allow the  Anchorage                                                               
coastal district  to construct meaningful policies  reflective of                                                               
local conditions  and management intent.   This legislation would                                                               
also create  the Alaska  coastal policy board,  which would  be a                                                               
streamlined version of the previous  coastal policy council.  She                                                               
applauded the  efforts to bring  back third party  oversight with                                                               
the  proposed  board,  which  would   provide  broad  agency  and                                                               
district representation.   The legislation would  also return DEC                                                               
to the  ACMP.  She  echoed earlier  testimony with regard  to the                                                               
difficulty of the  removal of air and water  quality issues under                                                               
the  existing program.   In  closing, Ms.  Keesecker thanked  the                                                               
[sponsor's]  efforts  to  rectify   this  important  program  for                                                               
9:50:59 AM                                                                                                                    
TOM  LOHMAN,  Environmental  Resource Specialist,  Department  of                                                               
Wildlife Management, North Slope  Borough, informed the committee                                                               
that the North  Slope Borough's local district  plan was approved                                                               
in 1988, his  second year with the borough.   He related that the                                                               
ACMP isn't like  other regulatory schemes and not  intended to be                                                               
like  other  regulatory  schemes.     The  ACMP  is  a  voluntary                                                               
partnership  and  any party  that  opts  to  become part  of  the                                                               
program  expects to  benefit from  their  participation.   States                                                               
that opt into the national  program agree to meet certain general                                                               
conditions and in return receive  federal dollars.  [The program]                                                               
provides a  unique federal commitment to  make federal activities                                                               
consistent with  the terms  of local programs  and in  return the                                                               
federal government  receives the protection of  coastal resources                                                               
and  uses.    Mirroring  the  federal  approach,  the  state,  in                                                               
crafting  its program,  adopted a  unique approach  30 years  ago                                                               
such  that  the  authority  was transferred  down  to  the  local                                                               
district level.   The  approach adopted  by the  state recognized                                                               
the uniqueness of  Alaska in regard to the size  and diversity of                                                               
its  resources and  uses.    The plan  also  recognizes that  the                                                               
historic  grant  of  real  authority from  the  state  and  local                                                               
communities is  important for  everyone.   Mr. Lohman  then noted                                                               
his  agreement  with  Ms.  Camery  that  the  districts  are  the                                                               
residents of  the state.   This legislation,  HB 74,  attempts to                                                               
correct  some  of  the  damage  to the  program  since  the  2003                                                               
regulation  revisions.   Although  there were  assurances at  the                                                               
time  of the  revisions that  districts  would be  able to  adopt                                                               
meaningful local enforceable policies  dealing with a broad range                                                               
of coastal resources and uses.   The aforementioned simply didn't                                                               
happen, but  rather the districts  have been left with  a greatly                                                               
diminished role  in the program.   Mr. Lohman opined that  no one                                                               
should   be   frightened   of   the   local   districts'   strong                                                               
participation in  the program  as was  the case  for most  of the                                                               
history of  the program.   He pointed  out that during  that time                                                               
local plans  weren't used to  halt otherwise good projects.   Mr.                                                               
Lohman said  that [the  North Slope  local coastal  district] has                                                               
been and will continue to  be pro-development on the North Slope.                                                               
Furthermore,  it's  been frustrating  that  despite  a couple  of                                                               
years of good faith effort and  expense on the part of districts,                                                               
the current administration has been  slow to restore the program.                                                               
At  the statewide  district meeting  in April  2007, Commissioner                                                               
Irwin  assured everyone  that DNR  would fix  the program.   Only                                                               
when ACMP legislation  was filed last year did  DNR announce that                                                               
it  would begin  a  formal re-evaluation  of  the program,  which                                                               
would  begin in  July.   Department officials  acknowledged at  a                                                               
June  meeting that  legislation caused  them to  act.   Again, in                                                               
good  faith  many  local  districts  put a  lot  of  effort  into                                                               
participation  in the  re-evaluation.   Mr.  Lohman related  that                                                               
[the  North  Slope  Borough  local  coastal  district]  submitted                                                               
extensive  written comments  in  August,  attended four  full-day                                                               
meetings  in  September and  October,  and  an intense  three-day                                                               
meeting in  early December to  discuss proposed  DNR legislation.                                                               
Over  the   holidays,  the   [districts]  scrambled   to  prepare                                                               
extensive comments after being told the  goal was for DNR to file                                                               
legislation at  the start of this  session.  He recalled  that at                                                               
the December  meeting, DNR  urged everyone  to work  together and                                                               
pointed out  that success in the  legislature requires simplicity                                                               
and consensus.   The North  Slope Borough coastal  district along                                                               
with other districts  asked for the opportunity to  meet with DNR                                                               
as it processes all the  input received prior to the introduction                                                               
of legislation.   However, there has been  no communications from                                                               
DNR  since the  three-day  meeting and  no  legislation from  the                                                               
administration  has  been introduced.    He  noted that  DNR  has                                                               
argued  that  there  are legal  constraints  on  the  executive's                                                               
ability, either  through the  agency or  a newly  created coastal                                                               
policy board, to  approve district policies that  are stricter or                                                               
more  specific  than  laws  passed   by  the  legislature.    The                                                               
aforementioned is ridiculous, and  therefore [the districts] have                                                               
asked  for  a more  detailed  briefing  on  this issue;  no  such                                                               
briefing  has been  provided.   No district  is looking  to adopt                                                               
policies  that  conflict  with  or are  pre-empted  by  state  or                                                               
federal  law, and  furthermore none  of the  districts are  anti-                                                               
development or  used the  programs as  such prior  to 2003.   The                                                               
districts merely want  the ability to shape  the development that                                                               
does occur  to meet local  needs and  concerns.  In  closing, Mr.                                                               
Lohman related strong support for HB 74.                                                                                        
9:57:37 AM                                                                                                                    
CO-CHAIR HERRON announced  that he and Co-Chair  Munoz would work                                                               
with Representative  Joule until the  next meeting at  which time                                                               
the committee will consider amendments.                                                                                         
9:58:19 AM                                                                                                                    
REPRESENTATIVE JOULE  highlighted that the testimony  from across                                                               
the  state today  illustrates the  wide interest  in HB  74 since                                                               
people  simply want  meaningful input  restored.   Representative                                                               
Joule related  that his job as  a legislator is to  represent the                                                               
people not  the state or the  industry.  He further  related that                                                               
sometimes   healthy  tension   is  appropriate.     In   closing,                                                               
Representative Joule said that he  looked forward to working with                                                               
the co-chairs until the next hearing.                                                                                           
[HB 74 was held over.]                                                                                                          

Document Name Date/Time Subjects
Committee Packet on HB74 for HCRA.PDF HCRA 2/10/2009 8:00:00 AM
HCRA 2/24/2009 8:00:00 AM
HB 74
02 10 09 AOGA Testimony on HB74 ACMP.pdf HCRA 2/10/2009 8:00:00 AM
HCRA 2/24/2009 8:00:00 AM
HB 74
LetterFromAleutiansWestCRSA2.10.9(pro).PDF HCRA 2/10/2009 8:00:00 AM
HCRA 2/24/2009 8:00:00 AM
HB 74
letter from City of Cordova2.9.9 (pro).PDF HCRA 2/10/2009 8:00:00 AM
HCRA 2/24/2009 8:00:00 AM
HB 74
LetterFromAML2.7.9 (pro).PDF HCRA 2/10/2009 8:00:00 AM
HCRA 2/24/2009 8:00:00 AM
HB 74
HB74sp1968.jpg HCRA 2/10/2009 8:00:00 AM
HCRA 2/24/2009 8:00:00 AM
HB 74
HB74sp1977.jpg HCRA 2/10/2009 8:00:00 AM
HCRA 2/24/2009 8:00:00 AM
HB 74
HB74sp1989.jpg HCRA 2/10/2009 8:00:00 AM
HCRA 2/24/2009 8:00:00 AM
HB 74
HB74sp1999.jpg HCRA 2/10/2009 8:00:00 AM
HCRA 2/24/2009 8:00:00 AM
HB 74
HB74sp2001.jpg HCRA 2/10/2009 8:00:00 AM
HCRA 2/24/2009 8:00:00 AM
HB 74
HB 74_Fiscal_Note_DEC-CO.pdf HCRA 2/10/2009 8:00:00 AM
HCRA 2/24/2009 8:00:00 AM
HB 74
HB 74_Fiscal_Note_DNR-DCOM.pdf HCRA 2/10/2009 8:00:00 AM
HCRA 2/24/2009 8:00:00 AM
HB 74
LetterFromCityofValdez2.10.9 (pro).PDF HCRA 2/10/2009 8:00:00 AM
HCRA 2/24/2009 8:00:00 AM
HB 74
LetterFromConocoPhillips2.10.9 (con).PDF HCRA 2/10/2009 8:00:00 AM
HCRA 2/24/2009 8:00:00 AM
HB 74
NVOK support HB 74 Feb 2009.doc.pdf HCRA 2/10/2009 8:00:00 AM
HCRA 2/24/2009 8:00:00 AM
HB 74