Legislature(2003 - 2004)

03/03/2004 01:50 PM RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HB 524-WASTE MANAGEMENT/DISPOSAL                                                                                              
Number 2802                                                                                                                     
CO-CHAIR  DAHLSTROM announced  that  the next  order of  business                                                               
would be HOUSE  BILL NO. 524, "An Act relating  to the protection                                                               
of  land  and  water  from  waste  disposal;  providing  for  the                                                               
regulation  of waste  management;  making conforming  amendments;                                                               
and providing for an effective date."                                                                                           
ERNESTA  BALLARD,   Commissioner,  Department   of  Environmental                                                               
Conservation (DEC), testified.  She  said the governor has a very                                                               
ambitious  program  for  environmental  protection  and  resource                                                               
development.  She  remarked, "They compliment each  other and the                                                               
governor expects excellence in both."   Commissioner Ballard said                                                               
this bill  is an  essential piece of  [DEC's] ability  to support                                                               
any  resource   development  program  and  to   assure  that  the                                                               
environment  is protected  at  the time  that  the resources  are                                                               
developed.  She  said she is proud to report  to the committee in                                                               
support  of  the governor's  overall  program  that each  of  the                                                               
budgets that have  been presented to the  legislature by Governor                                                               
Murkowski has  increased DEC's  core capabilities  with additions                                                               
to its permit staff.                                                                                                            
Number 2888                                                                                                                     
COMMISSIONER BALLARD said DEC's  environmental protection role is                                                               
defined  by legislation  passed  over  many legislative  sessions                                                               
over the last  30 years that assigns clear  responsibility to DEC                                                               
control  water, land,  and air  pollution in  Alaska and  to also                                                               
fulfill the  state's obligations under  the Clean Water  Act, the                                                               
Clean Air Act,  and other federal legislation,  which establish a                                                               
two-tiered approach to protecting  the nation's environment.  The                                                               
first  tier is  national air  and water  quality standards.   The                                                               
second tier  is state  implementation that  is responsive  to the                                                               
unique needs of each state.   She stated that she is a relentless                                                               
advocate of a strong state budget  and a strong state program for                                                               
environmental   protection  and   the  comprehensive   regulatory                                                               
program necessary  to carry that out.   She said the  Clean Water                                                               
Act  is ultimately  the  subject of  HB 524  and  is designed  to                                                               
provide  states  with  the  latitude  to  shape  water  pollution                                                               
control  programs to  fit their  own unique  circumstances.   The                                                               
Alaska Legislature,  following the  opportunity presented  by the                                                               
Clean Water Act,  has charted a course in state  law that governs                                                               
water, as well as air, energy, and environmental conservation.                                                                  
COMMISSIONER  BALLARD said  HB 524  expands the  responsibilities                                                               
already designated by the legislature  for DEC.  It expands DEC's                                                               
ability to control  pollution and it refocuses  DEC's approach to                                                               
the complex  issues of solid  and mine wastes.   She said  HB 524                                                               
provides important  "tools" DEC will  use to authorize  its waste                                                               
disposal activities.   She said  "the tools are arrayed  by risk"                                                               
and there  are "different tools  for different risks."   She said                                                               
this bill grew from [DEC's]  comprehensive review of its programs                                                               
that followed Administrative Order  202, the first administrative                                                               
order passed by  Governor Murkowski when he first  took office in                                                               
December 2002.   She said  Administrative Order 202  directed all                                                               
departments of state  government to do a  comprehensive review of                                                               
their  statutory authorities  and their  programs to  assure that                                                               
they  are  using  state resources  efficiently  and  effectively.                                                               
Commissioner Ballard said HB 524  is part of DEC's overall effort                                                               
to  clarify,   streamline,  and  adhere  to   federal  and  state                                                               
TAPE 04-11, SIDE B                                                                                                            
COMMISSIONER  BALLARD it  is DEC's  goal  with its  environmental                                                               
protection  program to  assure that  all program  components from                                                               
legislative budgeting and oversight  to fieldwork and enforcement                                                               
are  conducted   in  the  state,  with   Alaskan  solutions,  and                                                               
specifically addressing Alaskan  challenges.  She said  HB 524 is                                                               
an essential piece of bringing  Alaskan program home to Alaska to                                                               
assure that  the priorities negotiated  between the  governor and                                                               
the  legislature,  at the  time  the  budgets are  approved,  are                                                               
translated into "on  the ground" programs to  protect the state's                                                               
Number 2950                                                                                                                     
COMMISSIONER BALLARD  said [HB 524] clarifies  [DEC's] "statutory                                                               
foundation," and  she called attention  to handout in  the packet                                                               
provided by DEC.   She said the handout begins  by asserting that                                                               
this is  a key piece of  [DEC's] statutory foundation.   The bill                                                               
has  a  zero fiscal  note  because  it  is clarification  of  the                                                               
department's authorities  and does  not add any  additional staff                                                               
or expenses.   She said  [the bill] is  part of a  rational water                                                               
protection program  that the  state has not  enjoyed over  the 30                                                               
years as  it has developed its  environmental protection program.                                                               
Commissioner Ballard  said DEC calls  that program  "raindrops to                                                               
oceans" and the  term is used because water  begins as condensate                                                               
in the air  and ultimately falls to the earth  as rain; it cycles                                                               
through surface water,  ground water, and ultimately  goes out to                                                               
the sea.   She remarked, "If we don't have  a comprehensive and a                                                               
rational approach  to it,  we're going  to miss  the boat."   She                                                               
said if  it is protected in  one area and not  another area, "we"                                                               
haven't done ourselves any good.                                                                                                
COMMISSIONER BALLARD explained  that the water is looked  at as a                                                               
continuum  from  raindrops to  ocean,  and  this  bill is  a  key                                                               
component of filling  in gaps that [DEC] feels it  has now in its                                                               
statutory foundation  to protect  the water.   She  said it  is a                                                               
bill   that   primarily  gives   [DEC]   a   set  of   risk-based                                                               
authorizations,  which  can  be  used  to  address  the  riskiest                                                               
impacts to water  with the "sharpest tools."   She said remarked,                                                               
"We can  still by rule  and therefore, with public  comment, with                                                               
opportunity for all  stakeholders to participate; by  rule we can                                                               
address even  the most  minimal risks."   She  said the  bill has                                                               
five components  of authorization  for waste  disposal activities                                                               
depending on  risks, which are  identified in the handout  by the                                                               
bullet  points.   This  an extremely  important  change from  the                                                               
current  authority  DEC  has.     The  current  authority  simply                                                               
references a permit;  it doesn't make clear that a  permit may be                                                               
a different type of authorization  then an individual permit with                                                               
the name  of the discharger  on it, and developing  an individual                                                               
relationship with DEC.                                                                                                          
COMMISSIONER  BALLARD  said  the  tool  DEC  would  use  for  the                                                               
riskiest impacts to water would  be an individual permit in which                                                               
DEC  would  negotiate  specific  discharge  requirements  for  an                                                               
individual discharger.  The next  tool in reduction of risk would                                                               
be a general  permit in which DEC would authorize  one permit for                                                               
a  number of  similar  activities  in a  geographic  area.   Each                                                               
individual discharger  would still need  to contact DEC,  and DEC                                                               
would still have an individual  relationship with them, but would                                                               
not negotiate independent or  promulgate independent permit terms                                                               
for them.                                                                                                                       
Number 2812                                                                                                                     
COMMISSIONER BALLARD  called attention the third  bullet, and she                                                               
said this  tool is  one that  DEC is  very eager  to have.   It's                                                               
called  "permit  by  rule"  or  sometimes  "regulatory  rule"  or                                                               
"permission by regulation," she said.   She said the best example                                                               
she can  give for  people who  are unfamiliar  with environmental                                                               
regulations  is a  building permit.   In  some communities,  if a                                                               
person is doing simple remodeling at  a cost of less than $5,000,                                                               
that individual does not need an  individual permit.  She said if                                                               
the remodeling does not include  moving a bearing wall or putting                                                               
in  plumbing,  the  home  owner would  simply  conform  to  "best                                                               
practices," which  are usually  listed in a  sheet that  the city                                                               
can provide.  She said this is a  permit by rule, and the rule is                                                               
that person  complies with the  conditions that are on  the sheet                                                               
of paper,  but does not need  an individual permit or  a building                                                               
inspector.  She said the difference  between a permit by rule and                                                               
nothing   is,  first,   [DEC]  goes   through  rule   making  and                                                               
promulgates the  terms and conditions under  which, for instance,                                                               
bilges could be pumped.  She offered some examples.                                                                             
COMMISSIONER BALLARD  said if [DEC]  goes through rule  making to                                                               
identify the best practices for a  low risk activity, then it has                                                               
the opportunity  for stakeholder comment, and  equally important,                                                               
DEC would have the opportunity to  enforce.  She said if there is                                                               
a  blatant violation  and somebody  observes somebody  else doing                                                               
wrong and points it  out to DEC, and if DEC  had done nothing and                                                               
had no  regulatory relationship  with the  general public,  it is                                                               
helpless.   He said  if DEC  has a permit  by rule,  it is  a low                                                               
impact risk  and a  very low impact  regulatory activity,  but it                                                               
provides the  protection [DEC] believes the  environment deserves                                                               
and needs.   She  turned attention to  "plan approvals,"  and she                                                               
said [DEC]  has many  places, in both  statute and  regulation in                                                               
state  law  and state  code,  in  which  plans are  submitted  to                                                               
various  agencies for  review.   Commissioner  Ballard said  this                                                               
bill  gives [DEC]  specific  authority to  not  just review,  but                                                               
approve  a  plan when  it's  necessary,  and that  approval  step                                                               
provides   the  control   [DEC]  thinks   it  needs   to  achieve                                                               
environmental protection.                                                                                                       
COMMISSIONER BALLARD said something  extremely important to large                                                               
mines is  the opportunity for  DEC to issue a  consolidated waste                                                               
management permit  for complex facilities which  now require more                                                               
than one permit.  She said  this is permit streamlining, and this                                                               
administration had talked  a lot about it and this  is an example                                                               
of it.   She said HB 524 also allows  an administrative extension                                                               
of DEC  permits, and she  remarked, "We  are good, but  we're not                                                               
perfect."  She  said DEC sometimes doesn't have the  staff or the                                                               
resources to renew a permit at the time the permit has expired.                                                                 
COMMISSIONER BALLARD  said it is  extremely important for  DEC to                                                               
have  the  permits  administratively extended  so  the  regulated                                                               
community, municipalities, and industrial  permit holders are not                                                               
out of  compliance because [DEC]  does not have the  resources to                                                               
get  to the  permits.    She said  the  next  issue is  extremely                                                               
important to stakeholders and developers  because it allows [DEC]                                                               
to require proof of financial  responsibility under certain waste                                                               
circumstances.     She   said  DEC   uses   proof  of   financial                                                               
responsibilities in several  places in DEC regulation,  and it is                                                               
the tool  by which DEC  assures that financial resources  are set                                                               
aside and  dedicated to  long-term clean up  or maintenance  of a                                                               
long-term treatment system  for a solid waste facility  or a mine                                                               
waste facility.   This assures  citizens in the future  that when                                                               
an undertaking  is over and there  is a residual waste  system or                                                               
pile in place,  that financial resources are  available to assure                                                               
that it is maintained.                                                                                                          
COMMISSIONER BALLARD said  the last major component of  HB 524 is                                                               
modification  to the  definitions  of solid  waste and  municipal                                                               
solid waste.   It is important for DEC to  be able to distinguish                                                               
between municipal  wastes and  industrial wastes.   She  said DEC                                                               
has  different  provisions  in  law  and  in  regulation  and  it                                                               
ultimately needs the  ability to allow the  small municipal waste                                                               
facilities that are operated in  Alaska's many small villages and                                                               
communities  to operate  under a  much  less rigorous  regulatory                                                               
regime than  more large  and complex facilities.   She  said this                                                               
changes  to  the definition  makes  DEC's  authority to  do  that                                                               
Number 2579                                                                                                                     
CO-CHAIR  DAHLSTROM  asked that  testimony  be  limited to  three                                                               
minutes each.                                                                                                                   
Number 2542                                                                                                                     
MARILYN   CROCKETT,  Deputy   Director,   Alaska   Oil  and   Gas                                                               
Association (AOGA),  testified, and stated  she is in  support of                                                               
HB 524.   She  said the  bill is a  very important  and necessary                                                               
streamlining  mechanism that  the department  has proposed.   The                                                               
ability  to   use  the  additional   regulatory  tools   is  very                                                               
important,  not only  to the  applicants but  to the  department,                                                               
which has to operate with limited  resources, she said.  She said                                                               
the other component  of the bill that AOGA is  very interested in                                                               
and is  strongly supporting is  the ability of the  department to                                                               
administratively  present permits  when they  expire.   That does                                                               
allow DEC to  focus and prioritize on the  authorizations and the                                                               
permits  that  have  the  higher  risk,  and  it  allows  DEC  to                                                               
prioritize those activities.  She  said it provides protection to                                                               
the regulated community,  as well, in the event that  a permit or                                                               
an authorization  that is currently  held is about to  expire and                                                               
there  is not  time  to get  it  renewed.   She  said  this is  a                                                               
procedure  that  is  routinely used  by  the  federal  government                                                               
through  the  Environmental  Protection Agency  (EPA),  and  AOGA                                                               
commends the department for including it in this provision.                                                                     
Number 2463                                                                                                                     
STEVE  BORELL,  Executive  Director,  Alaska  Miners  Association                                                               
(AMA), testified.   He said  AMA supports this bill,  which would                                                               
make   important   changes,  specifically,   the   administrative                                                               
extension of  permits, which [AMA]  believes is crucial  and will                                                               
help both  industry and DEC in  that situation.  He  said the use                                                               
of permit  by rule  was well  described, and  he suggested  it is                                                               
much simpler  for all [parties] involved  to have a set  of rules                                                               
"and  if  a  person  follows  those rules,  they  are  indeed  in                                                               
compliance with  the law and they  don't need to actually  go and                                                               
apply  for a  permit, wait  for the  processing, worry  about not                                                               
getting the permit on time, and  then ... they need to review the                                                               
permit."  He said he believes  these are all important changes to                                                               
the law, and AMA supports them.                                                                                                 
Number 2386                                                                                                                     
MYRL  THOMPSON,  Ogan  Is  So   Gone,  testified.    He  directed                                                               
attention to  Section 3, subparagraph  (C), and asked if  this is                                                               
an exemption for coal bed methane drilling.                                                                                     
COMMISSIONER BALLARD  said this  language is in  existing statute                                                               
and  there is  no change  proposed.   She  said subparagraph  (C)                                                               
refers  to "exploratory  drilling  the produced  water," and  the                                                               
exemption was  put in by the  legislature a number of  years ago.                                                               
She stated that DEC is not proposing any change.                                                                                
MR. THOMPSON  asked how that  exemption would affect  drilling in                                                               
the Matanuska Valley with respect to [HB 524].                                                                                  
COMMISSIONER  BALLARD  said  there  would be  no  change  to  the                                                               
current regulatory  regime since there  is no change  proposed to                                                               
MR. THOMPSON  said he didn't have  any problem with the  bill per                                                               
se, but  he does  have a problem  with that  particular exemption                                                               
due to the ongoing process in the Matanuska Valley.                                                                             
Number 2263                                                                                                                     
REPRESENTATIVE   HEINZE  asked   how  the   proof  of   financial                                                               
responsibility   integrate  with   reclamation  and   reclamation                                                               
bonding or funds.                                                                                                               
COMMISSIONER  BALLARD mentioned  that the  Department of  Natural                                                               
Resources  had   recently  presented  the  committee   with  some                                                               
statutory language.   She noted  that it  was pointed out  in the                                                               
handout  that DEC  will coordinate  with  a "financial  assurance                                                               
vehicle," which is  provided through DNR requirements.   She said                                                               
both requirements  are important and "their"  reclamation bonding                                                               
is extremely important for the physical acts of reclamation.                                                                    
COMMISSIONER BALLARD  said DEC's proof of  financial assurance is                                                               
important  for the  environmental  protection that  it seeks  for                                                               
future potential waste  management issues.  She said  if a mining                                                               
developer offers a financial instrument  which has adequate asset                                                               
depth to cover both requirements,  [DEC and DNR] will both accept                                                               
the same  instrument but can't put  up the same assets  to pledge                                                               
for two different responsibilities.                                                                                             
Number 2191                                                                                                                     
REPRESENTATIVE GUTTENBERG turned attention  to page 2, [paragraph                                                               
2], and  he asked if that  section would have been  dealt with if                                                               
Fairbanks  had  made  a  different   determination  on  its  last                                                               
COMMISSIONER BALLARD said that language  will not have any impact                                                               
on the I/M program in Fairbanks.                                                                                                
REPRESENTATIVE GUTTENBERG turned attention  to page 5, Section 4,                                                               
and  he said  it looks  like the  bill is  changing who  does the                                                               
forms from  the EPA  to the state.   He asked  if it  was assumed                                                               
that could be done with no cost.                                                                                                
COMMISSIONER BALLARD answered in the affirmative.                                                                               
Number 2140                                                                                                                     
REPRESENTATIVE HEINZE  moved to  report HB  524 out  of committee                                                               
with  individual  recommendations  and  the  accompanying  fiscal                                                               
notes.   There being no objection,  HB 524 was reported  from the                                                               
House Resources Standing Committee.                                                                                             
CO-CHAIR DAHLSTROM turned the gavel over to Co-Chair Masek.                                                                     

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