Legislature(2009 - 2010)BARNES 124

03/22/2010 01:00 PM RESOURCES


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ HB 414 SEPARATE OIL & GAS PRODUCTION TAX TELECONFERENCED
Heard & Held
+= HB 74 COASTAL MANAGEMENT PROGRAM TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
               HB  74-COASTAL MANAGEMENT PROGRAM                                                                            
                                                                                                                                
1:19:43 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  NEUMAN announced  that the  next order  of business  is                                                               
HOUSE  BILL  NO. 74,  "An  Act  relating  to the  Alaska  coastal                                                               
management program;  and establishing  the Alaska  Coastal Policy                                                               
Board."  [Before the committee was CSHB 74(CRA).]                                                                               
                                                                                                                                
REPRESENTATIVE  REGGIE  JOULE,  Alaska State  Legislature,  joint                                                               
prime  sponsor  of  HB  74,  said  his  staff  member,  Elizabeth                                                               
Hensley,  will present  the bill  and other  people on  line will                                                               
provide additional information.                                                                                                 
                                                                                                                                
1:20:59 PM                                                                                                                    
                                                                                                                                
ELIZABETH  HENSLEY, Staff,  Representative  Reggie Joule,  Alaska                                                               
State Legislature,  stated [CSHB 74(CRA)] would  amend the Alaska                                                               
Coastal Management Program (ACMP),  which was created pursuant to                                                               
the 1972  federal Coastal  Zone Management Act.   She  said that,                                                               
among other things, the intent of the 1972 Act was:                                                                             
                                                                                                                                
     to preserve,  protect, develop,  and where  possible to                                                                    
     restore  or  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 explained that the  Alaska Coastal Management Program                                                               
was created  in 1977  when the  Alaska State  Legislature enacted                                                               
the Alaska  Coastal Management  Act.   The program  was federally                                                               
approved  in 1979.   Originally,  a 17-member  board oversaw  the                                                               
program,  but  in  2003,  under House  Bill  191,  the  Murkowski                                                               
Administration concentrated all decision  making authority in the                                                               
Department of Natural Resources (DNR).                                                                                          
                                                                                                                                
1:22:26 PM                                                                                                                    
                                                                                                                                
MS. HENSLEY said CSHB 74(CRA)  has three primary objectives.  The                                                               
first  is to  establish the  Alaska  Coastal Policy  Board.   The                                                               
nine-member board would consist  of five public members appointed                                                               
by  the  governor  and  the  other  four  members  would  be  the                                                               
commissioners  of  the  Department   of  Natural  Resources,  the                                                               
Department of  Environmental Conservation, the  Alaska Department                                                               
of  Fish &  Game, and  the Department  of Commerce,  Community, &                                                               
Economic  Development.    The  board  would  be  responsible  for                                                               
approving   district   coastal   plans,   grant   programs,   and                                                               
regulations; DNR  would retain day-to-day management  of all ACMP                                                               
matters and  would retain responsibility for  project consistency                                                               
reviews.    The  second  objective  is  to  streamline  the  ACMP                                                               
consistency  determination process  and  to promote  inter-agency                                                               
cooperation and  issue resolution.   To that end, it  would bring                                                               
the Department of Environmental  Conservation (DEC) back into the                                                               
review process, as  this department was carved out  of the review                                                               
process in 2003.   The third objective is to  restore the role of                                                               
coastal   districts  by   allowing   them   to  establish   local                                                               
enforceable policies that are meaningful.   Local districts would                                                               
be empowered, but  have no veto power.  The  bill recognizes that                                                               
local  people have  local knowledge  that is  of importance  when                                                               
dealing with coastal resource uses.                                                                                             
                                                                                                                                
CO-CHAIR NEUMAN opened public testimony.                                                                                        
                                                                                                                                
1:25:27 PM                                                                                                                    
                                                                                                                                
EDWARD ITTA, Mayor, North Slope  Borough, supported HB 74, saying                                                               
this  subject  means  a lot  to  coastal  communities  throughout                                                               
Alaska  and is  of importance  to all  Alaskans who  want to  see                                                               
orderly and  efficient development in the  state's coastal areas.                                                               
He  noted that  there are  some misconceptions  about what  HB 74                                                               
would  do.   First, the  ACMP is  a coordinating  program, not  a                                                               
permitting  program.    Second,  HB   74  would  not  create  new                                                               
obstacles  to slow  down development  projects; rather,  it would                                                               
establish  a  process  for resolving  conflicts  between  project                                                               
applicants,  agencies,  and  local  districts.   The  bill  would                                                               
streamline the  participation of all stakeholders  by having them                                                               
work together early in the process.                                                                                             
                                                                                                                                
1:29:12 PM                                                                                                                    
                                                                                                                                
MAYOR ITTA said  HB 74 would not simply reinstate  the way things                                                               
were before  2003 when  the program was  essentially gutted.   It                                                               
would  restore  a  local  voice  in  the  process  through  local                                                               
enforceable  policies and  a coastal  policy  [board] that  would                                                               
decide disputes  instead of one  individual.  The bill  would not                                                               
allow citizen or third-party lawsuits,  which was a sore point in                                                               
the old  process.  Additionally,  the bill would not  allow local                                                               
concerns  to  trump legislative  or  agency  authority and  would                                                               
strike a middle  ground between the pre-2003  arrangement and the                                                               
current approach of shutting out meaningful local input.                                                                        
                                                                                                                                
MAYOR ITTA  pointed out that HB  74 relates to the  debate in his                                                               
borough  over  offshore development  in  the  Arctic Ocean.    He                                                               
allowed  he  is  not  a  fan of  Outer  Continental  Shelf  (OCS)                                                               
drilling,  but added  that  he recognizes  his  is a  development                                                               
borough and  OCS development  is probably going  to happen.   So,                                                               
rather  than fight  it, he  would prefer  to work  with industry,                                                               
agencies,  and  the executive  and  legislative  branches of  the                                                               
State of Alaska  to ensure this project is  done with world-class                                                               
care.   He said he  has recently  had some success  in convincing                                                               
his fellow whalers  that lawsuits do not need to  be filed to get                                                               
some   accommodation  and   recognition  of   whaler's  concerns.                                                               
Progress has  been made with Shell  on a variety of  concerns, as                                                               
well as  with the U.S.  Minerals Management Service  (MMS), which                                                               
wrote  some of  the  whaler's concerns  into Shell's  exploration                                                               
permit for this summer's Beaufort Sea activity.                                                                                 
                                                                                                                                
1:32:31 PM                                                                                                                    
                                                                                                                                
MAYOR  ITTA  specified, however,  that  he  cannot point  to  any                                                               
progress in  regaining a  meaningful local  voice in  the coastal                                                               
management process.   North Slope residents  remember how coastal                                                               
zone management  used to work  at the  local level and  know that                                                               
that has been  taken away.  He said what  frustrates him the most                                                               
is that by watering down the  ACMP so there is virtually no local                                                               
voice,  the  State  of  Alaska   has  effectively  abandoned  its                                                               
opportunity to  exercise influence  in coastal  waters.   All the                                                               
cards have been handed over to  the federal government and in the                                                               
absence of a credible state  program local people will look there                                                               
for a substitute chance for recognition of local concerns.                                                                      
                                                                                                                                
MAYOR  ITTA cautioned  that  national  environmental groups  will                                                               
likely be jumping all over this  vacuum that he believes has been                                                               
caused  by the  state's inaction.   A  credible state  plan could                                                               
help  to  dampen the  resistance  that  environmental groups  are                                                               
encouraging.  It  is a tool the  state can use to  the benefit of                                                               
all parties, yet  there has been no movement by  the state toward                                                               
a solution.   He said he believes very strongly  in local control                                                               
and that  the State of  Alaska must  control its own  destiny and                                                               
not allow  another federal program  to overtake and  override the                                                               
good things that have been done in the state.                                                                                   
                                                                                                                                
1:35:04 PM                                                                                                                    
                                                                                                                                
MAYOR ITTA said he has been  thinking about options that might be                                                               
available should  the state do  nothing.   One option is  for the                                                               
borough to rewrite Title 19 of  its municipal code and create new                                                               
permitting hoops for  project applicants to go  through.  Another                                                               
option is  to work with  federal agencies and legislators  on the                                                               
concept of an Arctic regional  citizen advisory council.  A third                                                               
option  is  marine  spatial planning  through  President  Obama's                                                               
Whitehouse Council  [on Environmental Quality].   He clarified he                                                               
does  not  believe  a  federal solution  is  a  good  alternative                                                               
because he believes  everyone is better off with  a state program                                                               
that  recognizes  local people  as  stakeholders  and that  takes                                                               
local  concerns seriously.   However,  he must  support something                                                               
because, as  North Slope Borough  mayor, doing nothing is  not an                                                               
option.  Doing nothing would  simply fan the flames of resistance                                                               
at a time when he believes  he has convinced a significant number                                                               
of whalers  and other North  Slope Inupiaq Eskimos that  they can                                                               
work with the State of Alaska  just as headway has been made with                                                               
federal agencies and the oil companies.                                                                                         
                                                                                                                                
1:37:03 PM                                                                                                                    
                                                                                                                                
MAYOR ITTA pointed out that  people on the frontlines of proposed                                                               
developments,  like  the people  in  his  community, have  unique                                                               
concerns  and  insights.    He   said  he  believes  that  HB  74                                                               
reestablishes and refines a mechanism  that can give local people                                                               
a voice without  stalling the process.  He  directed attention to                                                               
page  11 of  his PowerPoint  presentation that  depicts a  map of                                                               
development in  Prudhoe Bay in  1977 and  a map of  all permitted                                                               
development in Prudhoe  Bay as of 2001.   He said he  is aware of                                                               
no  project being  stopped, and  emphasized that  the ACMP  was a                                                               
program  that gave  the North  Slope  Borough a  local voice  and                                                               
development  still  happened.    He maintained  that  striking  a                                                               
balance that mitigates  the concerns of the  North Slope Inupiaqs                                                               
who have lived along the coast  for thousands of years is a small                                                               
consideration in light of the  billions of dollars that are being                                                               
talked about.                                                                                                                   
                                                                                                                                
CO-CHAIR NEUMAN  said he appreciates  Mayor Itta's offer  to work                                                               
with the legislature and DNR.                                                                                                   
                                                                                                                                
1:40:50 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  TUCK   referred  to  page  10   of  Mayor  Itta's                                                               
PowerPoint  presentation and  asked  whether  the Coastal  Impact                                                               
Assistance  Program (CIAP)  would bring  additional funds  [$79.8                                                               
million] to the state for a properly managed coastal program.                                                                   
                                                                                                                                
MAYOR ITTA responded correct.                                                                                                   
                                                                                                                                
MS. HENSLEY  explained that according  to a document  prepared by                                                               
DNR's  Division  of  Coastal and  Ocean  Management  about  $14.5                                                               
million  was  allocated  directly  for  2010  to  Alaska  coastal                                                               
districts,  also called  coastal political  subdivisions, through                                                               
the Coastal  Impact Assistance  Program.   About $27  million was                                                               
allocated directly  to the  state.  She  understood that  some of                                                               
this money  goes directly to the  coastal political subdivisions,                                                               
some directly to the state,  and some to individual entities that                                                               
apply for  funding through the  CIAP grant program.   In response                                                               
to Co-Chair Neuman, she agreed to  provide members with a copy of                                                               
the document.                                                                                                                   
                                                                                                                                
CO-CHAIR NEUMAN noted  there is also a program  dealing with soil                                                               
and water conservation districts whose  funding has been cut, but                                                               
the program  brings in $8-$9  in matching  funds for every  $1 it                                                               
receives.   He asked  whether this program  could apply  for CIAP                                                               
funding.                                                                                                                        
                                                                                                                                
REPRESENTATIVE JOULE deferred to Mr. Randy Bates for an answer.                                                                 
                                                                                                                                
1:44:57 PM                                                                                                                    
                                                                                                                                
BERT COTTLE,  Mayor, City of  Valdez, testified that the  City of                                                               
Valdez  supports HB  74  because  it would  correct  part of  the                                                               
damage that  was done in the  2003 changes and would  put coastal                                                               
communities back at the table as  policy makers.  Before the 2003                                                               
changes, the  City of  Valdez had  41 enforceable  policies under                                                               
which input  could be made,  but today that  number is 14;  HB 74                                                               
would change  that.  The City  of Valdez supports Section  37 [of                                                               
the  bill as  originally  introduced] which  would eliminate  the                                                               
carve out of the Department  of Environmental Conservation.  This                                                               
department needs  to be  back at  the table and  not be  a stand-                                                               
alone policy maker.  Also, Section  37 [of the bill as originally                                                               
introduced]   would  eliminate   the   requirement  for   coastal                                                               
districts  to update  their plan  every 10  years.   There is  no                                                               
reason  to update  a plan  that  is current  because updating  is                                                               
costly and time consuming.  Section  1 of HB 74 would establish a                                                               
small coastal policy board, which  the City of Valdez feels would                                                               
be  good.   The  previous 17-member  board was  too  large to  be                                                               
effective.  This smaller board  would only address Alaska coastal                                                               
management  policy issues  and would  be unable  to override  any                                                               
agency's authority.                                                                                                             
                                                                                                                                
REPRESENTATIVE  SEATON noted  that  the bill  version before  the                                                               
committee, CSHB 74(CRA), only goes as high as Section 36.                                                                       
                                                                                                                                
MAYOR COTTLE said Section 37 is  the section number he was given.                                                               
In  further response,  he said  he  would contact  Representative                                                               
Seaton after the hearing in this regard.                                                                                        
                                                                                                                                
1:47:52 PM                                                                                                                    
                                                                                                                                
TOM  OKLEASIK,  Planning   Director,  Northwest  Arctic  Borough,                                                               
stated the Northwest  Arctic Borough supports adoption  of HB 74,                                                               
as does the borough's planning  commission jointly with the North                                                               
Slope Borough  Planning Commission  via Resolution JBPC0901.   He                                                               
said  the  Northwest Arctic  Borough  supports  HB 74  for  three                                                               
reasons.   First,  the bill  would update  the ACMP  to a  modern                                                               
coastal  management  program  where  good  governance  is  valued                                                               
through public involvement.  One  of the borough's key objectives                                                               
under its strategic plan is  to increase public participation for                                                               
an  interactive and  engaging borough  democracy.   The borough's                                                               
mayor, assembly,  and planning commission value  hearing from the                                                               
area's lifelong Alaska residents,  communities, and businesses in                                                               
order to  make the best  governing decisions, policies,  and good                                                               
public   relations.      However,   under   the   current   ACMP,                                                               
participation of  stakeholders was  identified as a  key weakness                                                               
in the October 2002-August 2007  evaluation that was conducted by                                                               
the  National  Oceanic   and  Atmospheric  Administration  (NOAA)                                                               
Office of Ocean and Coastal  Resource Management.  The evaluation                                                               
report states  on page  6, paragraph 4,  that elimination  of the                                                               
Coastal  Policy  Council  was  controversial,  particularly  with                                                               
transferring its  authority solely  to state  staff.   Checks and                                                               
balances  are a  fundamental premise  of the  U.S. democracy,  he                                                               
said, and reinstatement of the  Alaska Coastal Policy Board under                                                               
HB 74 would promote modern  governance and checks and balances so                                                               
that  bureaucrats in  Juneau are  not  disconnected from  Alaskan                                                               
communities and forcing decisions upon Alaskans.                                                                                
                                                                                                                                
1:50:46 PM                                                                                                                    
                                                                                                                                
MR. OKLEASIK said the second  reason for the borough's support of                                                               
HB  74  is  that  it  would bring  balance  to  the  bureaucratic                                                               
decision-making  process  for  coastal management  issues.    The                                                               
Northwest  Arctic  Borough  has  been attempting  to  revise  its                                                               
coastal  management  plan since  2005,  but  has yet  to  receive                                                               
approval  due to  state  staff interpretations  of  the laws  and                                                               
regulations.   The  borough has  met all  the deadlines  and made                                                               
many  special  efforts to  meet  bureaucratic  demands.   It  has                                                               
attempted  mediation  with  the  state, which  ended  in  impasse                                                               
despite the  financial expense and  many hours and  days invested                                                               
in that process.   As of today, the borough  has been waiting for                                                               
over a  year for the DNR  commissioner to makes a  decision.  The                                                               
statutes and regulations have no  timeline for making a decision,                                                               
so  communities are  left hanging  in a  "Catch 22  bureaucracy".                                                               
This  has  been  a  terrible and  expensive  experience  for  any                                                               
community to be forced through  and the legislature needs to make                                                               
changes so  that Alaskan communities  can successfully  work with                                                               
their own  state government.   The bill would bring  more balance                                                               
to  these important  decisions and  promote responsible  resource                                                               
and community  developments, especially  by the  Alaska residents                                                               
most  impacted.   The  ACMP  needs to  be  valued  and given  the                                                               
legislative tools to work and to respect all Alaskans.                                                                          
                                                                                                                                
1:52:14 PM                                                                                                                    
                                                                                                                                
MR.  OKLEASIK  explained  that the  borough's  third  reason  for                                                               
supporting  HB  74  is  because  it  would  assist  in  advancing                                                               
communication  between DNR  and local  communities.   Creation of                                                               
the Alaska  Coastal Policy Board  would help ensure  that coastal                                                               
districts and  the state agencies  work together on  resource and                                                               
community  development.   Right  now the  project developers  and                                                               
coastal  districts  are in  reactive  roles  with state  agencies                                                               
overruling  any  decision  throughout  the  process.    This  was                                                               
illustrated recently with the Kodiak  Kenai Cable Company project                                                               
to  bring  broadband  access  to  the  Arctic  region,  including                                                               
Kotzebue.    Due  to  the   Northwest  Arctic  Borough's  coastal                                                               
management  plan not  being approved,  the borough  as a  coastal                                                               
district  had to  make  any request  for  information during  the                                                               
public  review  process for  the  applicant.   Additionally,  the                                                               
company  was not  made aware  of areas  in the  borough's coastal                                                               
district that  are important  to ongoing  subsistence activities.                                                               
This  caused many  frustrations  because DNR  had  to review  all                                                               
communication and decide  what action to take,  which slowed down                                                               
the project  development.  Information from  the district coastal                                                               
management plan was  not made available by DNR for  review by the                                                               
parties until the public notice  step.  Had the borough's coastal                                                               
management plan been approved, that  company would have known the                                                               
district's designated areas and policies  and built them into its                                                               
plans  at the  start of  its  planning process  instead of  being                                                               
caught in the current "Catch  22" bureaucracy with no foreseeable                                                               
timelines  for  resolution.   The  coastal  district  could  have                                                               
worked  proactively   and  coordinated  more  closely   with  the                                                               
company.  The  bill would assist in advancing  communication in a                                                               
closely  coordinated   fashion  and   would  bring   good  public                                                               
practices into the Alaska Coastal Management Program.                                                                           
                                                                                                                                
1:54:38 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  NEUMAN asked  Mr. Okleasik  why the  district's coastal                                                               
management plan may or may not be approved.                                                                                     
                                                                                                                                
MR. OKLEASIK replied  he has been trying to get  a good handle on                                                               
that since his first day on the  job.  The district has been sent                                                               
in 20  different directions, and  even when the  district follows                                                               
the directions it  comes back as unapprovable.  It  does not make                                                               
sense to  have the  district do  what it was  directed to  do and                                                               
then be told that [DNR] changed  its mind.  There is no effective                                                               
appeals  process  before a  third  party;  state staff  has  sole                                                               
discretion  over  all  appeals,  which  has  been  the  extremely                                                               
frustrating part of the program.                                                                                                
                                                                                                                                
1:56:14 PM                                                                                                                    
                                                                                                                                
CO-CHAIR NEUMAN  asked Mr.  Okleasik to  describe one  issue that                                                               
has been the most controversial.                                                                                                
                                                                                                                                
MR. OKLEASIK answered  there has been so much  resistance that he                                                               
cannot describe one  single thing.  However, one  example is that                                                               
the  district has  its subsistence  policies in  designated areas                                                               
and out  of these policies only  one area has been  approved.  In                                                               
Kotzebue,  fish- and  meat-drying  racks are  right  in front  of                                                               
people's homes  and antlers are  all over the place.   Therefore,                                                               
it  is  crazy that  only  one  small  subsistence area  has  been                                                               
approved in the whole borough.                                                                                                  
                                                                                                                                
1:57:43 PM                                                                                                                    
                                                                                                                                
MARLENE CAMPBELL, Coastal  Management Coordinator, Sitka District                                                               
Coastal  Management Program,  City and  Borough of  Sitka, stated                                                               
that  the assembly  of the  City  and Borough  of Sitka  approved                                                               
Resolution 2009-32  supporting HB  74 to enable  Alaska's coastal                                                               
communities  to  more  effectively   participate  in  the  Alaska                                                               
Coastal  Management  Program.     The  resolution  reaffirms  the                                                               
position of  the City and Borough  of Sitka and the  community of                                                               
Sitka ever  since House  Bill 191  was initiated.   Prior  to the                                                               
ACMP revision, the  Sitka Coastal Management Program  was a model                                                               
of effective coastal management.   It allowed the Sitka community                                                               
to  have   due  deference  and  protected   local  resources  and                                                               
activities  while   at  the  same  time   permitting  responsible                                                               
development.   The revision process  forced complete  revision of                                                               
Sitka's  coastal plan,  and  Sitka  lost more  than  half of  its                                                               
enforceable policies.   The policies remaining  are so restricted                                                               
that they are virtually unusable in coastal comments.                                                                           
                                                                                                                                
MS. CAMPBELL noted that HB  74 would restore the Sitka district's                                                               
opportunity  for  a seat  at  the  table in  management  decision                                                               
making  by  establishing  the  Alaska  Coastal  Policy  Board  to                                                               
participate  in  district  management plan  approvals,  which  is                                                               
desperately  needed.   The board  would  not be  involved in  the                                                               
consistency review process.   She said this  greatly improved and                                                               
streamlined  board is  necessary for  checks and  balances.   The                                                               
bill would  streamline project reviews  through the  inclusion of                                                               
air and water quality issues  and the Department of Environmental                                                               
Conservation  (DEC)  [Section  37   of  the  bill  as  originally                                                               
introduced].  She said  it is her view that the  carve out of DEC                                                               
has  been totally  dysfunctional  and removal  of  air and  water                                                               
quality  from  the  purview  of  the  ACMP  was  a  grave  error.                                                               
Additionally,  HB 74  would maintain  legislative authority  over                                                               
the Alaska  Coastal Management Program  and maintain  the ability                                                               
to pass future ACMP legislation.                                                                                                
                                                                                                                                
2:00:30 PM                                                                                                                    
                                                                                                                                
MS.  CAMPBELL  said  House  Bill  191 was  sold  as  a  means  of                                                               
streamlining   the  ACMP;   instead,  these   regulatory  changes                                                               
crippled  the  program and  disabled  local  participation.   Due                                                               
deference to coastal communities  with approved programs would be                                                               
restored by  HB 74.   It would  not slow down  permitting because                                                               
all the parties would  have a seat at the table  at the same time                                                               
to resolve conflicts  and expedite permitting.  She  said she has                                                               
been the coastal management coordinator  for the City and Borough                                                               
of Sitka since 1987,  and HB 74 would be a  great step forward to                                                               
reinstate  some  of  the  best features  of  the  Alaska  Coastal                                                               
Management Program.                                                                                                             
                                                                                                                                
MS. CAMPBELL pointed  out that designations did not  make it into                                                               
HB  74, and  these are  a problem  for Sitka.   Designations  are                                                               
extremely problematic to coastal  districts because the districts                                                               
are no longer permitted to  have enforceable policies that relate                                                               
to resources without  designated specific areas.   In many cases,                                                               
the resources that  the policies relate to may move  from area to                                                               
area,  so  she hopes  that  the  designations  can be  made  more                                                               
flexible and promulgate  policies as long as  a thorough analysis                                                               
and justification  for the specific  policy is provided  and have                                                               
no conflicts with state or federal law.                                                                                         
                                                                                                                                
CO-CHAIR  NEUMAN noted  that  on April  15,  2009, the  committee                                                               
closed  testimony on  HB  74 and  held the  bill  over, but  that                                                               
public testimony has been re-opened today.                                                                                      
                                                                                                                                
2:02:53 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  GUTTENBERG inquired  whether  Sitka believes  the                                                               
Department  of  Environmental   Conservation  is  an  appropriate                                                               
agency to be returned to involvement in the ACMP process.                                                                       
                                                                                                                                
MS.  CAMPBELL  responded  yes,  the  city  assembly's  resolution                                                               
specifically  supported   the  re-involvement   of  DEC   in  the                                                               
consistency review  process rather  than having  the department's                                                               
participation carved out and totally  separate from the ACMP.  At                                                               
the local  level, to not be  able to even consider  air and water                                                               
quality issues  when making coastal management  decisions that so                                                               
directly relate  to the air  and water quality issues  of coastal                                                               
decisions  is   counterintuitive  and   unproductive.     From  a                                                               
practical   standpoint,   there   is  no   real   capability   of                                                               
communicating  with DEC  because of  it being  carved out  of the                                                               
program and  not a  participant.   The City of  Sitka once  had a                                                               
productive  relationship  with  DEC and  this  communication  and                                                               
interaction is missed.                                                                                                          
                                                                                                                                
CO-CHAIR NEUMAN closed public testimony  for the time being after                                                               
ascertaining that no one else wished to testify.                                                                                
                                                                                                                                
2:05:22 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  NEUMAN  requested  Mr.  Randy Bates  to  highlight  the                                                               
administration's concerns with HB 74.                                                                                           
                                                                                                                                
RANDY BATES, Director, Division  of Coastal and Ocean Management,                                                               
Department of  Natural Resources,  said the  department continues                                                               
to have significant concerns with  the drafting and provisions of                                                               
this  bill because  the issues  the department  raised last  year                                                               
have not  yet been addressed.   These issues  relate specifically                                                               
to  the authority  and purview  of  coastal district  enforceable                                                               
policies and the  relationship that is expected  to exist between                                                               
coastal  management   and  the   laws  that  state   and  federal                                                               
legislators have established.                                                                                                   
                                                                                                                                
2:06:51 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  NEUMAN inquired  whether there  is some  legal question                                                               
regarding establishment of an Alaska Coastal Policy Board.                                                                      
                                                                                                                                
MR. BATES responded  that, in his opinion, the  basic question of                                                               
whether it  is DNR making  the decisions on  enforceable policies                                                               
or a coastal policy board is  irrelevant.  The questions that DNR                                                               
is  concerned  with are  specific  to  the authority  of  coastal                                                               
district  enforceable policies.    The North  Slope Borough,  the                                                               
Northwest Arctic Borough,  and DNR have engaged  for quite awhile                                                               
regarding  the  authority  of coastal  district  policies.    For                                                               
example, one  of the  districts wanted the  ability to  manage or                                                               
write   an   enforceable   policy  related   to   noise-producing                                                               
operations so  it could  have a policy  that maybe  limited noise                                                               
producing operations  to less  than 125  decibels to  address the                                                               
impact on marine mammals.   However, the Marine Mammal Protection                                                               
Act specifically preempts states  from developing laws like that;                                                               
it  is a  duplication of  authority and  the Act  precludes that.                                                               
Additionally,  the state's  own  granting agency,  the Office  of                                                               
Ocean  and  Coastal  Resource   Management  within  the  National                                                               
Oceanic  and Atmospheric  Administration  (NOAA),  has said  that                                                               
while that  may be an  approvable policy generally if  it relates                                                               
to just  noise, it would  be illegal  to implement the  policy at                                                               
the  project review  level.   From the  department's perspective,                                                               
there are significant legal concerns  with the structure of these                                                               
enforceable  policies, what  is proposed  within HB  74, and  the                                                               
relationship of those policies with  the state authorities.  That                                                               
must be addressed  before moving on with  any meaningful crafting                                                               
of statutes that would affect coastal management.                                                                               
                                                                                                                                
2:09:28 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  P. WILSON  requested Mr.  Bates to  specify which                                                               
parts of  the bill need  to be  changed to meet  the department's                                                               
concerns.                                                                                                                       
                                                                                                                                
MR. BATES  replied the department's first  substantive concern is                                                               
that HB 74 would create a  new oversight body, the Alaska Coastal                                                               
Policy  Board, and  would  vest  that body  with  the ability  to                                                               
approve   enforceable  policies   that   would  override   agency                                                               
authority,  effectively rendering  the legislative  establishment                                                               
of  laws relative  to resource  management  and protection  moot.                                                               
The second concern is that the  bill is specific to the issues of                                                               
a group  of ACMP participants  and does not balance  or represent                                                               
the interests of  all ACMP participants and  stakeholders.  While                                                               
there may be  specific sections of the bill that  relate to this,                                                               
the fundamental issue  that must be resolved  is the relationship                                                               
between  enforceable  policies  and existing  state  and  federal                                                               
laws.   It  is  DNR's  opinion that  establishment  of a  coastal                                                               
policy board  is irrelevant, as  is providing  additional purview                                                               
in  the statutes  for district  enforceable  policies, until  the                                                               
relationship  between   these  laws   is  addressed  and   it  is                                                               
determined  whether a  district  enforceable policy  can be  more                                                               
stringent than a law established by the state legislature.                                                                      
                                                                                                                                
2:12:13 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE EDGMON said he is  hearing a sense of conciliation                                                               
from  representatives of  the coastal  areas, but  he is  hearing                                                               
zero conciliation  from DNR and  that the bill is  a non-starter.                                                               
He asked  whether there is  any middle  ground or attempt  by the                                                               
state to work with its constituent  base in the coastal areas, or                                                               
is DNR flatly refusing to work on this issue.                                                                                   
                                                                                                                                
MR.  BATES answered  that  HB 74  will  not work  the  way it  is                                                               
structured  and DNR  has  significant concerns  with  the way  it                                                               
would work.   The  department is very  troubled with  the ongoing                                                               
concerns  that   continue  to  be   raised  related   to  coastal                                                               
management and  absolutely wants  to resolve  those issues.   The                                                               
department  is  working on  regulatory  fixes  that will  resolve                                                               
certain  issues, some  of which  are  partially addressed  within                                                               
this  bill.    The  department  will  continue  to  look  at  the                                                               
relationship between those  state and federal laws  and what they                                                               
mean to  coastal district laws.   It is not  that DNR has  a hard                                                               
line  against  any  changes  to coastal  management;  it  is  the                                                               
fundamental  issue  that  must   be  resolved  before  any  other                                                               
discussion on changes to coastal management can move forward.                                                                   
                                                                                                                                
2:14:35 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KAWASAKI pointed out that  an answer still has not                                                               
been heard  to Representative P. Wilson's  question regarding the                                                               
changes that need to  be made in HB 74 for  the department to say                                                               
that it is a good bill.                                                                                                         
                                                                                                                                
CO-CHAIR NEUMAN agreed.   He suggested that  a sectional analysis                                                               
would help members know what the  bill does and would assist with                                                               
questions of Mr. Bates.                                                                                                         
                                                                                                                                
2:15:19 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GUTTENBERG  inquired whether  district enforceable                                                               
policies can supersede state or federal law.                                                                                    
                                                                                                                                
LINDSAY   WOLTER,  Assistant   Attorney  General,   Environmental                                                               
Section,   Civil  Division   (Anchorage),   Department  of   Law,                                                               
responded  that that  is the  fundamental question  that must  be                                                               
answered and  she is not prepared  to answer it today.   She said                                                               
this question  has been ongoing  for several years and  the state                                                               
has  been seeking  advice from  the Office  of Ocean  and Coastal                                                               
Resource  Management, which  is the  federal oversight  authority                                                               
for the  coastal management program; however,  no specific answer                                                               
has been  received.  She has  been trying to answer  the question                                                               
within  her office,  but she  has not  received an  okay to  move                                                               
forward and  use client money to  answer the question.   While it                                                               
is  a  simple  question,  it  is a  very  complicated  issue  and                                                               
complicated to answer.   In some scenarios  the specific examples                                                               
of enforceable policies  really do intrude upon  state or federal                                                               
authorities  that have  been specifically  granted by  either the                                                               
state  legislature  or  Congress.     She  said  she  thinks  the                                                               
department's  position is  that it  does not  want to  be in  the                                                               
position  of trying  to approve  enforceable policies  that might                                                               
not comply with current state or federal authority.                                                                             
                                                                                                                                
2:18:25 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE P. WILSON  asked how the bill  would, as currently                                                               
written, supersede state and federal law.                                                                                       
                                                                                                                                
MS. WOLTER began searching her papers and said she looked at....                                                                
                                                                                                                                
CO-CHAIR NEUMAN interjected that  Section 14 discusses preemption                                                               
and he believes  the bill says no  to Representative Guttenberg's                                                               
question.                                                                                                                       
                                                                                                                                
2:19:48 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  P. WILSON  inquired how  many meetings  have been                                                               
held to work these things out.                                                                                                  
                                                                                                                                
MR. BATES  replied these  changes were brought  about in  2003 by                                                               
House Bill 191, which mandated  that each coastal district revise                                                               
its district plan  according to the statutes  and the regulations                                                               
that  DNR had  to rewrite.   So,  DNR has  been working  with the                                                               
coastal districts  since that  point to  help them  develop their                                                               
plan  revisions.   Of  the  33 coastal  districts  with plans,  5                                                               
voluntarily  dropped out  because they  felt existing  state laws                                                               
and local ordinances  would take care of their concerns.   Of the                                                               
remaining 28 districts, 25 revised  their plans in 2007 and 2008.                                                               
One district  does not have  a plan,  but is working  towards it.                                                               
The  North Slope  and Northwest  districts pursued  mediation and                                                               
voluntarily  declared impasse  with  the  state after  exhausting                                                               
mediation   opportunities,  so   their  plans   currently  remain                                                               
unapproved.   In the  department's opinion,  significant movement                                                               
on plan  revisions was  achieved during  that time  of mediation.                                                               
In terms  of enforceable  policies, many  pieces were  agreed to.                                                               
However,  there  were still  some  outstanding  issues that  were                                                               
critical to those  districts such that they felt  impasse was the                                                               
only recourse.   Several meetings occurred weekly,  if not daily,                                                               
for those two districts.                                                                                                        
                                                                                                                                
MR. BATES said  monthly meetings have been  reinstituted with the                                                               
working  group, which  is composed  of  representatives from  the                                                               
coastal  regions  and  all  of  the  state's  agencies,  and  the                                                               
department  has monthly  meetings specifically  with the  coastal                                                               
districts.  The department is  trying to reconstitute some of the                                                               
communication  that was  lost over  the last  few years,  and the                                                               
meetings, telephone  calls, and conferences are  in the hundreds.                                                               
There is still  some frustration on the  districts' parts because                                                               
the  statutes are  not  being changed  to  accommodate a  broader                                                               
opportunity for district policies  and that remains a substantial                                                               
sticking point.                                                                                                                 
                                                                                                                                
2:22:56 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  P.  WILSON asked  Mr.  Bates  to state  what  the                                                               
specific sticking  points are so  that members can see  how those                                                               
are addressed by HB 74.                                                                                                         
                                                                                                                                
MR.  BATES directed  attention to  an April  18 [2009]  letter to                                                               
Representative Neuman  in the committee packet  which articulates                                                               
the   top  issues   with  the   coastal  districts   that  remain                                                               
outstanding.   He  offered to  put  together a  list should  this                                                               
letter be insufficient.   He reiterated, however,  that the piece                                                               
that  must first  be resolved  before engaging  in discussion  on                                                               
policies   is   the   relationship   between   coastal   district                                                               
enforceable policies and existing state and federal laws.                                                                       
                                                                                                                                
2:25:42 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GUTTENBERG  inquired whether  Mr. Bates  has given                                                               
Representative Joule an analysis of why  HB 74 would not work and                                                               
recommended alternatives to  make it work.  He noted  that he was                                                               
on  the  House Resources  Standing  Committee  in 2003  when  the                                                               
enforceable policies were removed and DEC was carved out.                                                                       
                                                                                                                                
MR. BATES answered that Representative  Joule has attended one of                                                               
the conferences and his staff  has attended conferences when both                                                               
statutory and regulatory revisions were  discussed.  While he has                                                               
not had  specific discussions directly with  Representative Joule                                                               
or Senator  Olson, the sponsor  of the Senate companion  bill, he                                                               
has  had discussions  with their  staff and  representatives from                                                               
the different  districts about district enforceable  policies and                                                               
the relationship between state and  federal laws.  The department                                                               
has not engaged in revising HB  74 because of its substantive and                                                               
significant  concerns with  the bill.   The  department wants  to                                                               
resolve the issues, but the  legal aspects of those policies must                                                               
be looked  at before a  board is  re-created or the  authority of                                                               
policies expanded.   Whether it is a coastal policy  board or the                                                               
DNR commissioner  presiding over these policies,  the fundamental                                                               
legal basis must be understood  for whether policies can infringe                                                               
upon  state   or  federal  laws.     Neither  a  board   nor  the                                                               
commissioner can  violate the  law and approve  a policy  that is                                                               
preempted  by federal  law, and  it is  this piece  that must  be                                                               
solved  before  there  can  be  discussion  on  who  is  deciding                                                               
ultimately on district plans.                                                                                                   
                                                                                                                                
2:28:56 PM                                                                                                                    
                                                                                                                                
CO-CHAIR NEUMAN surmised DNR and  the other state departments are                                                               
trying  to figure  out the  federal implications  because federal                                                               
funds  are  being received.    He  understood  that DNR  is  also                                                               
dependent upon answers  from federal attorneys which  may be what                                                               
is taking time.                                                                                                                 
                                                                                                                                
MR. BATES responded yes, that is part of it.                                                                                    
                                                                                                                                
2:29:45 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GUTTENBERG observed that Section  14 on page 11 of                                                               
CSHB 74 (CRA)  states in several places that the  board cannot do                                                               
things that are preempted by  state or federal [law].  Therefore,                                                               
he is  trying to  determine why  this is  still a  sticking point                                                               
given that Section 14 seems to delineates that.                                                                                 
                                                                                                                                
MR.  BATES replied  that, to  him, the  difference is  preemption                                                               
versus either  duplicative or overriding  authority.  There  is a                                                               
difference  between specific  federal preemption  and that  which                                                               
simply  is  not   allowed  by  law,  either   overriding  law  or                                                               
duplicating  or being  more stringent.   While  Section 14  deals                                                               
specifically with preemption, the  department's legal question is                                                               
much  broader than  that:   Can  a  district enforceable  policy,                                                               
which is  ultimately adopted by the  state as a state  policy and                                                               
federally approved, overwrite statutory  authority.  For example,                                                               
can  a district  overwrite  or  be more  stringent  than what  is                                                               
established in  state law for  habitat authority under  Title 16?                                                               
Therefore, the  department is struggling  with a  bigger question                                                               
than just preemption.                                                                                                           
                                                                                                                                
2:32:10 PM                                                                                                                    
                                                                                                                                
CO-CHAIR JOHNSON  observed that there is  language throughout the                                                               
bill that  states may or  must adopt regulations approved  by the                                                               
board, such as on page 3, line 24,  and page 7, line 29, and page                                                               
11, line  27.   He asked  whether there  are other  statutes that                                                               
provide for a board to approve  regulations.  He said it seems to                                                               
him that  regulations are up  to the  department and this  may be                                                               
dealing with the separation of powers.   He added that it gets to                                                               
the issue that  there is a board that  cannot preempt regulations                                                               
that it must approve.                                                                                                           
                                                                                                                                
MR. BATES  answered he  is unsure whether  other boards,  such as                                                               
the Board of  Game or Board of  Fisheries, establish regulations.                                                               
He said  this bill  would vest powers  within the  Alaska Coastal                                                               
Policy  Board  that would  give  it  the authority  to  establish                                                               
regulations  and he  believes  that was  how  the Coastal  Policy                                                               
Council was set up during the years prior to 2003.                                                                              
                                                                                                                                
2:33:52 PM                                                                                                                    
                                                                                                                                
CO-CHAIR   NEUMAN   repeated  that   he   would   like  to   have                                                               
Representative Joule review the provisions of the bill.                                                                         
                                                                                                                                
REPRESENTATIVE EDGMON argued that it  makes no sense to have this                                                               
in-depth discussion  if DNR  is unwilling  to compromise  or come                                                               
forward  with  solutions.    He  said  the  department  left  the                                                               
committee meeting  of April 9, 2009,  with a mission to  foster a                                                               
solution.   However,  rather than  offering solutions  today, the                                                               
department is  saying "no", not  until this issue  of enforceable                                                               
policies  is established,  even  though the  Alaska Coastal  Zone                                                               
Management Program has been around for 25 years.                                                                                
                                                                                                                                
2:34:58 PM                                                                                                                    
                                                                                                                                
CO-CHAIR NEUMAN  pointed out that  Mayor Itta expressed  a desire                                                               
to work  with the  state.   He reiterated that  he would  like to                                                               
have  Representative Joule  review  the  bill's contents  because                                                               
that might answer many of these questions.                                                                                      
                                                                                                                                
MR. BATES said  that while DNR has significant  concerns with the                                                               
bill, it does not mean that  the department does not want to work                                                               
with folks.   The department  is continuing its  ongoing outreach                                                               
to the North  Slope and Northwestern districts as well  as to the                                                               
other districts.   The money  from the Coastal  Impact Assistance                                                               
Program (CIAP) is flowing and  is not contingent upon a rewritten                                                               
coastal  management program.    About $79  million  will come  to                                                               
Alaska over  the next  couple of  years because  the state  has a                                                               
coastal  management   program.     A  wide  variety   of  coastal                                                               
districts,  including the  North Slope  and Northwest  districts,                                                               
are receiving  a significant portion  of this money.   Receipt of                                                               
the  money  has  no  bearing  on  whether  the  North  Slope  and                                                               
Northwest coastal  districts have  plans; the  money is  based on                                                               
proximity  to  producing  wells  for  leases.    It  is  a  great                                                               
opportunity for the state to  engage in mitigation and additional                                                               
work related to Outer Continental Shelf activities.                                                                             
                                                                                                                                
2:37:29 PM                                                                                                                    
                                                                                                                                
MS. HENSLEY explained  that Section 1 would  establish the Alaska                                                               
Coastal   Policy  Board,   comprised  of   five  public   members                                                               
representing  coastal  districts  and the  commissioners  of  the                                                               
departments of  natural resources,  fish and  game, environmental                                                               
conservation, and commerce, community and economic development.                                                                 
                                                                                                                                
REPRESENTATIVE JOULE,  in response  to Co-Chair Neuman,  said the                                                               
five public  members would be  appointed by the governor  and the                                                               
governor would  use the criteria laid  out in the bill  to select                                                               
the  appointees.   People  from around  the  state would  forward                                                               
their  names to  the governor  and  the governor  would make  the                                                               
appointments from that pool of names.                                                                                           
                                                                                                                                
2:40:04 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  JOHNSON estimated  that  60-70 percent  of the  state's                                                               
population  lives in  the Upper  Cook Inlet  area, yet  that area                                                               
would have  only one representative  on the coastal  policy board                                                               
as provided on page 2, lines 9-13.                                                                                              
                                                                                                                                
REPRESENTATIVE JOULE  surmised Co-Chair Johnson is  thinking that                                                               
that part of the coastal  district is unrepresented.  However, he                                                               
countered with  the question, "Where is  the resource development                                                               
going to occur?"   He said there  are many ways to  look at this,                                                               
but agreed  there are  numerous people in  that district  and Co-                                                               
Chair Johnson's point is well made.                                                                                             
                                                                                                                                
CO-CHAIR NEUMAN  said all  Alaskans are in  this together  and he                                                               
knows from  his discussions with  Representative Joule  that that                                                               
issue is being looked at.                                                                                                       
                                                                                                                                
2:41:51 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  P. WILSON  understood that  the pre-2003  coastal                                                               
policy program  worked well.   She therefore requested  that when                                                               
reviewing  the  sectional analysis,  Ms.  Hensley  note how  each                                                               
section is different than what existed prior to 2003.                                                                           
                                                                                                                                
MS.  HENSLEY responded  that this  is a  complex program  and she                                                               
will do this as well as she can.   She pointed out that there are                                                               
people  in the  audience  with 20-plus  years  of experience  who                                                               
could clarify or answer what she does not know in this regard.                                                                  
                                                                                                                                
2:43:58 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE P.  WILSON requested Mr.  Tom Lohman to  also note                                                               
how each section is different than what existed prior to 2003.                                                                  
                                                                                                                                
THOMAS   LOHMAN,   Attorney   at  Law,   Environmental   Resource                                                               
Specialist,  Department  of   Wildlife  Management,  North  Slope                                                               
Borough, noted  he has  been with  the borough's  coastal program                                                               
since 1987  and the  North Slope  plan was  first adopted  in May                                                               
1988.   He said the Alaska  Coastal Management Plan did  not work                                                               
well  pre-2003, depending  upon where  a person  wants to  focus.                                                               
The problems  with the program  that existed in 2003  were solved                                                               
before  House Bill  191 and  largely had  to do  with third-party                                                               
involvement in consistency reviews,  which did delay projects and                                                               
that  was  solved  by  the  legislature.    House  Bill  191  was                                                               
essentially  enacted  because there  was  a  certain momentum,  a                                                               
sense that there was a problem  with the program even though that                                                               
problem no longer existed at that  point.  He said this bill does                                                               
not roll all the way back  to pre-House Bill 191; some things are                                                               
different.    He  acknowledged   there  were  problems  with  the                                                               
previous Coastal  Policy Council, including its  unwieldy size of                                                               
17  members  that  made  it  difficult to  get  a  quorum.    The                                                               
requirement  was that  the public  members  be elected  officials                                                               
from  regions around  the  state.   This  was  a problem  because                                                               
elected  officials  did not  necessarily  have  knowledge of  the                                                               
program.   The wording of HB  74 would put people  with knowledge                                                               
on the board because they would be nominated by the regions.                                                                    
                                                                                                                                
2:45:26 PM                                                                                                                    
                                                                                                                                
MR. LOHMAN said  he believes this overriding legal  question is a                                                               
red  herring,  given  the coastal  management  program  has  been                                                               
around for  a very long  time.  The  North Slope Borough  has met                                                               
with  the Office  of Ocean  and Coastal  Resource Management  and                                                               
that agency has  had no problem in either Alaska  pre-2003 or any                                                               
other programs the agency administers  around country where local                                                               
programs are  stricter than  applicable federal  laws.   With the                                                               
board in place, a district  would still have to supply scientific                                                               
evidence,  local   knowledge,  and  other  data   bases  to  show                                                               
scientifically  why a  district wants  to do  something stricter.                                                               
Regarding the noise example brought up  by Mr. Bates, he said the                                                               
North Slope district would yield  to DNR because the 125 decibels                                                               
is a  highly scientific question that  has to do with  impacts on                                                               
marine mammals.   The example that comes up at  every meeting the                                                               
North Slope district has had with  the state is the issue of tank                                                               
farm  regulation  where  there  are  statewide  one-size-fits-all                                                               
requirements  for the  lining  and  diking of  tanks.   If  local                                                               
knowledge  indicates   that  rainfall  and   snowfall  conditions                                                               
require that something  more be done, the district  would need to                                                               
go to the board  or DNR, whichever is the case,  to show that its                                                               
special conditions  necessitate stricter  requirements.   That is                                                               
not in conflict with, he argued;  it is stricter for reasons that                                                               
must be proven  to this third-party board.  He  said that is what                                                               
is  being asked  for and  that  is what  this bill  accomplishes,                                                               
which is why he believes this  issue of usurping state or federal                                                               
authority is a red herring.                                                                                                     
                                                                                                                                
MR. LOHMAN maintained that local  districts having the ability to                                                               
craft local  policies that reflect  local concerns is  in keeping                                                               
with what  every Alaska governor  has said since  statehood about                                                               
being  opposed to  federal intrusion  into  what goes  on in  the                                                               
state.  Given  Alaska's large size and diversity,  the same holds                                                               
true for  around the state -  there are reasons at  a local level                                                               
to  express views  through local  enforceable policies.   In  the                                                               
case of the  oil industry on the North Slope  such policies solve                                                               
problems  rather than  cause  them.   A  signal  is  sent to  the                                                               
developer/applicant about  what is  expected and  discussions can                                                               
then occur before permits are submitted.   He said this bill does                                                               
not  roll  it back  completely  to  pre-2003 because  there  were                                                               
problems  then; it  rolls  it back  at  the district  enforceable                                                               
level giving  districts some influence.   The bill  also corrects                                                               
some of the problems that existed with the program pre-2003.                                                                    
                                                                                                                                
2:48:54 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE TUCK  asked what the  changes are in  CSHB 74(CRA)                                                               
that would make  the new board a legal problem  when the pre-2003                                                               
Coastal Policy Council was not a legal problem.                                                                                 
                                                                                                                                
MR. LOHMAN responded  he does not see any legal  problem with the                                                               
board.   He said  a letter  was written months  ago by  Mr. Bates                                                               
through  the DNR  commissioner to  the attorney  general's office                                                               
looking  for an  opinion  on this,  but no  answer  has yet  been                                                               
received.  He  pointed out that no question was  ever heard about                                                               
the ability  of an  independent coastal  policy board  to approve                                                               
regulations or  to approve local  adopted policies under  the old                                                               
program; this  question was not  heard until December 2008.   The                                                               
North  Slope  Borough had  30-plus  local  policies pre-2003;  it                                                               
applied  for 41  under this  program, received  5, and  none went                                                               
through unamended.   The pre-2003  Coastal Policy Council  had an                                                               
involvement through  a petition  process and  individual reviews.                                                               
That  was  messy  because  a  lot of  the  council  members  were                                                               
unfamiliar with  the program and unfamiliar  with broader regions                                                               
of  the state,  but there  was  no legal  problem with  it.   The                                                               
proposed  board would  not  at all  be  involved with  individual                                                               
consistency reviews.   He  said he  thinks any  perceived problem                                                               
with the old board has been  solved and he does not believe there                                                               
was a legal problem in either case.                                                                                             
                                                                                                                                
MR. LOHMAN, in response to Co-Chair  Neuman, said he lived on the                                                               
North  Slope for  nine years,  but now  lives in  Anchorage.   He                                                               
reiterated he has been with the North Slope Borough since 1987.                                                                 
                                                                                                                                
2:51:37 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SEATON  inquired whether the Department  of Law is                                                               
saying  that  the  legislature  by  statute  does  not  have  the                                                               
authority to give a district the ability to write regulations.                                                                  
                                                                                                                                
MS. WOLTER provided an answer by  using the tank farm issue.  She                                                               
said the  state legislature has  given specific authority  to the                                                               
Department of  Environmental Conservation (DEC) to  regulate this                                                               
particular thing;  so, DEC has  gone through a public  process to                                                               
create regulations  that address tank lining,  tank capacity, and                                                               
so forth.   However, this  normal public process would  not occur                                                               
if  districts  can add  something  different  than what  DEC  has                                                               
already regulated.  Without a  public process, project applicants                                                               
would not  have any say  in why they  might not agree  with those                                                               
more stringent enforceable policies,  which are enforced as state                                                               
law.   Another concern is  that between districts there  could be                                                               
very different  standards.  A  project overlapping  two districts                                                               
with different standards would have  to comply with two different                                                               
standards rather than the one DEC  standard.  She said she thinks                                                               
this  is  something that  is  important  for the  legislature  to                                                               
figure out.   If authority  has been given  to a state  agency to                                                               
regulate  something specifically,  how far  does the  legislature                                                               
want to  go with enforceable  policies on  a district-by-district                                                               
basis and how far can they go on a state level.                                                                                 
                                                                                                                                
MS.  WOLTER  noted  that  on  a federal  level,  any  changes  to                                                               
statutes and  regulations resulting from program  changes must go                                                               
through the federal oversight body  and be approved by that body.                                                               
In regard  to Mr.  Lohman's statement that  the borough  would be                                                               
willing  to yield  on the  issue of  noise levels,  she said  the                                                               
Marine Mammal  Protection Act preempts  the state and is  a clear                                                               
example  of   something  that  would   not  be  allowed   on  the                                                               
enforceable policy level.  The  state has brought specific issues                                                               
to  the   federal  government  asking   whether  they   would  be                                                               
approvable and in  many examples the federal  government has said                                                               
no.   Even  when something  has gone  through on  a state  level,                                                               
there  have been  problems getting  it  approved as  part of  the                                                               
state program by the federal program.                                                                                           
                                                                                                                                
2:55:51 PM                                                                                                                    
                                                                                                                                
MS.  HENSLEY  said  Ms.  Wolter's   point  about  duplication  is                                                               
addressed in  Section 14 [page 11,  lines 10-12], and the  law is                                                               
not new, it  was simply moved from AS 46.40.030.   The only thing                                                               
that has  been added in  this section is the  preemption standard                                                               
because it is a term understand the world over.                                                                                 
                                                                                                                                
MS. WOLTER  clarified she  is not  talking about  the duplicating                                                               
language; rather, she is talking  about when enforceable policies                                                               
are more stringent or more specific than state or federal law.                                                                  
                                                                                                                                
2:57:04 PM                                                                                                                    
                                                                                                                                
MS.  HENSLEY returned  to her  sectional analysis  review, noting                                                               
Section  2 clarifies  that the  Department  of Natural  Resources                                                               
will  render all  federal consistency  determinations as  well as                                                               
state  consistency  determinations  when  a  project  requires  a                                                               
permit from  the department  or from two  or more  state resource                                                               
agencies.   This provision is significant  because [pre-2003] the                                                               
Coastal Policy Council that made the consistency determinations.                                                                
                                                                                                                                
REPRESENTATIVE EDGMON  interjected that one year  later the legal                                                               
issue has  still not been  resolved for whatever  unknown reason,                                                               
and going through the bill is  academic unless the legal issue is                                                               
resolved.    He therefore  requested  that  the attorney  general                                                               
address the committee so there can  be some clarity on this issue                                                               
before moving forward.                                                                                                          
                                                                                                                                
CO-CHAIR NEUMAN agreed the attorney  general can be asked to come                                                               
to  the next  hearing, but  maintained it  is still  important to                                                               
know what the bill would do.                                                                                                    
                                                                                                                                
2:58:54 PM                                                                                                                    
                                                                                                                                
MS. HENSLEY  explained that Section  3 would  establish authority                                                               
for DNR  to adopt regulations after  approval by the board.   She                                                               
added that  she would research  other instances in which  a board                                                               
makes regulations and get that  information to members.  She said                                                               
Section 4 would establish the  powers of the board, including the                                                               
ability to accept grants and  take reasonable action to carry out                                                               
the intent of the program.   Section 5 would establish the duties                                                               
of the board  to approve the ACMP standards and  the criteria for                                                               
district plan approval.  Section 6  defines the board.  Section 7                                                               
provides for approval of ACMP  program changes by the board; this                                                               
provision  essentially changes  the word  department to  the word                                                               
board.                                                                                                                          
                                                                                                                                
3:00:12 PM                                                                                                                    
                                                                                                                                
MS.  HENSLEY related  that Section  8 looks  at objectives.   The                                                               
second objective  remains the same  regarding the  development of                                                               
industrial  or commercial  enterprises,  given that  the ACMP  is                                                               
intended  to   promote  development.     She  pointed   out  that                                                               
subsistence is added to paragraph (5) on page 6, line 9.                                                                        
                                                                                                                                
CO-CHAIR NEUMAN inquired whether  [adding subsistence] would give                                                               
the proposed coastal policy board the ability to manage game.                                                                   
                                                                                                                                
MS. HENSLEY  replied she does  not believe it would  because this                                                               
change is  just stating  what is already  there; the  federal law                                                               
includes  subsistence  as  one  of  the  resources  that  can  be                                                               
managed.   Coastal  districts already  have  authority to  create                                                               
enforceable  policies  that  address  subsistence,  so  it  is  a                                                               
technical change to clearly reflect what is covered.                                                                            
                                                                                                                                
3:01:21 PM                                                                                                                    
                                                                                                                                
MS.  HENSLEY  said Section  9  is  more  substantial in  that  it                                                               
removes  the requirement  for  district  enforceable policies  to                                                               
meet statewide  standards.  The statewide  standards criteria was                                                               
somewhat confusing,  so this section  provides that  the district                                                               
plan criteria must be met.                                                                                                      
                                                                                                                                
CO-CHAIR NEUMAN announced  that the meeting time  had expired and                                                               
asked  which sections  of the  bill should  be looked  at by  the                                                               
committee in regard to substantial changes.                                                                                     
                                                                                                                                
MS.  HENSLEY  responded  the most  substantial  changes  are  the                                                               
creation of  the Alaska Coastal  Policy Board and  the re-uniting                                                               
of  the   Department  of  Environmental  Conservation   with  the                                                               
program.   She emphasized  that the board  would not  conduct the                                                               
review process of projects as that would remain with DNR.                                                                       
                                                                                                                                
3:02:43 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOULE  reminded members  that the North  Slope and                                                               
Northwest  Arctic  districts  still  have  not  had  their  plans                                                               
approved and  maybe that is  where the  focus of the  bill should                                                               
be.  He  pointed out that this  is the fourth year  for this bill                                                               
in one form or another, along  with DNR's opposition to the bill.                                                               
He related that  at one time DNR said it  would introduce its own                                                               
bill and  he wishes DNR would  provide that guidance or  join him                                                               
in his office  to hammer this out.   He said he has  met with the                                                               
commissioner on several occasions  and attended DNR's symposiums,                                                               
yet  nothing   materializes.    In  reference   to  Mayor  Itta's                                                               
statement that  he must  support something,  and given  the state                                                               
not taking  any action,  Representative Joule  said he  is unsure                                                               
what options that leaves the mayor.                                                                                             
                                                                                                                                
[HB 74 was held over.]                                                                                                          
                                                                                                                                
3:05:52 PM                                                                                                                    
                                                                                                                                

Document Name Date/Time Subjects
HB414-REV-TAX-03-20-10 Separation of Oil and Gas Production Tax.pdf HRES 3/22/2010 1:00:00 PM
HB 414
HB 74 HRES Pkg for 3.22.10.pdf HRES 3/22/2010 1:00:00 PM
HB 74
HB 414 HRES for 3.22.10.pdf HRES 3/22/2010 1:00:00 PM
HB 414
HB 74 Mayor Itta Presentation.pdf HRES 3/22/2010 1:00:00 PM
HB 74
HB 74 Calista Letter.pdf HRES 3/22/2010 1:00:00 PM
HB 74
HB 74 Shell Letter.pdf HRES 3/22/2010 1:00:00 PM
HB 74
HB 74 joint association letter on ACMP.pdf HRES 3/22/2010 1:00:00 PM
HB 74
HB 74 AK Miners Assn Letter.pdf HRES 3/22/2010 1:00:00 PM
HB 74
HB 74 Steel Fab Letter.pdf HRES 3/22/2010 1:00:00 PM
HB 74
HB 74 Harbour Article 3.30.10.pdf HRES 3/22/2010 1:00:00 PM
HB 74