Legislature(2003 - 2004)

03/01/2004 09:05 AM Senate FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
     SENATE BILL NO. 305                                                                                                        
     "An  Act  relating   to  state  ownership  of  submerged   land                                                            
     underlying   water  that  was  navigable  at  the  time  Alaska                                                            
     achieved statehood."                                                                                                       
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
JOE BALASH,  Staff to Senator Gene  Therriault, the bill's  sponsor,                                                            
read the Sponsor Statement as follows.                                                                                          
     With the exception  of withdrawn federal lands, at statehood in                                                            
     1959,  Alaska received title  under the equal footing  doctrine                                                            
     to all submerged lands  under state navigable waters and marine                                                            
     waters   out  to  three  miles.   Unfortunately,  the   federal                                                            
     government   has  been   slow  to   concede  any  navigability                                                             
     determinations.  Since  Alaska entered  the Union, the  federal                                                            
     courts have  determined fewer than 20 rivers  navigable. Unless                                                            
     the state  is pro-active in asserting its claims,  it stands to                                                            
     lose up to 60 million acres of its statehood entitlement.                                                                  
     In some cases,  the federal government has used  every possible                                                            
     legal  tactic under the Federal  Quiet Title Act to  impede the                                                            
     state's  assertion of ownership.  The Black, Kandig  and Nation                                                            
     Rivers  in northeast  Alaska are examples.  These three  Rivers                                                            
     clearly  meet the criteria  established  by the federal  courts                                                            
     for determining navigability in Alaska                                                                                     
     Although no one contested  the state's claim that these streams                                                            
     met  the  federal  criteria,  this  case took  nine  years  and                                                            
     millions  of state and federal dollars to litigate.  Eventually                                                            
     the state  won two of the three  cases. The third was  resolved                                                            
      by a Federal Recordable Disclaimer of Interest in 2003.                                                                   
     In  addition,  prior to  1989 the  federal  government  applied                                                            
     incorrect  standards  to determine  navigability  and may  have                                                            
     mistakenly  conveyed state-owned  land to Native corporations,                                                             
     clouding  the title to hundreds of thousands,  if not millions,                                                            
     of  acres. This  is a critical  topic as  Congress considers  a                                                            
     deadline  for  completing  the land  selection  and  conveyance                                                            
     Contributing  to the problem  is the lack  of a reasonable  and                                                            
     efficient  way for the state  to secure title to its  submerged                                                            
     lands.  SB  305 takes  three  steps  to  begin the  process  of                                                            
     identifying state claims.                                                                                                  
     First, SB 305 provides  to all parties that the state is laying                                                            
     claim  to all submerged  lands, except  those withdrawn  at the                                                            
     time  of  statehood,  that  meet  the  standards  and  criteria                                                            
     established  in the Submerged Lands Act and in  various federal                                                            
     court decisions.                                                                                                           
     Second, it  provides authority for state agencies  to identify,                                                            
     in  accordance with  the appropriate  federal  and state  laws,                                                            
     which  waterbodies  the  state  claims as  navigable  and  non-                                                            
     navigable.  This  will  help  the state  clarify  criteria  for                                                            
     identifying  navigable   waters, address  conflicts   involving                                                            
     clouded  titles due to inaccurate  conveyances from  the Bureau                                                            
     of  Land  Management,  and more  clearly  delineate  its  title                                                            
     Third, the bill directs  the Department of Natural Resources to                                                            
     give notice  to all private property  owners, including  native                                                            
     corporations  created under the Alaska Native  Claim Settlement                                                            
     Act,  that may  have received  title to lands  that could  have                                                            
     erroneously   included   state   submerged   lands   in   their                                                            
     conveyance.   This  is critical   to resolve   future  problems                                                            
     regarding  mineral development,  gravel extraction,  access and                                                            
     other related land uses.                                                                                                   
     This legislation  is only one step for the state  to eventually                                                            
     resolve the title  disputes over its submerged lands, and deals                                                            
     only with the issue  of state title to submerged lands. It does                                                            
     not   address  conflicts   over  federal   fish  and   wildlife                                                            
     management  in  state  navigable   waters  created  by  federal                                                            
     reserved water rights claims.                                                                                              
Mr.  Balash  concluded  that,  "this is  primarily  an  issue  where                                                            
federal  agencies  have  used incorrect  definitions  and  means  of                                                            
conveying title to primarily  the Native corporations." He continued                                                            
that,  "this is  just an  assertion  of the  State's  claims and  an                                                            
effort" to  put on record  that the State  does not "concede  any of                                                            
our title to anybody."                                                                                                          
Co-Chair Green  questioned whether  conceding title, which  has been                                                            
incorrectly  conveyed, to  one group might  set a precedent  whereby                                                            
the State would be required to concede title to other groups.                                                                   
Mr. Balash responded  that "the real question" is  establishing that                                                            
the  water  was  recognized  as being  "navigable  at  the  time  of                                                            
Statehood." He  shared that "the knowledge, the files,  the criteria                                                            
upon  which that  is  all based  in  order to  stake  that claim  is                                                            
getting  old."   He  exampled  that  "the  people   who  know  about                                                            
particular  bodies of  water are soon  to be passing,"  and  in that                                                            
case, the  State "would lose  the ability  to regain that  knowledge                                                            
and  reclaim  that  title  in  a Court  or  a  federal  agency."  He                                                            
furthered that were the  State to not pursue the issue now while the                                                            
information  is still available, the  Court might decide  that since                                                            
the State "didn't  care about it for  the last 45 years,  why do you                                                            
care about it now."                                                                                                             
Senator Olson asked regarding  the State's assertion "that incorrect                                                            
standards were being used"  by the federal Bureau of Land Management                                                            
(BLM), whether  there is a definition of what constitutes  navigable                                                            
waters  or  whether  the  contrary   opinion  is  the  result  of  a                                                            
difference of opinions as to what navigable waters are.                                                                         
Mr.  Balash  reiterated  the  State's position  that  the  BLM  used                                                            
incorrect definitions.  He informed that "the Courts have delineated                                                            
what a  navigable  waterbody is."  Continuing, he  pointed out  that                                                            
some conveyances  were granted "prior  to 1989, before some  of that                                                            
case law" was determined,  and, he voiced that this "would indicate"                                                            
that some  of the State's  title have been  incorrectly conveyed  to                                                            
Native corporations.                                                                                                            
Mr. Balash  stated that one  component of  the Alaska Native  Claims                                                            
Settlement Act was that  each of the Native corporations was awarded                                                            
a certain acreage allotment,  and he continued, any of the submerged                                                            
land acreage  that was  incorrectly conveyed  "counted against  that                                                            
total acreage."  He noted  that were the State  to reclaim  title to                                                            
those  submerged  lands, that  acreage  would  be removed  from  the                                                            
allotment,  and the Native corporations  would be entitled  "to make                                                            
additional  selections  in the  uplands  or in  other  parts of  the                                                            
Senator Olson  surmised therefore "that the Native  corporations are                                                            
not going to be happy with this legislation."                                                                                   
Mr. Balash  responded that  this might not  be the case as  a Native                                                            
corporation might be able  to select more acreage. However, he noted                                                            
that conflict  might arise were a  Native corporation not  desire to                                                            
relinquish the  land. He noted that the Sealaska Native  Corporation                                                            
has  been reviewing  this  legislation  to  determine  any  negative                                                            
consequences;  however, he  noted that no  information has,  of yet,                                                            
been provided.                                                                                                                  
Senator Hoffman commented  on the State's assertion that the federal                                                            
government  has been  "dragging  its feet  in the  conveying of  the                                                            
State's submerged  lands" and that,  as a result, the State  has had                                                            
to resort  to taking expensive  legal action.  He asked whether  the                                                            
State would be required  to continue the litigation process were the                                                            
federal  government  to continue  its  status  quo approach  to  the                                                            
Mr. Balash  replied that  there are numerous  courses of action.  He                                                            
noted that  the federal Department  of the Interior and the  BLM are                                                            
working with  the State to review  cases for the Federal  Recordable                                                            
Disclaimer of Interest  process. He stressed that because litigation                                                            
is  difficult,  expensive,  and time  consuming,  other legislation                                                             
would be forthcoming  to establish a State/federal  Navigable Waters                                                            
Commission, which would  address the issue "in an expedited manner."                                                            
He  shared  that  there are  options  that  the  State  and  federal                                                            
government  could use to try and speed  up the process; however,  he                                                            
reiterated  that this legislation  is the  first step in  clarifying                                                            
the  State's position  to  future  federal  Courts and  agencies  in                                                            
regards to the State's claim to submerged lands.                                                                                
Senator Hoffman  noted that the year 2009 has been  specified as the                                                            
target date to identify all State submerged lands.                                                                              
Mr. Balash  responded that  the goal is to  identify as much  of the                                                            
land as possible by that  date. He noted, however that the submerged                                                            
land  issue is  not being  addressed  on the  federal Congressional                                                             
level at this  time. However, he noted that the Navigational  Waters                                                            
Commission  legislation   has  been  previously  addressed   at  the                                                            
Congressional  level,  and  he  continued,  the hope  is  that  that                                                            
Commission would be established "sooner rather than later."                                                                     
DICK MYLIUS,  Deputy Director, Division  of Mining, Land  and Water,                                                            
Department  of Natural Resources testified  via teleconference  from                                                            
an offnet site  and noted that he is available to  answer questions.                                                            
JOANNE GRACE, Senior Assistant  Attorney General, Opinions, Appeals,                                                            
& Ethics  Section,  Office of the  Attorney  General, Department  of                                                            
Law, testified  via  teleconference  and clarified,  in response  to                                                            
Senator Hoffman's  questions, that  while the State was granted  the                                                            
title  to  its submerged   lands at  Statehood,  the  issue  "is  to                                                            
determine  what belongs to  the State and  what doesn't." She  noted                                                            
that, before 1989 when  the BLM was applying incorrect standards, it                                                            
might  have conveyed  some submerged  lands to  Native Corporations                                                             
"that the United States  did not actually have title to convey." She                                                            
continued that  BLM's position was that the lands  being conveyed to                                                            
the Native corporations  were designated as non-navigable,  and that                                                            
the Native corporations  would be charged acreage for that land. She                                                            
clarified,  however,   that  were  these  lands  determined   to  be                                                            
navigable,  the Native  corporations'  concern  is  that "they  were                                                            
charged acreage for land  that they did not actually receive, and if                                                            
the conveyances are all  completed by the year 2009, then the Native                                                            
corporations  would lose the opportunity  to go back to BLM  and say                                                            
you purported  to convey  this submerged  land to  us when you  were                                                            
using incorrect  standards,  and we  would like you  to go back  and                                                            
reconsider  using the correct standards  so that we can be  credited                                                            
with the  acreage that  we should  have gotten  for those  submerged                                                            
Senator Hoffman  voiced that numerous  Native corporations  received                                                            
"over-selections"   of lands,   and therefore,   he  continued,  the                                                            
assertion that  they would be losing land "may not  be exactly true,                                                            
as it depends  on how large  their over-selections  are." He  shared                                                            
that the  corporation  he is a member  of has  an over-selection  of                                                            
approximately ten percent.  Therefore, he opined, when the submerged                                                            
land identification is  completed in 2009, "many of the Corporations                                                            
would still get their land."                                                                                                    
Co-Chair Green  asked whether a wrongful  conveyance would  place "a                                                            
cloud on the title."                                                                                                            
Senator Hoffman  affirmed that while  there would be a cloud  on the                                                            
title and  the land  would be  withdrawn from  the corporation,  the                                                            
over-selection would compensate for the removed land.                                                                           
RON SOMERVILLE, Resource  Consultant to the House of Representatives                                                            
and Senate  Majority, testified  via teleconference  from an  offnet                                                            
site and noted  that during the drafting  of SB 305 and SB  295, one                                                            
of the issues  of discussion was that  "only the corporations  could                                                            
request  the clarification   from BLM"  regarding  the navigability                                                             
issues.  He asserted  that the State  could not  make this  request.                                                            
Therefore,  he  continued,   the encouragement   is  to  the  Native                                                            
corporations to  get that process going "if the villages  want to do                                                            
TINA CUNNING,  State-Federal Issues  Program Manager, Office  of the                                                            
Commissioner, and Co-Chair,  State Navigable Waters Team, Department                                                            
of Fish and Game,  testified via teleconference from  an offnet site                                                            
to note that there are  some corporations that "are closer to" their                                                            
entitlement  allotment  than others.  She shared  that one of  these                                                            
corporations  had  requested  BLM "to  review  some of  the  waters"                                                            
conveyed  to  it, and  the  determination  was  that the  land  "was                                                            
incorrectly  included in  the conveyances."  She stated,  therefore,                                                            
that  some corporations  would  benefit from  the  inclusion of  the                                                            
upland acreage language.                                                                                                        
Co-Chair  Green  asked  whether  the  time  frame of  180  days,  as                                                            
identified  in Sec.  3,  line 7,  that reads  as follows,  would  be                                                            
     NOTICE  TO  NATIVE  CORPORATIONS.  Within  180 days  after  the                                                            
     effective  date  of  this  Act,  the  commissioner  of  natural                                                            
     resources  shall send a written notice of the  state's claim of                                                            
     ownership  of submerged land  described in AS 38.04.062(a),  as                                                            
     enacted  in sec. 2 of  this Act, to  each regional corporation                                                             
     established  under 43 U.S.C 1607 (sec. 8, Alaska  Native Claims                                                            
     Settlement  Act). The  purpose of the  notice is to assert  the                                                            
     state's  ownership  interest in  submerged land  that may  have                                                            
     been  erroneously  included  in a  conveyance  or  patent to  a                                                            
     regional  or village  corporation  from the  federal Bureau  of                                                            
     Land Management.                                                                                                           
Mr. Balash stated  that, "this is a generic notification  to be sent                                                            
out to  potential landowners  who might have  been wrongly  conveyed                                                            
lands."  He stated that  the "language was developed in consultation                                                            
with  the State  agencies,  and therefore,  he stated,  any  concern                                                            
about this timeframe would have, at that time, been addressed.                                                                  
Co-Chair Green  asked for confirmation  that the notice would  be of                                                            
generic  nature  as opposed  to  being required  to  delineate  each                                                            
parcel of land.                                                                                                                 
Mr. Balash confirmed  that is correct. He stated that  the 2009 date                                                            
is the date  targeted by Alaska's  Congressional delegation  and the                                                            
Office of  the Governor;  however, he noted  that the Congressional                                                             
legislation regarding this issue has not yet been adopted.                                                                      
Senator  Dyson  moved  to  report  the  bill   from  Committee  with                                                            
individual recommendations and accompanying fiscal note.                                                                        
There being  no objection, SB 305  was REPORTED from Committee  with                                                            
fiscal  note #1 in  the amount of  $186,500 from  the Department  of                                                            
Natural Resources.                                                                                                              

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