Legislature(2009 - 2010)BELTZ 211

03/30/2009 01:30 PM Senate JUDICIARY

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* first hearing in first committee of referral
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Heard & Held
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
Moved SB 47 Out of Committee
         SB 148-LIABILITY FOR TRIBAL ROAD CONSTRUCTION                                                                      
1:36:16 PM                                                                                                                    
CHAIR FRENCH announced the consideration of SB 148.                                                                             
DOROTHY SHOCKLEY, Staff to Senator  Albert Kookesh, introduced SB
148 with the following statement:                                                                                               
     SB  148 will  resolve  the issue  of  liability to  the                                                                    
     state or  employees of the  state when  partnering with                                                                    
     federally   recognized   tribes    under   the   Indian                                                                    
     Reservation Roads  (IRR) Program.  With the  decline in                                                                    
     state and federal highway funds,  it is imperative that                                                                    
     we  collaborate  and  work  together.  This  bill  will                                                                    
     assist  the partnering  process and  ultimately benefit                                                                    
     all Alaskans  by leading  to long-term  improvements in                                                                    
     the state's overall transportation infrastructure.                                                                         
She directed  attention to the list  of tribes in Alaska  that in                                                               
2008 received  more than $45  million in IRR funds.  The stimulus                                                               
is expected to supplement these  funds by roughly $40 million. As                                                               
the  Department of  Transportation &  Public Facilities  prepares                                                               
the  next Statewide  Transportation  Improvement Program  (STIP),                                                               
tribes  for   the  first  time   can  bring  both   matching  and                                                               
maintenance  funds,  she  said.   "This  will  move  the  working                                                               
relationship along and  allow both state and federal  funds to be                                                               
used on highways."                                                                                                              
1:38:33 PM                                                                                                                    
CHAIR  FRENCH  asked Mr.  Putzier  to  explain where  this  would                                                               
apply,  to whom  it would  apply, and  what would  happen in  the                                                               
event that  a road  was built incorrectly  and someone  wanted to                                                               
file suit.                                                                                                                      
PETER   PUTZIER,  Senior   Assistant   Attorney  General,   Civil                                                               
Division, Opinions,  Appeals, & Ethics, Department  of Law (DOL),                                                               
Anchorage, explained that  the bill would apply where  a tribe is                                                               
performing work on state roads  pursuant to the IRR Program. This                                                               
program has  been around for some  time, but with changes  in the                                                               
law tribes now  are better funded. Most notably  in 2005 SAFETEA-                                                               
LU  (Safe Accountable  Flexible  Efficient Transportation  Equity                                                               
Act)  made  about  $100  million available  to  the  roughly  230                                                               
federally  recognized tribes  in Alaska.  One sort  of partnering                                                               
relationship that has been discussed  is that the tribe would use                                                               
100 percent federal funds and  their own personnel to perform the                                                               
CHAIR FRENCH questioned where this work would take place.                                                                       
MR.  PUTZIER  explained  that by  definition  Indian  Reservation                                                               
Roads  are either  on  a reservation  or leading  to  or from  an                                                               
Alaska  Native village.  That opened  the  door for  a number  of                                                               
state roads  to be  denominated as  Indian Reservation  Roads and                                                               
the  tribes  have  expressed  an  interest  in  taking  over  the                                                               
maintenance activities for some of those roads.                                                                                 
CHAIR  FRENCH asked  if  the state  highway  near Mentasta  could                                                               
potentially fall under the bill.                                                                                                
MR. PUTZIER replied there is that potential.                                                                                    
CHAIR FRENCH asked what would  determine whether that highway did                                                               
fall under the bill.                                                                                                            
MR. PUTZIER explained  that the tribes go through  a process with                                                               
the Bureau  of Indian Affairs  (BIA) where sections of  road that                                                               
are on  a particular tribe's  inventory are  formally denominated                                                               
as an Indian Reservation Road.                                                                                                  
CHAIR FRENCH asked if the state has any input in the decision.                                                                  
MR. PUTZIER  said no.  Early on  the state  was asked  to certify                                                               
certain state roads as IRR  and there was considerable discussion                                                               
about what  that certification should say.  Ultimately, the state                                                               
provided  a  listing  of  the  public  roads  in  Alaska  without                                                               
providing  any sort  of certification.  Tribes  used that  public                                                               
listing of roads  to identify the various roads  they consider to                                                               
be IRRs.                                                                                                                        
CHAIR  FRENCH summarized  that the  state opted  not to  make the                                                               
hard choices and simply turned over a list of all state roads.                                                                  
1:42:54 PM                                                                                                                    
MR. PUTZIER  clarified that it's  not up  to the state  to decide                                                               
whether or not certain segments of  road are IRR or not. "We were                                                               
asked  to provide  a  certification that  the  roads were  Indian                                                               
Reservation Roads  and we  weren't sure  of the  ramifications of                                                               
providing such a certification," he added.                                                                                      
CHAIR FRENCH asked how many miles  of state road were on the list                                                               
that was given to BIA.                                                                                                          
MR. PUTZIER  replied he doesn't know  the number of miles  but he                                                               
believes the list includes all state roads within Alaska.                                                                       
CHAIR  FRENCH said,  "So  you basically  turned  the universe  of                                                               
state roads  over to  BIA and  now it's  up to  them to  make the                                                               
final  decision as  to which  segments of  those roads  this bill                                                               
would apply to."                                                                                                                
MR. PUTZIER  clarified that the  state didn't turn  anything over                                                               
to the BIA; they simply  provided a publicly available listing of                                                               
the roads in the state.                                                                                                         
CHAIR FRENCH asked what position  the administration is taking on                                                               
the bill.                                                                                                                       
MR. PUTZIER replied he believes the administration supports it.                                                                 
CHAIR  FRENCH asked  if  he's being  cautious  because he  hasn't                                                               
MR.  PUTZIER replied  this didn't  come through  as a  governor's                                                               
bill, but DOTPF certainly supports it.                                                                                          
SENATOR THERRIAULT  observed that  the bill  says "By  the Senate                                                               
Transportation Committee  by request"  and asked if  that doesn't                                                               
mean it is at the request of the administration.                                                                                
1:44:43 PM                                                                                                                    
MARY  SIROKY, Legislative  Liaison, Department  of Transportation                                                               
and Public  Facilities (DOTPF),  confirmed that  the bill  was at                                                               
the request of the administration.                                                                                              
SENATOR WIELECHOWSKI asked about the  ability of an individual to                                                               
sue a tribe.                                                                                                                    
MR.  PUTZIER explained  that  the tribe  would  be considered  an                                                               
employee of  the federal government and  in the event that  it is                                                               
sued,  the federal  Department  of Justice  would  take over  the                                                               
defense. A  person would  be able to  maintain an  action against                                                               
the tribe  pursuant to  the Federal  Tort Claims  Act. That  is a                                                               
waiver of  the federal government's  liability to  certain causes                                                               
of action  similar to what the  state has, so a  lawsuit could be                                                               
maintained against the tribe.                                                                                                   
SENATOR  WIELECHOWSKI  asked if  the  Act  limits the  amounts  a                                                               
person can recover.                                                                                                             
MR. PUTZIER replied it's similar to  the state recovery in that a                                                               
person can get compensatory but  not punitive damages. He said he                                                               
doesn't  believe  the compensatory  damages  are  capped, but  he                                                               
isn't certain.                                                                                                                  
SENATOR WIELECHOWSKI  asked if, for  these types of  actions, the                                                               
limits  under the  Federal  Tort Claims  Act  are different  than                                                               
under the State Tort Claims Act.                                                                                                
1:46:38 PM                                                                                                                    
MR. PUTZIER replied he doesn't know the answer.                                                                                 
SENATOR  WIELECHOWSKI  asked if  someone  online  might know  the                                                               
CHAIR  FRENCH  noted that  that  there  wasn't anyone  who  could                                                               
answer and asked Mr. Putzier to find out soon.                                                                                  
MR. PUTZIER agreed to do so.                                                                                                    
SENATOR  WIELECHOWSKI asked  how common  it is  to have  lawsuits                                                               
with claims  arising out of  design, operations,  maintenance, or                                                               
construction activities pertaining to roads.                                                                                    
MR. PUTZIER  replied, according to  the tort section,  it's quite                                                               
common to have litigation arising on highways.                                                                                  
SENATOR  WIELECHOWSKI noted  that he  received a  letter from  an                                                               
angry  constituent  complaining  about  the  ruts  on  the  Glenn                                                               
Highway  that  allegedly  caused   an  accident.  He  understands                                                               
there's a  balance, but he doesn't  want to pass this  bill if it                                                               
takes away  Alaskan's constitutional right  to file a  lawsuit if                                                               
they've been wronged.                                                                                                           
1:48:25 PM                                                                                                                    
MR. PUTZIER acknowledged it's a  good point, but the bill doesn't                                                               
relieve the  State of Alaska of  its own negligence. The  idea of                                                               
the bill is that if a project  is managed by a tribe, any actions                                                               
arising from  that work could  not be brought against  the state.                                                               
The  individual could  sue the  tribe. However,  the state  would                                                               
remain liable for certain causes of action.                                                                                     
SENATOR WIELECHOWSKI  asked if lawsuits  against tribes  in these                                                               
types of  actions would  need to be  brought in  federal district                                                               
MR.  PUTZIER said  his understanding  is that  under the  Federal                                                               
Tort   Claims  Act   an   individual  first   has   to  file   an                                                               
administrative claim  against the agency  for which the  tribe is                                                               
working.   Typically   that   would  be   the   Federal   Highway                                                               
Administration  (FHWA)  and  that  agency would  have  about  six                                                               
months to process the claim. If  it's unresolved at that level an                                                               
individual  would  have the  right  to  sue in  federal  district                                                               
SENATOR WIELECHOWSKI asked if this  means an individual would not                                                               
be able to sue in state court.                                                                                                  
MR. PUTZIER  said his  understanding is that  there would  not be                                                               
the ability under the Federal Tort Claims Act.                                                                                  
SENATOR  WIELECHOWSKI  asked if  the  statute  of limitations  is                                                               
different under the  Federal Tort Claims Act than  the 1tate Tort                                                               
Claims Act.                                                                                                                     
MR. PUTZIER  said he believes  they differ in some  respects, but                                                               
he would check on that.                                                                                                         
SENATOR   WIELECHOWSKI   expressed   interest  in   getting   the                                                               
information and asked if he said  he would also provide a list of                                                               
the roads that would be impacted by the bill.                                                                                   
MR. PUTZIER  asked if he wanted  a list of state  roads or Indian                                                               
Reservation Roads.                                                                                                              
SENATOR WIELECHOWSKI  replied he'd like  to know the  breadth and                                                               
depth  of the  roads that  this will  impact. In  particular he's                                                               
interested in  the major roads  along the Railbelt and  any roads                                                               
in Anchorage.                                                                                                                   
MR.  PUTZIER said  he knows  that sections  of the  Glenn Highway                                                               
have an IRR designation.                                                                                                        
SENATOR WIELECHOWSKI  expressed concern that this  creates a maze                                                               
for Alaskans to  navigate to figure out who they  need to sue and                                                               
what  procedures they  need  to go  through in  order  to file  a                                                               
1:52:16 PM                                                                                                                    
CHAIR FRENCH  asked if this  is the  sort of provision  you'd see                                                               
done on  behalf of  contractors that the  state employs  to build                                                               
MR.  PUTZIER  explained  that  DOTPF  asks  to  be  named  as  an                                                               
additional insured when it contracts with a contractor.                                                                         
CHAIR FRENCH observed that if there's  an accident on a road that                                                               
the  state contracted,  the lawsuit  alleging  a poorly  designed                                                               
road ultimately will follow an insurance policy to its end.                                                                     
MR. PUTZIER  agreed; typically the  state and the  contractor are                                                               
sued and the state will tender the defense to the contractor.                                                                   
CHAIR  FRENCH  asked if  in  this  case  the  state will  say  an                                                               
individual should go to federal court to seek damages.                                                                          
MR. PUTZIER  emphasized that  this is  slightly different  than a                                                               
normal  construction  job because  it  literally  turns over  the                                                               
construction  to the  tribe.  The tribe  would  be using  federal                                                               
funds  and its  own resources;  the  state would  have no  active                                                               
participation  or  oversight.   It's  a  government-to-government                                                               
relationship between the tribe and the federal government.                                                                      
1:54:10 PM                                                                                                                    
CHAIR FRENCH said  he can see the attraction  because there would                                                               
be more federal funds and more  work for the tribes. "There's not                                                               
even a 90:10 match, it's pure federal dollars."                                                                                 
MR. PUTZIER responded  there is the opportunity for  a match, but                                                               
he  believes  the  goal  is  for  the  tribe  to  build  its  own                                                               
transportation  expertise so  there is  a desire  to do  the work                                                               
CHAIR FRENCH asked if this is  mandated by SAFETEA-LU or if other                                                               
state legislatures are pushing this type of legislation.                                                                        
MR. PUTZIER replied this is  not required and because the program                                                               
is new, states with Indian  reservations are trying to figure out                                                               
how  the   state/tribal  relationship   will  occur.   Alaska  is                                                               
different in that it doesn't  have reservations and has the issue                                                               
that  IRRs  can be  roads  leading  to  and from  villages.  That                                                               
complicates the jurisdictional puzzle  and the application of the                                                               
program so looking at other  states won't provide a clear analogy                                                               
to the kinds of issues that Alaska is facing.                                                                                   
1:55:43 PM                                                                                                                    
GORDON  JACKSON, Director  of Roads  and Transportation,  Central                                                               
Council  Tlingit  Haida Indian  Tribes  of  Alaska (THITA),  said                                                               
THITA  is  one of  the  largest  federally recognized  tribes  in                                                               
Alaska with  27,000 members,  $25 million  in budgets,  and about                                                               
250  employees. SB  148 is  important  and, if  enacted, it  will                                                               
resolve the  state's lingering concern about  potential liability                                                               
from  IRR projects.  If  the bill  does not  pass  the state  may                                                               
continue to  require model maintenance agreements,  which require                                                               
tribes  to  carry  significant   general  liability  coverage  to                                                               
protect the state. This insurance  can be costly and difficult to                                                               
1:57:59 PM                                                                                                                    
MR. JACKSON said  THITA takes inventory of roads  within the City                                                               
and  Borough   of  Juneau  (CBJ)   and  has  also   entered  into                                                               
memorandums of  agreement (MOA) with various  municipalities. The                                                               
MOA basically  says the  tribe will  coordinate and  cooperate on                                                               
roads and where possible provide  matching funds. THITA also sent                                                               
a MOA to the state.  Roughly $320 million is available nationally                                                               
for the  IRR Program and THITA  wants to ensure that  it is being                                                               
2:00:03 PM                                                                                                                    
CHAIR FRENCH asked if he has projects in mind.                                                                                  
MR. JACKSON  replied there are  a number  of trails that  CBJ has                                                               
mentioned, there is  some need for marine  highway terminals, and                                                               
there is  need for  terminal buildings  at various  airports. The                                                               
idea is  to work cooperatively if  money is coming to  the state,                                                               
he said.                                                                                                                        
KAY GOUWENS,  Attorney, Sonosky Chambers Sachse  Miller & Munson,                                                               
Anchorage, said  she is  testifying on  behalf of  the Chickaloon                                                               
Native Village  in support of SB  148. She related that  her firm                                                               
has been  negotiating with the  state for more  than a year  on a                                                               
proposed model maintenance agreement  under which tribal entities                                                               
could maintain state-owned  roads. There has been  agreement on a                                                               
number  of issues  but liability  of  the state  remains a  major                                                               
sticking  point. Passage  of  SB 148  would  resolve the  state's                                                               
concerns so  that these  projects can go  forward. Under  the IRR                                                               
Program,  tribal contractors  performing work  are treated  as if                                                               
they are  agents of  the federal  government and  their employees                                                               
are treated  as if they  are federal employees. The  Federal Tort                                                               
Claims Act gives protection to  the traveling public and makes it                                                               
unnecessary  for  the  tribes  to   carry  insurance  to  protect                                                               
themselves  from liability.  Passage of  this bill  will make  it                                                               
possible to move beyond the  state's liability concerns and bring                                                               
IRR funds into the state and put them to work.                                                                                  
2:04:28 PM                                                                                                                    
CHAIR FRENCH asked if a  citizen would sue the federal government                                                               
or the  tribe under the  Federal Tort  Claims Act if  an accident                                                               
were to  happen on a  road that  had been designed,  operated, or                                                               
maintained by a tribe.                                                                                                          
MS.  GOUWENS   replied  it  would  technically   be  the  federal                                                               
government but she  expects that the claim would  be presented to                                                               
the  tribe. The  tribe would  have an  obligation to  forward the                                                               
claim  to the  Federal  Highway Administration  (FHWA), the  FHWA                                                               
would enter it into the Federal  Tort Claims Act process, and the                                                               
Department of Justice would handle any lawsuit that is filed.                                                                   
CHAIR FRENCH  asked what  assurance the  citizen would  have that                                                               
they would be paid if they were to sue the tribe.                                                                               
MS. GOUWENS replied by operation  of law those are claims against                                                               
the federal government  so the federal government is  on the hook                                                               
for any payment that has to be made on those claims.                                                                            
2:06:49 PM                                                                                                                    
SENATOR WIELECHOWSKI observed that the  tribes don't have to have                                                               
MS. GOUWENS  said that's correct.  The Indian  Self Determination                                                               
Act (ISDA)  is the applicable  law. It provides the  Federal Tort                                                               
Claims Act coverage for the  IRR Program, and others, pursuant to                                                               
or in  accordance with  the ISDA. Indian  tribes are  taking over                                                               
federal  Indian programs  that federal  agencies used  to provide                                                               
directly.  Those federal  agencies  were covered  by the  Federal                                                               
Tort Claims  Act so they  didn't have to purchase  insurance. The                                                               
idea is  that the  same protection should  apply when  the tribes                                                               
are carrying out the programs. The  FTCA provision makes a lot of                                                               
sense because it  prevents the tribes from having  to spend their                                                               
limited resources on  buying insurance and still  it protects the                                                               
traveling public.                                                                                                               
SENATOR  WIELECHOWSKI asked  if  a claim  would  be dragged  into                                                               
federal district court  if somebody wanted to  sue another driver                                                               
because  there   had  been  an   accident  caused   by  negligent                                                               
construction of the road.                                                                                                       
MS. GOUWENS said  her understanding is that if  somebody filed an                                                               
action  in state  court to  sue  another driver  the tribe  would                                                               
inform the  federal government and  the federal  government would                                                               
have that  action removed to  federal district court.  "I believe                                                               
the whole case  would go, but under the Federal  Tort Claims Act,                                                               
state substantive law on liability applies," she said.                                                                          
SENATOR WIELECHOWSKI  asked if the  FTCA limits would  apply only                                                               
to  the  tribe  and  not  to the  other  driver  who  caused  the                                                               
MS.  GOUWENS  replied  she  believes  that's  correct.  The  FTCA                                                               
doesn't  allow   punitive  damage  claims  against   the  federal                                                               
government but  she doesn't know  about any dollar  amount limit.                                                               
It's  a two-year  statute  of limitation  for  filing the  claim,                                                               
which is the same as for the state tort law.                                                                                    
SENATOR  WIELECHOWSKI  asked  if  there   is  a  time  limit  for                                                               
notifying the administrative agency.                                                                                            
MS. GOUWENS  said she  believes the  time limit  is two  years to                                                               
file  the  claim with  the  administrative  agency and  then  the                                                               
agency has six months to act on that claim.                                                                                     
SENATOR WIELECHOWSKI  asked if the  agency typically  acts within                                                               
six months.                                                                                                                     
MS. GOUWENS said yes.                                                                                                           
HOWARD  MERMELSTEIN, Director,  Tetlin Native  Village Department                                                               
of  Transportation,  stated support  for  SB  148. Responding  to                                                               
previous questions about  what is on the  inventory, he explained                                                               
that  the C.F.R.  25.179 regulations  governing  the IRR  Program                                                               
states that  any road that  provides primary access or  access to                                                               
goods and services for Alaska  Natives is eligible to be included                                                               
in the inventory. Working from  the public listing of state roads                                                               
the tribe selects and submits  an inventory document to BIA which                                                               
uses parameters  to decide what  roads do or  do not go  into the                                                               
system. Roads that  are owned by the state go  into the system as                                                               
state-owned roads  and the  tribes generate  five percent  of the                                                               
cost  to  construct on  the  road.  Part  of the  Alaska  Highway                                                               
traverses the former Tetlin reservation  and that section of road                                                               
is in the system.                                                                                                               
The  traveling public  will  always  have a  place  to turn  with                                                               
respect  to  liability.   For  the  most  part   the  tribes  are                                                               
interested  in  ongoing  maintenance,  but any  must  follow  the                                                               
federal highway regulations  and meet or exceed  state or federal                                                               
standards for road construction. If  there is litigation the case                                                               
would go over to the  federal government through the Federal Tort                                                               
Claims Act.  It's important that  the bill pass so  that projects                                                               
can  move forward  because  the  IRR Program  does  bring in  $50                                                               
million a year to the state, he stated.                                                                                         
SENATOR  THERRIAULT   asked  how  broadly  the   term  "road"  is                                                               
interpreted and if rural community boardwalks would qualify.                                                                    
MR. MERMELSTEIN  replied boardwalks  that are  more than  12 foot                                                               
wide have been reclassified as board  roads and many of those are                                                               
in the system.  This allows tribes the ability  to maintain those                                                               
board roads, many  of which were built by the  BIA. The work must                                                               
meet  or exceed  accepted standards  and if  the tribe  and their                                                               
contractors  carried out  the design,  then it  would fall  under                                                               
protection of the tribes and the Federal Tort Claims Act.                                                                       
Oftentimes  trails fall  under  the  classification of  motorized                                                               
trails, which  allows tribes to  spend their funds to  upgrade or                                                               
maintain those trails. In order for  a tribe to widened or make a                                                               
state-owned trail into a roadway. Once  a road or trail is in the                                                               
IRR inventory, they are open to  the general public and the tribe                                                               
can no longer block access.                                                                                                     
2:20:25 PM                                                                                                                    
SENATOR  THERRIAULT asked  if a  boardwalk of  less than  12 feet                                                               
could be nominated as a project for improvement.                                                                                
MR. MERMELSTEIN  said yes  and added that  what a  tribe receives                                                               
through  the  funding formula  is  based  on population,  vehicle                                                               
miles traveled and the length of section of roadway.                                                                            
CHAIR FRENCH noted  the table showing the list of  tribes and the                                                               
amount  that would  go to  each under  what looks  like the  2008                                                               
allocation. He said  it's worth pointing out that  the amounts of                                                               
money available  to tribes  on the major  road system  are fairly                                                               
modest,  which   would  suggest   there  won't  be   a  wholesale                                                               
substitution  of tribes  in place  of the  state with  respect to                                                               
construction,   design  and   maintenance   goes.  For   example,                                                               
Chickaloon  would receive  $580,000 and  Eklutna is  in line  for                                                               
$42,000. While  the total $36  million allocation is  large, each                                                               
individual tribe would receive just a modest amount of money.                                                                   
MR. MERMELSTEIN agreed  and added that Chickaloon is  in line for                                                               
more funding than  most tribes because it has  been proactive for                                                               
years in getting  the roads traversing its land  into the system.                                                               
Four tribes  on Prince of  Wales Island also have  been proactive                                                               
for years  and they are  in line for  roughly $7 million.  As the                                                               
program  increases  in size,  more  funding  will come  into  the                                                               
state.  For FY09  about  $54  million should  come  to the  state                                                               
through its tribal governments for roads.                                                                                       
2:25:01 PM                                                                                                                    
JOHNNY  AMBROSE, Transportation  Technician, Ruby  Tribal Council                                                               
stated support for SB 148 on  behalf of the Council. He's been in                                                               
his current  position for a little  over a year and  the learning                                                               
curve is steep.                                                                                                                 
CHAIR  FRENCH announced  he would  hold SB  148 over  so that  he                                                               
could hear from  a plaintiff's attorney to  get their perspective                                                               
on what this might mean to the traveling public.                                                                                

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