Legislature(2003 - 2004)

05/09/2003 03:37 PM RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                                                                                                                                
          CSHB 191(FIN) am-COASTAL MANAGEMENT PROGRAMS                                                                      
                                                                                                                                
CHAIR OGAN announced  that the committee has  held three hearings                                                               
on very  similar legislation  so he would  like to  limit today's                                                               
testimony to the changes in the  bill. He asked Ms. Rutherford to                                                               
explain the changes to the latest version.                                                                                      
                                                                                                                                
MS. MARTY  RUTHERFORD told members  that Breck Tostevin  with the                                                               
Department of  Law was  also available  to answer  questions. She                                                               
then informed members she is  under contract to the Department of                                                               
Natural  Resources (DNR)  and the  Administration.  She gave  the                                                               
following testimony.                                                                                                            
                                                                                                                                
                                              th                                                                                
     Last  we  spoke   was  Monday,  April  28,    and  this                                                                    
     committee   had,  under   consideration,  a   committee                                                                    
     substitute to SB 143 that  was very similar to CSHB 191                                                                    
     - the  finance version  as amended  and adopted  by the                                                                    
     House.  However, the  House  has  made five  amendments                                                                    
     since your last hearing and I  will speak to those if I                                                                    
     might. I'd  also like to  note that  the Administration                                                                    
     supports these five amendments.                                                                                            
                                                                                                                                
     The   first  amendment   is  to   Section   20  at   AS                                                                    
     46.40.096(d)  on page  12, line  28. The  House adopted                                                                    
     this amendment, which restores the  language that is in                                                                    
     the existing  statute, which states that  the reviewing                                                                    
     entity request  comments from 'interested,'  as opposed                                                                    
     to   'affected,'  persons.   So,  restoration   of  the                                                                    
     'interested' language was made  to avoid arguments that                                                                    
     the  section would  not provide  for the  public notice                                                                    
     required by federal law....                                                                                                
                                                                                                                                
     The second change  is to Section 22 on pages  13 and 14                                                                    
     - AS 46.40.096(j). This is  a clarifying amendment made                                                                    
     by the House concerning the  process used when only DEC                                                                    
     permits  are  required for  a  project  in the  coastal                                                                    
     zone. The  change, again  in subsection  (j), clarifies                                                                    
     that under  an .096(g)  consistency review -  perhaps I                                                                    
     might  note  again  the  review  where  activities  are                                                                    
     subject only to  air and water quality  [indisc.] - the                                                                    
     change in subsection  (j) clarifies that when  it is an                                                                    
     .096(g)  consistency review,  which is  a review  where                                                                    
     activities subject  only to DEC's air,  land, and water                                                                    
     quality [indisc.] required, that  DEC will exclude from                                                                    
     this  consistency  review  those  activities  that  are                                                                    
     subject  to  DEC  permits but  DEC  will  evaluate  the                                                                    
     project to determine if there  are any other activities                                                                    
     that are  the subject  of a district  local enforceable                                                                    
     policy.  If there  are, then  those activities  will be                                                                    
     evaluated for  consistency against the  local policies.                                                                    
     So,  for  example,  if  the project  was  a  bulk  fuel                                                                    
     storage  facility, the  DEC permits  required for  that                                                                    
     facility would  be excluded from a  consistency review.                                                                    
     However, if  a district had a  local enforceable policy                                                                    
     that  dictated bulk  fuel storage  could  not be  sited                                                                    
     next  to   a  [indisc.]  water  body,   then  DEC  must                                                                    
     determine  that the  activity of  siting the  tank farm                                                                    
     was consistent with the local policy....                                                                                   
                                                                                                                                
     The  third  amendment, made  in  House  Finance, is  in                                                                    
     Section  22,   page  15,  lines  7   through  15.  This                                                                    
     addresses  the  exception  to  the  90-day  consistency                                                                    
     review deadline.  I think  it's the  last item  we were                                                                    
     discussing at  the hearing on the  28th. This amendment                                                                    
     is to .096(o) and provides  that the 90-day deadline is                                                                    
     not applicable to the  consistency review involving the                                                                    
     disposal of an interest in  state land or resources and                                                                    
     that's  because DNR's  disposal process  is statutorily                                                                    
     identified   and   [indisc.]  interest   finding.   The                                                                    
     amendment  goes  on to  clarify  that  the deadline  is                                                                    
     suspended in three circumstances.  The first is when an                                                                    
     applicant has  not adequately responded within  14 days                                                                    
     of  receipt of  a request  for additional  information.                                                                    
     The  second situation  is when  the applicant  requests                                                                    
     that the review time be  suspended. The third is when a                                                                    
     draft    consistency    determination   undergoes    an                                                                    
     administrative appeal  within the department,  which is                                                                    
     known as an elevation.                                                                                                     
                                                                                                                                
     The  fourth   change  was  made  on   the  House  floor                                                                    
     concerning the  transition provisions set out  on pages                                                                    
     22 and 23, Section 46  (b) and (c). The changes provide                                                                    
     that the current coastal  management plan regulations -                                                                    
     this  would  be 6  AAC  80  and  6  AAC 85,  and  these                                                                    
     regulations and the district  programs remain in effect                                                                    
     until they  are amended through the  DNR public process                                                                    
     or they  sunset under the bill's  transition provision.                                                                    
     We believe this is also a clarifying amendment.                                                                            
                                                                                                                                
     The last  change is  to Section 47,  page 23,  lines 26                                                                    
     through  28.  This  is  new  language  added  in  House                                                                    
     Finance  to   the  transition  provision....   The  new                                                                    
     subsection (b)  provides that  upon request,  DNR shall                                                                    
     consult  with the  coastal  districts  to identify  the                                                                    
     plan  amendment  that  will   meet  the  standards  and                                                                    
     guidelines  established under  the act.  So, basically,                                                                    
     this  [indisc.] one  of the  concerns by  the districts                                                                    
     that they  would have  to be  determining on  their own                                                                    
     without  assistance what  portions  of  the plans  meet                                                                    
     guidelines under  the amendment. So this  just dictates                                                                    
     that DNR  will be responsive  if the districts  ask for                                                                    
     assistance.                                                                                                                
                                                                                                                                
     Those are the  five changes, Mr. Chairman,  and I would                                                                    
     like to  restate that  the Administration  does support                                                                    
     the  five  amendments  and  Mr.   Tostevin  and  I  are                                                                    
     available to answer questions should you wish it.                                                                          
                                                                                                                                
CHAIR  OGAN  asked  Ms.  Rutherford  to  characterize  how  these                                                               
amendments were negotiated and who was involved.                                                                                
                                                                                                                                
MS.  RUTHERFORD  said  the  first   and  fourth  amendments  that                                                               
replaced  "affected   parties"  with  "interested   parties"  and                                                               
changed the transition provision were  suggested by the Office of                                                               
Coastal Resource Management (OCRM) within  NOAA to make sure that                                                               
the Administration's  intent was reflected  in the act  and meets                                                               
federal  requirements.   The  second  amendment,   regarding  the                                                               
process  used  when   only  DEC  permits  are   required,  was  a                                                               
combination  of OCRM  asking questions  and the  Administration's                                                               
recognition that  further clarification was necessary.  The third                                                               
amendment  came about  in discussion  with  the Senate  Resources                                                               
Committee members  at the April  28th meeting when  Senator Elton                                                               
asked  about suspension  versus  termination. The  Administration                                                               
felt  that  needed  to  be clarified.  The  fifth  amendment  was                                                               
included to address concern by communities.                                                                                     
                                                                                                                                
SENATOR  ELTON noted  that  he discussed  with  Ms. Rutherford  a                                                               
previous agreement between  the City and Borough  of Juneau (CBJ)                                                               
and the  U.S. Army Corps  of Engineers that has  made development                                                               
easier but might  be threatened by this legislation.  He asked if                                                               
she was able to find out if  that agreement is at risk or whether                                                               
any of the amendments address that situation.                                                                                   
                                                                                                                                
MS. RUTHERFORD  responded that  she told Mr.  Freer [of  the CBJ]                                                               
that  she was  available to  discuss the  matter with  the city's                                                               
department of  law. She never  received a request. The  issue was                                                               
discussed  among  members of  the  Administration  and they  feel                                                               
quite  comfortable  that  this  legislation  will  not  affect  a                                                               
municipality's Title  29 ability to promulgate  ordinances and to                                                               
create its own agreements with the Corps of Engineers.                                                                          
                                                                                                                                
SENATOR LINCOLN  asked Ms. Rutherford  who will decide  whether a                                                               
matter of  concern is  adequately addressed  by state  or federal                                                               
law under Section 14(2)(C)(ii).                                                                                                 
                                                                                                                                
MS.  RUTHERFORD   said  the  DNR  commissioner   will  make  that                                                               
decision. She  noted that an earlier  change to the bill  on page                                                               
10 requires that the department  shall approve a district coastal                                                               
management  plan submitted  for review  and approval  if specific                                                               
standards are  met. She said  the commissioner has  the decision-                                                               
making role and  some inherent discretion. She  added, "...but by                                                               
creating  local enforceable  policies, we  hoped we  brought some                                                               
comfort to  the districts and the  various legislative committees                                                               
that,  in  fact, there  is  tremendous  room for  still  creating                                                               
enforceable policies that  are not addressed by  state or federal                                                               
law."                                                                                                                           
                                                                                                                                
SENATOR LINCOLN commented that answers  her question but does not                                                               
give her comfort.                                                                                                               
                                                                                                                                
CHAIR OGAN took public testimony.                                                                                               
                                                                                                                                
MR.  CHARLES  DEGNAN,  Bering Straits  Coastal  Resource  Service                                                               
Area, said  the coastal resource  service area is  concerned that                                                               
local input  into projects  is being eliminated  in two  ways. It                                                               
narrows authority to DNR to  approve coastal management plans and                                                               
it eliminates  the Alaska Coastal Policy  Council. He recommended                                                               
that the coastal  resource service areas be  included. He pointed                                                               
out that Alaska  is a very large and diverse  state with a varied                                                               
climate and topography.  It makes good sense  that local citizens                                                               
have input into  their local coastal districts. He  would like to                                                               
see  due deference  to local  districts. That  would help  local,                                                               
state  and  federal officials  have  continuous  access to  local                                                               
knowledge  and expertise.  He said  it  would also  help to  hold                                                               
public  hearings  in  locations  without  the  benefit  of  DNR's                                                               
presence.                                                                                                                       
                                                                                                                                
MR.  DAN  BEVINGTON,  Kenai   Peninsula  Borough,  expressed  the                                                               
following  concerns.  The   section  on  page  4,   line  17,  AS                                                               
46.39.040, outlines how  the plans will be  developed. It appears                                                               
to  leave  DNR   as  the  sole  authority.  [A   portion  of  Mr.                                                               
Bevington's  testimony was  indiscernible  due to  teleconference                                                               
transmission problems.]  He asked  if subsection  (3) on  page 5,                                                               
line 1,  will assure that the  data will be provided  in a timely                                                               
manner to assure a district function under the statutes.                                                                        
                                                                                                                                
CHAIR OGAN asked Ms. Rutherford to address that question.                                                                       
                                                                                                                                
MS. RUTHERFORD said  subsection (3) is existing  language and DNR                                                               
will implement that subsection in exactly  the same way it has in                                                               
the past.                                                                                                                       
                                                                                                                                
MR. BEVINGTON  said the language on  page 5, line 24,  appears to                                                               
give DNR  sole discretionary  authority over  the appropriateness                                                               
of  local district  plans  with  no provisions  for  a dialog  or                                                               
appeal.  He said  although he  understands  the need  for a  more                                                               
efficient  system,  a provision  for  that  discussion should  be                                                               
provided.                                                                                                                       
                                                                                                                                
MR. BEVINGTON referred to the language  on lines 14 through 23 on                                                               
page 9,  and said it  appears to give  sole discretion to  DNR in                                                               
regard to the acceptance of a  plan. He said he understands DNR's                                                               
mandate  to provide  good  management of  our  resources, but  he                                                               
still  sees some  oversight and  participation in  developing the                                                               
plan to  be beneficial. In  the past, the coastal  policy council                                                               
has provided that to some degree.                                                                                               
                                                                                                                                
CHAIR  OGAN asked  if Mr.  Bevington's last  point addressed  the                                                               
most recent changes to the bill.                                                                                                
                                                                                                                                
MR. BEVINGTON  said it did  not. He  then told members  the Kenai                                                               
Peninsula Borough completed  585 reviews last year.  He wanted to                                                               
assure committee members  that the Borough has  been committed to                                                               
this  program.    He  said  his  last  concern  is  with  Section                                                               
46.40.096(g)(1)(A)  on  page 16;  he  believes  that line  should                                                               
read,  "is  authorized   only  or  solely  under   a  general  or                                                               
nationwide permit...".                                                                                                          
                                                                                                                                
With no  questions of Mr.  Bevington, CHAIR OGAN called  the next                                                               
testifier.                                                                                                                      
                                                                                                                                
MR. ANDREW DEVALPINE, Bristol Bay  Coastal Resource Service Area,                                                               
said Ms.  Rutherford said she  has heard from industry  that this                                                               
bill has  gaps large enough to  drive a truck through  and people                                                               
like himself have  told her it is too restrictive  and limited in                                                               
regard to input.  In his mind, that  raises a red flag  as to how                                                               
this will all pan out. The  notion behind the bill is to simplify                                                               
permitting. If it  passes, it appears there will  be fewer people                                                               
to process  the permits and  more than  30 plan renewals  and new                                                               
laws and  regulations to  learn. He agrees  the state  has strong                                                               
environmental protections  in place. He  cautioned if it  is true                                                               
that developers are lining up at  the door, waiting for this bill                                                               
to pass  because it will  make the  process easier, DNR  will not                                                               
only have the  added job of revising the ACMP,  it will also have                                                               
"more paper going through this restricted pipeline."                                                                            
                                                                                                                                
MS.  JUDY BRADY,  Executive Director  of the  Alaska Oil  and Gas                                                               
Association (AOGA),  said AOGA  can live  with the  amendments in                                                               
the latest  version. AOGA  is aware that  some of  the amendments                                                               
are necessary for  the purpose of clarification, but  it has some                                                               
concerns with others, one being  with the phrase, "not adequately                                                               
responded to  within 14  days." She  noted the  word "adequately"                                                               
always creates tension  between 2 or 3 parties  but AOGA believes                                                               
that will be  straightened out in the  regulations. Regarding the                                                               
fifth  amendment, AOGA  assumed that  the department  would offer                                                               
assistance  anyway. AOGA  also assumed  that would  be part  of a                                                               
public process  and that the details  would be worked out  in the                                                               
regulations.                                                                                                                    
                                                                                                                                
CHAIR  OGAN  asked   Ms.  Brady  if  AOGA   shares  the  previous                                                               
testifier's  concern  about  the  constricted  pipeline  scenario                                                               
regarding the paperwork.                                                                                                        
                                                                                                                                
MS.   BRADY  said   AOGA   would  not   have   worked  with   the                                                               
Administration  and  the  Legislature   to  clarify  the  coastal                                                               
management  program if  the  program  had not  been  so bad.  Any                                                               
inconvenience that  businesses will  have to  go through  for the                                                               
next  few  years  to  make   this  a  workable  program  will  be                                                               
worthwhile. AOGA believes  that whatever is required  by the bill                                                               
will be an improvement over what it has to deal with right now.                                                                 
                                                                                                                                
CHAIR  OGAN  said  he  would  prefer to  see  the  whole  program                                                               
repealed.                                                                                                                       
                                                                                                                                
SENATOR LINCOLN  noted that Ms.  Brady said AOGA could  live with                                                               
the legislation but  does not embrace it. She asked  Ms. Brady if                                                               
AOGA tried to  work out its concerns in the  legislation with the                                                               
Administration.                                                                                                                 
                                                                                                                                
MS. BRADY said  that AOGA provided some responses  to the changes                                                               
in  the legislation  after  the first  hearing  when the  coastal                                                               
districts   wanted   to   maintain   enforceable   policies   and                                                               
consistency reviews.  AOGA preferred a  totally self-implementing                                                               
program.  The Administration  made it  clear that  it had  made a                                                               
commitment to  the coastal districts. AOGA  accepted that because                                                               
this legislation does make some  very important changes to remove                                                               
roadblocks  in the  process. Some  of the  amendments before  the                                                               
committee now  are the  result of that  original change  so while                                                               
she cannot say  that AOGA supports them, it supports  the bill in                                                               
general and does not oppose any of the amendments.                                                                              
                                                                                                                                
SENATOR WAGONER commented  that he has heard  the Kenai Peninsula                                                               
Borough and  people from his  district express concern  about the                                                               
speed   with  which   this  bill   is  progressing   through  the                                                               
legislature. He said there is not  a lot of support for this bill                                                               
at this time in his district.                                                                                                   
                                                                                                                                
SENATOR ELTON  said he sees this  bill, as amended by  the House,                                                               
as a  fundamental shift  in how coastal  areas are  developed. He                                                               
has not  heard from any  of the districts or  coastal communities                                                               
that the current program is perfect.                                                                                            
                                                                                                                                
TAPE 03-45, SIDE B                                                                                                            
                                                                                                                                
SENATOR  ELTON  said as  Ms.  Brady  testified,  he is  aware  of                                                               
concerns  about  the  process  and  the  structure  that  coastal                                                               
communities have. However, the communities  are quick to say that                                                               
this legislation  represents a fundamental  change that  shifts a                                                               
lot  of  the  decision  making  power  from  the  coastal  policy                                                               
council, bifurcates  the process  by excluding  DEC from  some of                                                               
the  process, and  sets  a very  high  threshold for  ill-defined                                                               
enforceable policies.  He said his  concern about  moving forward                                                               
with the  bill is that  other issues  have been resolved  using a                                                               
negotiated  process  involving  stakeholders. He  noted  the  air                                                               
emissions legislation  involved a  process with everyone  who had                                                               
concerns.  That process  made the  committee's  work much  easier                                                               
because those  involved worked out  the best  approaches. Because                                                               
this legislation creates such a  fundamental shift, he would have                                                               
preferred that the legislation underwent  a process like that. He                                                               
said with  the exception of  one coastal community, he  has heard                                                               
of  no one  who supports  this legislation.  Many of  the coastal                                                               
communities  want to  develop their  resources  in the  quickest,                                                               
most   beneficial  way   possible   because   they  are   hurting                                                               
economically.  He  said he  cannot  support  this legislation  as                                                               
written as  he believes the communities'  concerns are legitimate                                                               
and could be worked out using a stakeholder process.                                                                            
                                                                                                                                
SENATOR  WAGONER   responded  that  he   is  not  asking   for  a                                                               
stakeholder  process. His  concern  is that  the Kenai  Peninsula                                                               
Borough  handled  over 500  applications  last  year; it  is  not                                                               
delaying the process. He asked to  hold the bill in committee for                                                               
another two  or three days  to give  the Borough time  to discuss                                                               
the changes with communities and provide additional input.                                                                      
                                                                                                                                
SENATOR LINCOLN  referred to  a letter dated  May 6  to committee                                                               
members signed  by 17 individuals from  boroughs and communities.                                                               
Those  individuals  talked  about the  legislation's  potentially                                                               
devastating   impact  to   public   involvement   and  that   the                                                               
communities have not had ample time  to study all of the impacts.                                                               
They  also  said  it  is  not feasible  to  rewrite  all  coastal                                                               
management  plans  in  a  one-year  period.  They  provided  good                                                               
reasons to  hold the bill for  work during the interim.  She said                                                               
she will  not vote to  move this  bill from committee  because of                                                               
that letter.                                                                                                                    
                                                                                                                                
CHAIR OGAN  noted this bill  has been  discussed at four  or five                                                               
committee hearings and many of  the concerns have been addressed.                                                               
He said his concern is that  the clock is ticking and the state's                                                               
fiscal  situation  is urgent.  He  has  made this  legislation  a                                                               
priority because  he views it as  part of the Governor's  plan to                                                               
jumpstart  the  economy. He  supports  moving  it from  committee                                                               
today.                                                                                                                          
                                                                                                                                
SENATOR  BEN STEVENS  moved CSHB  191(FIN) am  with its  attached                                                               
fiscal notes and individual recommendations.                                                                                    
                                                                                                                                
SENATOR ELTON objected and said  the committee needs to recognize                                                               
the  existing  coastal  zone  management  process  is  a  dispute                                                               
resolution  process. It  speeds up  development because  it keeps                                                               
decisions out  of the court system.  He said he is  not sure that                                                               
consolidating  power  in  the  state  government  will  speed  up                                                               
development.                                                                                                                    
                                                                                                                                
SENATOR BEN  STEVENS clarified  [for the  purpose of  the motion]                                                               
that the bill has several fiscal notes.                                                                                         
                                                                                                                                
A  roll call  vote was  taken.  CHAIR OGAN  announced the  motion                                                               
carried with Senators Stevens, Dyson,  Seekins, Wagoner and Chair                                                               
Ogan in favor, and Senators Elton and Lincoln opposed.                                                                          

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