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Vol. 16, No. 17 Week of April 24, 2011
Providing coverage of Alaska and northern Canada's oil and gas industry

House reaches ACMP deal

Parnell administration, coastal districts, legislators agree on program changes

Kristen Nelson

Petroleum News

The midnight hour was magic for ACMP — the Alaska Coastal Management Program extension passed the Alaska House just as April 15 became April 16, and the compromise struck in the House Resources Committee and solidified in House Finance moved on to the Alaska Senate.

It was heard and held in Senate Finance in April 17, the last day of the regular session, and the legislation, House Bill 106, was included on the governor’s proclamation for the special session which began April 18. Senate Finance hadn’t taken the bill up again when Petroleum News went to press April 21.

ACMP, the state’s voluntary participation in the federal program created under the Coastal Zone Management Act of 1972, gives coastal districts a voice in proposed development projects and gives the state and coastal districts a voice in federal projects.

But industry became increasingly unhappy with how the program was structured and in 2003, under the Murkowski administration, there was a major rewrite, removing the coastal policy council and giving the commissioner of the Department of Natural Resources decision-making authority on coastal plans and elevations of consistency reviews of proposed projects.

While the 2003 program revisions pleased industry, coastal districts were unhappy with the changes, unhappiness reflected by legislators from coastal areas of the state. In 2005 the Legislature enacted a drop-dead date of June 30, 2011, for the program.

Extension required

Coastal legislators fought for changes in the program in recent Legislatures, but to no avail.

But an extension was required in this year’s Legislature to keep the program alive. Gov. Sean Parnell proposed a six-year extension with no changes.

House Resources took up the issue and held hearings on HB 106 throughout March, and passed out a committee substitute in early April.

The bill was modified in House Finance to meet various concerns and received letters of support from the Resource Development Council, the Alaska Miners Association and the Council of Alaska Producers.

North Slope Borough Mayor Edward Itta said in written comments on the bill that while he did have concerns, the bill “helps bring local communities to the table.” He also said he was pleased to see a coastal policy board reconstituted, and the elimination of designated areas, and noted that the bill established “clearer mechanisms” for the state and coastal districts to engage in the process leading to approved local policies.

Objective standards

Concerns about the House Resources bill were articulated by Attorney General John Burns, who worked on revisions with the departments of Natural Resources and Environmental Conservation, legislators and coastal districts. It was Burns who presented a committee substitute to House Finance late on April 15, as the regular session neared its April 17 end. The bill was passed out of committee that same evening and moved on to the House floor where it passed 40 to 0.

“The bill provides objective standards, a predictable process and a strong state program that ensures local input but does not afford a local veto,” Burns told House Finance.

The Alaska Coastal Policy Board established in HB 106 has five public members appointed by the governor, including one at-large member from any coastal resource district who is a representative of a Native regional corporation, a mining organization, an oil and gas organization or any other resource development or extraction industry.

The governor appoints four public members — one from each of four coastal regions — from a list of at least three names submitted by the coastal resource districts. The bill provides that the governor may reject a list of nominees and request subsequent lists with different names.

Administration members of the board include a DNR deputy commissioner and the commissioners of DEC, the Department of Fish and Game and the Department of Transportation and Public Facilities.

Burns told House Finance that the governor’s ability to reject an entire list was a subject of long dialogue, with the focus on achieving a balance in composition on the board.

Three public members and three designated members (the commissioners) constitute a quorum, but the bill says “action may be taken only upon the affirmative vote of at least two-thirds of the full membership of the board.”

DEC Commissioner Larry Hartig compared the design to the Board of Forestry. He said what made the forestry board really work was the supermajority vote requirement and having people on the board who were truly trying to reach compromise. That made it important, he said, to have one person who has the whole picture in mind choosing the board members.

Duties of the board

The board makes recommendations to DNR on approval or modifications of district coastal management plans; provides a forum for discussion of ACMP issues and coastal uses and resources of the state; is to annually solicit from state and federal agencies information on any new statutes or regulations affecting coastal uses or resources to determine if there is overlap with enforceable policies — and if so direct a district to resubmit its coastal management plan for review; and review and provide comments to DNR on proposed program regulations.

District enforceable policies may not duplicate, restate, incorporate by reference, rephrase or adopt state or federal statutes or regulations and cannot “arbitrarily or unreasonably restrict uses of state concern,” but may establish new standards or requirements within the authority of a state or federal agency unless a state agency objects. A state agency may object if its interpretation of scientific evidence within its area of expertise conflicts with the local enforceable policy; the local policy conflicts with the agency’s allocation of existing or planned agency resources to meet state policies and objectives; or conflicts with agency priorities or objectives or other state policies.

Hartig said that since coastal districts don’t have the authority to enforce local policies, it falls on the agencies — and agencies don’t get fiscal notes when they take on an enforceable policy, he said.

Burns illustrated the problem with a Fish and Game example. If a district wanted to declare a species endangered that would force the department to focus entirely on that species. Fish and Game could object and say it doesn’t have the resources.

Agency authority

On the issue of requiring revisions in coastal plans when statutes or regulations change, Burns said it’s imperative that an agency have the ability to exercise its authority. An agency may not have the resources to focus on an issue, but if the agency later develops statewide regulations those would supplant the district policies.

The other side of the concern is for industry, Burns said: If a company has a permit, that won’t change retroactively. If a permit was issued under a coastal district enforceable policy and a state agency later promulgates regulations, the permit is grandfathered in and is good for the life of the permit.

Hartig said he’s been on both sides of the issue — as a recipient of permits and on the agency side.

When an agency establishes regulations they go through a process established in statutes and regulations. A district doesn’t necessarily have the same vetting or appeal process. Hartig said the state’s authority never goes away and when an agency does adopt regulations it goes through a very public process.

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