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FEDERAL MITIGATION REQUIREMENTS AND INTERAGENCY COORDINATION RELATED TO THE 

ECONOMIC DEVELOPMENT ON FEDERAL, 

STATE, AND PRIVATE LANDS 

JOINT FIELD HEARING 

BEFORE THE 

COMMITTEE ON 

ENERGY AND NATURAL RESOURCES 

UNITED STATES SENATE 

AND THE 

Subcommittee on Fisheries, Water, and Wildlife 

OF THE 

COMMITTEE ON ENVIRONMENT AND 

PUBLIC WORKS 

UNITED STATES SENATE 

ONE HUNDRED FOURTEENTH CONGRESS 

FIRST SESSION 

AUGUST 17, 2015–WASILLA, AK 

( 

Printed for the use of the 

Committee on Energy and Natural Resources and the Committee on 

Environment and Public Works 

Available via the World Wide Web: http://www.fdsys.gov 

(II) 

COMMITTEE ON ENERGY AND NATURAL RESOURCES 

LISA MURKOWSKI, Alaska, Chairman 

JOHN BARRASSO, Wyoming 

JAMES E. RISCH, Idaho 

MIKE LEE, Utah 

JEFF FLAKE, Arizona 

STEVE DAINES, Montana 

BILL CASSIDY, Louisiana 

CORY GARDNER, Colorado 

ROB PORTMAN, Ohio 

JOHN HOEVEN, North Dakota 

LAMAR ALEXANDER, Tennessee 

SHELLEY MOORE CAPITO, West Virginia 

MARIA CANTWELL, Washington 

RON WYDEN, Oregon 

BERNARD SANDERS, Vermont 

DEBBIE STABENOW, Michigan 

AL FRANKEN, Minnesota 

JOE MANCHIN III, West Virginia 

MARTIN HEINRICH, New Mexico 

MAZIE K. HIRONO, Hawaii 

ANGUS S. KING, JR., Maine 

ELIZABETH WARREN, Massachusetts 

KAREN K. BILLUPS, Staff Director 

PATRICK J. MCCORMICK III, Chief Counsel 

HEIDI HANSEN, Counsel 

ANGELA BECKER-DIPPMANN, Democratic Staff Director 

SAM E. FOWLER, Democratic Chief Counsel 

SPENCER GRAY, Democratic Professional Staff Member 

COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS 

JAMES M. INHOFE, Oklahoma, Chairman 

DAVID VITTER, Louisiana 

JOHN BARRASSO, Wyoming 

SHELLEY MOORE CAPITO, West Virginia 

MIKE CRAPO, Idaho 

JOHN BOOZMAN, Arkansas 

JEFF SESSIONS, Alabama 

ROGER WICKER, Mississippi 

DEB FISCHER, Nebraska 

MIKE ROUNDS, South Dakota 

DAN SULLIVAN, Alaska 

BARBARA BOXER, California 

THOMAS R. CARPER, Delaware 

BENJAMIN L. CARDIN, Maryland 

BERNARD SANDERS, Vermont 

SHELDON WHITEHOUSE, Rhode Island 

JEFF MERKLEY, Oregon 

KIRSTEN GILLIBRAND, New York 

CORY A. BOOKER, New Jersey 

EDWARD J. MARKEY, Massachusetts 

RYAN JACKSON, Majority Staff Director 

BETTINA POIRIER, Democratic Staff Director 

SUBCOMMITTEE ON FISHERIES, WATER, AND WILDLIFE

DAN SULLIVAN, Alaska, Chairman 

JOHN BARRASSO, Wyoming 

SHELLEY MOORE CAPITO, West Virginia 

JOHN BOOZMAN, Arkansas 

JEFF SESSIONS, Alabama 

ROGER WICKER, Mississippi 

DEB FISCHER, Nebraska 

MIKE ROUNDS, South Dakota 

JAMES M. INHOFE, Oklahoma (ex officio) 

SHELDON WHITEHOUSE, Rhode Island 

THOMAS R. CARPER, Delaware 

BENJAMIN L. CARDIN, Maryland 

BERNARD SANDERS, Vermont 

KIRSTEN GILLIBRAND, New York 

CORY A. BOOKER, New Jersey 

EDWARD J. MARKEY, Massachusetts 

BARBARA BOXER, California (ex officio) 

(III) 

C O N T E N T S 

OPENING STATEMENTS 

Page 

Murkowski, Hon. Lisa, Chairman and a U.S. Senator from Alaska ................... 1 

Sullivan, Hon. Dan, Subcommittee Chairman and a U.S. Senator from Alaska ........................................................................................................................... 3

WITNESSES 

Fogels, Ed, Deputy Commissioner, Alaska Department of Natural Resources .. 7 

Brand, Randy, Vice President, Great Northwest, Inc ........................................... 19 

Crockett, Deantha, Executive Director, Alaska Miners Association ................... 26 

Nukapigak, Joseph, Vice President, Kuukpik Corporation .................................. 31 

Clark, Theresa, Vice President of Lands and Shareholder Service, Olgoonik 

Corporation ........................................................................................................... 38 

Shephard, Phil, Executive Director, Great Land Trust ........................................ 43 

Murphy, Ted, Associate State Director, Bureau of Land Management, U.S. 

Department of the Interior .................................................................................. 58 

Hobbie, David, Chief, Regulatory Division, Alaska District, U.S. Army Corps 

of Engineers .......................................................................................................... 65 

Thiesing, Dr. Mary Anne, Wetlands Coordinator for the Office of Ecosystems, 

Tribal and Public Affairs in Region 10, U.S. Environmental Protection 

Agency ................................................................................................................... 70 

ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED 

Arctic Slope Regional Corporation: 

Statement for the Record ................................................................................. 112 

Brand, Randy: 

Opening Statement ........................................................................................... 19 

Written Testimony ............................................................................................ 21 

Clark, Theresa: 

Opening Statement ........................................................................................... 38 

Written Testimony ............................................................................................ 40 

Coons, Michael: 

Letter for the Record ........................................................................................ 119 

Crockett, Deantha: 

Opening Statement ........................................................................................... 26 

Written Testimony ............................................................................................ 29 

Ecological Land Services, Inc.: 

Letter for the Record ........................................................................................ 121 

Fogels, Ed: 

Opening Statement ........................................................................................... 7 

Written Testimony ............................................................................................ 10 

Responses to Questions for the Record ........................................................... 95 

Fortymile Mining District: 

Letter for the Record ........................................................................................ 122 

Hobbie, David: 

Opening Statement ........................................................................................... 65 

Written Testimony ............................................................................................ 67 

Responses to Questions for the Record ........................................................... 105 

Matanuska-Susitna Borough: 

Statement for the Record ................................................................................. 79 

Murkowski, Hon. Lisa 

Opening Statement ........................................................................................... 1 

Page

IV 

Murphy, Ted: 

Opening Statement ........................................................................................... 58 

Written Testimony ............................................................................................ 61 

Responses to Questions for the Record ........................................................... 100 

Nukapigak, Joseph: 

Opening Statement ........................................................................................... 31 

Written Testimony ............................................................................................ 34 

Responses to Questions for the Record ........................................................... 97 

Supplemental Statement for the Record ........................................................ 132 

Shephard, Phil: 

Opening Statement ........................................................................................... 43 

Written Testimony ............................................................................................ 45 

Sullivan, Hon. Dan: 

Opening Statement ........................................................................................... 3 

Thiesing, Dr. Mary Anne: 

Opening Statement ........................................................................................... 70 

Written Testimony ............................................................................................ 72 

Questions for the Record .................................................................................. 110 

(1) 

FEDERAL MITIGATION REQUIREMENTS AND 

INTERAGENCY COORDINATION RELATED TO 

ECONOMIC DEVELOPMENT ON FEDERAL, 

STATE, AND PRIVATE LANDS 

Monday, August 17, 2015 

COMMITTEE ON ENERGY AND NATURAL RESOURCES, 

COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS, 

U.S. SENATE SUBCOMMITTEE ON FISHERIES, 

WATER AND WILDLIFE, 

Wasilla, AK 

The Committees met, pursuant to notice, at 2:30 p.m. at the Curtis D. Menard Memorial Sports Complex, 1001 South Mack Drive, 

Wasilla, Alaska, Hon. Lisa Murkowski, Presiding. 

OPENING STATEMENT OF HON. LISA MURKOWSKI, 

U.S. SENATOR FROM ALASKA 

The CHAIRMAN. I call to order the meeting of the Energy and 

Natural Resources Committee and Environment and Public Works 

Subcommittee hearing on BLM and U.S. Army Corps of Engineers 

mitigation. 

I would like to welcome everybody. I want to start off this afternoon by thanking Senator Sullivan for working with me to arrange 

what is probably a pretty unprecedented hearing. 

Senator SULLIVAN. Yes. 

The CHAIRMAN. To have a joint hearing between the Energy and 

Natural Resources Committee and the Environment and Public 

Works Committee. 

I would also like to thank Wasilla for hosting us this afternoon. 

I want to welcome and thank our witnesses for joining us and participating in an important dialogue for Alaskans. 

We have brought our committees to Alaska to examine the regulatory practices that impact and often delay or prevent development in our state. Specifically, our focus today will be on the Bureau of Land Management’s (BLM) policies for mitigation and land 

use and the Army Corps of Engineers and EPA’s regulation of 

water and wetlands and related mitigation issues. 

We here in Alaska are keenly aware of the challenges that current regulatory practices impose. We have heard the statistics before, and you will hear them a lot today. Approximately 43 percent 

of our state is categorized as wetlands. That does not include the 

lakes and the streams and the rivers and the adjacent waters to 

them. The BLM also manages 72 million acres of Alaska’s land and 

in many ways, given the reach of its regulations and its ownership 

2 

of lands in our state, the Federal Government, is sort of a gatekeeper and a landlord here in Alaska. 

So how the Federal Government chooses to approach those rules 

has a big impact on our daily lives and our ability to grow as a 

state. Right now there is a lot to be desired. In some instances we 

are being held back by ill-designed, ill-fitted or ill-applied policies. 

It is estimated that the acreage of wetlands in the lower 48 has 

halved over the last 200 years while here in Alaska, over the same 

period of time, we have lost only one tenth of one percent of our 

wetland acreage. So it is really a different comparison set when you 

are talking State of Alaska verses the rest of the country. 

Despite this strong record, our state is still pigeonholed into the 

same regulations as the limited fill of wetlands in drier climates 

like Arizona or in more heavily populated regions like California or 

New York. The BLM employs many land management regulations 

including national and regional policies and those concerning mitigation. These are not well-suited for Alaska which has some unique 

history, geography, remoteness and work force needs. We all know 

our considerations should simply be different from those in the 

lower 48, yet Alaska is again categorically analyzed through the 

lens of national and regional portfolios. 

Like many Alaskans, my concern about Federal overreach has 

grown dramatically over the years. As I go around the state, and 

I know Senator Sullivan hears the same, if there is one unifying 

theme amongst Alaskans, whether you are down on Prince of 

Wales Island, up in the Interior of the Fortymile region or up on 

the North Slope, a concern consistently is we see ongoing, rapidly 

developing, encroachment, overreach and overregulation that is stifling us. 

The regulatory scheme within the Department of the Interior has 

significantly departed from the fundamental principle of multiple 

use as defined in and required by law. Instead it is tilted toward 

conservation, more conservation, and is followed by what appears 

to be mere lip service toward other uses protected under law. 

Though the Department of the Interior’s authorities are rooted in 

very different principles from that of the EPA’s Clean Water Act, 

Interior has decided to adopt its regulatory principles on mitigation 

anyway. Secretary Jewell published an order highlighting Interior’s 

mitigation priorities, and it mirrors the language from the Section 

404 sequence of mitigation. 

There is something fundamentally flawed about an agency that 

borrows theories and regulations which are born from wholly different laws and adopting them as its own when its authorizing language is so markedly different, and that is what we are seeing 

here. 

Then we come to the Corps of Engineers and the EPA. We have 

seen time and time again in Alaska instances where individuals 

and companies have pre-coordinated desired projects, redesigned 

those projects based on the Corps recommendations and paid millions and millions of dollars toward mitigation only to learn, at the 

very end, that the agency wants additional conditions. This moving 

of the regulatory goalpost has a serious, chilling effect on project 

development and it limits the growth of our economy. It hurts the 

3 

livelihoods of the Alaskan people, and it cripples our ability to fulfill promises of our statehood. 

I think, in fairness, that the Corps really does try to get to yes. 

I wish that I could say the same for EPA, but its perogative often 

seems to be finding a way to get to, or to perhaps stay at, no. 

We have reached a point where Federal agencies are unreasonably binding the hands of well-intentioned, environmentally-principled, hard-working Alaskans. And whether it is the layering on 

of new regulations like the recent waters of the United States rule, 

reasonable litigation ratios or something else, we have reached a 

point where it often looks like the goal in Alaska is to stop new development in its tracks rather than helping it to reasonably and responsibly advance. So the question then is what do we do about it? 

What do you do about it? 

Well, it begins with oversight. I hope that the desire would be 

a constructive and an open conversation amongst us all here today. 

We will renew our demands that the agencies faithfully apply the 

law, thoughtfully analyze each and every permit sought in this 

state, and work with us, not against us, but with us as Alaskans. 

If that is not enough, we will turn to the legislative and appropriations process to secure the fair treatment that we deserve. 

Again, I want to welcome our witnesses. I am going to turn to 

Senator Sullivan for his opening comments, and then for those of 

us gathered here today, we will kind of, blow out the program here 

this afternoon in terms of what you can expect for the timing. 

It is a delight and a privilege to be here with my colleague, Senator Sullivan. I appreciate his leadership for Alaska on the Environment and Public Works Committee. It is key and it is so important to so many of the issues that we are working on in the Senate. 

Thank you, Senator Sullivan. 

STATEMENT OF HON. DAN SULLIVAN, U.S. SENATOR FROM 

ALASKA 

Senator SULLIVAN. Thank you. 

Well, thank you, Madam Chair, and I want to thank everybody 

for attending. 

You know, these issues that we are discussing today, I think, 

sometimes can be viewed as rather technical. These regulatory 

issues sometimes are viewed as only impacting large companies. 

Well, I thank you for the turn out here of many state legislators. 

Certainly I want to thank Representatives Gattis and Keller and 

Hughes, but there are others in the audience today—I really want 

to thank you, for everybody coming. I have seen so many Alaskans 

from so many different parts of the state come out today and show 

that you are interested in this topic because it is a huge topic for 

all of us. 

I want to thank the witnesses. I know we have an outstanding 

panel both in terms of the first panel and the second panel. And 

I do want to thank Senator Murkowski, the Chairman of the Energy and Natural Resources Committee in the U.S. Senate. 

This is, I think, a rather new approach. This is a combination of 

the Energy and Natural Resources and the Environment and Public Works Committees. I chair the Subcommittee on Fisheries 

4 

Waters and Wildlife. So this is an official U.S. Senate hearing, and 

to have Senator Murkowski’s leadership on this is critical. 

As I mentioned, I think that there’s a tendency on some of these 

issues that we dismiss them or say this is kind of technical. It 

doesn’t really impact us or it just impacts large companies which 

certainly impact us, but how does this affect the lives of our citizens throughout the state? 

Well, I think that you are going to see today in testimony that 

these kinds of regulations do hugely impact all of us. And whether 

it’s small placer miners or other examples that we hear about constantly, this really matters to Alaska. Let me provide just a couple 

of examples. 

Recently the Alaska Association of Realtors shared with us a 

story about a land transaction that fell through because the Army 

Corps acknowledged that the land may include wetlands. After disclosing this information to perspective buyers and even after lowering the sale price by a significant amount, the mere suggestion 

that property could include wetlands in our state made an important real estate transaction fall through. 

A few months ago, a Fairbanks company wrote to my office and 

explained that they previously had a 404 permit to fill a portion 

of their land. A few years later, their permit expired. After reapplying for another permit they were told that it would only be 

issued after placing a permanent, non-development deed restriction 

on one fifth of their property. This was all after paying an undefined sum to a mitigation bank in-lieu of fee program. The power 

to require payment and other concessions on what occurs on private and state lands effectively grants Federal agencies the ability 

to zone the whole state, and that should concern all of us. 

Finally, at an EPW Subcommittee hearing earlier this year in 

Alaska, Mayor Charlotte Brower testified that the North Slope Borough paid over $1 million in mitigation fees for simply trying to expand their landfill on the North Slope. In testimony before an EPW 

Committee she stated, ‘‘That’s $1 million less to pay for teachers, 

health aides, police officers and many other services we need on the 

North Slope.’’ It is important to remember every dollar spent on 

mitigation is a dollar not spent building Alaska. 

I want to conclude by mentioning one other thing that I think 

is very important. In many ways, I think we’re going to see compensatory mitigation often appears arbitrary and even punitive to 

those of us trying to navigate this complex process. 

One critical issue that I certainly want to discuss today is the 

legal authority, the statutory authority for Federal agencies to undertake these actions. All Federal agencies, all Federal actions, 

whether an action or a regulation, has to be based on a Federal 

statute or the Constitution. That is a fact. 

Unfortunately, I think many agencies forget or downright ignore 

this bedrock principle of the rule of law, that they have to have 

statutory authority to do what they do. And when they do this, 

when they ignore that, it’s what we in Alaska refer to, and Chairman Murkowski has already mentioned this, as Federal overreach. 

It is not just us talking about it. It’s not just us claiming it. In 

the last two terms of the U.S. Supreme Court, in two different 

cases, the U.S. Supreme Court has found that the EPA has violated 

5 

either statutes or the Constitution of the United States, zero for 

two, on two different cases. So this is a concern for all of us, and 

it should be. 

I want to thank everybody who is here again. I want to thank 

the witnesses. I look forward to an informative hearing so that we 

can take additional action to address what is a huge concern for 

our state and, I think, a concern for most of you. 

Again, I want to thank everybody for coming out today. 

Thank you. 

The CHAIRMAN. Thank you, Senator Sullivan. 

With that we will now hear testimony from two panels. 

The first panel is the six Alaskans that you have in front of you 

today. I will introduce them in just a moment, and we will hear 

their comments. 

Let me just outline to you the process that we will use and follow 

today which is a little bit different than what you would see if you 

were attending a hearing in Juneau. In the Senate we have hearings set up so that the witnesses will each provide five minutes of 

oral testimony. Their full statements will be included as part of the 

record. But hopefully this will be an opportunity for you to basically outline the issues that you have been dealing with, not only 

to inform those who are here in the room, but to inform the Senate 

Committee records, the Committee records for both the Energy 

Committee and the EPW Committee. We will hear comments from 

each of the witnesses, and then Senator Sullivan and I will pose 

questions to each of them after the six have presented. When they 

have concluded that Q and A exchange we will excuse the first 

panel and we will turn to the second panel, which is comprised of 

three representatives from our agencies. 

Senator Sullivan and I agreed coming in that typically back in 

Washington we see the agency people are on the first panel. And 

no disrespect to the gentlemen and lady that make up that first 

panel, but we thought it was very important to hear the actual stories, the issues on the ground that these Alaskans have been dealing with so that it would better help form your comments and responses when we get to that panel. So we do appreciate the deference that you have shown us, no disrespect to the titles, but we 

are just making sure that you all are fully informed as to where 

they are coming from as well. 

There will not be an opportunity for you, as audience, to then 

come up and also present testimony. As much as we would like to 

be able to do that, that is not a format that we typically use. Perhaps at a Town Hall we might be able to look at that as one alternative. 

If you would like to submit written commentary for the public 

record, we are going to be holding the Committee record open for 

an additional two weeks. If you or your companies would like to 

provide a written statement, it is welcome. 

I also want to acknowledge and thank the representatives who 

are here today. Senator Sullivan has mentioned Representatives 

Gattis, Keller and Hughes. I do believe that I saw Senator Stoltze 

walk into the room a minute ago, and we appreciate him being 

here as well. And a former colleague of mine, former Senator Scott 

6 

Ogan, is also with us. So thank you for not only being here today 

but the good work that you are doing working with us in Juneau. 

With that, unless, Senator Sullivan, you think we need to add 

anything more in process, I think we are ready to go to our first 

panel. 

Senator SULLIVAN. I think we are good to go. 

You should know though, we do read the submissions for the 

record. I think some of us will be staying around after the hearing 

so we can hear from you then. We want to hear from everybody. 

But if you are not able to make comments or we don’t hear the 

comments today, we certainly want to encourage you, particularly 

if you have your own stories on how this has impacted you, we certainly want to hear that because that becomes part of the official 

record of this hearing. I think it can have a good impact in terms 

of legislative actions that we want to take to address some of these 

challenges. 

The CHAIRMAN. Good. 

We will turn to our panel to receive testimony on the implications of the regulatory actions that are taken by Federal agencies 

to which these witnesses will speak. We anticipate they will discuss 

the affects of regulatory actions on project proponents and the 

State of Alaska Attorney General, if not—on Federal, State and 

private lands. 

I will go ahead and introduce each of the panelists, and then we 

will begin with Mr. Fogels. 

At the end here is Mr. Ed Fogels, who is Deputy Commissioner 

of the Department of Natural Resources for the State of Alaska. He 

is here to talk about the development challenges he experiences in 

his role both as Deputy Commissioner of the Department of Natural Resources and as a conduit for project proponents who are 

seeking assistance from the State of Alaska to navigate the maze 

of Federal regulations. We are pleased that Mr. Fogels is here. 

Next to Mr. Fogels is Mr. Randy Brand. He is the Vice President 

of Great Northwest, and he will speak about his experiences in the 

construction industry in Fairbanks and the evolution of increasingly complex and costly mitigation and permitting requirements 

that his business has encountered. I think it is almost legend in 

Fairbanks what Great Northwest has had to go through, so we look 

forward to your testimony. 

Next to Mr. Brand is Deantha Crockett, the Executive Director 

of the Alaska Miners Association, representing miners both large 

and small across our state. She will discuss the challenges they 

face with a complex and unclear regulatory scheme required by the 

BLM and also speak to miner’s experiences with 404 mitigation. 

We also have Mr. Joe Nukapigak, the Vice President of Kuukpik. 

He is here to highlight permitting challenges that we experienced 

on the Spur Road, what might be expected for proposed roads in 

the Colville Delta, and what the community would like to see on 

GMT1 mitigation funds. 

Next to Joe we have Theresa Clark, the Vice President of Lands 

and Shareholder Services at Olgoonik. She is here to talk about the 

challenges the villages face when they try to marry mitigation and 

regulatory requirements for growing villages. 

7 

Rounding out the panel we have Phil Shephard of the Great 

Land Trust. We greatly appreciate you being here, Phil, to present 

the interests and the perspectives of the Great Land Trust. 

So thank you all for being here. We will lead off with Mr. Fogels. 

Again, if you can try to limit your comments to about five minutes, your full statements will be incorporated as part of the official 

hearing record. 

I will note that we have the hearing room until five o’clock, so 

we are going to try to keep moving on this. 

Mr. Fogels, welcome to the Committees. 

STATEMENT OF ED FOGELS, DEPUTY COMMISSIONER, ALASKA 

DEPARTMENT OF NATURAL RESOURCES 

Mr. FOGELS. Thank you, Chairwoman Murkowski, Chairman 

Sullivan. 

My name is Ed Fogels. I’m Deputy Commissioner at the Alaska 

Department of Natural Resources, and on behalf of Governor Bill 

Walker, I thank you for this opportunity to testify. 

The focus of my testimony today is to first discuss permit coordination process employed by the State of Alaska and second is to 

discuss some concerns we have with current mitigation requirements. I’ll focus primarily on some BLM mitigation requirements 

that we are afraid might start duplicating and confusing the mitigation requirements required under the Clean Water Act. 

The state has established a sophisticated coordination office for 

large projects within my department. This office, the Office of 

Project Management and Permitting, coordinates the environmental review and permitting process for major development 

projects. The state has found this leads to real permitting efficiencies for several reasons. 

First, public processes are integrated across different agency 

timelines, which prevents repetitive and confusing public notices. It 

gives the public an accessible source of information about projects 

in one place. 

The state processes are synched with corresponding Federal processes to minimize duplication of effort, permit collaboration and 

avoid duplication. The state can speak with a highly coordinated 

and well-informed voice in the Federal and local permitting process 

and in National Environmental Policy Act reviews. 

Our services are unique in that they are voluntary for project 

proponents. If a project proponent wants to pursue the efficiency of 

coordination they must enter into a memorandum of understanding 

with the state which also requires reimbursement of state expenses. The state has long advocated that the Federal Government 

establish a similar coordination process for large and complex 

projects based on the same principles and structures. 

Next let me speak to our concerns about the Bureau of Land 

Management’s draft regional mitigation strategy manual, which is 

a guidance document that will direct Federal staff on how to require mitigation for impacts to Federal lands that occurs as a consequence for permitted activities. The manual mentions different 

types of mitigation and how they may be applied, but we feel there 

is little to no discussion of what impacted resources would require 

8 

mitigation or how those impacts will be calculated in order to determine what mitigation requirements would be required. 

We are also very concerned about duplication with the compensatory mitigation requirements for permits issued under Section 

404 of the Clean Water Act. 

We’re also concerned the manual has not been developed through 

a public process. As it has been formulated as a guidance document, the manual has not gone through a formal rulemaking process. 

Next I would like to briefly discuss one example which we believe 

illustrates where the process could be improved, the Greater 

Mooses Tooth well or GMT1 in the National Petroleum Reserve. 

First, let me start by emphasizing, however, how grateful we are 

to BLM and all the Federal agencies for permitting this project. 

GMT1 is anticipated to add about 30,000 barrels per day in the 

Trans-Alaska Pipeline system, making it a critical priority for the 

State of Alaska and furtherance of the national strategic interest; 

however, the state has some concerns about the process, and we believe they should be addressed for future projects. 

The EIS and BLM’s record of decision layered additional mitigation measures on the project. These mitigation measures are in addition to numerous requirements already required by other BLM 

EIS’ and lease stipulations. 

Cooperating agencies including the state were surprisingly excluded from the development of the mitigation measures. BLM required a number of oil spill-related measures for the project despite 

the fact that this authority falls mainly under the Alaska Department of Environmental Conservation. Consultation with the cooperating agencies would have prevented this duplication. 

Next let me touch briefly on an issue of these new Areas of Critical Environmental Concern. This is, I’m sorry, another concerning 

area on the BLM planning and regulatory activities have a proposal to designate multiple Areas of Critical Environmental Concern, or ACECs. 

BLM is increasingly proposing excessively restrictive ACECs 

across Alaska. If designated as proposed, these ACECs will create 

uncertainty for development projects of critical public and economic 

importance such as the natural gas pipeline for the North Slope 

and the Donlin Gold project’s proposed natural gas pipeline. Specifically, two ACECs in the Eastern Interior RMP, Resource Management Plan, would close approximately 713,000 acres from mineral location and leasing, providing blanket closures on restrictions 

for off-highway vehicles, including snow machines. 

We’re also concerned that these ACECs could potentially hamper 

the state’s ability to fulfill its statehood land entitlement as most 

of these ACECs are layered on top of existing withdrawals. 

In closing, I would like to say that regardless of these issues that 

I’ve brought before these Committees, we do have an excellent 

working relationship with our Federal agency partners, especially 

the Alaska staff, and we continue to work to make that relationship better. 

Our intent here is to highlight the areas where we must improve. 

The state needs to be viewed as an equal partner by the Federal 

Government. Additionally, the Federal Government should draw 

9 

from the success of the state permitting coordination model to improve its own process. 

We at the state applaud the efforts of the oversight of your Committees to drive Federal improvements in these areas. 

Thank you. 

[The prepared statement of Mr. Fogels follows:] 

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The CHAIRMAN. Thank you. 

Mr. Brand, welcome. 

STATEMENT OF RANDY BRAND, VICE PRESIDENT, GREAT 

NORTHWEST, INC. 

Mr. BRAND. Thank you. 

If you visit the EPA website, you’re bombarded with why we 

need the clean water rule to protect our streams and wetlands. 

Ironically, EPA workers accidentally caused a toxic wastewater release in Colorado. If this had happened to any of us in the industry, we would soon be out of business and in handcuffs. 

For the past 22 years my firm has either had a controlling interest or outright ownership of 300 acres of heavy industrial-zoned 

land in Fairbanks. We have developed this property to serve the 

construction needs of the greater Fairbanks area. Originally all 

that was required for a wetland permit was to submit a written development plan to show the purpose and need. Over the years, 

things became gradually more difficult. 

The first change was the requirement that any plan for pit development had to include a restoration plan to include littoral zones. 

Restricting development of a 20-foot wide zone around an old pit 

may not sound like much, but it adds up quickly. A 20-foot strip 

around a five acre pond equals about 0.85 acres. A geometric calculation of this set-aside equals a volume of 206,000 cubic yards 

with a potential value of over $600,000. Requirements gradually 

worsened to the point we are at today with the requirement of compensatory mitigation. 

In 2006, my firm needed to update our existing wetlands permit. 

The U.S. Army Corps of Engineers required that we contribute 

$55,000 to The Conservation Fund to provide for offsite mitigation 

of 16 acres of lost wetlands. We were also required to permanently 

set aside an additional 10.64 acres of our land to be protected wetlands in perpetuity. 

As we were aware of two U.S. Supreme Court rulings that might 

affect our determination, we held off executing the permit. After 

those rulings were published, we requested on July 12th, 2006 the 

Corps revisit the jurisdictional determination for our property. This 

remained unanswered until March 28th, 2007 when the Corps offered a proffered permit which included a condition that the in-lieu 

fee for compensatory mitigation would be held in escrow until a 

new jurisdictional determination was issued under the new guidance. 

On July 28th, 2008 the Corps determined that this property was 

jurisdictional wetlands. With the help of the Pacific Legal Foundation, we fought this determination on our property all the way to 

the 9th Circuit Court and won at a cost of $89,000. The new rulemaking by the EPA will reverse that determination, potentially 

forcing us to re-enter the permitting process for our ongoing development. To hopefully protect ourselves from that situation, we have 

cleared and disked much of this land at a cost of $73,000 to convert 

it to uplands beyond the EPA’s reach. 

In other private cost impacts, a business associate of mine with 

a development on North Slope Borough leased land in Deadhorse 

was required to pay $90,000 in fees to develop seven and a half 

20 

acres in 2011. Three years later he applied to develop an adjoining 

seven and a half acre parcel. The price doubled to $180,000 without 

any explanation. That’s about $24,000 per acre. 

This impact is not limited to private landowners. Our ability to 

improve public infrastructure is also impacted by these rules. 

Mayor Brower has previously testified that the Barrow landfill 

project had to pay $1 million in compensatory mitigation. 

I would like to add that Northern region transportation projects paid $3.4 million in mitigation payments in 2014 and $1.3 million 

in mitigation payments in 2015 to date. During 2014 the credit cost 

increased from $2,200 per credit to as much as $33,000 per credit. 

[Audio problems.] 

Mr. BRAND. So last but not least is an agreement reached in De- cember 2007 whereby the Juneau Airport project paid $5.3 million 

to the Southeast Alaska Land Trust as compensatory mitigation for 

impacts to 73 acres of wetlands. That’s about $73,000 per acre. 

Another interesting note is the government’s failure to recognize 

court rulings. Several of us individually own property upstream of 

the Great Northwest property that was deemed non-jurisdictional 

wetlands. The government claimed jurisdiction over my property 

last week, just as they had done to other property owners in the 

same neighborhood. 

To further complicate matters, the EPA has shut down The Conservation Fund until they do an audit of the expenditures. Permits 

cannot now be obtained as there is no organization to receive the 

required funds. Progress for future paying projects is now at risk. 

These payments are impacting our ability to deliver worthwhile 

infrastructure improvements, predominately within long dedicated 

rights-of-way. Additionally, these payments are re-directing taxpayer dollars to NGO’s with their own self-serving interests, salaries, and expenses. One could even argue these payments constitute extortion due to the fact you will not get a permit to fill 

your wetlands without making the appropriate payment. 

These new regulations will take large tracts of land not currently 

under the authority of the Clean Water Act and redefine them as 

waters of the U.S. This egregious Federal overreach has more to 

do with the largest land grab in history than with expanding protection under the Clean Water Act. The net result will be changing 

the Clean Water Act into a Wetlands Protection Act. 

If there is a need for a Wetlands Protection Act, Congress should 

enact one and leave public rights-of-way and privately held properties out of it. If the public wants to set these areas aside then 

the public should purchase the land outright at fair market value. 

Thank you. 

[The prepared statement of Mr. Brand follows:] 

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26 

The CHAIRMAN. Randy, thank you, we appreciate your testimony. 

I think sometimes those costs that are associated are just astounding. 

Deantha Crockett, welcome. 

STATEMENT OF DEANTHA CROCKETT, EXECUTIVE DIRECTOR, 

ALASKA MINERS ASSOCIATION 

Ms. CROCKETT. Thank you, Senators. 

For the record my name is Deantha Crockett, and I’m the Executive Director of the Alaska Miners Association (AMA). 

I know that you two are quite aware of what AMA is. But for 

the record, we are the statewide membership-funded trade association that represents all aspects of the mining industry. You described the vast affect of the areas of the state that these polices 

have an effect on our membership spans. We’ve got branches in 

Nome and we have a branch in Ketchikan, Prince of Wales and six 

in between. Members really do operate in every corner of our state. 

I represent six large operating mines, but around 400 permitted 

placer operations. A vast majority of my job on a day-to-day basis 

is advocating and helping placer miners to sum up Federal policies 

in five minutes. I think I heard Mr. Fogels use this word as well, 

and I’m sorry to say that the word I’ve got to use is uncertainty. 

Right now I have the large operations that I referenced evaluating what source of investments they’ll make of those big projects, 

but I’ve got the vast majority of my placer miners evaluating 

whether or not they’ll still have a livelihood. 

I do have one of my members, someone I’ve become great friends 

with, in the third row, Bronk Jorgensen. He is here from the Fortymile Mining District and watches that every single day in terms of 

how Federal management policies affect placer mining on Federal 

land in Alaska. 

I will begin with the BLM. I think we’re seeing multiple policies 

come from multiple field offices throughout different levels of management in the agency whether it’s land planning, regulatory enforcement or how permitting is conducted. But a lot of times policies are introduced in draft form to which the industry scrambles 

to digest multiple volumes, I’m not exaggerating, about this high, 

of different plans and policy changes that come out. Sometimes the 

polices come to fruition, sometimes they don’t, and sometimes in 

the meantime we see them used by the agency as legitimate land 

management tools. 

To be specific, BLM recently reevaluated its implementation of 

the regulations in which mineral activity is permitted and managed in Alaska, which is essentially new regulation that doesn’t 

add any additional environmental protection. It doesn’t fix any 

problems, and it burdens the miners with increasing costs and 

delays. 

For many years placer mining operations have applied for permits and been regulated under the Annual Placer Mining Application, the APMA process, which is managed by three State of Alaska 

agencies and BLM. For a long time these agencies got together and 

made sure that the APMA was a good program that placer miners 

could effectively manage permitting for but still establish the objectives of all the agencies involved. 

27 

That certainly changed into a different animal, and now BLM 

has proposed seven new supplemental documents for the APMA. 

There is also a requirement to gather new data and a possible Reclamation cost estimate to determine the cost of reclaiming an operation that doesn’t have any non-compliance issues in the first 

place. 

So outside of the permitting, the agency has also released a number of land management plans as part of an overarching landscape 

level process. The RMPs cover really large acreages and often contain management prescriptions that guide polices of the land users 

in the area outside of what is current land regulation and statute. 

Deputy Commissioner Fogels did a phenomenal job of explaining 

the ACECs, so I was able to cross out a little of my testimony here. 

Recently we’ve seen two, a newly proposed and then an expanded 

one, that was in existence in the Fortymile region, and it really has 

that district very concerned. It’s hundreds of thousands of acres 

that are being proposed for closure to mineral entry, an area that’s 

known to be highly mineralized. 

There is an additional component within the land managing 

process called rapid ecological assessment. And I have to be honest 

with you, I’m still not totally sure what it does or what it doesn’t 

do. But these are all examples of, frankly, what is a puzzle and us 

trying to understand BLM’s land management philosophy and how 

it applies to placer mining on Federal lands in Alaska. 

When the National Director, Neil Kornze, visited Chicken earlier 

this year, which we profusely thank you for your help on, I had the 

opportunity to talk to him. I told him that I think there are really 

good, intelligent and hard working staff within the BLM Alaska offices here. I firmly believe that. They’re all sitting in this row right 

here. They are wonderful about communicating with me. They’re 

asking for different ways to provide outreach to miners. 

And what I told Director Kornze is that they’ve got a lot of good 

ideas on how placer mining can be regulated and the agency’s objectives can still be established. I hope that the communication between the Alaska staff and the national staff is a two way street, 

and they’re being allowed to implement ideas. I think they are the 

best ones to understand placer mining in Alaska. 

So switching to wetlands mitigation, we certainly do have our 

struggles with jurisdiction over Section 404. But one thing I can 

say at this time is kudos to that agency for its recent internal review of how wetlands jurisdiction and regulation is conducted in 

Alaska. I know that they are evaluating the 1994 Alaska Wetlands 

Initiative, and is it a tool that is there for the agency to manage 

projects specific to mining in Alaska. 

I know that the agency has committed to reviewing whether the 

entire suite of tools is being utilized to regulate operations and wetlands in Alaska. We saw these words put into action with the recently released general permit for placer mining that the agency 

went through. They extended the existing permit because they 

readily admitted we’re not done. This is not a forum with which 

we’re happy and ended up striking out the compensatory mitigation for certain small placer mining projects. 

So they really did put their money where their money is, so to 

speak, and ended up taking multiple stages of revisions from placer 

28 

miners into that final product. And it’s one that there are some 

things we don’t like about it. There’s a lot of things we like about 

it, and I think they did a great job of meeting us in the middle, 

if you will, on that one. 

So I think I’ve exceeded my time allotment. For that, I apologize. 

But I thank you again for the opportunity to testify for placer miners today. 

[The prepared statement of Ms. Crockett follows:] 

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31 

The CHAIRMAN. Thank you, Deantha. 

Joe, welcome. 

STATEMENT OF JOSEPH NUKAPIGAK, VICE PRESIDENT, 

KUUKPIK CORPORATION 

Mr. NUKAPIGAK. Thank you. 

Thank you, Senator Murkowski and Senator Sullivan and the 

Committees for allowing me the opportunity to provide testimony 

on Federal mitigation requirements. I hope to add local content and 

offer some suggestions for the committees to consider. 

Kuukpik Corporation is the Alaska Native Land Settlement Act 

Village Corporation for Nuiqsut, which is an almost entirely Native 

community on the North Slope of Alaska. Approximately 90 percent 

of our residents of Nuiqsut are shareholders in Kuukpik Corporation or are married to Kuukpik Corporation shareholders or descendants of Kuukpik shareholders. 

Kuukpik is one of the largest private landowners in the National 

Petroleum Reserve-Alaska, having received title to approximately 

74,000 acres of ANCSA lands surface estate. The balance of 

Kuukpik’s lands, totaling about 69,000 acres, are just east of the 

NPR-A in and around the Colville River Delta. 

Nuiqsut is the community most affected by oil development on 

the North Slope to date. Alpine is only eight miles away from the 

village and can be seen from the village, day and night. Nuiqsut 

is a traditionally Inupiat community where over 70 percent of 

households get more than half their food from subsistence hunting. 

The oil industry has been active on the eastern side of Nuiqsut’s 

traditional subsistence lands at Prudhoe Bay and Kuparuk for over 

50 years, but construction of the Alpine field in 1998 put the oil 

field and Nuiqsut in close daily contact. Three new satellite oil 

fields have been built around Nuiqsut since Alpine and at least two 

more are planned. Impacts to subsistence activities and resources 

are continuing and persistent issues. 

Our challenge as a community and a corporation was to realize 

the economic benefit of ANCSA land ownership through oil development, while protecting our Native culture. Our leadership has 

consistently worked to protect subsistence and our natural surroundings. 

As oil development occupied more and more subsistence lands to 

the east and north, Kuukpik decided that better access to subsistence land to the west was the one part of dealing with oil development impact, while the other part was better access to jobs and 

training at Alpine oil field. 

Our solution was to build a Spur road from the village to the industrial CD–5 road. The road has three purposes. One is to open 

up more area for subsistence to the west. Two is to allow Nuiqsut 

residents and shareholders to drive to training and employment opportunities at home. Three expanded health, life, and safety options. 

Projects such as the Spur Road are a key part of ANCSA’s purpose, to protect Native land and culture while promoting economic 

development of Native land, jobs, and training for Alaska Natives. 

Yet the Federal permitting process has created substantial barriers 

to the project. 

32 

The Permit Process. In January 2013, Kuukpik submitted an application to the U.S. Army Corps of Engineers. The proposed road 

was 5.8 miles long and called for placing gravel on 51 acres of our 

land that we own. Over several months Kuukpik submitted information to improve our application. In August 2013, the EPA commented on our application. Like many 404 applicants, they sent 

Kuukpik a letter stating that they reserved the right to elevate our 

ANCSA project if their concerns are not addressed, or could not be 

addressed. 

Specifically, the EPA argued that mitigation for Kuukpik’s 51- 

acre road required that we set aside an additional 294.2 acres in 

permanent conservation status. Under the EPA calculation, the 51- 

acre footprint of our community road would actually impact a minimum of 343.2 acres of Kuukpik-owned property. The proposed 

mitigation acreage would be almost six times the actual footprint. 

Kuukpik continued to meet with the Corps of Engineers and the 

EPA throughout the fall of 2013. We repeatedly argued that the 

size of parcel needed as an offset for the project was smaller than 

required by the EPA and that the purpose of the road is an extension of our right as a landowner under ANCSA and served to mitigate oil development impacts. 

Our negotiations lead Kuukpik to the conclusion that despite the 

inherent conflict between ANCSA and the Clean Water Act, we 

needed the 404 permit. We eventually agreed to set aside a 127- 

acre parcel in the area known as Fish Creek, so that the Spur 

Road’s 51-acre footprint impacts 178 acres of Kuukpik land. The 

mitigation acreage is more than twice as much as the actual footprint even though the mitigation acreage is made up of higher 

value wetland than those occupied by the project footprint. 

Kuukpik is still in the process of finalizing the easement. One of 

the many byzantine requirements of the Clean Water Act is that 

a qualified third-party entity hold the easement, and that an entitlement be set up to fund future costs of managing that easement. 

We are in the process of identifying a qualified and willing thirdparty that can harmonize our need to continue our lifestyle with 

the demands of the Clean Water Act. 

Kuukpik supports continuing to use all the mitigation-related 

tools available under the existing rule, including wetland mitigation banks, in-lieu fee programs and permittee responsible mitigation; however, Kuukpik also supports expansion of the options 

available to Alaska Native Corporations including recent legislation 

introduced by our Congressman calling for preservation leasing for 

tribal organizations, including Alaska Native Corporations. That 

legislation could more closely tie mitigation acreage to the actual 

life of project-related impacts. 

Finally, we think that Alaska Native Corporations should be exempt from Clean Water Act requirements where the applicant is an 

Alaska Native Corporation and the project is on Alaska Native 

land. 

BLM Region Mitigation Strategy. The Department of the Interior 

has now stepped into the compensatory mitigation equation. BLM 

negotiated an $8 million mitigation payment to offset impacts created by GMT1. Decisions regarding the disposition of the funds 

should be made by the NPR-A Working Group. 

33 

The NPR–A Working Group was created as part of the Integrated Activity Plan for the NPR-A. The purpose of the Working 

Group is to guide the Federal Government’s decision making process within the NPR-A. The group has broad representation including tribal, local government, and corporate groups. It makes perfect 

sense to allow that group to determine the use of the funds. 

Second, we recommend that funding community mitigation be 

the highest priority for the funds. 

We will continue to work with our families and our neighbors including the City of Nuiqsut, Native Village of Nuiqsut, and the 

BLM on plans for utilizing the funds. 

Thank you for your time. 

[The prepared statement of Mr. Nukapigak follows:] 

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38 

The CHAIRMAN. Thank you, and thank you for representing 

Kuukpik. 

Ms. Clark, welcome. 

STATEMENT OF THERESA CLARK, VICE PRESIDENT OF LANDS 

AND SHAREHOLDER SERVICE, OLGOONIK CORPORATION 

Ms. CLARK. Good afternoon. My name is Theresa Clark. I am the 

Vice President of Lands and Shareholder Services for Olgoonik Corporation. 

Thank you, Senator Murkowski and Senator Sullivan and members of the Committees for providing Olgoonik the opportunity to 

testify today. I thank you for conducting this public hearing here 

in Alaska on this very important issue of Federal wetlands, Federal 

mitigation requirements, and the proposed legislation to address 

wetlands mitigation. 

Olgoonik Corporation is the ANCSA village corporation for Wainwright. Olgoonik privately owns 175,000 acres of surface estate, all 

of which are within the NPRA, so we are one of the closest communities to offshore development in the Chukchi Sea. Offshore exploration, development, and production will require onshore-based 

support services which we are planning to deliver. 

We received our full entitlement to our ANCSA lands. It took 

BLM over 20 years to patent our lands to us. The Clean Water Act 

was amended to address wetlands mitigation just as we were receiving the balance of our full entitlement, which subjected our 

lands to new and additional Federal requirements. 

Wainwright residents and Olgoonik Corporation will be highly 

impacted by oil exploration and industry development in both a 

positive and negative manner. We are trying to minimize the adverse impacts that development brings to our community, especially those affecting our subsistence way of life. The positive impacts will be business and job opportunities, and a financial future 

for generations. 

To minimize impacts and to capture benefits we are planning 

and developing Olgoonik lands on the outskirts of Wainwright. 

This will make development of Olgoonik lands subject to wetlands 

mitigation rules. 

We have our own land management plan to develop lands and 

protect certain sensitive areas. Our strategy is to keep development 

of our lands to a minimum by compacting the development into a 

reasonably small footprint. 

We are currently in the process of purchasing lands formally utilized by the Air Force as the Early Defense Warning System, DEW 

lines. With your introduction of an amendment to the 2015 NDAA 

and its passage, Senator Murkowski, thank you, we are now in the 

process of purchasing those lands. This property is within our 

ANCSA lands. Our plans for this property is to build infrastructure 

upon the plans already existing to provide essential support to oil 

and gas industries. This will further minimize development on wetlands within our ANCSA lands. 

Full mitigation to protect wetlands is good and needed. We recognize that fact. We are also mindful that this impacts our ANCSA 

lands or purchased lands, the DEW line. 

39 

For example, there is a social deed in our community to build 

new homes. We are subdividing lands for that purpose. Roads will 

be needed for access. To build roads, we’ll have to comply with the 

Federal regulations. This will drive up the price of development as 

the current method we are leaning toward is paying an in-lieu fee. 

The current wetlands inventory data for Alaska’s North Slope is 

limited and out-of-date. The Arctic Coastal Plain is comprised of 

approximately 80 percent wetlands. This was determined by the 

State of Alaska in 1994. This places the burden of more detailed 

delineation of our lands on us as a developer. Currently the average cost per acre to develop is approximately $12,000 per acre. 

Using this data, a majority, if not all, of our land is considered 

wetlands. The in-lieu fee program is not available or able to presell additional credits at this time. Permittee responsibility is challenging in that we are required to triple the size of the impacted 

area when one adds together the project with a conservation easement. 

We are certainly watching for and hoping that the Arctic Slope 

Regional Corporation’s bank will be certified. In short, we feel that 

having multiple mitigation options is important from a permitting 

standpoint but also a financial standpoint. 

Finally, we do not desire to lock up any of our lands in perpetuity to mitigate as we cannot predict the future. Decisions made 

today in regards to our lands may not be applicable 20 years down 

the road. As time passes, corporate leaders change, additional development will be needed to take place, and we need to keep the 

options open for our future generations to determine. 

Therefore, with these purposes in mind, we support the proposed 

legislation to one, provide ANCs exemption from the Clean Water 

Act requirements where an applicant in an ANC and the proposed 

projects are on ANC lands. And two, to have the ability to enter 

into a preservation easement as a mitigation option. 

I thank you for the opportunity to be heard, Senator Murkowski 

and Senator Sullivan and members of the Committees. I request 

your support on this proposed legislation. 

[The prepared statement of Ms. Clark follows:] 

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43 

The CHAIRMAN. Thank you, Theresa. 

And finally we will wrap up with Mr. Phil Shephard, welcome to 

the Committees. 

STATEMENT OF PHIL SHEPHARD, EXECUTIVE DIRECTOR, 

GREAT LAND TRUST 

Mr. SHEPHARD. Thank you. 

Thank you, Senator Murkowski and Senator Sullivan. 

My name is Phil Shephard. I’m the Executive Director of Great 

Land Trust. We’re a private, non-profit land trust that operates 

here in Alaska. We’re based in Alaska. We have an all-Alaskan 

board. 

We were founded in 1995, so 20 years ago. We work with willing 

landowners, agencies, communities, local governments and other 

partners to conserve south central Alaska’s special lands and waterways. We have our service area, the area that we work is in 

south central, so from Denali, down to Kodiak, Prince William 

Sound. Primarily we’ve worked in Anchorage and Mat-Su, and we 

were asked in 1998 by the municipality of Anchorage, the State of 

Alaska, and various regulatory agencies to consider starting an inlieu fee program in Anchorage. 

So there’s been discussion today about different mitigation options. We happen to operate one that’s called an in-lieu fee program. There are other options. 

But so what I’m going to talk about today is this public/private 

partnership that we happen to run as a land trust to do some of 

the mitigation. I’m not going to weigh in on why mitigation happens because that’s not our purview. We don’t do advocacy work. 

What we do is the mitigation after the fact. 

So when the Army Corps has made the decision that okay, here’s 

a permit, you can’t fill this wetland, then that permittee, whether 

it’s a private developer or an agency, it’s DOT or some agency 

that’s filling a wetland, they decide that the mitigation is formed 

and the mitigation options and the fee. Then that payment is made 

to us, and we aggregate those funds and then we turn around and 

we purchase those purchase properties to permanently protect 

those wetlands. 

What we have to do in order to do that, in order to operate this 

is in the fee program, is we spend a great deal of time using the 

current data on wetlands in Anchorage and the Mat-Su to know, 

okay, well where are the best wetlands to mitigate? And so what 

we’ve done to date is partner with dozens of private landowners 

and agencies. We’ve created seven new parks, we’ve built a number 

of trails, we’ve conserved about 45 miles of salmon habitat here in 

Upper Kuukpik arm, we’ve provided six access points to public 

lands, and we’ve worked in eight different estuaries. 

One of the things that we’ve focused on is if there’s a wetland 

and it’s privately owned and if we only work with willing landowners and the landowners that have these wetlands, and for 

whatever reason they decided they, you know, they don’t want 

them anymore, we purchase those and then oftentimes they are adjacent to say, a state game refuge or a state park, and then we add 

those to the park. And then that way that property provides access 

to these public lands. 

44 

So we are blessed with a lot of public lands in Alaska. In some 

cases, especially around Anchorage, access is very limited. Actually 

right near here we just purchased property near Machetanz Elementary School and added it to Palmer Hayflats State Game Refuge and are building a boardwalk for the kids at Machetanz who 

are helping us. That’s an example of a project, a type of project, 

that we do. 

When we try to figure out where to do the mitigation we spend, 

I already said, a great deal of time with maps and GIS to figure 

out the best possible mitigation to do. We work closely with the 

boroughs, the municipal governments, state agencies, to find the 

best property. When we get frequent feedback from these agencies 

and resident experts that choose these properties we’re really 

proud of all of the projects we’ve done. 

One of our—several of our main partners have been Native Corporations. We’ve got—we’ve conserved almost 7,000 acres of Native 

Corporation lands in Upper Turnagain Arm that were mitigation 

from various projects around Anchorage. 

Obviously there’s way more impacts to wetlands around Anchorage and the Mat-Su just because there’s more people here. And so 

I can’t speak to the North Slope and these areas in the interior. 

We only operate or are in the fee program in Mat-Su and Anchorage. 

In closing, I’d like to thank the Senators, both Senators Murkowski and Sullivan, for coming here and having this hearing. I’m 

sure everyone appreciates the ability to understand this issue more 

fully. I would just like to close with we’re a, you know, small, private nonprofit in a partnership between a private nonprofit and 

these Federal agencies and the public I think has resulted in some 

really sound, high quality mitigation that has been for the good 

citizens of this area. 

[The prepared statement of Mr. Shephard follows:] 

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47 

The CHAIRMAN. Thank you. 

Thank you, Mr. Shephard, and thank you to each of you for not 

only your testimony here this afternoon but the work that you do 

within your respective communities, your region, and the state. 

I think if I have heard a common theme here it is the uncertainty that comes about with any level of requested development 

whether it is housing, as you were talking about in Wainwright, 

Ms. Clark, or whether it is mining activities out in the Fortymile 

region. When you do not have clear and consistent policies, it is difficult to make that business judgment decision as to how to move 

forward. 

I have to say to friends here at home I feel like I have to apologize sometimes for the alphabet soup. I was listening to Mr. Fogels 

and Ms. Crockett. We have APMAs, we have ACECs, we have 

RMPs, we have REAs, and that’s just in the little BLM area. It 

kind of boggles your mind. Unfortunately it just seems like that 

this is the acronym of the day, what is coming next? I don’t know 

and I am not sure that our regulators know, and it adds to the confusion and complexity of what we are dealing with. 

I am concerned as we look at the impact to our opportunities to 

develop. Mr. Fogels, you mentioned some of the big ticket items 

that we think about whether it is the ability for Donlin Gold to 

bring affordable energy to a project out there being limited by an 

ACEC; whether it is our Trans-Alaska Pipeline; whether it is further build out and repair of our Dalton Highway after the washout; 

whether it is what we are trying to accomplish in GMT1 and recognizing that we are still trying to get things moving within the 

NPRA. It really causes you to wonder how we have had the level 

of progress that we have had to date. 

Let me ask, specifically, about these areas of critical environmental concern, these ACECs. In 1986, my understanding is we 

had 16 across the state and it encompassed about 2.7 million acres. 

Now, well in 2014, we had 52 ACECs overlaid across the state accounting for approximately 8.7 million acres of additional management. I do not go anywhere without my map of things that rile me 

up. Where is my rile me up map? [Laughter.] 

I got so riled up that I put it in another file. Where is my colored 

maps? Those, you have them. 

For those who do not have the areas of withdrawals of Alaskan 

lands, it is not just things like ACECs and the withdrawals within 

each of our public lands. It is what we also see withdrawn off of 

our coastline, with critical habitat designations. At the end of the 

day, Senator Sullivan has seen this chart through videos, but it is 

a colored patchwork that just, kind of, reinforces the situation that 

we are in and trying to access what we are dealing with here in 

this state. We are seeing this growth in ACECs. We are seeing this 

growth, this expansion, if you will. 

I am going to ask you, Mr. Fogels. You have been with the Department of Natural Resources for some time. Are these regulatory 

measures increasing the health and the welfare to Alaskans? Is it 

helping us in terms of management? Are we gaining any benefit by 

these additional designations? 

48 

Mr. FOGELS. Senator Murkowski, I think, in my professional 

opinion, these most recent proposals that we have seen do not add 

to the health and welfare of the Alaskan people. 

We, I should say that these are all, the ones out in the Eastern 

Interior Management Plan that totals up about 713,000 acres. And 

then there’s another large one that we’re watching. We’re very concerned about the Donnelly project with many hundreds of thousands of acres. Those are all still in draft. I know those have been 

finalized. All of those plans are still in their planning process. So 

we’re strongly commenting on these, on all of these ACECs, and we 

do not believe they’re warranted. They’re way too big. They don’t 

have the justification. 

In addition, we believe that the BLM already has the ability to 

manage those resources properly with their existing tools. They 

don’t need to create these Areas of Critical Environmental Concern. 

I think it’s—— 

The CHAIRMAN. Let me interrupt and ask you, though, even if it 

has not been finalized, what is the impact of this proposed designation? What does that do to any potential development? 

Mr. FOGELS. Well, Senator, that’s a good question. That’s one 

that we see in a number of different venues in Alaska when an 

agency typically is studying something, let’s say, for wilderness, 

then they’re apt to treat it and manage it like a wilderness while 

they’re studying it. So, while we do not have direct experience with 

that in these instances, I would imagine that’s a significant concern 

on these Areas of Critical Environmental Concern. 

The BLM is doing a good job with their planning process. I’ve got 

high hopes that reason will prevail and the public will comment on 

these things. Until that happens, I don’t know. 

The CHAIRMAN. But until such time as there is a final designation, it is managed as de facto withdrawal effectively? 

Mr. FOGELS. Well, Senator, I think you might, I think in your 

next panel you might have BLM folks. You might ask them about 

that. 

It’s important to note that wherever these ACECs are proposed 

now, as we understand it, there are already withdrawals under 

those ACECs. And that’s one of the things that concerns us is that 

those existing withdrawals, many of those, were put in place for a 

purpose that is no longer valid. And so with the layering of the 

ACEC on top of that, we argue that that’s essentially repurposing 

that original withdrawal that underlies it. 

That would be contrary to provisions in ANILCA which prohibits 

the designation, the withdrawal of more than 5,000 acres without 

Congressional approval. 

The CHAIRMAN. Let me ask you, Ms. Crockett. Representing the 

miners in the Fortymile area and Mosquito Flats, Fortymile is the 

area where over 700, what did you say? Seven hundred and ? 

Ms. CROCKETT. Eighteen. 

The CHAIRMAN. Eighteen thousand acres will be put under this 

designation. Even though it has not been finalized, what impact is 

that having on a small placer miner out there? 

When was the last time we saw a new mine permitted out there 

in the Fortymile region or really anywhere in the state? 

49 

Ms. CROCKETT. Senator Murkowski, that’s an interesting question. I actually don’t know the answer to when the last time a placer mine was permitted in the Fortymile Mining District. 

The CHAIRMAN. But it has been long enough that you cannot remember. [Laughter.] 

Ms. CROCKETT. I should be a little fair admitting I’ve only been 

there for three years. So I will research that and get back to you. 

The CHAIRMAN. Okay. 

Ms. CROCKETT. Maybe the BLM folks have an answer to that; I 

have not had one brought to my attention in the last three years. 

So I will find that out. 

Ms. CROCKETT. You also asked me about the impact, and I think 

it has made a lot of them very scared. 

And looking in terms of how did we get here? If you talked about 

the number of ACECs that are in place or proposed now, how many 

more there are. The number is certainly alarming, but I think 

what’s more alarming for me is learning about the ACEC nomination process and how exactly it works. 

So the two that are within the Fortymile region in one meeting 

with BLM, it was explained there were individuals that nominated 

these, that proposed these ACECs. So any member of the public 

can nominate for an ACEC. And when they were put into the Eastern Interior Resource Management Plan there was an ACEC nomination process so that individuals could then forward that generally had hunting and fishing interests, and foreclose that as 

needed caribou habitat or moose having habitat, etcetera. 

When the proposal came out with public comment there was no 

information whatsoever about the mineral potential of the area. It 

was a lot of information about ecological aspects and wildlife aspects. We brought that to their attention and they said, bring it to 

us. So we did. We said, okay, we’d like to provide you with some 

information. Here is a known, very large deposit here in a number 

of areas where placer mining activity could really increase and diversify and strengthen. And that was generally not available to the 

general public that may have been interested in commenting on 

this. 

So I think that process of how they’re brought to the public, 

those of us that are trying to just understand this better, and information they don’t include, is more alarming to me than anything. 

And I hope that kind of answers your question. 

The CHAIRMAN. Well, it does. 

I know that Senator Sullivan will go to the issue of specific authorization under the law, and I think what we would question is 

whether or not much of this can move forward without congressional authority under the parameters of ANILCA. 

Ms. CROCKETT. Yes, absolutely. 

And the proposals, as they stand now, do designate closure to 

mineral entries. So no mining activity would occur if these become 

effective. 

The CHAIRMAN. Again, contrary to ANILCA. 

Ms. CROCKETT. Yes. 

The CHAIRMAN. Senator Sullivan? 

Senator SULLIVAN. Thank you, Madam Chair. 

Mr. Fogels, I wanted to follow-up on a couple questions. 

50 

You talk about OPMP. I agree with you, the state has done a 

good job of coordinating on large projects. There was an Executive 

Order by the Obama Administration a few years ago that tried to 

replicate that, but from my perspective, it did not seem to go anywhere. 

How is the coordination at the federal level and is there a need, 

do you think, from the Federal legislative standpoint to mandate 

that kind of coordination? 

Because right now whether it is the Shell project, whether it is 

a different Alaska natural gas AK LNG project, it seems like Federal agencies come in with all kinds of different requirements, completely uncoordinated. What do you think needs to happen there 

and is that Executive Order doing enough? 

Mr. FOGELS. Senator Sullivan, I would have to say that, in my 

opinion, I see where the coordination can, on the Federal level, 

have flashes of where it actually starts working. But it’s pretty inconsistent. We’ve seen places where we tried, at a local level, to improve that coordination. We have excellent regular meetings with 

EPA and the Army Corps to discuss large projects around the 

state, trying to avoid blow outs like we have with CD5 to head 

those off at the pass. So that’s working. 

I think on a broader scale with President Obama’s interagency 

working group, our frustration there was that, as you know, we 

were never invited to sit at that table. 

Senator SULLIVAN. Yes. 

Mr. FOGELS. That was purely a Federal table. 

Much to our pleasant surprise, the local Federal leaders decided 

to build their own mirror group of that and they invited us to sit 

at the table here in Alaska. 

Senator SULLIVAN. Let me ask you, let me follow-up on that in 

terms of those invited to the table. 

In the Clean Water Act, you agree the Clean Water Act, we are 

supposed to be a co-regulator, on an equal basis with the Federal 

Government. That is the way the Clean Water Act was set up. 

Yet on compensatory mitigation are we at all involved in the 

process in terms of laying out these random and, I think, arbitrary 

numbers and amounts and the dollar figures? Are we at all a part 

of that process even though that is under the Clean Water Act? 

Mr. FOGELS. Senator, in my experience we are really not involved 

in that process at all. 

Senator SULLIVAN. So you think that clearly goes against the 

spirit if not the actual rule of the law of the Clean Water Act? 

Mr. FOGELS. Well certainly the spirit, Senator. 

I think in years past we’ve also tried to evaluate whether the 

state should seek primacy for the 404 process. And almost every 

state in the Nation has primacy over the 404–2 discharge program. 

But only two have primacy over the 404 program. And when you 

read the Clean Water Act and even early EPA guidance documents, 

it clearly says the states should be ultimately getting primacy and 

they should take the lead. And that has not happened. 

Senator SULLIVAN. Let me ask another, kind of, related question 

with regard to mitigation. 

I actually spent a lot of the day yesterday at the Chena Hot 

Springs Alternative Energy Fair, which was a great event. I had 

51 

a lot of time to talk to Governor Walker about a number of these 

issues, and told him we had this hearing coming up. 

We were discussing, both of us were wondering to what degree 

the Federal Government can require mitigation with regard to the 

state. So coequal sovereign under our Constitution, and I did not 

think the Federal Government could require if the State of Alaska 

is building the road, do we have to mitigate that under the Federal 

rules? 

So I took a look at this. I think the answer is not only yes, but heck, yes. Almost $3.4 million in 2014 we had to pay to the Federal 

Government for mitigation to build roads in Alaska. I think that 

violates the tenth amendment or any other aspect of the Clean 

Water Act. It certainly seems to me kind of an outrageous example 

of the Federal Government claiming way too much authority. 

What is your thought on that? 

Mr. FOGELS. My thought? 

Well, I would think a former Attorney General would kind of 

know more about that than I probably do. [Laughter.] 

Senator SULLIVAN. So Madam Chair, I have a number of more 

questions. 

The CHAIRMAN. We will go back and forth. 

Because the question, I think most Alaskans would be 

stunned—— 

Senator SULLIVAN. Stunned. 

The CHAIRMAN. To know that, for instance, on the rebuild of the 

Dalton Highway after the substantial flooding, what we need to do 

is we need to elevate that road. We are going to have to do something a little bit different than what we had before or we will have 

a repeat. In order for us to move forward with that, a level of mitigation is required. I am not sure what the dollar amount is, but 

we do know that the state is basically going to be paying the Federal Government for those mitigation costs. 

Then it speaks also to the issues that Mr. Nukapigak and Ms. 

Clark have spoken to whether it is coming from Wainwright or 

Nuiqsut. The fact that these are your ANCSA lands that were conveyed to you as part of a settlement, and for you to access these 

lands whether it is a road that will allow for additional subsistence 

opportunities for you or whether it is for the folk, the people, in 

Wainwright to be able to access additional area for housing that is 

necessary. That they also will be paying the Federal Government, 

and whether it is six times the amount or whether it is negotiated 

down to just twice the amount of the footprint, I think most would 

be very shocked to find that from your native lands that were conveyed upon settlement that you, as tribal entities, have a requirement now to pay the Federal Government. 

I was in Craig on Prince of Wales last week, and they too are 

looking to build additional housing. The compensation that they 

have to then pay, again, to access their lands and what I was told 

was that the issue of where these mitigation dollars go to is of 

great concern. 

Mr. Fogels, you mentioned that there is an issue right now with 

the availability of mitigation banks that can accept these dollars to 

move forward. I understand that up north there was an effort to 

expand, or build out, a hangar in the area. They are all ready to 

52 

move on the project, and there is nobody that can take the mitigation dollars because of this audit that you acknowledged. 

What do you do then? You need to build the hangar. You need 

to repair the road. You need to build housing or a connector road. 

Mr. Shephard has mentioned the in-lieu system, but he also 

mentioned that is just down here. 

Are we to believe that we are not able to move on anything up 

in the North Slope because we do not have a place to even bank 

it if we can agree that a two-to-one mitigation ratio is reasonable 

and not extortion? 

Mr. FOGELS. Well, Senator Murkowski, yes, as we understand it, 

there’s a situation that’s developed that one of the main mitigation 

banks in the in-lieu fee programs is no longer accepting money to 

further the program. I think it’s a fairly recent development. I 

think, I know, that is a huge concern to us. 

What we’re doing right now is, even with the tight budget situation the state has right now, we received a small legislative appropriation this year to start investigating forming a state in-lieu fee 

program or possibly even a mitigation bank. 

So that’s something that, I think, the state can have a bigger role 

in this whole process. That’s one place we’re really looking at trying to put some energy and hopefully help. 

The issue is if for every acre we develop now we have to go and 

protect ten or five or whatever it is. That is just an untenable situation. It’s just, I mean anyone can see that’s just not workable. 

So we’d like to use that money as much as possible to do environmentally good things, right? I mean, it’s kind of ironic when Point 

Thompson thought it was being permitted. Exxon wrote some huge 

multimillion dollar check that’s probably going to go and protect a 

block of land somewhere. 

At that same time, when we’re talking about how do we cleanup 

these legacy wells, you know, which all have wetlands in house. 

Wouldn’t it be nice if we could have just used that money to clean 

up a legacy well? I know that’s kind of a reach for the Clean Water 

Act, but I mean, that’s what we need to do. We need to reach, we 

need to think outside of the box and figure out how to use these 

dollars to fix real environmental problems. 

The CHAIRMAN. Mr. Fogels, can you explain what happens there 

then if, for instance, in Wainwright the mitigation dollars, the concerns you are under, which are the organization is that it is not 

able to accept funds now? Is there any requirement that these mitigation dollars be used to help either in the regions of the North 

Slope Borough or even within the State of Alaska? 

The mitigation dollars the Great Northwest paid, are they required to be directed somewhere in the region that is impacted or 

even the state that is impacted? 

Mr. FOGELS. Well, Senator, you know, our understanding is that 

those dollars should be used to be as close as possible in areas related as possible to the area of the impact. 

I think you might have some folks coming in the next panel that 

you may actually get a more clear answer of what the latitude is 

to move those dollars around to other parts of the state. I’m not 

sure I would have been the best person to answer that with very 

much precision. 

53 

The CHAIRMAN. Well, know that for the next panel that is something that I would like to drill down on because it is my understanding that while it is recommended that that happen, there is 

no certainty to that. In fact, these dollars go places that you and 

I may have never heard of. 

I think what Great Land Trust has done to make it be very localized is the model that we would like to pursue and recognize. You 

can see that benefit going there. But I am afraid that the system 

that we currently have does not allow for an assurance that we are 

seeking. 

Senator Sullivan? 

Senator SULLIVAN. Mr. Nukapigak, I thought your testimony was 

very powerful in a couple of ways. You talked about some broader 

themes, kind of the clash of ANCSA and the Clean Water Act, 

which I think is a really important issue. 

But could you unpack that a little bit more? Essentially what you 

are saying is under the Alaska Native Claims Settlement Act, regional and village corporations receive the allotments of land they 

own in fee simple, to develop with their shareholders. Yet when 

you are trying to develop these for your shareholders, you have to 

actually give up more land. You literally have to give land back, 

and it is not one for one. 

What I am interested in is when you talked about the EPA and 

you said it wanted a 300-acre easement to make it 50 acres. Then 

they came back and said, ah, maybe we’ll do a little bit less here, 

a little bit more. Were they giving you any kind of sense of where 

they were coming up with these numbers? You mentioned six to 

one initially then it came down to two to one. What was the basis 

of these negotiations? 

That is one question. But the broader question is do you think 

that what is going on here undermines the spirit and again, the 

letter of the law, what the Federal Government is trying to do in 

regard to ANCSA? The more you develop your land, the more you 

are going to lose your land. I do not think that was part of the deal. 

Mr. NUKAPIGAK. Well, Senator Sullivan, there are times that my 

corporation had to contend with some of those issues. You see the 

Tenement Act allowed us to select land to then determine what 

then the population of the village. And so when we finally, when 

Alpine was finally discovered some years ago, there was two ways 

that we had to set aside or come up with $1.4 million, which is 

hard earned money. 

Senator SULLIVAN. One million four hundred thousand dollars? 

Mr. NUKAPIGAK. One million four hundred thousand dollars of 

our hard earned money or set aside a certain piece of land that the 

EPA wanted us to. You know, that’s kind of contradictive of what 

the purpose of ANSCA was for. 

And you know, what can we do? I don’t know, here we’re trying 

to make a pact for the betterment for our people to make our life 

easier by having access to the Alpine for jobs. And so, it’s only 

eight miles away and some of our locals and without that, we’ve 

got no roads. 

I don’t think the men of our villages would be willing to spend 

three weeks at a time at eight miles away unless they’d be able to 

come home every night and spend the night with the family. 

54 

You know, these are the environments that we strive to make 

better. 

Senator SULLIVAN. When they came to you initially with this six 

to one proposal, did they give you a sense of why they chose six 

to one? 

Mr. NUKAPIGAK. Well, they, I don’t know how that number came 

up but they gave to us some sort of a calculation that, I don’t like, 

maybe, of course, somebody might be able to answer that—— 

But how they calculated that is something that I don’t know, 

probably I think it would be, might be easier, might even be able 

to answer that might be a person in this room. 

Senator SULLIVAN. Okay, well we can, I mean, maybe we can 

take that for the record and if you guys could get back to us on 

it on answering that question, that would be very helpful. 

Ms. Clark, I was going to ask you, you kind of watched that 

whole episode. I would imagine that that also sends a bit of a concern. It is kind of random, right, six-to-one and then down to twoto-one and then all over the map? 

You guys, as you mentioned, are looking at a whole number of 

important issues with regard to the potential developments in your 

community. I wanted to ask you a question. The mitigation rule 

that we are talking about here encourages permittees to first avoid 

and then minimize impacts on wetlands but when that cannot be 

done you have to mitigate. Is it geographically possible to avoid 

wetlands in your region? 

Ms. CLARK. No, no. What we’re doing right now because the 1994 

delineation, you know, if you go to the outlet you go to probably 

the Corps of Engineers website. You’ll see that the wetlands are delineated there in our area. They’re not delineated. And so we’re 

having to have a consultant come in and delineate what is wetlands and what isn’t wetlands because if we don’t do that, then 

they’ll all have to be considered wetlands, which would either cost 

us more dollar wise or more land wise. So we’re trying to save 

some money and some land by getting our land delineated and determining what is wetlands and what isn’t wetlands near our community. 

Senator SULLIVAN. But right now it is looking like pretty much? 

Ms. CLARK. Wetlands. 

Senator SULLIVAN. Everything. 

Ms. CLARK. Right. 

Senator SULLIVAN. So you are, again, stuck with a conundrum 

that as you want to develop, you lose land. 

Ms. CLARK. Yes, that’s correct. 

Senator SULLIVAN. Again, I am not sure of the Federal law, 

whether it is the Clean Water Act or the ANCSA, that should create such a black and white choice. It seems to me that that is completely at odds with both the goals of both of those statutes. 

So I made a reference to Mayor Brower’s comments about essentially the tradeoffs. They expanded their land bill, had to pay over 

$1 million. Are your communities struggling with similar payoffs? 

You are having to contemplate right now whether it’s payment of 

$1.4 million or the loss of lands that, in essence, is making you 

make a very difficult decision how you are going to do this because 

you really have no choice whether it is the wetlands or whether it 

55 

is payment that could cost millions that takes away from all your 

potential effective use of that kind of money. 

Ms. CLARK. We’re struggling with that right now. 

Senator SULLIVAN. What do you think would be an answer to address that? 

Mr. NUKAPIGAK. What was the question again, sir? 

Senator SULLIVAN. With regard to the tradeoff, not only in terms 

of money for the ability to develop but also lands like we were talking about, that if you are developing your land, you are losing your 

land because all your land is wetlands. The exemption you talked 

about in terms of your testimony. 

Mr. NUKAPIGAK. Well, um, I don’t know what the purpose of this 

ANCSA was supposed to be was to keep land for the ancient land 

that we have taken from the path. 

But mitigation may not mean mitigation. Things like that is, 

here, you wanted to hold up one. Your own land but, you know, 

when your hands are tied by EPA or somebody, what can you do 

it to come up with money more or lose that land that is highly valued such as ancient land? But how you value, in terms of money, 

monetarily or how you compensate for it is another manner. 

Senator SULLIVAN. Yes. 

Mr. Brand, I wanted to ask you a question. First, I commend you 

for your company’s willingness to actually challenge this because 

that takes a lot of guts, a lot of money, a lot of time, and a lot of 

uncertainty. You won in the 9th Circuit, of all places, which is kind 

of a miracle. [Laughter.] 

Well done, from my perspective. 

You are an example of a small business, not one of the large companies that has had to not only litigate but seen the different increases in these regulatory and permitting requirements. Can you 

give us a sense of how that has grown? Your testimony touched on 

it. You said several years ago, hey, you only had to do one thing. 

Now it looks like it is layer upon layer upon layer. Can you give 

us a little bit of sense of that in addition to the kind of litigation 

that you undertook? 

Mr. BRAND. I’ll try. 

As I mentioned in my testimony, it used to be 25 years ago or 

so all you had to do was submit a written plan along with purpose 

and need, and you were granted the permit. And then the littoral 

zone came in. Anybody that doesn’t know what littoral zone is, it’s 

a shallow area if you’re digging relative to the water. They instituted a plan where we needed to create a littoral zone for fish and 

bird habitat, I believe, that for the first 20 feet from the shoreline 

you couldn’t get much more than like three feet deep. 

So that created a bit of a restriction where we were only able to 

mine a portion of our property rather than the entire property because we had to set aside a littoral zone. And if you take it, at best, 

at a full 150 feet, it’s $700,000 worth of gravel that you have to 

leave in the ground to comply with this new restriction. 

Then, we’ve all been talking about the compensatory mitigation 

as well as the time factor. It’s a huge amount of time to submit and 

go through the process to get your wetlands permit, if you can. And 

right now in Fairbanks because of The Conservation Fund debacle, 

we couldn’t even do that. 

56 

Senator SULLIVAN. And you mentioned in your testimony that 

you just found out that other land that you own, private land, was 

recently found to be Clean Water jurisdictional by the Corps of Engineers. How did that happen and then what are the implications 

for any plans you had for that private land that you own? 

Mr. BRAND. That’s a very good question. I don’t know how that 

happened. 

But a little bit of history on our situation. The Great Northwest 

property was deemed to be the closest water was the Tanana River. 

And we were successful on our argument because they cannot 

claim wetlands that are adjacent to adjacent wetlands, and in our 

situation that’s I think from the—decision that you can’t, you 

know, keep on going forever out through the water calm. You have 

to stop at wherever there’s a barrier. 

And our property was separated by two barriers from the Tanana 

River. The first was the flood control dike built by the Corps of Engineers many, many years ago. And then the second barrier was 

the railroad embankment, for the railroad spur that runs out to the 

Fairbanks International Airport. So those two embankments separated our property from the Tanana River, and that was the whole 

argument in court. Therefore our wetlands were adjacent, and they 

couldn’t be considered jurisdictional wetlands. They are or were 

wetlands, but they’re no longer jurisdictional wetlands until this 

new rulemaking becomes effective. 

And the properties that I and others own personally are further 

removed from the Tanana River upstream, if you will, from The 

Great Northwest project. So with The Great Northwest property 

non-jurisdictional wetlands because of these barriers, anything further removed from it should also be non-jurisdictional wetlands. 

But the Government has ignored that and continues to assert jurisdiction over the wetlands. 

The CHAIRMAN. Why don’t you go ahead? 

Senator SULLIVAN. So, Ms. Crockett, I had a question and I know 

that you are very familiar with the state of the amount of wetlands 

in Alaska which is about 40 percent of the state that I think comes 

to about 60 percent or over 60 percent of all the wetlands in the 

United States. These statistics are why this is such an important 

issue for us. 

But if you add state lands, you remove Alaska Native lands, and 

we are only left with, 60 percent of Alaska, Federal land. If you 

look at that whole menu of lands, we are only left with about one 

percent of Alaska’s land base that is in private hands. So when we 

look at mitigation requirements, where is industry supposed to find 

private land mitigation? 

Isn’t that part of the huge conundrum that a one-size-does-notfit-all for Alaska when it comes to the Clean Water Act as we are 

literally so different from every other state and country? 

Ms. CROCKETT. Senator Sullivan, yes. 

I’d answer that question I have no idea. It’s just something that 

we’re grappling with every single day. And I think Deputy Commissioner Fogels touched on this a bit earlier, but we even struggle 

with that purpose whatsoever. 

And it’s not as though the people I represent and companies I 

represent are being forced to just write a check to be able to do 

57 

something. We are being forced to write a check to go close up land 

that could, I mean, we are literally denying our future generations 

or maybe not that far away, the potential to develop something in 

the future. We could, hypothetically, be blocking up the next Red 

Dog or access to the next Red Dog for no significant purpose. 

And, you know, I don’t know how we got that way, down that 

road, instead of doing things that are actually good for the environment, that are actually, you know, why isn’t like you said with the 

Exxon example, why isn’t the company, if you do want to talk 

about the disturbance that’s going into wetlands and access a dollar amount then do something good with it. Don’t just lock up land. 

Do something good, you know, enhancement is something that we 

talk about all the time and really do think outside the box. And I 

don’t think this is a naive statement. 

I know there are liability issues and there are things that agencies disagree with, but we should find a way to get around that. 

And we should find a way to say, okay, company x, you’d like to 

develop this project. We would like to figure out a fair reasonable 

amount to assess you. We want you to bring a project to us, propose to us something good you can do to enhance the environment 

or enhance someplace that’s in the State of Alaska and do something for the greater good verses denying us future opportunities. 

Senator SULLIVAN. Right. 

Thank you, Madam Chair. I think we have gotten a lot of good 

ideas from this panel. 

The CHAIRMAN. There really are, and we could stick to this panel 

all afternoon. Believe me, I have got a lot more questions, but I do 

think in the interest of getting to the next panel we will wrap up. 

I want to ask, though, Mr. Fogels, has the state taken a position 

on the proposal that has been introduced, at least in the House by 

Congressman Young, for the preservation easements for tribes and 

Native Corporations? 

Mr. FOGELS. Senator Murkowski, I do not know. I’m not familiar 

enough with that legislation. I haven’t been involved in it, so I 

don’t think I can answer that question right now at this time. I can 

look into it to see if I can get you a response. 

The CHAIRMAN. I would appreciate it because it is something 

that as we listen to some of the on-the-ground examples of what 

we are dealing with, whether it is Wainwright or Nuiqsut or out 

in Craig. These are very real, very immediate issues. It is something that I would like to look at, perhaps dealing with legislation 

in the Senate following Congressman Young on this. I would appreciate knowing where the state is on it as well. 

The exemption allowing our even exemption for Clean Water Act 

on ANC lands is perhaps another matter to, again, consider. But 

I think that these are very direct and immediate issues that we can 

look to as we are trying to figure out a path forward here. 

The CHAIRMAN. So again, I thank you all for what you have provided to us today by way of not only your input here but that there 

is follow-up to your comments that you have made today that you 

would like to have presented as part of the record. 

Again, we will keep this record open for another couple weeks 

and would welcome them. So thank you. Thank you for being here 

and thank you for making the trip to be here. We appreciate it. 

58 

Next we will go to the second panel. We have a diverse group of 

Administration panelists before us this afternoon. We appreciate 

them being here and providing their comments and their input to 

us. 

The panel will be led off by Mr. Ted Murphy. Mr. Murphy is the 

Alaska Associate State Director of BLM. He is here to give us a 

perspective on BLM’s regulatory process, internal practices such as 

how it is determined whether guidance and policy should receive 

public comment, and then talk a little bit about the evolution of the 

regulatory framework. Mr. Murphy, we welcome you. 

Next to Mr. Murphy is David Hobbie, the Chief of Alaska’s District Regulatory Division of the Army Corps of Engineers. He is 

here to inform us about what tools are available to the Corps, and 

how he intends to employ those tools going forward in his new role 

as the Chief here. 

We also have Dr. Mary Anne Thiesing, the Regional Wetland 

Ecologist and Wetlands Coordinator in the Office of Ecosystems, 

Tribal and Public Affairs for EPA. She is here to speak to the interagency cooperation and coordination of EPA and the Corps as well 

as engagement of EPA with individual project stakeholders. 

Again, thank you for being here, and thank you for the courtesy 

that you have given in allowing the first panel to proceed and offer 

specific cases of the concerns. My hope is that that will better 

frame your opening comments or certainly your responses to questions that Senator Sullivan and I will have. 

So we thank you for being here. 

Mr. Murphy, if you would like to lead off with about five minutes 

or so? Again, your full statements will be included as part of the 

official hearing record. 

Thank you. 

STATEMENT OF TED MURPHY, ASSOCIATE STATE DIRECTOR, 

BUREAU OF LAND MANAGEMENT, U.S. DEPARTMENT OF THE 

INTERIOR 

Mr. MURPHY. Thank you. 

Chairman Murkowski and Chairman Sullivan, thank you for the 

opportunity to discuss the Bureau of Land Management’s efforts to 

facilitate responsible economic development of public lands while 

protecting the natural and cultural resources that Americans cherish. I’m Ted Murphy, the BLM Associate State Director for Alaska, 

and I look forward to discussing these issues with—from the BLM 

experience here in Alaska. 

Mitigation is central to the BLM’s successfully carrying out our 

multiple use and sustained yield mission. It is something we have 

done for decades and its legal basis comes straight from our governmental authorities under FLPMA. 

When you think about mitigation at the BLM you think about 

what is a three step process: avoidance, minimization and compensation. Through this process accounts are first divided through 

careful siting that will minimize by using innovative design features and best management practices. And then sometimes they 

are compensated for their corresponding offsets elsewhere. 

59 

Mitigation programs have been used to solve some of our most 

significant resource challenges and partnerships with states, tribes 

and other Federal entities have been central to their success. 

For example, in the early 2000’s the BLM faced a major challenge with permitting large scale oil and gas projects in Wyoming. 

In response to concerns about impacts to state managed game species, the BLM, the State of Wyoming and the oil and gas companies 

came together to develop innovative solutions that worked for the 

companies and helped mitigate impacts to those state managed 

species. This approach was championed by the previous Administration as a breakthrough for balancing the development and conservation and it has served as a model for our agency. 

While recently in Nevada BLM issued mitigation to speed the approval of a solar project through Western Solar Plan. The plan 

avoided sensitive areas by establishing focused areas for development. They identified key design features and called for regional 

mitigation strategies to direct compensatory investments. By identifying mitigation responsibilities up front BLM was able to provide 

certainty to private developers and increase the efficiency of its environmental review. Innovative mitigation approaches are helping 

the BLM conserve greater safeguards to habitat and support system while economic development on portions of public land in ten 

states across the West. 

A recent landmark agreement among the U.S. Fish and Wildlife 

Service, the BLM and Barrick Gold of North America established 

a conservation bank that gives fair certainty for the company’s 

planned future mine expansion on public lands. Other states are 

leading efforts to develop similar systems and the BLM is working 

hard to support these efforts. 

Chairman Murkowski and Chairman Sullivan, I know you both 

are familiar with the Greater Mooses Tooth Project in Alaska. As 

you know this project is the first oil and gas development project 

on Federal lands in the National Petroleum Reserve in Alaska. As 

part of our public review of the project the BLM identified significant impact to the subsistence resource provided by—of ANCSA. In 

the final project approval the BLM included a suite of best management practices approved by the company to avoid or minimize 

project impacts as well as an $8 million fund to directly address 

the subsistence impacts. As part of the planning for that project 

BLM is also moving forward with regional mitigation strategies for 

Mooses Tooth with—development units that will provide certainty 

to developers coming into these areas in the future. We believe this 

sort of up-front planning is good for subsistence resources and good 

for developers. 

With all of these promising efforts underway on public lands, the 

BLM is recognizing the need to set common standards and consistent expectations for mitigation across our lands and program 

areas. Since 2005 BLM has developed a series of increasingly detailed policies to assist BLM staff in their mitigation work. The latest of these was released in 2013. We released this policy on an interim basis which has allowed us to gather important lessons as we 

continue to execute these programs on the ground with states and 

companies. We anticipate issuing a final policy in the coming 

months. 

60 

Chairman Murkowski and Chairman Sullivan, thank you again 

for the opportunity to present this testimony, and I would be glad 

to answer questions you may have. 

[The prepared statement of Mr. Murphy follows:] 

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The CHAIRMAN. Thank you, Mr. Murphy. 

Mr. Hobbie, welcome to the Committees. 

STATEMENT OF DAVID HOBBIE, CHIEF, REGULATORY DIVISION, ALASKA DISTRICT, U.S. ARMY CORPS OF ENGINEERS 

Mr. HOBBIE. Thank you. Thank you. 

Good afternoon, Chairman Murkowski, Chairman Sullivan. 

Thank you for the opportunity to testify today. My name is David 

Hobbie. I am the Chief of the Regulatory Division of Alaska’s District U.S. Army Corps of Engineers. 

I’ve served at the Corps for approximately 25 years, have worked 

around the globe, predominantly in the Regulatory Program, and 

I am very happy to be back in Alaska. In my career with the Corps 

and its Regulatory Program, I have witnessed many changes over 

the past quarter century, while gaining an understanding and appreciation for the complexity of this mission. 

There are some special challenges that come with applying the 

Regulatory Program in a state as varied and as unique as Alaska, 

including identifying and implementing compensatory mitigation 

requirements. Natural resources in Alaska are abundant and include a huge percentage of wetlands. Alaska is also an extremely 

large landmass with a low population base and a large percentage 

of the land are publicly held. 

I have been back in Alaska for approximately seven months as 

the Chief of the Regulatory Division. One of the first issues I was 

asked about following my arrival was compensatory mitigation. 

Compensatory mitigation is a key component of the Regulatory 

Program, and reviewing these practices in the state has been one 

of my top priorities. 

The fundamental objective of compensatory mitigation is to offset 

environmental losses resulting from unavoidable impacts to waters 

of the United States caused by activities authorized by Clean 

Water Act permits. Compensatory mitigation enters the analysis 

only after the proposed project has incorporated all appropriate and 

in implementing compensatory mitigation requirements. The Alaska Regulatory Program has sought opportunities to be more flexible when possible while at the same time protecting aquatic resources to the maximum extent practicable. One example involves 

the Alaska Department of Transportation replacing culverts fully 

to increase fish passage and assist with fish resources. 

Additionally, we are looking at ways to improve communication 

and collaboration, not only with agency partners at the state and 

Federal level, but also with the public in order to better understand their issues. These efforts have involved meetings with leadership from the Department of Natural Resources, the U.S. Environmental Protection Agency, Bureau of Land Management, National Marine Fisheries, Alaska Oil and Gas, and CIRI which is an 

Alaskan Native Corporation, just to mention a few. During these 

meetings we discuss mitigation and the opportunities that exist for 

the Federal family and our non-Federal loan partners to work more 

closely together. 

Compensatory mitigation is a complex issue. Our goal, which is 

a national goal within Corps, is to ensure no net loss of wetlands 

functions and values while remaining as flexible as possible to 

66 

allow reasonable and sustainable development. It is also our goal 

to be transparent, as transparent as possible, in our decisionmaking process. 

Every project is unique. No two projects are exactly identical. Although the structures may look the same, the areas and types of 

impacts associated with individual projects are nearly always different. Therefore, the quantity and type of compensatory mitigation 

required will vary depending on the site specific nature of each 

project. 

Before I close, I would like to offer a little general information 

about the Regulatory Program in Alaska. So far in Fiscal Year 

2015, which starts on October 1st of 2014, the Alaska District has 

authorized 431 projects under the Nationwide/Regional General 

Permit Program. General permits streamline the process of meeting the requirements of the Clean Water Act for projects with no 

more than minimal environmental impacts. 

Of the 431 projects authorized, 17 required compensatory mitigation, approximately four percent. We have completed 75 Standard 

Permits/Letters of Permission for larger, more complex projects 

where the impacts were determined to be more than minimal, of 

which 12 required compensatory mitigation, approximately 16 percent. I believe the number reflects the Corps’ ability to work closely 

with the applicant and partner agencies to avoid and minimize impacts so that compensatory mitigation is not always a requirement 

for the authorization of a project. At the same time, the Corps remains flexible, so that when compensatory mitigation is required, 

we are able to work with the applicant and other agencies to 

achieve a successful outcome. 

Thank you again for the opportunity to speak here today. I look 

forward to questions. 

[The prepared statement of Mr. Hobbie follows:] 

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The CHAIRMAN. Thank you, Mr. Hobbie. Welcome to Alaska, or 

welcome back. 

Mr. HOBBIE. Thank you. 

The CHAIRMAN. Dr. Thiesing. 

STATEMENT OF DR. MARY ANNE THIESING, WETLANDS COORDINATOR FOR THE OFFICE OF ECOSYSTEMS, TRIBAL AND 

PUBLIC AFFAIRS IN REGION 10, U.S. ENVIRONMENTAL PROTECTION AGENCY 

Dr. THIESING. Good afternoon, Chairman Murkowski and Chairman Sullivan. I’m Mary Anne Thiesing, Wetland Coordinator for 

the Office of Ecosystems, Tribal and Public Affairs in Region Ten, 

EPA. I’m pleased to be here to discuss the Clean Water Act, Section 404 Mitigation program, compensatory mitigation banking and 

EPA’s coordination with the Corps. 

As you know the Clean Water Act was promulgated in 1972 to 

restore and maintain the physical, chemical and biological integrity 

of the waters of the U.S. The Act established the Section 404 permit program which authorizes the discharges of dredged and fill 

material to waters in the U.S. discharge that can degrade or even 

destroy those waters. 

The Corps is given responsibility under the Act to issue the Section 404 permits. In Alaska permits often are associated with activities such as road construction or energy development. 

To offset the impacts from permitted activities, the 404 program 

is built on the concept that when impacts to waters, including their 

loss, are unavoidable, they shall be compensated by establishing, 

restoring or preserving waters at the impact site or at another location, generally within the same watershed as the impacts. Consideration of mitigation occurs throughout the permit application process and includes avoidance and minimization. However, there may 

still be unavoidable impacts to waters. Those require compensatory 

mitigation but it is only considered after a proposed project has 

first looked to trying to avoid and minimize adverse impacts. 

Individual permits that are associated with activities with more 

than minimal adverse effects to the aquatic environment may include special conditions that require compensatory mitigation. And 

that’s to offset degradation or loss of waters of the U.S. when 

avoidance or minimization is not practicable. 

There are basically three mechanisms that will allow permittees 

to offset the aquatic impacts resulting from their projects. They can 

purchase credits from a mitigation bank, they can purchase credits 

from an in-lieu fee program, or they can conduct a compensatory 

mitigation project on their own. 

A mitigation bank is a site that has restored, established, enhanced and/or preserved aquatic resources and the Corps, in consultation with an Interagency Review Team, approves for the use 

of compensating the losses from future permitted activities. The 

bank approval process establishes the number of credits and the 

bank sponsor is responsible for the success. 

With in-lieu fee mitigation, a permittee provides funds to an inlieu fee program. Those are sponsored by either a government or 

a nonprofit entity or a tribe that conducts compensatory mitigation 

projects consistent, again with an agreement, with the Corps in 

71 

consultation with an interagency review team. Typically the in-lieu 

fee mitigation projects are started only after they pool the funds 

from multiple permittees. And the in-lieu fee program sponsor is 

the one who is responsible for the success of the sites. 

The third option, permittee responsible, is basically the responsibility of the permittee to conduct and ensure the success of mitigation. It’s usually, it can occur either at the project site or in a different one, preferable within the same watershed. 

EPA works closely with the Corps and the Interagency Review 

Team that oversees the review, approval and management of mitigation banks and in-lieu fee programs. For proposed permittee responsible mitigation, the EPA provides comments to the Corps in 

the review process. 

Congress directed in 2004 that the Corps and EPA publish regulations, and they did so in 2008 to revise and clarify compensatory 

mitigation requirements. It ensures a level playing field among 

providers of compensation because it holds all the providers to the 

same standard regardless of whether it’s a bank, an in-lieu fee program or by the permit applicant. It also increased consistency and 

predictability in compensatory mitigation requirements through a 

number of timing of the contents of mitigation plans and also the 

timelines for review. It did not change when compensation is required but rather focuses on how and where mitigation is planned, 

implemented and managed to improve its ecological success and 

sustainability. 

Although careful attention is given to compensatory mitigation 

requirements when they are necessary, most of the 404 authorizations don’t require mitigation. Permitting data from 2010 through 

2014 shows the Corps nationally issued approximately 56,400 written authorizations per year under its permit authorities, about ten 

percent required compensatory mitigation. This reflects a number 

of factors, the Corps’ ability to successfully work with the applicants and also with the agencies to try and avoid or minimize any 

impacts. Most of those authorizations occurred under the general 

permit process and they have no more than the minimal adverse 

impacts. 

Compensatory mitigation is a basic component of the Section 404 

permit program. It is consistent with the act’s goals of trying to restore and maintain the chemical, physical and biological integrity 

of the nation’s waters. We work together to ensure that this provision is applied consistently, predictably and effectively so that the 

applicants can proceed with projects to achieve their needs while 

at the same time protecting public health and water quality. 

Thank you very much for the opportunity to be here. I will be 

happy to answer any questions you may have. 

[The prepared statement of Dr. Thiesing follows:] 

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The CHAIRMAN. Thank you, Doctor, and I apologize that I mispronounced your last name. 

You wrapped up your statement by saying that the goal here is 

a level of consistency, predictability and effectiveness. I think what 

you heard with the panel just before you is that this process, when 

it comes to compensatory mitigation, is anything but consistent, 

predictable and in many cases, effective. 

I want to ask you a question. You mentioned that nationally that 

with the 404C permits issued, only about ten percent are required 

to be mitigated. Is that correct? 

Dr. THIESING. Yes, about ten percent of them are, correct. 

The CHAIRMAN. How does that compare then, here in Alaska? 

Those are national figures. We recognize that things are just entirely different down there. When you are up in the North Slope 

and 90 percent of the area around you is determined to be wetlands, what percentage here in Alaska of those 404Cs require a 

compensatory mitigation? 

Dr. THIESING. Not 404Cs, 404 permits, Ma’am? I believe Mr. 

Hobbie actually answered that in his testimony. 

Mr. HOBBIE. Yes, Ma’am. 

If you look at our numbers as a total I wrote my pertinent individual permit information and information GPs because the small 

ones would be less. If you combined our new totals we issued 431 

nationwide GPs and 71 IPs. If you combine those two totals about 

six percent of the time we require mitigation in the State of Alaska. 

The CHAIRMAN. Does that hold true then for the North Slope? 

Mr. HOBBIE. I do not break the numbers down that way and I’d 

have to get back to you. I can’t tell you things I don’t know about 

the North Slope. 

The CHAIRMAN. Well it is something that, I think, would be interesting to drill down on because when you have an area that is effectively almost all wetlands and the extent of the wetlands I 

would be curious to know exactly what we are talking about here. 

Mr. HOBBIE. What I would say is most likely the percentage is 

almost always going to be greater. The reason is, percentage wise, 

because of course we, the North Slope is not the area of our most 

predominate permitting. It’s typically the Anchorage Borough area 

and Juneau, Wasilla so many of the permits also the impacts in the 

North Slope tend to be much greater. 

A lot of oil and gas, it probably has too many, hundreds of acres 

in size where a lot of the projects within the municipality of Anchorage, Wasilla, Juneau are sometimes tens of acres, half acres or 

an acre. So the impacts are much larger on the North Slope, typically speaking, therefore, it would drive more compensatory mitigation while other areas may not. 

The CHAIRMAN. I look forward to that break down. 

Mr. HOBBIE. Will do. 

The CHAIRMAN. I want to bring up with you an issue that was 

just presented to me this morning. I had an opportunity to meet 

with the Mayor of the Mat-Su Borough, the Palmer Mayor and the 

Mayor here in Wasilla. They alerted me to what they are entitling 

here the ‘‘Wetland Mitigation Bank Concern.’’ 

78 

They apparently received some information that was disclosed 

just as a result of a FOIA request regarding some changes in policies that relate to compensatory mitigation. The fact that the guidance letter was developed and implemented without public input 

which is something that I think we are going to have a little bit 

longer conversation about here and the concern that we have that 

so much of what we’re seeing coming out is not with full public 

comment. 

The concern they have raised, and I will read from their document here they provided, ‘‘The Corps new policy requires ownership of wetland banks, requires ownership of the surface, subsurface rights or an agreement with subsurface right owners to not 

impact the surface even in those cases where the possibility of mineral exploration or extraction is remote. Municipal entitlements for 

boroughs and municipalities from the state only convey the surface 

estate to municipalities.’’ 

This is an issue here in the Mat-Su. It is also an issue out in 

the Ketchikan Gateway Borough. I was asked to bring this to your 

attention. 

I am going to not only provide this to you, Mr. Hobbie, but it will 

become part of the record. 

[The information referred to follows:] 

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The CHAIRMAN. The Borough is essentially laying out that they 

could potentially lose millions of dollars in wetland mitigation credit. This is something that was new to me this morning, and I am 

still learning more about it. But I would like you to be able to respond to not only the people here in the Mat-Su Borough but 

Ketchikan Borough because I understand that they have a similar 

concern, an issue, as it relates to the mitigation bank. 

Mr. HOBBIE. Okay, Senator. 

I’m not familiar with that particular letter; however, we are 

struggling right now. And when I say we, Alaska District, and it’s 

nationwide typically when a mitigation bank is established the 

land is reserved into perpetuity or any other sort of mitigation. 

Typically that requires some surface rights. 

The rationale behind that is locking up the surface may be fine, 

but that doesn’t exclude people coming in individually and mining 

the area because in most states, the subsurface rights are not 

bound by any restrictions. So therefore the easement really doesn’t 

mean much. 

The CHAIRMAN. Understood, but if you do not have the subsurface rights? 

Mr. HOBBIE. Totally understand. 

The CHAIRMAN. Yes. 

Mr. HOBBIE. What we’re trying to do is make sure the policy has 

some kind of consistency across the nation. Alaska is sure where 

it’s not the only state that has some sort of issues, so we want to 

make sure we’re trying to be as consistent as possible across the 

nation. 

I’m not saying that that means that will never happen; however, 

it’s something we’re investigating to try to ensure that we are applying the rules as fairly as we can. 

The CHAIRMAN. I am going to turn to Senator Sullivan, but one 

thing that I think is important to keep in mind here in this state 

is we are unique. We have some laws here, Federal laws, that 

apply to our lands that do not apply in other states. ANILCA is applicable only in Alaska, and I want to talk about ANILCA when we 

do our next round. 

Senator Sullivan? 

Senator SULLIVAN. Thank you, Madam Chair. 

I want to thank the witnesses here. I really appreciate some of 

you flying in from out of town. 

But also what Ms. Crockett mentioned in her earlier testimony 

is it has been my experience, as Attorney General in Alaska, and 

as the DNR Commissioner, is closer to the Federal officials are to 

Alaska, when they live here, when they work here, they see our 

issues. I think the working relationship is oftentimes a lot stronger 

because you get it. 

The problem is when Washington, DC dictates certain policies 

with, kind of, a one-size-fits-all mentality, and then they try to 

apply it here. So I just appreciate you being here. I know that you 

guys are working hard on these issues. 

But as you did see and as Senator Murkowski mentioned, we 

also appreciate you letting the Alaskan panel go first, because I 

think it was good for all of us to see what the issues are. Clearly 

there is a lot of frustration. That is a sampling of what is going 

83 

on in the state, but that was not some kind of handpicked group. 

That is very representative of the sense in Alaska whether you are 

a small, private landowner or a big company in terms of what is 

going on with mitigation. 

A lot of it is the sense of, you talked about transparency and predictability, it almost seems like it is the opposite where it is random. So I want to get into some of those kind of questions. 

I also, if you can and if you cannot do it here, one of the things 

I mentioned in my opening statement, authority, authority, authority, authority. If you are a Federal agency and you are taking action or issuing a regulation, do you agree that you have to have a 

basis either in Federal statute or the U.S. Constitution? Do you 

agree with that? Do you? 

The answer is yes, if you are wondering. [Laughter.] 

It is not even a close question. 

Just for the record, it should be yes. If you take an action as a 

Federal agency, your action or your reg has to be based in statute 

or the U.S. Constitution. Just for the record, do you agree with 

that? 

Mr. HOBBIE. Yes, sir. 

Senator SULLIVAN. Okay. 

Mr. MURPHY. Yes. 

Dr. THIESING. Of course, of course it does. 

Senator SULLIVAN. Okay. 

Dr. THIESING. We take the same oath that you do, sir. 

Senator SULLIVAN. Oh, I know. I am just checking because, as I 

mentioned, now this is a really important issue because there are 

a lot of things where, on the actions you are taking, I know you 

have some discretion and the Corps allow some discretion. 

But as I mentioned in my opening statement, in the last two 

terms of the U.S. Supreme Court, they have found that the EPA 

has not done that. And one of those cases actually started here, the 

Utility Air Regulator Case verses EPA. It wound its way to the 

U.S. Supreme Court. Two years in a row the U.S. Supreme Court 

has stated that you have not abided by the statute or the Constitution. So your record on this is not terribly good. I think it is an 

area that, in terms of Congressional oversight, that is important. 

The Deputy Commissioner, Mr. Fogels, raised a really good issue. 

As you guys know, when you look at the structure of the Clean 

Water Act, just like the Clean Air Act, it is supposed to be a coregulator relationship between the states and the feds. It is in the, 

actually, preamble of the law. 

So why is it that in terms of mitigation which has such a big impact here which we have so many concerns about, that you guys 

do not invite the State of Alaska in with regard to your mitigation 

decisions? We asked Commissioner Fogels whether you do that. His 

answer was no. So why don’t you do that? 

Mr. HOBBIE. Well, sir, I would say two things. 

One, through our permitting process, you know, we do invite responses, information, from all agencies, State and Federal, you 

know. The state does have an opportunity. When it comes to the 

Interagency Review Team for mitigation, the Department of the 

Environmental Conservation which is a state agency, does sit on 

84 

that Interagency Review Team with regards to mitigation banks 

and such. 

Senator SULLIVAN. So you think that Deputy Commissioner 

Fogels’ response was incorrect that the state does actually have a 

co-regulator role with regard to the mitigation decisions? 

Mr. HOBBIE. Senator, what I’m stating is the DEC does sit on the 

Interagency Review Team, and I’m stating that it’s a practice they 

do come into our projects, a good majority of them with regards to 

mitigation. 

Senator SULLIVAN. Okay. 

Dr. THIESING. Senator, if I might add to that? 

I believe that the commissioners of all the state agencies were 

signators to the State Interagency Review Team document. They’re 

not? 

Senator SULLIVAN. Okay. But I think, for example, I was very involved with regard to the Corps and the permitting on Point 

Thompson, right? At the end of that permitting process, wham, 

there was a huge dollar figure that you put with regard to the permittees in terms of compensation that we had no idea, right? 

So I know from personal experience that we are not that involved 

because we were the lead agency doing that project but we did not 

have a clue. 

I think if you say you are doing it, you need to do a much, much 

better job of doing it because you have a Deputy Commissioner who 

just talked about it and also my experience. We are getting 

blindsided by this. I think it is important to go back and look at 

the statute. We are the co-regulator. We are the co-sovereign here. 

I think that is a really important issue, and it is a part of the frustration. 

Let me ask another question that came up. Do you see this tension that became very apparent in the previous panel between 

ANCSA and what is required in terms of the Clean Water Act mitigation? And if so, how do you address it? Again, I will just summarize it. 

If our Alaska Native Corporations, regional corporations, village 

corporations want to develop the land that they were given by the 

Federal Government and the State to develop to take care of their 

shareholders, their people they are responsible for, to do that they 

have to give up land. They actually have to give up land in a way 

that is more than one for one. The EPA wanted six for one which 

I have a question for on that too. But do you see the tension there? 

How do we solve that? What is your recommendation to solve that? 

To develop land you have got to lose land. 

Mr. HOBBIE. Senator, there are a couple ways to respond to that. 

First of all with regards to compensatory mitigation, again, I do 

believe there’s a low percentage of times where we do require it. 

When we do though—— 

Senator SULLIVAN. Not on the North Slope, though. We will be 

very curious about your numbers on the North Slope. I think we 

see it on almost everything, roads, developments and that is a lot, 

in many ways the heart and soul of our economy. So I would like 

to see those numbers. 

Mr. HOBBIE. We’ll provide those, sir, to the Committees. 

85 

[The information referred to was not provided as of the date of 

printing.] 

Mr. HOBBIE. The other thing is the mitigation banks or in-lieu 

fee programs have become a way to allow applicants an easier access to mitigation. There’s nothing that precludes them from not 

tying up land. 

Mr. Fogels talked about legacy wells and stuff. When I met with 

the different agencies those were some of the things we were trying 

to do, trying to be flexible. 

Are there other areas in the state that can actually be cleaned 

up or rehabbed versus just setting aside land? 

Senator SULLIVAN. What if you are a corporation like Kuukpik that said they do not have $1.4 million for just an eight mile road? 

One million four hundred thousand dollars. They did not have that 

money. You heard it, their only option was to give up their land. 

You heard the testimony. They are in a conundrum. Develop the 

land. Give up the land. It seems to me it is squarely undermining 

the intent of ANCSA. How do you respond to that? 

Mr. HOBBIE. Again, sir, they may have chosen that route, but 

again, I’m not for sure—— 

Senator SULLIVAN. But I do not think they are choosing. 

Mr. HOBBIE. Um, well—— 

Senator SULLIVAN. If you do not have the money, what is the opposite? 

Mr. HOBBIE. If the determination was the impacts were more 

than minimal, mitigation is required by statute. That’s a requirement. You know, I can’t change that. 

The cost of that, the Corps of Engineers nor EPA, that I’m aware 

of, apologize if I speak for you, regulates the amount of fees that 

the in-lieu banks with mitigation banks charge and in-lieu programs charge. 

Senator SULLIVAN. Let me ask a question where you have more 

flexibility than you think you might have. 

On May 13th, 1994, the Army Corps and the EPA jointly issued 

a memorandum entitled, ‘‘Statements on the Mitigation Sequence 

and No Net Loss of Wetlands in Alaska.’’ What this states, and it 

is still a memo that is good to go according to your guy’s website, 

it states there are areas of the State of Alaska because of a high 

proportion of wetlands in a watershed or region opportunities for 

compensatory action may not be available. I think they are clearly 

referring to places like the North Slope. 

In addition, there are situations in this state where the technology for restoration enhancement or creation of wetlands is not 

available or are otherwise impracticable where compensatory mitigation is not practicable it is not required of Section 404 permit applicants. 

So isn’t the North Slope a perfect example of what this memorandum is talking about? Have there been situations where the 

Corps and the EPA under this authority that you guys have, that 

you stated, have said, look, it’s not going to work. You pick, we get 

it. You don’t have $1.4 million and you should not be required to 

give up land to develop lands so we are not going to require anything. Have you ever used the authority given to you by this memorandum between the EPA and the Corps? 

86 

Ms. THIESING. Sir, the memorandum was dated 1994. We have 

since come out with a rulemaking which applies something over or 

a different set of standards which are clearer intended to try and 

make, put everything on an even playing field. 

Kuukpik was the one that offered an area of preservation as 

compensation for the impacts that they had. And when a conservation easement was written or identified in the Corps’ permit and 

the permit that was ultimately granted to Kuukpik there are a 

number of uses of that land that remain theirs. 

They are, they can use it for subsistence purposes. There are a 

whole bunch of other things that are listed as part of the conservation easement which is not ordinarily something that is done. 

But—— 

Senator SULLIVAN. Alright Ms. Thiesing, for the record, in the 

preamble to your 2008 compensatory mitigation rule it references 

the 1994 memorandum. And it says, therefore it does not, the new 

rule, change the May 13th, 1994 statements on mitigation sequencing no net loss of wetlands in Alaska. So to say that the 2008 rule 

overrode the 1994 memo, giving you way more flexibility than you 

are utilizing is not correct. 

Ms. THIESING. But I believe what the preamble is addressing 

itself to is the no net loss. We understand that there will be loss 

of wetlands in Alaska. 

Senator SULLIVAN. Again, to say Kuukpik had an option. I think 

that is stretching the situation that you just heard from them. 

They didn’t really have an option to build a road because they did 

not have the $1.4 million. You see, I think that what you need to 

do is look at a lot more flexibility for the state, and I think you 

have that. You are just not using it. 

Madam Chair, I am sorry I kind of went a lot over. 

The CHAIRMAN. No, this is the line of inquiry that I think most 

of us here in Alaska are interested in, because I do not think that 

we have received satisfactory responses from the agencies. 

Pretty tough words are used when we hear whether it is from 

Wainwright or Nuiqsut or Craig or the folks at Great Northwest. 

But the word is extortion. Now that is pretty tough. 

I think we can understand why it is important to allow for mitigation, why those regulations are in place, but I think there also 

is an expectation, and this goes back to your words, that there be 

a level of predictability, that it be fair and reliable. This is where 

the concern is because it is almost as if there is a bargaining that 

goes on and we will figure out what it is that we can settle on. Instead of a six-to-one ratio you settle on a two-to-one because that 

was what people finally agreed to. 

It is not really an option when you have no other alternative, and 

yet you want to be able to provide for the health and safety of the 

people in your village. You want to be able to get to work which 

is effectively what they are looking for there at Kuukpik and you 

want a road open for subsistence. 

So I do not mean to be not asking a question, but I think you 

need to put yourself into the shoes of those that are working really 

very, very hard to try to provide for a level of access, a limited level 

of development and a willingness to do so and work within the 

laws. But we want to know that you are working within the laws 

87 

and not sometimes making it up as you go, and sometimes that’s 

how it feels. Again, these are pretty harsh words for you, but that’s 

how it feels. 

Mr. Murphy, I don’t want you to get off the hook. [Laughter.] 

The CHAIRMAN. The compensatory mitigation is certainly one 

thing within our Corps, but we do have other issues within our 

BLM lands. The Federal Land Policy Management Act, FLPMA as 

it is lovingly called. Throughout FLPMA we have the principles of 

multiple use defined, pretty consistently, pretty clearly. I think 

you, in your comments, referred to the fundamental authorities 

that come from FLPMA to BLM. 

Secretary Jewell in her Secretarial Order stated that, ‘‘Through 

the development of comprehensive mitigation strategy we can ensure that our national wildlife refuges, national parks, other Federal lands and waters are managed for conservation purposes with 

sound stewardship and a commitment to conserve habitat and fish 

in wildlife mitigation corridors.’’ 

She goes on to lay out the following mitigation priorities, and 

this is what she says in her Secretarial Order. She says, ‘‘To avoid 

potential environmental impacts where impacts cannot be avoided 

require projects to minimize impacts to the extent practicable and 

where impacts cannot be avoided, DOI should seek offset or compensation.’’ She is effectively taking this language, borrowing this 

language, if you will, from the Clean Water Act. And regarding the 

avoiding, the minimizing and the compensating, do we really have 

authority within FLPMA that gives to BLM the authority to borrow this language, if you will or these priorities, that the Secretary 

has included within this order? How do we get to this level of authority? It goes to Senator Sullivan’s earlier question. Do we have 

that authority within FLPMA because that is your fundamental 

authority? It seems to me that what you are doing is you are taking language from another authority and utilizing it to expand 

yours. That is my question. 

Mr. MURPHY. Well, as I pointed out in my comments looking 

through our handbook and manual—it’s, well mitigation in general. 

And we do have a long history of arguing with proponents at development all over the United States and that’s built upon the challenges and we realized in the lower 48 over time development that 

have impacts we couldn’t sustain there. And as we moved into 

Alaska and we started to see opportunities for development, particularly in the National Petroleum Reserve, we didn’t want to 

think of going down that same road, fragmenting habitat and precluding multiple use—resource economically and sustaining the resources, the natural resources that are on land. 

So, yes, we feel that our authority emanates from FLPMA. But 

within the National Petroleum Reserve we also have the National 

Petroleum Reserve Protection Act which also reinforces that level 

of mitigation necessary to sustain ourselves and the public land. 

The CHAIRMAN. So let me ask you about this draft guidance, this 

manual. It is my understanding that it was Secretary Hayes that 

began the process for this draft Regional Mitigation Manual, and 

that was when Secretary Salazar was in office so it was about five 

years ago, and that draft manual has not even been something 

issued. It has not been rescinded. So we are sitting here with a sitVerDate Nov 24 2008 09:52 Mar 10, 2017 Jkt 096272 PO 00000 Frm 00091 Fmt 6633 Sfmt 6633 C:\TARSHA\HEARINGS\96272\96272.TXT 96272
88 

uation where BLM is effectively drafting guidance and then before 

it has been finally issued, before it has been vetted, you are implementing it. It goes to the comment that I made earlier about the 

lack of public comment afforded through BLM. 

You heard the concerns. We have had conversations about it in 

the past, and yet it still seems to me we are in the same situation 

where you are moving forward with draft provisions that have not 

been vetted, have not received the public comment, and yet you’re 

moving forward to implement them. 

Even though they are not yet fully in place, you heard Ms. 

Crockett’s comments about the impact that this proposed guidance 

and these designations have on the ability to invest, the ability to 

permit, the ability to really do anything in any area. So at the end 

of the day, you may get your desired effect if the desired effect is 

to limit further development in the area because everybody is put 

on hold. How are we at that place where we are allowing these 

draft, unvetted guidance documents to be controlling without public 

comment? 

Mr. MURPHY. The—of that draft, I believe is 2013, and that draft 

mitigation policy was vetted with the public. And yes, we are implementing portions of that as we move forward. 

The CHAIRMAN. Even though it is still in draft? 

Mr. MURPHY. Even though it’s still in draft, in close coordination, 

we’re developing with FOIA, with the states and to be sure that 

we’re not overlapping each other, if you will, as well as making 

sure that we’re on program as we move forward. 

And again, it all emanates from, you’ve heard it time and time 

again, the transparency aspect that we’re trying to achieve that we 

can provide some assurances to those developers as we move forward and as they move forward to develop other lands in Alaska. 

The CHAIRMAN. One of the things that we did hear from Mr. 

Fogels though is a concern that you have overlapping, duplicative 

mitigation requirements. So if, in fact, you are working with the 

state to ensure that that is not the case, it seems to me we need 

to be doing a little bit better coordination. 

Let me go to Senator Sullivan. 

Senator SULLIVAN. Madam Chair, I am going to spend my comments or a couple more questions on authority because I think it 

goes to the fact, again, to this critical question so many of us are 

concerned about. It is clearly an oversight role of the Energy and 

Natural Resource Committee and the EPW Committee on pinning 

down where you have authority to take the actions that you do. 

Mr. Murphy, I know you are not driving this policy and this is 

actually driven by Secretary Jewell, but I still think your answers 

to this with regard to mitigation are not sufficient. I would request 

that, for the record, you get the Department of the Interior General 

Counsel’s Office to give detailed answers, citing specific statutes on 

where you get the authority to require $8 million in mitigation on 

GMT1. It is not sufficient to say the Secretary has a draft letter 

that provides us that authority. That is worthless. The authority 

has to derive from the Congress. You have to be able to point to 

a statute. 

89 

We have heard rumors that there was at one point officials from 

DOI saying hey, they can afford it, so we are going to require mitigation. 

Last time I checked that was not a proper authority to require 

that kind of level of mitigation. We heard, once again, it started at 

a real high number, again, not sure why, and then started to come 

down throughout this negotiation, and then what are you are actually going to do with the funds? Who made that decision? What are 

you going to do with those funds? You are just randomly coming 

up with the idea that now we have $8 million and we are going 

to use it for whatever purpose we want without any direction from 

the Congress of the United States? 

I don’t think you are answering these questions. I would respectfully request that the headquarters back at the Department of the 

Interior come back with detailed, detailed, legal authority on what 

gives you the authority for the GMT1 mitigation and the spending 

of that money on whatever you feel like? I don’t think that is a 

proper answer. 

[The information referred to was not provided as of the date of 

printing.] 

Senator SULLIVAN. I would like to ask a question that came up, 

and this could be for all three of you. In terms of mitigation required by the state, so the State of Alaska wants to build a road. 

We were required, I guess, last year to pay almost $3.5 million in 

mitigation. Do you have a statutory provision that you can provide 

us that allows Federal agencies to require compensatory mitigation 

of a co-equal sovereign to pay mitigation? I was very surprised by 

that. I actually did not know the answer until this morning. 

Mr. HOBBIE. I’ll take the first stab at it, Senator. 

As far, I mean, under the Clean Water Act of course, there’s regulations that have been promulgated. Part of that is, of course, the 

2002 rule. 

Senator SULLIVAN. But remember, we are a co-equal regulator 

under the Clean Water Act, so you are charging us compensatory 

mitigation. 

Mr. HOBBIE. We didn’t charge the state a dime. The state chose 

to pay that in a third party, in-lieu fee holder. Again, like replacing 

the fish culvert. 

Senator SULLIVAN. So we could have just not done anything? 

Mr. HOBBIE. You would not have got a permit, sir. [Laughter.] 

Sir, if the state was exempt—— 

Senator SULLIVAN. Come on there, Mr. Hobbie. 

Mr. HOBBIE. If the state was exempt—— 

Senator SULLIVAN. You are playing with the words. So we had 

to do it. No equal regulator under the Clean Water Act became the 

subservient sovereign. 

Mr. HOBBIE. Yes, sir, just like the Federal agencies have to mitigate also. 

Senator SULLIVAN. Okay, can you do the same thing? Provide the 

statutory authority detail on where that authority rests? 

Mr. HOBBIE. Yes, sir. 

[The information referred to was not provided as of the date of 

printing.] 

90 

Senator SULLIVAN. Okay, thank you. 

Ms. Thiesing, I wanted to ask you a question. This is a little 

more detailed, but again it goes to authority issues. It is my understanding that the lands that are set aside in compensatory mitigation are supposed to be under an imminent threat of development. 

Dr. THIESING. That’s correct. 

Senator SULLIVAN. Why is this a requirement? Where do you derive your authority for that? For example, the EPA initially dismissed, when Kuukpik was working with you, the location of their 

initial easement that they wanted to provide as inadequate because 

that land was not under the imminent threat of development. I just 

do not even understand that. That is not just taking acreage, the 

six-to-one or two-to-one or whatever, but you are actually making 

sure it is acreage that is really, really valuable for them. Again, 

where do you get the authority in the statute to say that the acreage that you want has to be extra valuable to them? Do you see 

how it is extra valuable? 

Dr. THIESING. Senator, I think you’re not correctly characterizing 

what the rule says. The authority for requiring measures to evaluate a permit comes from Section 404B of the statute, the 1972 Federal Water Pollution Control Act also known as the Clean Water 

Act. Section 404B, Section 404A authorizes the Corps to, the Secretary of the Army acting through the Chief of Engineers or his 

designee, to authorize discharges to fill, dredged of full material to 

waters of the West. Section 404B authorizes the Administrator to 

develop guidelines, the substantive criteria, by which the Corps 

will evaluate its authorizations for against the criteria that the Administrator develops. Okay? So, in other words, EPA has responsibility to develop the guidelines while the Corps evaluates all of its 

permits applications because—— 

Senator SULLIVAN. You are not really answering my question. 

Dr. THIESING. No, sir. 

Senator SULLIVAN. Why is this a requirement? Why is the compensatory land that you are seeking—— 

Dr. THIESING. I’m getting to that. 

Senator SULLIVAN. Have to be under the imminent threat of development? 

Dr. THIESING. Okay, that’s where the authority comes from. 

Now the rule which is part, the 2008 final mitigation rule, is part 

of the, has become part of the 404B guidelines, and in laying out 

criteria for using preservation as a means of offsetting unavoidable 

losses, okay? 

If you preserve an area you’re still incurring a loss of function 

and services that that area provides to the environment and to the 

human population. However, if an area is particularly valuable ecologically or provides important services and it is under threat of destruction or degradation then preserving that area provides an important—it provides, it preserves those important functions and 

services to the environment and to the human population using it. 

Senator SULLIVAN. Actually I think you can make the opposite 

argument. If you talked to the Kuukpik members who were here 

earlier that is very important to that population because of the fact 

that you are putting up, you are focusing on it in a way that actually is going after even more high value land for them. Again, I just 

91 

do not understand why this is a requirement and where you have 

the authority to make it a requirement. 

Dr. THIESING. It is a criteria by which, it’s a criteria laid out in 

a rule by which the Corps can consider a net loss of wetlands if 

an important area, an area that’s ecologically important and performs important functions, is preserved. 

Senator SULLIVAN. Okay, if you can, again if you can take the opportunity to provide more detailed comments with the general 

counsel from the EPA on the statutory basis for this requirement, 

if there is any. I’m doubtful there is. It would be very useful, I 

think, to be respectful here, as a follow-up to this hearing. 

Dr. THIESING. I can, sir. 

[The information referred to was not provided as of the date of 

printing.] 

Dr. THIESING. But the important thing is that valuable is, you 

know, in terms of when we look at preservation, our analysis of its 

value is how important is this to the area in terms of providing ecologically important services. 

Senator SULLIVAN. How about how important it is to the people 

of the area? 

Dr. THIESING. Well, but that’s the thing. One of the reasons the 

Kuukpik proposed this area for preservation was that it was very 

important to them for subsistence and for other uses for hunting, 

for fishing—— 

Senator SULLIVAN. But you initially dismissed Kuukpik’s—— 

Dr. THIESING. No, what we said in our comment letter was that 

we did not see the basis for them preserving. There was no information provided in the public notice that identified what the values 

of this parcel were. I mean, it did not have information available 

either from the public notice or from our discussions with the 

Corps as to what the basis for this parcel’s ecological value was. 

Senator SULLIVAN. Okay. 

Well Madam Chair, I am sorry, but just to wrap up. I do think, 

again, even on that it would be very useful. This is something I 

have asked the Administrator a number of times in hearings, in 

Washington, about getting back to the Committees of oversight 

with detailed statutory reasoning on how you have the ability to 

take these kind of actions. If you don’t you can admit that as well, 

but she has not been very good about getting back to us. I think 

it is something that we need to start instilling as part of the agency oversight. 

Where are you getting your authority? And you need to show us, 

you need to show the American people, the people of Alaska and 

the Congress. I think that if you can do that, provide that for additional follow-up to some of these questions, I think it would be very 

useful and we would really appreciate that. 

Thank you, Madam Chair. 

The CHAIRMAN. Thank you, Senator Sullivan. 

I think the whole discussion about where the authority stems 

from and some of the comments that have been made by this panel 

are important, again, in the context of where we are because we 

are not in Iowa. We are in Alaska. 

92 

We have some provisions, some Federal laws, ANILCA most specifically, ANCSA certainly, but certainly ANILCA that recognizes 

that our Federal land managers who work all over the country and 

manage all kinds of Federal land all over the country that we all 

have existing Federal statutes but within Alaska ANILCA provides 

that there is a difference that in order to accommodate a viable social and economic future that respects Alaskan needs, Alaskan traditions, participation within the state. This is laid out in Federal 

statute that is unique to Alaska. 

Yet it seems that that is just yet one more Federal law that we 

can overlook in an effort to say, well where we are working on all 

of these other land management policies for BLM across the country, and so we will just lump Alaska in but for ANILCA. 

I have questioned you, Mr. Murphy, on where the authority rests 

to allow for an ACEC in the Fortymile area that would encompass 

over 700,000 acres when within ANILCA it specifically limits, specifically limits, to 5,000 acres any withdrawal or deferral without 

Congressional authority. We can talk about whether it is EPA compensatory mitigation or BLM, the issues that you are dealing with 

in terms of some of these proposals and land designations and 

within the Corps, but I think it is imperative to understand where 

you are operating. 

I would assume that Mr. Murphy and Mr. Hobbie, you have had 

ANILCA training and that you require ANILCA training of all of 

your staffs here in Alaska. I would hope that that is the case. If 

it is not, we need to make sure that that is the case. 

Mr. MURPHY. It’s the case. 

The CHAIRMAN. But further to that that anybody who is sitting 

back in Washington, DC working out these regulations and reading 

through the records and the comments, that they too have an understanding and an appreciation of ANILCA because there is something that is clearly missing. I think part of it is bypassing some 

of the fundamental Federal statutes that relate specifically to the 

State of Alaska. 

We are well over our time, and I apologize to those of you that 

have been very patient with us as we have tried to gain more information. I appreciate not only the testimony provided today, but 

what you will be able to provide us with follow-up. 

As we have additional comments that may be presented by the 

public for the record, know that we will keep this Committee hearing record open for an additional two weeks. 

I think this has been very important for Alaskans to be able to 

understand some of what we are dealing with and perhaps some 

of the more constructive paths forward. 

It is probably the bigger part of our jobs representing Alaska 

back in Washington, DC to try to lend some air of predictability or 

certainty within the Federal regulations. This is one area where, 

I think, you can see we are not able to give that certainty because 

we do not have that at this point in time. So the request for greater 

cooperation, greater collaboration is an imperative and hopefully 

we will be making some progress moving forward. 

Senator Sullivan, thank you for—— 

Senator SULLIVAN. Thank you, Madam Chair. 

93 

The CHAIRMAN. Your leadership on these issues within EPW. It 

is really important that we are working together as a team. 

For those of you who gathered here today, thank you for your interest and your concerns as well. 

With that, the Committees stand adjourned. 

[Whereupon, at 5:30 p.m. the hearing was adjourned.] 

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