[House Report 106-763]
[From the U.S. Government Publishing Office]

106th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     106-763


                   CRAIG MUNICIPAL EQUITY ACT OF 1999


 July 19, 2000.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed


  Mr. Young of Alaska, from the Committee on Resources, submitted the 

                              R E P O R T

                             together with

                            DISSENTING VIEWS

                        [To accompany H.R. 3182]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Resources, to whom was referred the bill 
(H.R. 3182) to provide for a land conveyance to the city of 
Craig, Alaska, and for other purposes, having considered the 
same, report favorably thereon without amendment and recommend 
that the bill do pass.

                          PURPOSE OF THE BILL

    The purposes of H.R. 3182 are to provide for a land 
conveyance to the city of Craig, Alaska, and for other 


    H.R. 3182 requires the Secretary of Agriculture to convey 
4532 acres of land in the Tongass National Forest to the City 
of Craig, Alaska. Put in perspective, this bill affects less 
than three one- hundredths of one percent of the 17 million-
acre Tongass National Forest. The City will use the land to 
produce revenues to fund vital municipal services.
    The City of Craig is located in Southeast Alaska on Prince 
of Wales Island, the third largest island in the country. The 
community has grown from a mostly Native population of 250 in 
1971 to over 2500 residents, most of whom are not Alaska 
Natives. Craig reports it has no land base upon which to 
maintain its local services and no ability to utilize many 
federal programs which are dependent upon a large Alaska Native 
population for eligibility. Thirty years ago, streets were 
unpaved, water and sewer services were available for only a 
lucky few, and the City government provided almost no services. 
After years of growth, Craig's local government is now 
responsible for a range of services including police, fire, and 
emergency medical services, education, zoning, water and sewer, 
garbage disposal, harbor facilities and others.
    The City's problem is that it has no opportunity to expand 
its land base to support these municipal services. Despite the 
change in demographics over the years, 93 percent of the land 
within the Craig city limits is owned by two Alaska Native 
Village corporations. Under federal law passed in 1987, none of 
the Native land is subject to taxation so long as the land is 
not developed. Craig has approximately 300 acres of land owned 
privately by individuals within its city limits to serve as its 
municipal tax base. It can annex no other land because the 
entire land base outside its municipal boundaries is owned by 
the federal government as part of the Tongass National Forest 
or by another Alaska Native corporation.
    Didn't the Alaska Statehood Act of 1958 reserve a quantity 
of national forest land for the expansion and development of 
Alaska communities, including Craig? Yes, but in the 1960s and 
1970s the United States Forest Service rebuffed almost every 
selection made by the State on behalf of Craig. By the end of 
1970, the federal government commenced a long string of land 
freezes to settle Native claims and later to create and expand 
over 100 million acres of new conservation areas Statewide.
    The Alaska Native Claims Settlement Act of 1971 allowed two 
Native village corporations to acquire 93 percent of the lands 
within Craig's municipal limits. According to the Mayor, ``the 
City of Craig is the only community in Southeast Alaska which 
requested the State to select land near it for which no 
selection has been made.'' Craig's fortunes were dealt another 
blow when the Clinton Administration shut down logging in the 
Tongass National Forest, the City's most valuable economic 
    In summary, Craig has almost no taxable land base, and as a 
result of federal actions, no means of raising revenue 
sufficient to meet its responsibilities. Financially speaking, 
Craig is nearing the brink of crisis. It is only right and fair 
that Congress grant land the City was due 40 years ago.
    H.R. 3182 identifies and describes the parcel to be 
conveyed. It is the nearest tract of land to the municipality 
not owned by Alaska Native Corporations. It is on the local 
road system, and is not in any wilderness or special status. 
The land has timber resources that if developed, may create an 
endowment to fund municipal services.

                            COMMITTEE ACTION

    H.R. 3182 was introduced on October 28, 1999 by Congressman 
Don Young (R-AK). The bill was referred to the Committee on 
Resources. On February 9, 2000, the Committee held a hearing on 
the bill. On April 5, 2000, the Full Resources Committee met to 
consider the bill. No amendments were offered and the bill was 
ordered favorably reported to the House of Representatives by 
voice vote.


    Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of 
rule XIII of the rules of the House of Representatives, the 
Committee on Resources' oversight findings and recommendations 
are reflected in the body of this report.


    Article I, section 8, and Article IV, section 3 of the 
Constitution of the United States grant Congress the authority 
to enact this bill.


    1. Cost of Legislation. Clause 3(d)(2) of rule XIII of the 
Rules of the House of Representatives requires an estimate and 
a comparison by the Committee of the costs which would be 
incurred in carrying out this bill. However, clause 3(d)(3)(B) 
of that rule provides that this requirement does not apply when 
the Committee has included in its report a timely submitted 
cost estimate of the bill prepared by the Director of the 
Congressional Budget Office under section 402 of the 
Congressional Budget Act of 1974.
    2. Congressional Budget Act. As required by clause 3(c)(2) 
of rule XIII of the Rules of the House of Representatives and 
section 308(a) of the Congressional Budget Act of 1974, this 
bill does not contain any new budget authority, spending 
authority, credit authority, or an increase or decrease in 
revenues or tax expenditures.
    3. Government Reform Oversight Findings. Under clause 
3(c)(4) of rule XIII of the Rules of the House of 
Representatives, the Committee has received no report of 
oversight findings and recommendations from the Committee on 
Government Reform on this bill.
    4. Congressional Budget Office Cost Estimate. Under clause 
3(c)(3) of rule XIII of the Rules of the House of 
Representatives and section 403 of the Congressional Budget Act 
of 1974, the Committee has received the following cost estimate 
for this bill from the Director of the Congressional Budget 

                                     U.S. Congress,
                               Congressional Budget Office,
                                    Washington, DC, April 19, 2000.
Hon. Don Young,
Chairman, Committee on Resources,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 3182, the Craig 
Municipal Equity Act of 1999.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Megan 
                                          Barry B. Anderson
                                    (For Dan L. Crippen, Director).

H.R. 3182--Craig Municipal Equity Act of 1999

    CBO estimates that enacting H.R. 3182 would not 
significantly affect the federal budget. The bill would not 
affect direct spending or receipts; thus, pay-as-you-go 
procedures would not apply. H.R. 3182 contains no 
intergovernmental or private-sector mandates as defined in the 
Unfunded Mandates Reform Act. The bill would benefit the city 
of Craig, Alaska, by providing land from which the city may 
generate new revenues to pay for city services. The budgets of 
other state, local, and tribal governments would not be 
affected by this bill.
    H.R. 3182 would direct the Secretary of Agriculture to 
convey approximately 4,500 acres of land within the Tongass 
National Forest to the city of Craig, Alaska. The Secretary 
would have to complete the conveyance within 90 days of the 
bill's enactment. According to the Forest Service, the lands 
that would be conveyed to the city do not currently generate 
any significant receipts, and the agency does not expect them 
to generate any significant receipts in the foreseeable future. 
The lands that would be conveyed are part of a larger area 
where the timber was offered for sale in 1999. No bids were 
received for this timber and the agency does not plan to 
reoffer it for sale in the near future.
    On April 12, 2000, CBO transmitted a cost estimate for S. 
1797, similar legislation that was ordered reported by the 
Senate Committee on Energy and Natural Resources on April 5, 
2000. The lands that would be conveyed under each bill are the 
same, and our estimates of each bill's impact on direct 
spending are identical. Differences between the two estimates 
reflect a provision in the Senate version that would increase 
discretionary spending, assuming appropriation of the necessary 
    The CBO staff contact is Megan Carroll. This estimate was 
approved by Peter H. Fontaine, Deputy Assistant Director for 
Budget Analysis.

                    compliance with public law 104-4

    This bill contains no unfunded mandates.

                preemption of state, local or tribal law

    This bill is not intended to preempt any State, local or 
tribal law.

                        changes in existing law

    If enacted, this bill would make no changes in existing 

                            DISSENTING VIEWS

    H.R. 3182 would give away over 4,500 acres of Tongass 
National Forest lands without compensation. These lands are 
located over twenty miles away from the community of Craig. The 
purpose of the transfer would not be for municipal expansion, 
but rather for the old-growth rain forest lands to be logged to 
generate municipal revenues. The Forest Service opposes the 
bill on the grounds that Craig has no legal entitlement to 
receive these national forest lands and because the United 
States would not receive anything in return.
    Craig's rationale for this land conveyance is that the 
community is surrounded by lands which have been conveyed to 
Native village corporations under the Alaska Native Claims 
Settlement Act of 1971. Three decades later, they are asking 
for a land handout from Congress.
    Craig's real need is for additional revenue, not land. The 
paradox in Alaska is that, despite tremendous wealth generated 
by the North Slope oil fields, state funding for municipal 
services and other government programs has been decreasing. 
Craig, for example, needs additional funds to operate a 
recently built $13 million high school.
    But even if Congress were obligated to give something to 
Craig, this bill provides for a very inefficient and 
controversial method to fund municipal services. In recent 
years, the market for Tongass timber has been depressed and 
Forest Service sales often have no bidders. It is dubious how 
much net revenue from logging would get to the Craig Municipal 
    Congress has provided the state of Alaska with a generous 
entitlement to 105 million acres of land, in part to provide 
for municipal needs. There is no compelling justification for 
using the Tongass National Forest as a land bank when the state 
has ample land and fiscal resources to take care of its own 
municipal problems. We urge the House to oppose H.R. 3182.

                                                     George Miller.