STATE OF ALASKA DEPARTMENT OF NATURAL RESOURCES DIVISION OF MINING, LAND AND WATER PRELIMINARY DECISION Alaska Bush Adventures, LLC Application for Lease AS 38.05.070(b) Negotiated This is the initial determination on a proposed disposal of interest in State land and is subject to comments received during the Public Notice period. The public is invited to comment on this. The deadline for commenting is 5:00 PM on August 22, 2014. Please see the Comments Section on page 5 of this decision for details on how and where to send comments for consideration. Only the applicant and those who comment have the right to appeal the Final Finding and Decision. Proposed Action: The Department of Natural Resources (DNR), Division of Mining, Land and Water (DMLW), Southcentral Regional Office (SCRO) has received a request from Alaska Bush Adventures, LLC (ABA) to lease 1 acre of State land for 55 years in an area approximately 60 miles south of the village of Crooked Creek, 50 miles southwest of the village of Sleetmute and 60 miles southeast of the city of Aniak. The location of the project area is further described as being within the SE4NE4 of Section 16, T. 11 N., R. 50 W., Seward Meridian. ABA is proposing to continue to use this site as a base camp for fishing and hunting services, as well as for other outdoor recreation activities. Their operating season extends from June to October. SCRO has already issued a temporary Land Use Permit, expiring in 2017, as an interim authorization while the decision is awaiting adjudication. SCRO is considering the issuance of a 10-year commercial recreation/tourism lease to ABA for the construction, use, operation, and maintenance of an outdoor recreation base camp. Scope of Review: The scope of this decision is to determine if it is in the State s best interest to issue a land lease on State uplands. Authority: This lease application is being adjudicated pursuant to AS 38.05.035(b)(1) Delegation of the Powers and Duties of the Director; AS 38.05.035(e) Written Findings; AS 38.05.070(b) Generally; AS 38.05.945 Public Notice; and 11 AAC 58 Leasing of Lands. The authority to execute the Final Finding and Decision and the lease has been delegated to the Regional Managers of DMLW. Administrative Record: Case file constitutes the administrative record for ABA s lease application. Page 1 of 8
Legal Description, Location, and Geographical Features: The State land where this proposed lease site is located is described as follows: Legal description: Within the SE4NE4 of Section 16, T. 11 N., R. 50 W., S.M. Geographical location: Approximately 80 miles southwest of Sleetmute, Alaska Approximate Lat/Long: 61 2' 37.56" N, 158 8' 48.74" W Area geographical features: Taylor Mountains and Fortyseven Creek Existing surveys: None Municipality/Borough: Unorganized borough Native Corporations/Federally Recognized Tribes: Calista Corporation, Kuskokwim Corporation Title: The State of Alaska holds fee title to the subject land under U.S. Patent 50-2012-0170 dated 5/23/2012. A DNR Title Report (RPT-4288) issued on 5/2/2013 from DNR s Realty Services Section advised that aside from the usual reservations for ditches, canals, railroads, telegraph and telephone lines, and water rights, there are no other reservations within the proposed lease site. An updated Title Report has been requested, but was not available at the time of issuance of this decision. SCRO reserves the right to modify the Final Finding and Decision based upon information contained within the updated Title Report. Third Party Interests: ABA's site is located on an active State Mining Claim (553634), which covers the project area. There are no other known third party interests. Classification and Planning: The site is subject to the Kuskokwim Area Plan (KAP), Management Unit 15: Holitna River, Subunit 15g: Taylor Mountains and Fortyseven Creek (map number 15: Holitna River - West). The classifications for this site are Mineral Land and Wildlife Habitat Land. The KAP notes that emphasis in the Holitna management unit includes support for commercial and sport use of the fish and wildlife resources, and specifically states that Subunit 15g will be managed for multiple use, including fish and wildlife habitat and harvest. ABA s proposed use for the site is consistent with the area s classifications and planning. Traditional Use Findings: From the KAP: "The Holitna [River] basin contains the greatest concentration of salmon spawning areas in the entire Kuskokwim drainage and the most productive moose habitat The greatest concentration of subsistence activities in the planning area occurs in the Holitna basin. It is used for hunting, trapping, fishing, berry picking, houselog harvest, and firewood collection." DMLW is unaware of any other traditional uses for this area, and welcomes any public comments regarding traditional uses in this area from those familiar with the location. Access: The site is accessible via small airplane. A 4,000 gravel airstrip adjacent to the site is considered a generally allowed use of State land as described in 11 AAC 96.020. Agency Notice: An Interagency Review was conducted on 4/18/2014. The deadline for agency comments was 5/9/2014. The following agencies were included in the review: Department of Environmental Conservation Department of Fish and Game - Habitat Department of Fish and Game - Sport Fishing Department of Public Safety - Alaska Wildlife Troopers Department of Transportation and Public Facilities DNR Contract Administration Page 2 of 8
DNR Division of Forestry DNR Division of Oil and Gas DNR DMLW - Mining DNR DMLW - Water DNR Office of History and Archaeology/SHPO Environmental Protection Agency - Alaska Operations Office National Oceanographic and Atmospheric Administration - Fisheries The Land Sales and Contract Administration Section of DMLW had no objections to the proposal. The Environmental Protection Agency made no objections, and directed discussion instead to the State level. The Mining Section of DMLW had no objections to the proposal, but added that ABA should be aware of the "23 active mining claims in the immediate area", including both placer mining and hardrock exploration. The Mining Section noted such activity may include aircraft use. The Department of Fish and Game had no objection to the proposal, "provided that all food, waste, and trash is properly stored to prevent attracting and feeding wildlife." No other agencies responded with comments. Lease Discussion: Alaska Bush Adventures, LLC, applied for a lease in 2011 for a one-acre site that had previously been leased to Dean Hilde, d/b/a Backcountry Alaska Guides and Outfitters, for similar commercial recreation purposes. ABA is current under Alaska Business License #432480. The proposed lease site is situated on uplands with no water frontage. It has been used as an outdoor recreation camp since 1999, when it was leased to Dean Hilde. Mr. Hilde transferred his lease to Mr. Krank of ABA in 2011. The surrounding area has seen exploration and mining activity for many years. ABA intends no significant improvements to either the existing 14' x 25' camp cabin or the surrounding land. In ABA's application, measures have been articulated to address concerns over potential site contamination and cleanup. ABA was made aware of the specific requirements regarding environmental protection in the Land Use Permit SCRO issued in 2012. The KAP specifically allows for commercial hunting and fishing in this area, which conforms with the State's policy to encourage the settlement of land and the development of its resources by making them available for maximum use consistent with the public interest. ABA s proposal would not significantly alter the operations that have previously been conducted at the site, which have resulted in no documented impacts. Though ABA has requested a 55-year lease in their application, the site's small size and remote location qualify it for a briefer lease period. Furthermore, the mining activity in the immediate area has priority over surface interests, and could complicate a longer term lease. Therefore, a lease term of 10 years is appropriate. A copy of the State s standard lease is available for review upon request. Development Plan: The Development Plan (DP) attached to this decision (Attachment A) and dated 10/11/2011 is hereby accepted by SCRO through the issuance of this decision. Should the proposed lease be granted, it is anticipated that the DP will need to be updated throughout the life of the lease as activities and/or infrastructure are added or subtracted. All updates must be accepted, in writing, by SCRO before any construction, deconstruction, replacement of infrastructure, or change in activity will be permitted. SCRO reserves the right to require additional agency review and/or public notice for changes that are deemed by SCRO to be beyond the scope of this decision. Hazardous Materials and Potential Contaminants: The DP states that the only hazardous materials to be found at the site will be fuel for cooking stoves, as well as fuels and oils ATVs and boat motors. Fuels stored at the site will not exceed 55 gallons. The DP Page 3 of 8
notes that all such materials will be properly stored and hauled out for disposal in an approved manner, and that sorbent pads and drip pans will be available. The DP specifies that all waste products which cannot be burned will be flown out, and that an on-site outhouse for human waste will be covered with soil at the end of each season. The use and storage of all hazardous substances must be done in accordance with existing Federal, State and local laws. Debris (such as soil) contaminated with used motor oil, solvents, or other chemicals may be classified as a hazardous substance and must be removed from the sites and managed and disposed of in accordance with State and Federal law. Lease Performance Guaranty (bonding): In accordance with AS 38.05.035(a)(4), the existing performance guaranty, which was required under the previous lease in the amount of $2,500.00 and dated 7/2/2012, is still sufficient and shall be carried over for the proposed lease. $2,500.00 Performance Bond: This bond will remain in place for the life of the proposed lease. The bond amount is based upon the level of development, amounts of hazardous material/substances on site, and the perceived liability to the state. This bond will be used to insure ABA's compliance with the terms and conditions of the lease issued for the project. This bond amount will be subject to periodic adjustments and may be adjusted upon approval of any amendments, assignments, reappraisals, changes in the development plan, changes in the activities conducted, or changes in the performance of operations conducted on the authorized premises, and as a result of any violations to any one or more of the authorizations associated with this project. Reclamation Bond: SCRO is reserving the right to require a reclamation bond due to non-compliance issues during the term of the lease or near the end of the life of the project. Insurance: As per AS 38.05.035(a)(4), ABA will be required to submit proof of liability insurance to SCRO, with the State of Alaska listed as a NAMED insured party. ABA will be responsible for maintaining such insurance throughout the term of the lease. A current certificate of liability insurance from ABA, expiring 9/21/2014, is on file with DMLW. Survey: In accordance with AS 38.04.045, this short term land lease does not require a survey. However, the State of Alaska reserves the right to require one in the future, should the need arise. The applicant will be required to submit 10-digit GPS coordinate points for the leased area. These points are the limits of the lease parcel and will be set at the northwest, northeast, southwest and southeast corners. Subleasing: Subleasing is permissible through AS 38.05.095, if the proposed lease is approved. All potential subleases must first be approved in writing by SCRO. Depending on the activity of any potential subleases, SCRO is reserving the right to reevaluate the need for further agency review and/or public notice before making a determination on the appropriateness of the proposed sublease. Sublease compensation to the State will be determined by SCRO according to AS 38.05.073(m), under the authority of AS 38.05.075(a) Leasing Procedures. In any case, the sublease fee for commercial activities will not be less than 25% of the annual fee paid to ABA by the sublessee. Assignment of Lease: The proposed lease, if issued, may be transferred or assigned to another individual or corporation only with written approval from the State of Alaska. Public Notice of the : Pursuant to AS 38.05.945, this will be advertised for a 30-day public comment period, starting on July 24, 2014. This notice will be run in both the Anchorage Daily News and the Page 4 of 8
Tundra Drums newspapers. Courtesy notices will also be mailed or emailed to neighboring property owners, permit/lease holders, Calista Corporation, Kuskokwim Corporation, the communities of Aniak, Crooked Creek, Red Devil and Sleetmute, and other interested parties on July 24, 2014. In addition, the post offices in Aniak, Crooked Creek, Red Devil and Sleetmute will be requested to post the notice per AS 38.05.945(b)(3)(B). The notice will also be posted on the Department s web site located at http://dnr.alaska.gov/commis/pic/pubnotfrm.htm. Comment(s): This decision is subject to both public and agency comments and all comments received by the comment deadline will be addressed in the Final Finding and Decision. Only those who comment and the applicant have the right to appeal this decision. Written comments about this project must be received in this office no later than 5:00 PM on August 22, 2014 to be considered. To submit comments or project proposals, please choose one of the following methods: Postal: Department of Natural Resources Southcentral Region Office ATTN: Brandon Tucker 550 West 7 th Avenue Suite 900C Anchorage, AK 99501-3577 E-mail: brandon.tucker@alaska.gov Fax: (907) 269-8913 Questions about the lease portion of this project can be directed to Brandon Tucker at (907) 269-8549. If public comments result in significant changes to the, additional public notice will be given. To be eligible to appeal the Final Finding and Decision, a person must provide written comments during the comment period per AS 38.05.035(i)-(m). Signature page follows: Page 5 of 8
Attachment A Development Plan Attachment A Development Plan Page 7 of 8
Attachment B Location Map Attachment B Location Map Page 8 of 8