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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Romann v. State, Dept. of Transportation & Public Facilities (11/12/99) sp-5203

Romann v. State, Dept. of Transportation & Public Facilities (11/12/99) sp-5203

     Notice:  This opinion is subject to correction before publication in
the Pacific Reporter.  Readers are requested to bring errors to the attention of the
Clerk of the Appellate Courts, 303 K Street, Anchorage, Alaska 99501, phone (907)
264-0608, fax (907) 264-0878.


             THE SUPREME COURT OF THE STATE OF ALASKA

DALE ROMANN,                  )
                              )    Supreme Court No. S-8344
               Appellant,     )
                              )    Superior Court Nos.
          v.                  )    3AN-95-8806 CI
                              )    3AN-95-4625 CI
STATE OF ALASKA, DEPARTMENT   )
OF TRANSPORTATION AND PUBLIC  )
FACILITIES,                   )    O P I N I O N
                              )
               Appellee.      )    [No. 5203 - November 12, 1999]
                              )


          Appeal from the Superior Court of the State of
Alaska, Third Judicial District, Anchorage,
                    Brian C. Shortell, Judge.


          Appearances: Peter J. Maassen and William H.
Ingaldson, Ingaldson Maassen, P.C., Anchorage, for Appellant. 
Elizabeth J. Hickerson, Assistant Attorney General, Anchorage, and
Bruce M. Botelho, Attorney General, Juneau, for Appellee.


          Before:  Matthews, Chief Justice, Compton,
Eastaugh, Fabe, and Bryner, Justices.


          BRYNER, Justice.


I.   INTRODUCTION
          Dale Romann appeals a superior court order affirming an
administrative decision rejecting his lease renewal application and
publicly auctioning a new lease of government-owned airport
property.  He challenges a decision of the Department of
Transportation and Public Facilities (DOT) to deny him a lease
renewal, as well as its administration of the auction. 
          We conclude that agency regulations did not entitle
Romann to a new lease of the property once his lease had ended. 
Moreover, we conclude that DOT did not abuse its discretion in
failing to favor Romann, its former tenant, in setting the terms of
the auction.  Accordingly, we affirm.
II.  FACTS AND PROCEEDINGS    
          Dale Romann's twenty-year lease of state-owned airport
property expired on July 1, 1994.  About a month before the lease
ended, he applied for a renewal.  The Lease Application Review
Committee for the Anchorage International Airport (Review
Committee) reviewed Romann's application and recommended that the
lease be extended for ten years.  But before the new lease's
thirty-day period for public comment had run, [Fn. 1] another
individual, Greg Remaklus, applied to lease the property.  The
Review Committee determined that both applications met its
approval; it rejected both in favor of a public auction.  On
March 22, 1995, the airport issued an invitation to bid for the
lease.  Romann remained on the leased property in holdover status.
          Romann appealed to DOT, objecting to the fact of the
auction and to some of its terms.  DOT denied his appeal, as well
as his request for reconsideration, because it interpreted its
regulations to require a public auction.  Romann appealed to the
superior court.
          On March 4, 1996, while Romann's superior court appeal
was still pending, the airport put the leasehold up for competitive
bid.  Romann bid on the lease, but lost to a higher bidder.  That
same day, he filed another appeal with DOT.  After DOT denied this
appeal Romann appealed again to the superior court, which
consolidated his appeals and eventually affirmed DOT's decisions. 
          Romann appeals.
III. DISCUSSION
     A.   Standard of Review
          When the superior court acts as an intermediate court of
appeal, we independently review its decision. [Fn. 2]  We apply
four principal standards of review in administrative appeals:  
          The "substantial evidence"test is used for
questions of fact.  The "reasonable basis"test is used for
questions of law involving agency expertise.  The "substitution of
judgment"test is used for questions of law where no expertise is
involved.  The "reasonable and not arbitrary"test is used for
review of administrative regulations.[ [Fn. 3]]  

     B.   DOT Reasonably Interpreted Its Regulations to Require a
Public Auction upon the Receipt of "Competing Applications."

          Romann first argues that because he applied to renew his
lease before DOT received a competing application, he was entitled
to an automatic lease renewal under 17 AAC 40.320(c)(1), which
provides that certain aviation-related leases "will be granted on
a 'first come-first served' basis." This argument requires us to
consider the interplay between subsection .320(c)(1) and two other
subsections of the same regulation -- subsections .320(c)(8)(A) and
(c)(8)(C).  
          By its own terms, subsection .320(c)(1)'s "first come-
first served"policy applies only when no other regulation requires
a public auction: 
               A lease or privilege for any activity
that is classed as aviation will be granted on a "first come-first
served"basis . . . unless law, regulations, or a determination by
the department that the best interests of the public will be served
require a particular lease or privilege to be offered at public
auction or by competitive proposal.[ [Fn. 4]] 

          Another subsection of section .320 -- subsection
(c)(8)(C) -- requires DOT to hold a public auction if it receives
competing lease applications that meet the requirements of yet a
third subsection: 
          If two or more applications meeting the
requirements in (A) . . . of this subsection are received for a
lease lot of the same class of use . . . , then the lease will be
granted under 17 AAC 40.340(d) [governing public auctions].[ [Fn.
5]]

That third subsection, subsection (c)(8)(A), provides:
               If a lease application conforms to the
airport master plan, meets all other requirements, and no other
objections or conflicting applications are received within the
notice period, the lease may be executed.[ [Fn. 6]]
     
          Applying subsection (c)(8)(A), DOT determined that
Romann's and Remaklus's lease applications conformed to the
airport's master plan and met all other applicable requirements.
And since Remaklus's application had been received before Romann's
application was noticed, DOT further determined that both
applications fell within the pertinent notice period.  But because
the applications conflicted by competing for the same lease,
subsection (c)(8)(A) did not authorize DOT to execute either. 
Accordingly, DOT turned to subsection (c)(8)(C).  DOT concluded
that this subsection required it to conduct a public auction
because two individuals who otherwise would have qualified for a
lease under subsection (c)(8)(A) had submitted competing, equal-
priority applications.  Upon concluding that subsection (c)(8)(C)
required a public auction, DOT further concluded that subsection
(c)(1)'s "first come-first served"policy no longer governed.
          On appeal, the superior court rejected the conclusion
that subsections .320(c)(8)(A) and (C) required a public auction,
finding that DOT's interpretation of these provisions conflicted
with their plain meaning.  According to the court's logic,
subsections (c)(8)(A) and (C), when read together, literally define
a null set: subsection (c)(8)(C) expressly requires DOT to hold a
public auction only if it receives "two or more applications
meeting the requirements in [subsection (c)(8)](A);"[Fn. 7] yet
subsection (c)(8)(A)'s requirements could only be met "[i]f . . .
no other . . . applications [were] received."[Fn. 8]  According to
the superior court's reasoning, since the mere existence of a
competing application would preclude an application from complying
with subsection (A), there could never be a case under subsection
(C) involving "two or more applications meeting the requirements in
[subsection](A)."[Fn. 9]
          Concluding, on this basis, that subsections .320(c)(8)(A)
and (C) did not require DOT to hold an auction in Romann's case, 
the superior court ruled that these subsections did not override
the "first come-first served"policy.  The court nevertheless
upheld DOT's refusal to apply this policy.  Relying on subsection
(c)(1)'s language that makes the "first come-first served"policy
inapplicable upon "a determination by the department that the best
interests of the public will be served"by an auction, the court
declared that DOT had validly made a best-interests determination
in Romann's case.
          On appeal, Romann disputes the court's finding of a valid
best-interests determination.  Although the state defends the
superior court's finding of a valid best-interests determination,
it primarily argues that the superior court should have upheld
DOT's interpretation of its own regulation.  Contending that the
court too rigidly applied the plain meaning of subsections
(c)(8)(A) and (C), the state urges us to hold that DOT properly
interpreted subsection (c)(8)(C) as requiring an auction, thereby
overriding subsection (c)(1)'s "first come-first served"policy.
The state argues that an agency's interpretation of its own
regulation deserves deference and that DOT's interpretation of
section .320 comports with relevant canons of statutory
construction, with the regulation's history, and with its
underlying policy.  We find this argument persuasive. [Fn. 10]
          As the state correctly notes, the superior court's
literal interpretation is problematic because it overlooks settled
rules of statutory interpretation.  "Whenever possible, we construe
each part or section of a statute with every other part or section,
to produce a harmonious whole."[Fn. 11]  And in so doing we assume
that every word and phrase in the statute has meaning and must be
given effect. [Fn. 12]  In relying on literal interpretation to
conclude that competing applications could never meet the
requirements of subsection (c)(8)(A), the superior court read that
subsection in isolation.  And as a result, the court effectively
nullified subsection (c)(8)(C)'s language requiring an auction when
competing applications meet the requirements of subsection
(c)(8)(A).  To adopt the superior court's interpretation, we would
have to assume that subsection (c)(8)(C)'s reference to subsection
(c)(8)(A) is meaningless.
          Moreover, although the superior court rigorously enforced
the regulation's plain meaning, we do not adhere to the plain
meaning rule of statutory interpretation.  We rely instead on a
sliding scale approach even if a statute is plainly worded: 
          [S]ince words are necessarily inexact and
ambiguity is a relative concept, we . . . turn to the legislative
history, mindful that the plainer the language, the more convincing
contrary legislative history must be.[ [Fn. 13]]   
          Section .320's recent history is instructive, revealing
that DOT revised its leasing regulations and adopted 17 AAC
40.320(c)(8)(C) in response to a recommendation by the Alaska
Ombudsman. [Fn. 14]  In the late 1970s the Ombudsman conducted an
investigation into the fairness of DOT's leasing practices, the
adequacy of its public notice procedures, and the propriety of its
valuation methods for leases of state lands. [Fn. 15]  The
investigation, according to the Ombudsman's report, revealed
constitutional notice problems that had been ignored by DOT's
Division of Aviation. [Fn. 16]  Accordingly, the Ombudsman
recommended that "the Division of Aviation immediately afford
public notice for all new land leases at Anchorage International
[Airport]."[Fn. 17] 
          In response to the Ombudsman's recommendations, DOT
committed to make certain changes ensuring the legality, fairness,
and reasonableness of its leasing practices. [Fn. 18] 
Specifically, DOT indicated that it would subject land leases to
prior public notice so that "[a]ll [future] agreements will be
granted only after prior public notice on an individual basis."
[Fn. 19]  Keeping to this commitment, in 1979 DOT adopted 17 AAC
40.320(c)(7), a provision requiring public notice of thirty days
before the execution of a lease. [Fn. 20]  It also adopted 17 AAC
40.320(c)(8)(C), the provision at issue here, which mandates a
public auction in the event of two or more competing lease
applications that meet the requirements of subsection (c)(8)(A). 
Thus, both subsection (c)(7)'s public notice requirement and
subsection (c)(8)(C)'s provision for a competitive lease process
appear to have been designed to address the fairness concerns
discussed in the Ombudsman's report.
          In light of this history -- and especially in light of
the Ombudsman's finding that "[t]he lack of public notice was
unfair to potential competitive lessees as they had no opportunity
to bid or negotiate for the lease tracts"[Fn. 21] -- it seems
sensible to interpret subsection (c)(8)(C) as DOT did -- that is,
as a provision requiring a public auction when multiple applicants
timely submit competing lease applications, each individually
meeting the requirements of subsection (c)(8)(A). 
          Romann nevertheless argues that this interpretation is
flawed because it implies a "nonsensical reading"of 17 AAC
40.320(c)(8) -- one that effectively nullifies subsection (c)(1)'s
"first come-first served"policy.  He maintains that if DOT must
hold an auction whenever two or more applicants compete for the
same lease, the "first come-first served"regulation would never
apply and would therefore be meaningless.  Romann thus proposes
that it would be more reasonable to construe "conflicting
application"under subsection (c)(8)(A) to apply to situations in
which one application "truly conflicts"with another because the
"first come-first served"doctrine would give preference to
neither: "If, for example, DOTPF validly determines under
subsection (c)(1) that 'first come-first served' should not apply
in a particular situation because of law, regulation or 'the best
interests of the public' . . . , then DOTPF can invite
applications." Asserting this view, Romann contends that because
his renewal application gave him priority under the "first come-
first served"policy, it actually never conflicted with Remaklus's
application in a way that would trigger subsection (c)(8)(C)'s
auction requirement.  
          But Romann's proposed interpretation undermines the
regulation's goal of promoting fairness through advance public
notice and competitive leasing.  As Romann would construe the
regulation, any existing tenant would have a right of renewal
without competition.  In turn, this would render subsection
(c)(7)'s notice requirement virtually useless -- the notice would
rarely do more than inform the public of a leasing decision already
made. [Fn. 22]
          Romann is also mistaken in asserting that DOT's
interpretation renders the "first come-first served"policy
meaningless.  Under DOT's reading of subsection (c)(8)(C)'s auction
provision, the "first come-first served"policy continues to play
a potentially meaningful role that comports with the basic
regulatory goals of notice and competitive fairness.  
          Applying DOT's interpretation, if DOT receives multiple
eligible applications during the thirty-day notice period, then
subsection (c)(8)(C)'s auction requirement comes into play and
overrides the "first come-first served"provision set out in
subsection (c)(1).  But subsection (c)(8)(C)'s auction provision
would not be triggered by applications received after the notice
period.  Subsection (c)(8)(A) deals only with situations "when no
other objections or conflicting applications are received within
the notice period." And because DOT reads subsection (c)(8)(C)'s
auction provision to be triggered by a conflict created by
competition under subsection (c)(8)(A) -- i.e., multiple,
conforming applications submitted during the notice period --
competition arising after the notice period would not require an
auction.  In the event of post-notice applications, then, the
"first come-first served"policy would presumably operate by
default to set priority among applications. 
          From the record currently before us, we cannot determine
whether, or how often, post-notice competition of this kind
actually arises.  But the issue is beside the point.  For purposes
of resolving the issue in this case, the significant point is that
DOT has interpreted its own regulation in a way that is reasonable
-- at least as reasonable as the interpretation adopted by the
superior court or the alternative suggested by Romann.  Because DOT
"is best able to discern its intent in promulgating the regulation
at issue,"we must defer to its decision by conducting review under
the "reasonable basis"standard. [Fn. 23]  Since we are unable to
say that DOT's interpretation of 17 AAC 40.320 lacks a reasonable
basis, we uphold its decision to conduct a public auction in this
case. [Fn. 24]
     C.   DOT's Administration of the Public Auction
          Romann also contends that DOT treated him unjustly in its
administration of the auction.  Alaska law provides DOT with broad
discretion to conduct public auctions of airport property. [Fn. 25] 
We thus review DOT's actions under the deferential "reasonable
basis"standard. [Fn. 26] 
                              1.   DOT's refusal to continue Romann's lease in
                              holdover status until the effective date of H.B. 543
                              
                         DOT granted Romann's lease holdover status while the
renewal decision was pending.  In early 1996 members of the Alaska
legislature wrote DOT, requesting it to "hold in abeyance any bid
auctions effective immediately, until the legislature [could] take
final action on House Bill 543." The letter explained that the
proposed law "clarifies the rights of existing tenants to extend
their lease terms . . . [and the request was issued] so that any
existing leases may benefit from the new law." DOT nevertheless
publicly auctioned the leasehold on May 8, 1996 -- while H.B. 543
was still pending.  Romann contends that DOT abused its discretion
in failing to continue his holdover status until the legislature
could enact the new legislation.
          We find no merit in this contention.  DOT had already
permitted Romann holdover status for nearly two years and had
already postponed the auction pending its review of airport lease
policy.  Moreover, DOT had granted Romann holdover status not in
recognition of some special, legal right to occupy the leasehold,
but merely to ensure efficient use of the property pending DOT's
determination of its appropriate disposition.  Finally, we note
that the legislature itself recognized that its letter seeking
postponement was merely a request, albeit an "urgent"one.  Romann
cites no legal authority that would require DOT to forestall its
public auction under these circumstances.  
          Accordingly, we conclude that DOT did not abuse its
discretion in declining further postponement for legislative
action.
                              2.   DOT's refusal to postpone the auction until after
                              completing its environmental assessment of the lease lot
                              
                         Likewise, we conclude that DOT did not abuse its
discretion in refusing to postpone the auction until it completed
its environmental assessment of Romann's former lease lot. 
          We recognize that Romann's inability to precisely
determine his liability for the environmental conditions of his
leasehold might have affected how he bid for the new lease.  But
Romann himself assumed responsibility for the contamination of the
leasehold when he originally entered into the lease.  By statute he
was strictly liable for any contamination. [Fn. 27]  DOT's
environmental assessment would by no means expose Romann to
increased liability; it would merely determine the extent of
contamination for which he was already liable.  Though Romann might
have preferred to know in advance what costs he could expect to
pay, the agency could reasonably conclude that it had no obligation
to delay the auction for his sole benefit. [Fn. 28]  
                              3.   DOT's bidding system
                         
                    DOT permitted bids on lease terms ranging from ten to
twenty-five years, depending on the amounts bidders were willing to
invest in permanent improvements, with longer lease terms requiring
a greater commitment.  Ultimately, however, the lease was to go to
the qualified bidder offering the largest advance payment -- or
"bonus bid"-- regardless of the lease length sought.  Romann
contests this bidding process, arguing that by failing to weight
bids according to the length of the lease term sought, DOT violated
17 AAC 40.330(a)'s amortization requirement.  Romann also argues
that the "bonus bid"format violated AS 02.15.090(a)'s uniform-rate
requirement.
               a.   The amortization requirement
          17 AAC 40.330(a) requires that a lease term be "of such
duration as to allow the lessee . . . to amortize and recover the
cost of investment during the term of the lease . . . ."[Fn. 29] 
DOT's bidding system, Romann argues, violates this regulation by
treating unfairly those bidders who, like himself, sought shorter
lease terms.  He observes, "[T]he up-front amount from a bidder
seeking a ten-year term was treated the same as the up-front amount
from a bidder seeking a 30-year term."
          But even assuming that the bidding process deliberately
favored bidders seeking long-term leases, this form of favoritism
would reflect a policy choice within the broad discretion that DOT
enjoys under 17 AAC 40.330(a).  While favoring longer-term leases
might result in a lower effective rate and ultimately generate less
money for DOT, longer-term leases could very well improve a
lessee's chances of "amortiz[ing] and recover[ing] the cost of
investment"-- the specific concern addressed in 17 AAC 40.330(a). 
               b.   The uniform-rate requirement

          Alaska Statute 02.15.090(a) grants DOT discretion to
"establish the terms and conditions and fix the charges, rentals,
and fees for the privileges or services that are reasonable and
uniform for the same class of privilege or service." Romann argues
that DOT violated the uniform-rate requirement by mandating that
potential lessees pay a "bonus bid"in addition to the uniform
rate.  But Romann's interpretation of this statute's "reasonable
and uniform"language ignores the balance of the provision, which
authorizes DOT to charge fees and set rental rates by a
"competitively offered contract."[Fn. 30] 
          Under its "bonus bid"system, DOT offered the lease to
the bidder making the largest bonus payment, regardless of the
lease term sought.  This allowed every bidder to choose a lease
length on which to bid and to make a bonus offer accordingly.
Moreover, DOT set the annual rental for the leasehold at six cents
per square foot -- the same rate as that for similarly situated
property.  We conclude that DOT's competitive bid procedure falls
well within its authority under AS 02.15.090(a). [Fn. 31]
          4.   DOT's refusal to credit Romann's bid with the value
of his existing leasehold improvements

          Romann also argues that DOT abused its discretion in
refusing to credit Romann's auction bid according to the value of
his permanent improvements on the leasehold.  But he points to no
statutory or regulatory authority to support his contention.  The
parties do not dispute that the existing improvements on the lease
lot belonged to Romann.  He had already benefitted from their use,
and since they had been required under Romann's original lease
agreement, these improvements had enabled him to occupy the
leasehold for the duration of the original lease.  Romann thus had
no reasonable ground for demanding that his past improvements be
credited again toward the requirements of a new lease.
          In contrast, DOT could reasonably have decided, as a
matter of policy, to disallow credit for prior improvements in
order to place all bidders on an equal footing with respect to the
new lease.  Accordingly DOT did not lack a reasonable basis for
disallowing credit. 
          5.   DOT's compliance with bidder qualification and
public notice requirements

          Romann further argues that by failing to award the lease
to either Remaklus or himself, DOT violated 17 AAC 40.340(d)(3)'s
"qualified bidder"requirement.  Romann maintains that he and
Remaklus were the only "qualified bidders"since only they had been
"qualified"through the Review Committee's established review
process.
          But DOT had established the Review Committee to implement
17 AAC 40.320(c)(8)'s provisions governing review of lease
applications.  Subsection (c)(8) does not speak to qualifications
to bid at a public auction, a subject addressed in 17 AAC
40.340(d)(3).  The latter regulation gives DOT broad discretion to
determine qualifications for bidders in each sale it conducts: 
               The sale shall be conducted by the
department and may be either by sealed bids or public outcry, or
both, after the manner determined by the department in each
instance to be in the public interest.  The sale shall be made to
the highest qualified bidder as determined by the department.[ [Fn.
32]] 

          Here, DOT required all bidders to register before the
auction; submit a completed, signed, notarized bidder's affidavit
and a bid deposit; and receive a bidder's card.  In addition, the
sample contract provided non-negotiable conditions and terms for
use of the lease lot that had been pre-approved by DOT.  There was
thus no need for an independent committee review of the lease
applications.
          Romann's contention that this method of bidder
qualification failed to provide adequate public notice of the
proposed lease is likewise meritless.  DOT complied with statutory
notice requirements for airport lease auctions by providing the
public with a summary of all relevant terms and conditions of the
auctioned lease. [Fn. 33]  DOT also held a pre-bid conference to
allow prospective bidders a further opportunity to review both the
proposed terms and conditions of the lease and the procedures
governing the auction.
          In sum, we hold that DOT acted well within its discretion
in conducting the disputed auction.  
IV.  CONCLUSION
          Because we conclude that DOT reasonably construed its
regulations to require a public auction in this case and conducted
the public auction properly, we AFFIRM its order denying Romann's
appeals.


                            FOOTNOTES


Footnote 1:

      See 17 Alaska Administrative Code (AAC) 40.320(c)(7).


Footnote 2:

     See Usibelli Coal Mine, Inc. v. State, Dep't of Natural
Resources, 921 P.2d 1134, 1141 (Alaska 1996).


Footnote 3:

     Handley v. State, Dep't of Revenue, 838 P.2d 1231, 1233
(Alaska 1992) (citing Jager v. State, 537 P.2d 1100, 1107 n.23
(Alaska 1975)).


Footnote 4:

     17 AAC 40.320(c)(1).


Footnote 5:

     17 AAC 40.320(c)(8)(C).


Footnote 6:

     17 AAC 40.320(c)(8)(A). 


Footnote 7:

     See 17 AAC 40.320(c)(8)(C).


Footnote 8:

     See 17 AAC 40.320(c)(8)(A).


Footnote 9:

     17 AAC 40.320(c)(8)(C).


Footnote 10:

     We may affirm the superior court's decision on any basis
appearing in the record.  See Pierce v. Pierce, 949 P.2d 498, 500
(Alaska 1997); Far North Sanitation, Inc. v. Alaska Pub. Utils.
Comm'n, 825 P.2d 867, 869 n.2 (Alaska 1992).  


Footnote 11:

     Benner v. Wichman, 874 P.2d 949, 957 (Alaska 1994) (citation
omitted).


Footnote 12:

     See O'Callaghan v. State, 826 P.2d 1132, 1135 (Alaska 1992). 


Footnote 13:

     State v. Alex, 646 P.2d 203, 208-09 n.4 (Alaska 1982) (quoting
United States v. United States Steel Corp., 482 F.2d 439, 444 (7th
Cir. 1973)) (internal quotations omitted).


Footnote 14:

     See Second Rep. of the Ombudsman, 1976 at 96-100 (1977).


Footnote 15:

     See id.


Footnote 16:

     See id.


Footnote 17:

     Id. at 98.


Footnote 18:

     See id. 


Footnote 19:

     Id. at 98-99.


Footnote 20:

     17 AAC 40.320(c)(7) provides:

               Public notice as described in 17 AAC
40.340(d)(1) must be completed before a lease is executed. The
contract for a lease or privilege may be executed by the department
30 days after the first appearance of the notice. Permits for the
temporary use of land or building space for 120 days or less may be
granted by the department without public notice.


Footnote 21:

     Second Rep. of the Ombudsman at 96.


Footnote 22:

     See 17 AAC 40.320(c)(8)(D) (requiring that the department
"consider all objections to or comments on a proposed lease which
are received within the 30-day notice period").


Footnote 23:

     Rose v. Commercial Fisheries Entry Comm'n, 647 P.2d 154, 161
(Alaska 1982) ("[W]here an agency interprets its own regulation
. . . a deferential standard of review properly recognizes that the
agency is best able to discern its intent in promulgating the
regulation . . . .").


Footnote 24:

     Because we uphold DOT's decision to deny Romann's application
in favor of a public auction of the lease, we need not address the
parties' dispute as to whether DOT made a "best interests"
determination that would have independently justified DOT's
decision.

          Romann argues that DOT's interpretation of its
regulations to require a public auction in his case is arbitrary
because it contradicts DOT's prior policy of automatically renewing
leases for similarly situated applicants, which it consistently
applied.  But the record does not support Romann's claim.  While
Romann submitted evidence indicating that DOT has renewed aviation-
related leases for numerous other leaseholders, Romann's evidence
does not establish that other applicants had filed competing
applications within the applicable notice periods.


Footnote 25:

     See 17 AAC 40.340(d)(3).


Footnote 26:

     See Paul Wholesale v. State, Dep't of Transp. & Pub.
Facilities, 908 P.2d 994, 997-98 (Alaska 1995).


Footnote 27:

     See AS 46.03.822.


Footnote 28:

     We also reject Romann's related argument that he was entitled
to a hearing before DOT terminated his lease.  As the superior
court observed, DOT never terminated his lease; the lease itself
expired.  Thus, Romann had no cognizable interest requiring a pre-
auction hearing under 17 AAC 40.382. 


Footnote 29:

     17 AAC 40.330(a) provides:

          The initial term of lease or permit may be for
any period allowed by law and will be determined by the purposes
for which the lease or permit is to be granted, its conformance
with the master plan for the airport, the amount of investment to
be made by the lessee or permittee, and the method and terms of
financing the investment.  It should be of such duration as to
allow the lessee or permittee to amortize and recover the cost of
investment during the term of the lease or permit.


Footnote 30:

     See AS 02.15.090(a), which provides in part:

               In operating an airport or air navigation
facility owned or controlled by the state, the department may enter
into contracts, leases, and other arrangements covering periods not
exceeding 55 years . . . granting the privilege of using or
improving an airport or air navigation facility or a portion of it
or space in it for commercial, governmental, or other public
purposes, including private plane tie down . . . .  The department
may establish the terms and conditions and fix the charges,
rentals, and fees for the privileges or services that are
reasonable and uniform for the same class of privilege or service. 
Charges, rentals, or fees authorized by this subsection may be
fixed for the international airports by order of the commissioner
or by negotiated or competitively offered contract. . . . The
terms, conditions, charges, rentals, and fees shall be established
with due regard to the property and improvements used and the
expense of operation to the state.       


Footnote 31:

     Romann also asserts that DOT, by making various alleged public
policy determinations regarding Romann's right to renew his airport
lease, violated the Open Meetings Act, AS 44.62.310.  But because
Romann fails to brief this issue at all, we need not consider it. 
See Adamson v. University of Alaska, 819 P.2d 886, 889 n.3 (Alaska
1991).


Footnote 32:

     17 AAC 40.340(d)(3) (emphasis added).


Footnote 33:

     See 17 AAC 40.340(d)(1).