JUNEAU, Alaska -- A bill moving through the Alaska Legislature would eliminate wilderness restrictions in a portion of a state park in the Bristol Bay region so a utility can study a hydroelectric project on a lake where such development now is banned.

Senate Bill 32, sponsored by Sen. Lesil McGuire, an Anchorage Republican, directs the state Parks division to throw out part of a 10-year-old management plan approved by local residents that declares Chikuminuk Lake and its surroundings in Wood-Tikchik State Park a wilderness.

State park officials, in observance of the management plan, refused to allow Nuvista Light & Electric Cooperative to fly helicopters into the area and conduct drilling and seismic work under a $10 million legislative grant approved in 2011. McGuire's bill would reverse that ruling.

The park, the size of Delaware and the largest state park in the United States, was created by the Legislature in 1978. The state selected the lands in the 1960s to prevent the U.S. government from creating a national park there, according to an official history.

"We feel a little betrayed," said Tim Troll, director of the Bristol Bay Heritage Land Trust, which has been buying up private inholdings in the park, including a 160-acre Native allotment on Chikuminuk -- the only private parcel there. "We thought that if it was in a state park, and it had a management council, that it was protected forever. And now it seems that maybe that's not the case. It's the message that we're worried about, and whether any state park now in Alaska is permanent."

Pro-development legislators and the Parnell administration have been fighting the federal government over what they consider to be anti-growth policies on federal land and water. They say the state can do better.

But Senate Bill 32 targets an area of a state park where rules now require park managers to promote and perpetuate "the wilderness character of the land and its specific values of solitude, physical and mental challenge, scientific study, inspiration and primitive recreational opportunities."

Andrew Guy, a supporter of McGuire's bill and president of Calista Corp., the Native corporation for the neighboring Bethel region, said cheap power was critical for rural Alaska.

"We need to get affordable energy out there so that our businesses can start being competitive, and once they start doing that, they can grow and add jobs," Guy said. "It is something that the Legislature needs to take a close look at if they want to have a healthy economy out in rural Alaska."

Guy described Nuvista as an independent co-op that is housed in Calista's Anchorage offices and shares board members with the regional Native corporation.

If its project proves feasible, Nuvista would build a 128-foot dam where Chikuminuk Lake empties into the Allen River -- the site of the private land now owned by Troll's group -- and a 120-mile power line to Bethel, largely through the Yukon Delta National Wildlife Refuge. Nuvista said the project would produce enough power for Bethel and 13 surrounding communities, replacing expensive diesel-powered generators.

"I can't understand why anybody would think they can do a hydro project in a wilderness area in one of the best state parks in all of the 50 states -- it just boggles my mind," said Jim Stratton, former state parks director and now an advocate in Anchorage for national parks. "If it wasn't a state park, the feds would've made it a national park."

In 2011, the Legislature appropriated $10 million to study the feasibility of a hydro project on Chikuminuk. But when Nuvista sought a permit to conduct its studies, the officials would only allow activities consistent with wilderness, said Ben Ellis, the state parks director. That allowed for animal and fish population studies and stream gaging, but not drilling, seismic tests and helicopter landings.