03/13/2020 03:30 PM Senate RESOURCES
| Audio | Topic |
|---|---|
| Start | |
| SB184 | |
| SB130 | |
| SB232 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SJR 15 | TELECONFERENCED | |
| *+ | SB 184 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | SB 130 | TELECONFERENCED | |
| += | SB 232 | TELECONFERENCED | |
ALASKA STATE LEGISLATURE
SENATE RESOURCES STANDING COMMITTEE
March 13, 2020
3:31 p.m.
MEMBERS PRESENT
Senator Peter Micciche, Chair
Senator John Coghill, Vice Chair
Senator Cathy Giessel
Senator Joshua Revak
Senator Scott Kawasaki
Senator Jesse Kiehl
MEMBERS ABSENT
Senator Click Bishop
COMMITTEE CALENDAR
SENATE BILL NO. 184
"An Act extending the fishery resource landing tax credit for
certain taxpayers that harvest fishery resources under the
provisions of a community development quota; providing for an
effective date by amending the effective date of sec. 36, ch.
61, SLA 2014; and providing for an effective date."
- HEARD & HELD
SENATE BILL NO. 130
"An Act relating to a seafood product development tax credit;
providing for an effective date by repealing secs. 32 and 35,
ch. 61, SLA 2014; and providing for an effective date."
- HEARD & HELD
SENATE BILL NO. 232
"An Act relating to personal use fishing permits."
- HEARD & HELD
SENATE JOINT RESOLUTION NO. 15
Requesting the United States Congress to repeal sec. 20001(b)(5)
of the Tax Cuts and Jobs Act to honor the Alaska Statehood Act
with respect to the state's share of bonuses, royalties, and
rentals from exploration and development in the coastal plain of
the Arctic National Wildlife Refuge.
- BILL HEARING CANCELED
PREVIOUS COMMITTEE ACTION
BILL: SB 184
SHORT TITLE: EXTEND FISHERY RESOURCE LAND. TAX CREDIT
SPONSOR(s): SENATOR(s) OLSON
02/12/20 (S) READ THE FIRST TIME - REFERRALS
02/12/20 (S) RES, FIN
03/13/20 (S) RES AT 3:30 PM BUTROVICH 205
BILL: SB 130
SHORT TITLE: SEAFOOD PRODUCT DEVELOPMENT TAX CREDIT
SPONSOR(s): SENATOR(s) STEVENS
01/21/20 (S) PREFILE RELEASED 1/10/20
01/21/20 (S) READ THE FIRST TIME - REFERRALS
01/21/20 (S) RES, FIN
03/04/20 (S) RES AT 3:30 PM BUTROVICH 205
03/04/20 (S) <Bill Hearing Canceled>
03/13/20 (S) RES AT 3:30 PM BUTROVICH 205
BILL: SB 232
SHORT TITLE: PERSONAL USE FISHING PERMIT FEES
SPONSOR(s): SENATOR(s) MICCICHE
02/24/20 (S) READ THE FIRST TIME - REFERRALS
02/24/20 (S) RES, FIN
03/06/20 (S) RES AT 3:30 PM BUTROVICH 205
03/06/20 (S) Scheduled but Not Heard
03/13/20 (S) RES AT 3:30 PM BUTROVICH 205
WITNESS REGISTER
SENATOR DONALD OLSON
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Sponsor of SB 184.
DENISE LICCIOLI, Staff
Senator Donald Olson
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Introduced SB 184 on behalf of the sponsor.
BRANDON SPANOS, Deputy Director
Tax Division
Alaska Department of Revenue
Anchorage, Alaska
POSITION STATEMENT: Answered questions regarding SB 184.
JOSEPH CAISSIE, Assistant State Assessor
Division of Community and Regional Affairs
Alaska Department of Commerce, Community & Economic Development
Anchorage, Alaska
POSITION STATEMENT: Answered questions regarding SB 184.
LAURELI IVANOFF, Communications Director
Norton Sound Economic Development Corporation
Unalakleet, Alaska
POSITION STATEMENT: Testified in support SB 184.
TIM LAMKIN, Staff
Senator Gary Stevens
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Introduced SB 130 on behalf of the sponsor.
SENATOR GARY STEVENS
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Sponsor of SB 130.
BRANDON SPANOS, Deputy Director
Tax Division
Alaska Department of Revenue
Anchorage, Alaska
POSITION STATEMENT: Answered questions regarding SB 130.
CHRIS BARROWS, President
Pacific Seafood Processors Association
Tacoma, Washington
POSITION STATEMENT: Testified in support of SB 130.
JERRY MCCUNE, Board President
Cordova District Fishermen United
Cordova, Alaska
POSITION STATEMENT: Testified in support of SB 130.
FRANCIS LEACH, Executive Director
United Fishermen of Alaska
Juneau, Alaska
POSITION STATEMENT: Testified in support of SB 130.
KONRAD JACKSON, Staff
Senator Peter Micciche
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Introduced SB 232 on behalf of the sponsor.
PAUL OSTRANDER, City Manager
City of Kenai
Kenai, Alaska
POSITION STATEMENT: Testified in support of SB 232.
ACTION NARRATIVE
3:31:43 PM
CHAIR PETER MICCICHE called the Senate Resources Standing
Committee meeting to order at 3:31 p.m. Present at the call to
order were Senators Kiehl, Revak, Coghill, Kawasaki, Giessel,
and Chair Micciche.
SB 184-EXTEND FISHERY RESOURCE LAND. TAX CREDIT
3:32:41 PM
CHAIR MICCICHE announced that the first order of business would
be SENATE BILL NO. 184, "An Act extending the fishery resource
landing tax credit for certain taxpayers that harvest fishery
resources under the provisions of a community development quota;
providing for an effective date by amending the effective date
of sec. 36, ch. 61, SLA 2014; and providing for an effective
date."
3:33:07 PM
SENATOR DONALD OLSON, Alaska State Legislature, Juneau, Alaska,
sponsor of SB 184, explained that the bill extends the date for
[The Western Alaska Community Development Quota (CDQ) Program]
to continue their function which is essential to many coastal
Alaska communities. The CDQ Program is based on a tax credit to
provide economic development.
3:33:46 PM
DENISE LICCIOLI, Staff, Senator Donald Olson, Alaska State
Legislature, Juneau, Alaska, said SB 184 extends the fishery
resource landing tax credit for the CDQ Program for 10 years.
The scheduled sunset date for the tax credit is December 31,
2020 and SB 184 will extend that to December 31, 2030.
She detailed that the Alaska Division of Legislative Finance
produced its biennial indirect cost report in 2019 and
recommended continuation of the program. The Alaska Department
of Revenue-Tax Division Revenues Source Book Report also
recommended continuation of the program.
MS. LICCIOLI explained that CDQ holders receive a tax credit if
certain program expenditures occur. She noted that many of the
programs are educational. The CDQ tax credits split are against
the specific municipality share of the tax.
She noted that the CDQ Program is net zero to the State, whether
there is sunset date extension or not. However, many of the CDQ
groups want the legislature to extend the program because they
receive the benefit of the program's tax credit. Municipalities
have not voiced opposition to extending the program's sunset
date, which is where the tax credit comes from.
CHAIR MICCICHE asked Mr. Spanos with the Tax Division to explain
the program's tax revenue distribution and use.
3:36:52 PM
BRANDON SPANOS, Deputy Director, Tax Division, Alaska Department
of Revenue, Anchorage, Alaska, detailed that the tax credit is
on the 50 percent fishery landing tax share that goes to the
municipalities. Having the CDQ credit come out of the
municipality side makes a lot of sense because the money goes
back to nonprofits organized by the villages in Western Alaska
and the Aleutians.
He said the CDQ Program is a federal program established in
1992. It provides 10 percent of the Bering Sea and Aleutian
Islands fisheries to the villages that formed six CDQ nonprofit
corporations. The federal government established the CDQ Program
to provide eligible Western Alaska villages with the opportunity
to participate and invest in the Bering Sea and the Aleutians
Island management area fisheries.
MR. SPANOS explained that the CDQ tax credit filings require Tax
Division approval. Most tax credit claims occur during tax
return filings, but the CDQ tax credit submission occurs prior
to that. There are seven contribution categories identified on a
tax credit form that a fisherman can donate to: scholarships,
seafood industry training, transportation facility grants,
transportation facility loans, facilities grants, facilities
loans, and research grants. A fisherman can claim a tax credit
up to 45.5 percent on their tax return.
SENATOR KIEHL asked if there is a list of municipalities
affected by the tax credit.
MR. SPANOS replied he had the list on his screen but someone
else may have in in a more usable form.
CHAIR MICCICHE asked Mr. Caissie if he had the list.
3:40:44 PM
JOSEPH CAISSIE, Assistant State Assessor, Division of Community
and Regional Affairs, Alaska Department of Commerce, Community &
Economic Development, Anchorage, Alaska, replied he did not have
the list and it is not readily available. It would entail going
through a list of 112 communities to determine which are
impacted by these credits.
CHAIR MICCICHE asked Ms. Ivanoff if she had the list.
3:41:16 PM
LAURELI IVANOFF, Communications Director, Norton Sound Economic
Development Corporation, Unalakleet, Alaska, replied she did not
have the information.
CHAIR MICCICHE asked someone to submit a list of the
municipalities affected by the tax credit before the next
hearing.
MS. LICCIOLI said Senator Olson's office will provide the list.
CHAIR MICCICHE asked Mr. Caissie if he had any testimony on the
bill.
MR. CAISSIE replied the department does not have any official
comment on the bill.
CHAIR MICCICHE asked Ms. Ivanoff if she had any comments on the
bill.
MS. IVANOFF stated that the Norton Sound Economic Development
Corporation (NSEDC) supports extending the sunset date. She said
NSEDC has given sizable contributions to the Northwestern Alaska
Career and Technical Center (NACTEC) for a vocational education
program that provides opportunities for students from the Bering
Strait School District and Nome Public Schools. The NSEDC
contributions have been an important resource for NACTEC.
SENATOR GIESSEL asked who Ms. Ivanoff represents.
CHAIR MICCICHE replied Ms. Ivanoff represents the Norton Sound
Economic Development Corporation.
He noted that the program had run from 2014 and 2020 and asked
if this was the first sunset.
3:43:22 PM
SENATOR OLSON explained that the Norton Sound Economic
Development Corporation is the CDQ assigned to the area between
Wales and the start of the next CDQ near the delta of the Yukon
River. He said the federal delegation initiated the CDQ Program
and this is the first extension that he is aware of.
He said he can attest to Ms. Ivanoff's comments on the programs
that have benefited from the CDQ Program because he lives in one
of the communities that benefits. The programs give more
opportunities to the youth to provide more education, more jobs,
and an opportunity to continue living in the area.
CHAIR MICCICHE said he asked because the program ran for 6 years
and the bill requests a 10-year extension. He asked if there was
a reason for the additional 4 years.
MS. LICCIOLI replied she would follow up with an answer to the
question.
SENATOR KIEHL said his question was why the extension was for
only 10 years when Legislative Finance's indirect expenditure
report suggested the legislature consider eliminating the sunset
date.
SENATOR OLSON replied that the legislature likes to see sunset
dates because things can change. He said the Bering Sea fishery
is very large and he is more comfortable with a sunset date so
the legislature can review the program and verify its benefit to
the public. He noted that there has been no opposition in his
region to having the CDQ in place.
MS. LICCIOLI added that one of the reasons for keeping a sunset
is on behalf of municipalities since the tax credit goes against
their share.
3:46:07 PM
CHAIR MICCICHE opened public testimony. He found no one who
wished to testify.
3:46:30 PM
CHAIR MICCICHE held SB 184 in committee for future
consideration.
SB 130-SEAFOOD PRODUCT DEVELOPMENT TAX CREDIT
3:46:54 PM
CHAIR MICCICHE announced that the next order of business would
be SENATE BILL NO. 130, "An Act relating to a seafood product
development tax credit; providing for an effective date by
repealing secs. 32 and 35, ch. 61, SLA 2014; and providing for
an effective date."
3:47:11 PM
TIM LAMKIN, Staff, Senator Gary Stevens, Alaska State
Legislature, Juneau, Alaska, explained that SB 130 is truly a
direct economic policy that the State has used for some time.
The intent is to support the long-term development of Alaska's
value-added seafood processing industry, specifically targeting
both salmon and herring fisheries.
He said the historical incentive has been processor tax credits
for salmon and herring fisheries to provide infrastructure and
research and development investment for added-value product
improvements or discoveries.
MR. LAMKIN detailed that the bill would extend the sunset for
the tax credit and broaden its scope to include pollock and cod.
The change will grow market demand for Alaska's quality
byproducts rendered from salmon, herring, pollock, and cod.
He said there may be amendments to the bill to include tax
credits for other fisheries such as perch, flounder, and others.
Extending the tax credits and incentives to find added-value
technology for all of Alaska's seafood is a topic for future
conversations.
MR. LAMKIN noted that United Fishermen of Alaska (UFA) submitted
a letter of support for SB 130.
CHAIR MICCICHE asked him to proceed with the sectional analysis.
3:49:36 PM
MR. LAMKIN provided the following sectional analysis of SB 130:
Sec. 1: AS 43.75.035(b)(1) and (2), relating to tax
credits applied to value-added activity for the
processing of salmon and herring products, (1)
adds the fisheries of pollock and cod as
applicable for the tax credit; and (2) extends
the sunset of the applicable tax credits through
year 2025.
Sec. 2: AS 43.75.035(c), conforming amendment, relating
to applying a tax credit for investment equipment
used to process salmon or herring, to include
equipment used for processing pollock and cod.
Sec. 3: AS 43.75.035(d), conforming amendment, relating
to a 3-year carry-forward of unused tax credits
for the processing of salmon and herring, adds
the same carry-forward of tax credits to be
applicable for pollock and cod processing.
Sec. 4: AS 43.75.035(e), relating to the 50 percent of
liability cap on applicable tax credits, is legal
drafting statutory clean-up, deleting a
duplicative and redundant clause already
contained in Section 1 of the bill.
Sec. 5: AS 43.75.035(g), conforming amendment, relating
to state claw-back of a carry-forward tax credit,
in the event an asset used for the processing of
salmon or herring to which a carry-forward
applies, if the asset is removed from the state,
adds pollock and cod in determining qualified
investment of processing within the state.
Sec. 6: AS 43.75.035(j)(3), conforming amendment,
relating to the definition of "qualified
investment" under this tax credit program, adds
investment in assets used for processing pollock
and cod products.
Sec. 7: AS 43.75.035(j)(6), conforming amendment,
relating to the definition of "value-added"
products under this tax credit program, adds
processing of pollock and cod byproducts.
Sec. 8-11: Are historical sunset dates and repealers of
this tax credit program, consolidating all of the
various sunset provisions of the program into a
single sunset, occurring now in section 8, and
set for Jan. 1, 2026.
Sec. 12: Sets an effective date for the bill of Jan. 1,
2021.
3:53:31 PM
SENATOR KAWASAKI asked if there is any metric to prove that the
tax credit has the intended result of increased investment in
value-added products for those fisheries.
MR. LAMKIN directed attention to the analysis section of the
fiscal note that describes the economic activity that has
resulted from the program. He deferred any discussion of the
specifics to the industry.
3:54:23 PM
SENATOR GARY STEVENS, Alaska State Legislature, Juneau, Alaska,
sponsor of SB 130, explained that the legislation to address out
of state competition that was affecting the salmon and herring
fisheries passed in 2002 or 2003. He said that program has been
very successful and he believes the tax credit will be similarly
beneficial to the pollock and cod fisheries.
CHAIR MICCICHE asked Mr. Spanos about the timing if there is no
fiscal note for FY2021 but the sunset splits that fiscal year.
3:55:40 PM
BRANDON SPANOS, Deputy Director, Tax Division, Alaska Department
of Revenue, Anchorage, Alaska, explained that the tax return is
filed the year following the catch so there would not be a
reduction as a result of the credit until the following year.
CHAIR MICCICHE said he assumes that there would not be an
interruption in the tax credit because of the previous sunset
date.
MR. SPANOS answered that's correct. If the tax credit sunsets,
the processors can still claim their credit in FY2021.
CHAIR MICCICHE asked if he had testimony on the bill.
MR. SPANOS stated that the writeup in the division's fiscal note
estimates the reduction though the indirect expenditure for
FY2022-FY2026. It takes into account the historic credit amounts
for salmon and herring as well as an estimate for the new
species, pollock and cod.
CHAIR MICCICHE noted that the fiscal note increases from $3.6
million up to $6.6 million in FY2026. He asked what the
division's methodology is to assume an investment increase.
MR. SPANOS answered that the assumption is that the industry
will spend the money immediately and increase spending in later
years. The estimate ranges between $3.6 million to $6.6 million.
3:58:34 PM
CHAIR MICCICHE asked Senator Stevens if he had any closing
comments.
SENATOR STEVENS said the tax-credit policy passed many years ago
and it was very effective in helping the salmon and herring
industry move ahead. SB 130 is an extension that would also
apply to pollock and cod. The tax-credit policy made an enormous
difference in the industry by allowing fishermen to put in new
engines and processors to put in new lines. He said his hope is
that the bill will have a similar impact on pollock and cod.
CHAIR MICCICHE said that as a fisherman, he has witnessed the
industry substantially increase its value-added products as a
result of the investment from the tax credit. He noted that the
fishermen have received more value for the prices as well.
4:00:28 PM
CHAIR MICCICHE opened public testimony.
4:00:43 PM
CHRIS BARROWS, President, Pacific Seafood Processors
Association, Tacoma, Washington, testified in support of SB 130.
He said SB 130 would provide Alaska seafood processors with the
ability to continue to receive some capital cost recovery in
exchange for investing in new equipment that produces value-
added products in Alaska. The bill incentivizes getting more
value out of each fish, which in turn provides greater benefit
to the State of Alaska, the coastal communities, fishermen, and
processors.
MR. BARROWS stated that expanding the list of tax-credit
eligible species to include Alaska pollock and Pacific cod is
important. He noted that the two species comprise about 69
percent of the statewide harvest by volume, based on 2018
numbers. Getting more value long term from the high value
species is a benefit to all fishery participants and the State
of Alaska.
He shared that the Pacific Seafood Processors Association (PSPA)
is comprised of eight major seafood companies that purchase fish
from harvesters from Ketchikan to Unalaska and St. Paul. In
turn, PSPA produces value-added products and provides markets
for Alaska fisheries in a global context. The PSPA companies
operate 25 facilities in 15 coastal communities across Alaska
and 3 floating processors that serve remote locations.
MR. BARROWS said seafood processors have used the existing
salmon tax credit to make critical investments in processing
technologies for salmon that would otherwise be cost prohibitive
for some processors. The tax credit has changed the face of
salmon processing to an increase in fillet and other value-added
salmon products that have a strong U.S. market. A higher value
product means a higher return on investment for the State and
all participants, including fish taxes which are based on fish
value.
He stated that part of the sustainability effort in Alaska is to
increase and improve the utilization of each fish which in turn
generates more value out of the state's resources. He said there
is no better way to increase the value of Alaska's resources
then to increase the utilization of harvested fish. Some other
examples include using milt, roe, stomachs, bellies, fish oil,
bones and skins that generated new products and new consumers of
Alaska seafood.
He summarized that reauthorizing the value added tax credit and
including cod and pollock in the reauthorization will help
Alaska producers continue progressing and expanding more fully
into other species.
4:04:24 PM
JERRY MCCUNE, Board President, Cordova District Fishermen
United, Cordova, Alaska, testified in support of SB 130. He
noted that when the legislation first passed, farmed fish
flooded the market and Alaska was just putting out frozen fish.
The industry's use of fillet machines is a result of the tax
credit. It applies strictly to value added, not something like a
new forklift.
MR. MCCUNE concluded saying that adding cod and pollock is
probably a good thing for applying tax credits to different
things.
4:05:44 PM
FRANCIS LEACH, Executive Director, United Fishermen of Alaska,
Juneau, Alaska, stated support for SB 130. She said the bill
will provide Alaska's seafood processors with the ability to
receive capital cost recovery for investing in new equipment to
produce value-added products. New and innovative products will
benefit Alaska's processors, fishermen, and coastal communities.
She recalled that the legislature enacted the seafood product
development tax credit when salmon and herring prices were
extremely low. It helped the processing sector to upgrade
infrastructure and develop new and innovative products. She
added that UFA appreciates the bill extending the tax credit to
benefit pollock and cod during an industry downturn.
MS. LEACH summarized that the seafood product development tax
credit is helpful to processors. The tax credit has shown in the
past, through innovative and updated equipment, to increase the
raw fish taxes revenue. Fish taxes are based on fish value and
the more money derived from fish equates to more money for
Alaska.
4:07:30 PM
CHAIR MICCICHE announced that public testimony remains open.
4:07:41 PM
CHAIR MICCICHE held SB 130 in committee.
SB 232-PERSONAL USE FISHING PERMIT FEES
4:08:07 PM
CHAIR MICCICHE announced that the final order of business would
be SENATE BILL NO. 232, "An Act relating to personal use fishing
permits."
4:08:34 PM
KONRAD JACKSON, Staff, Senator Micciche, Alaska State
Legislature, Juneau, Alaska, explained that SB 232 addresses the
impacts of the dipnet fishery that face Cook Inlet communities.
This includes burdens on local services, infrastructure,
handling of excess fish waste, and litter. He directed attention
to the photos in the packet that illustrate the situation at the
mouth of the Kenai River, noting that sometimes there is some
disregard for beaches, residents, and property owners near the
fisheries. He said Chair Micciche is familiar with the situation
because that area is in his district.
He said the dipnet influx does bring some revenue, but before
the City of Kenai instituted a small fee for beach access and
camping it shouldered the entire burden with no assistance from
the State.
MR. JACKSON explained that SB 232 institutes a $5 fee for a
personal use fishing permit. As currently drafted, the bill
would split the fees between communities where the personal use
fisheries take place with the remaining funds staying in the
general fund to assist fisheries that are outside of the
municipalities. He reiterated that the fee will cover some of
the infrastructure and support services where the fisheries take
place, and noted that the Chitina fishery instituted a $15
permit to help clean up some of the mess that resulted from the
fishery.
MR. JACKSON said the $5 fee currently would apply to all
personal use fisheries in the state, but the sponsor intends to
offer an amendment to focus on the Cook Inlet dipnet fisheries.
4:11:45 PM
SENATOR KAWASAKI asked if he said that the fee would apply to
every personal use fishery, but a pending amendment would limit
the focus to just the Cook Inlet fisheries.
MR. JACKSON answered yes. He said as currently written the fee
would apply to all personal use fisheries, including the Chitina
fishery, and that was never the intention.
SENATOR KAWASAKI asked how the $5 fee would be allocated to the
other fisheries.
MR. JACKSON restated that the ultimate intent is for the $5 fee
to apply to and be used for the Cook Inlet personal use
fisheries.
SENATOR KAWASAKI noted that the Copper River personal use
fishery creates waste that impacts a downriver community. He
asked if the downriver community would receive support for
cleanup.
MR. JACKSON reiterated that the focus is on the fisheries in
Cook Inlet.
4:14:07 PM
CHAIR MICCICHE, sponsor of SB 232, clarified that his intent was
to introduce the bill and then introduce a committee substitute
(CS) for strictly Cook Inlet. The fee will offset both the City
of Kenai's management costs and the Kasilof River's
infrastructure for restrooms, boat ramps, and cleanup.
SENATOR COGHILL remarked that the $5 fee is acceptable. He asked
how many people participate in the personal use dipnet fishery.
MR. JACKSON replied the city manager of Kenai probably has
accurate numbers. He noted that the City of Kenai does an annual
report on infrastructure impacts following the fishery.
4:15:31 PM
CHAIR MICCICHE opened public testimony.
4:15:47 PM
PAUL OSTRANDER, City Manager, City of Kenai, Kenai, Alaska,
testified in support of SB 232. He said the City of Kenai has
been supporting the personal use fishery since 1996. He noted
that the photos presented to committee members are from 2010 or
2011, before the city actively managed fish waste on the
beaches. The city has increased management and services in the
area and is very proud of the experience they provide to the
dipnet participants.
He detailed that with the rapid growth of the fishery, which
peaked in 2011 and 2012, the city established a personal use
fishery fund to buffer the volatility tied to fish runs. They
charge for parking, camping, and boat launching to generate
enough revenue to support the fishery and provide services.
MR. OSTRANDER said the city has seen decreased revenue from fees
over the last two or three years and the worry is that the city
will soon need to subsidize fishery expenses from the city's
general fund. For example, the city had a net loss of $95,000 in
FY2019 and a net loss of $3,000 last year after reducing
expenditures by $56,000. The city is seeing people accessing the
Kasilof River or the Kenai River at different locations.
MR. OSTRANDER pointed out that the Alaska Division of Mining,
Land, and Water (DMLW) manages the Kasilof fishery. The State
does not allow DMLW to charge fees, but their annual management
budget is approximately $50,000 to $60,000. The $5 fee
allocation would generate $40,000 for the Kasilof fishery.
4:20:11 PM
SENATOR KAWASAKI asked Mr. Ostrander to go over the fees that
the City of Kenai charges people who fish in the dipnet fishery.
MR. OSTRANDER answered that the city charges for camping,
parking, beach drop-offs, and boat launches.
SENATOR KAWASAKI asked if the City of Kenai has increased it
rates to make up for recent budget deficits.
MR. OSTRANDER answered that the City of Kenai last increased
fees in 2015. The city's current boat launch fees are higher
than what the State charges. The city believes that any fee
increases would create diminishing returns where people seek to
access the fishery from other locations.
SENATOR REVAK said he is very fond of the Kenai River and has
frequented the personal use fishery over the years. He said he
finds the city's fees expensive and spreading out the proposed
user fees would be appropriate.
CHAIR MICCICHE said the intent of the bill is to find a low-cost
way of spreading out impact from the personal use fisheries. As
the City of Kenai has increased fees, people are finding less
expensive ways to dipnet fish without participating in the
city's maintenance. More people are going to the Kasilof River
where there are no facilities, and that impacts the State.
4:24:16 PM
CHAIR MICCICHE held SB 232 in committee with public testimony
open.
4:24:55 PM
There being no further business to come before the committee,
Chair Micciche adjourned the Senate Resources Standing Committee
meeting at 4:24 p.m.