Legislature(2001 - 2002)
04/02/2002 01:56 PM House FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE BILL NO. 208
An Act relating to aquatic farming of shellfish; and
providing for an effective date.
REPRESENTATIVE DREW SCALZI, SPONSOR, testified via
teleconference in support of HB 208. He explained that the
legislation would change the way the Department of Fish and
Game develops mariculture sites. Under the current statutory
provision, applicants locate sites that they believe are
applicable to developing mariculture. A problem arises when
they locate a site only to find out when they return to the
department that it conflicts with an earlier use. Under the
legislation, the department would find sites and make them
available: predisposing problems. The department would
locate 90 sites; the Department of Fish and Game and
Department of Natural Resources would set the criteria. The
90 sites would be divided: 60 suspended cultures such as
mussels, oysters; 20 clams sites; and 10 geoduck sites. The
sites would be available annually until taken; a ten-year
lease would be required. Farmers must abide by the sustained
yield principle in harvesting. The farming would not
interfere with the established commercial, subsistence, or
personal use fisheries. Upon expiration of the lease the
permit holder must return the site in the condition that
mirrors the population estimates that were in existence when
the lease started. The bill is the first step by the state
in supporting the development of shellfish farming in
Alaska, since enactment of the Aquatic Farm bill of 1989.
The demand for Alaska shellfish in the market place cannot
be met with the small amount of farms that are now present.
Shellfish farming is an excellent opportunity for displaced
fishermen or fishermen that need to supplement their income.
A 10-acre farm could produce 435,000 pounds of clams worth
$1.1 million dollars annually. Alaska's largest seafood
wholesaler estimates the clam market in Anchorage at over
one million pounds a year.
Representative Hudson referred to fiscal notes.
Representative Scalzi estimated that over a 10-year period
the collection would pay for the costs.
ROGER PAINTER, ALASKA SHELLFISH GROWERS ASSOCIATION, JUNEAU,
testified in support. He referred to section (b)(2): Before
offering leases for aquatic farming sites under (a) of this
section, the commissioner of natural resources shall solicit
nominations of sites suitable for aquatic farming of clams,
geoducks, and other shellfish from the aquatic farming
industry in the state and the public." The Alaska Shellfish
Growers Association is actively working with the University
of Alaska on assessments of candidate sites. Under the
current program the burden is on the applicant to provide
site-specific information, which keeps the cost of the
current program low. He suggested that nominated sites be
required to provide site-specific information to keep the
costs of the program down. He felt that the Department of
Fish and Game's fiscal note could be reduced. He observed
that the fiscal notes by the Division of Commercial
Fisheries and Habitat Restoration were predicated on
observations at the site. During a normal opening the
Department of Fish and Game does not visit sites or conduct
dive surveys. He maintained that the burden to provide the
information should be on the industry.
Representative John Davies questioned why not operate under
the statutes. Mr. Painter explained that the sites would be
located in areas of low conflict in areas where the industry
is being encouraged. He referred to interaction with the
Prince of Wales community, which is working to support
industry. The cost to amend current land use plans, conduct
public hearing on the Prince of Wales project is $140
thousand dollars, which would result in a small number of
sites. The legislation would allow applicants to go into
areas where there would be a high probability of farming. He
emphasized the difficulty of locating sites that can be
approved. There was one applicant for all of Southcentral in
1999. The legislation would open doors by pointing people
into areas that would be successful. Representative John
Davies questioned why the department would have more
success. Mr. Painter responded that the department's role
would not be to identify sites but to evaluate sites
proposed by industry for points that would cause them to be
rejected.
Representative Scalzi referred to the Katchemak Bay area
where there are a lot of home sites. The Administration can
deal with relationships between user groups and expedite the
process.
TAPE HFC 02 - 72, Side B
Representative Hudson questioned if sites would be available
by road or boat. Mr. Painter explained that they were close
to the road but require a 2-mile boat ride. Representative
Hudson questioned the cost of providing road access to the
site. Mr. Painter noted that he flies all of his product
from his farm site, even though it is relatively close to
the road. He produces between a 1,000 and 2,000 pounds a
week. He would like to work with other farms in the area to
truck the product out as roads and ferry service is
improved.
Co-Chair Mulder observed the fiscal costs and questioned why
the industry is not willing to pay for the up front costs to
begin the program. Mr. Painter acknowledged that industry
should pay a greater portion of the up front costs and
reiterated that the fiscal notes could be reduced. The
industry can complete surveys for less money than the state.
He asserted that it would cost the department 50 times more
than industry to deliver the data.
Representative Lancaster asked for an example of the cost to
survey a site. Mr. Painter noted that they surveyed 100
miles of coast at a cost of $4 thousand dollars. He added
that he has worked with the Department of Community and
Economic Development to develop a spreadsheet that
demonstrates the flow of revenues back into the state
treasury from the passage of the legislation. He explained
that they visited clam sites and collected samples that
allowed them to analyze the number of clams available, took
soundings and salinity levels, and looked for sensitive
habitat and other problems. The Department of Natural
Resources has stated that 80 sites were permitted before the
program was abandoned.
DOUG MECUM, DIRECTOR, DIVISION OF COMMERCIAL FISHERIES,
DEPARTMENT OF FISH AND GAME, provided information on the
legislation. He noted that the department testified in
support of the legislation. He had not heard any criticism
on the fiscal note previously. He stressed the need to fund
the program in order to jump-start the industry. The
legislation would double the size of the industry. The
department would do the work to find sites that are suitable
and free of conflict. He emphasized that the funding is
needed to do the work. He observed that no statutory change
is necessary to keep the burden on the industry, but the
department supports the approach taken in the legislation
[to shift the burden to the department].
Representative Lancaster questioned if the sites had been
previously surveyed. Mr. Mecum stated that they do not do a
lot of surveys on suspended culture sites, but that they
have been involved in surveying on bottom farm sites. He
noted that the department is involved in litigation
regarding geoducks, which are highly viable. Goeducks are
worth $10 - $20 dollars a pound on the Asian live market. He
noted that there were 40 applications put in during the last
application period, 19 of which were ground bottom sites.
The department surveyed the sites at their cost, which was
expensive. He stressed the cost of "firing up" a research
vessel with divers to survey sites with scuba gear to do
actual quantitative surveys and estimates of the existing
biomass and populations. He disagreed that the industry
could provide the services cheaper and estimated the costs
for one site at $20 thousand dollars. The legislation
anticipates nine sites that could be anywhere in the state
of Alaska.
Representative Hudson questioned if there was conflict
between the diver fisheries and the set aside sites. Mr.
Mecum affirmed and acknowledged that potential dive sites
would have to be taken into consideration for a third of the
sites. He clarified that the intent of the legislation was
for the agencies to do the public process and biological
surveys to find areas that would have a reasonable
expectation for approval.
RICK THOMSPON, STATEWIDE AQUACULTURE PROGRAM, DEPARTMENT OF
NATURAL RESOURCES, testified via teleconference in support
of the legislation. He noted that the Department of Natural
Resources has worked closely with the industry, sponsor and
Department of Fish and Game to resolve issues.
Representative John Davies asked if the number of sites and
the potential of the industry expansion to all of the sites
made available were practical. Mr. Thompson stated that he
was not qualified to speak to the industry's capability to
expand. He noted that the department is responsive and would
work to eliminate conflicts. He stressed the need to build
in efficiencies. There may be areas that can support 10 - 15
sites. He thought that it would be good to identify sites,
when and where there are resources available.
JULY DECKER, EXECUTIVE DIRECTOR, SOUTHEAST ALASKA DIVER
FISHERIES ASSOCIATION, testified via teleconference in
support of the legislation. She did not think that the
legislation would be detrimental to the dive fisheries.
JON AGOSTI, CHUGIAK SHELLFISH ASSOCIATION, SEWARD, testified
via teleconference in support of the legislation. He noted
that he is also the president of the Qutekcak Shellfish
Hatchery. He emphasized the importance of the legislation to
his and other state hatcheries. They provide four new
species of shellfish cultured in the state in an attempt to
diversify and grow the industry. The legislation is critical
to help jump-start the industry. Grant funding is not going
to continue. The two-year application process, which has
less than a 50 percent chance of success, is a detriment to
the industry. It is a large cost in time and money for
unsuccessful applicants, which also acts as a deterrent.
CAREN ROBINSON, THE SHELLFISH MARKET, JUNEAU, testified in
support. She noted that she is a partner in a shellfish
company located on Prince of Wales Island. She distributes
the majority of oysters in Southeast Alaska and her biggest
fear of each week is whether there will be enough product to
meet demand. She noted that there is not enough to send out
of state.
Representative Hudson asked if the legislation extends the
length of the lease and questioned if longer contracts would
aid industry. Ms. Robinson agreed that it would be helpful
to do anything to extend and simplify the lease process.
Representative John Davies asked if the level of effort is
reasonable. Ms. Robinson thought that the number was
reasonable. She reiterated that she is unable to meet
demand, yet it is a difficult industry to get started in.
In response to a question by Representative Davies,
Representative Scalzi could not provide additional
information regarding the amount of public interest. He
noted that if all 90 sites were released that the state
would receive $58,000 annually, based on the assumption that
all sites were released. He felt that there was an extensive
level of interest.
Representative Whitaker reviewed the fiscal notes:
Department of Fish and Game, Division of Commercial
Fisheries $90 thousand dollars, and the first year;
Department of Natural Resources, $98.3 thousand dollars the
first year; and Department of Fish and Game, Division of
Habitat for $72.5 thousand dollars the first year. He
emphasized that the funding would spur economic development.
The total cost would be $272 thousand dollars. The
Department of Environmental Conservation withdrew their
fiscal note. He spoke in support of the legislation and
emphasized that it would help a fledgling industry.
Representative Lancaster pointed out that a hatchery was
built in Seward that just delivered its first commercial
product last fall, which could be used to support the
industry.
Representative Hudson questioned how many jobs would be
involved in each project. Representative Scalzi observed
that there are 14 members in the Katchemak Bay collective
involved. Mr. Painter stated that there are four full time
employees at their site. The site next to them has 2 full
time partners with a few part-time workers.
Representative Hudson estimated that there would be 270
individuals employed on the additional sites.
Co-Chair Mulder spoke in support of the legislation. He
asked the sponsor to work with industry and the department
to look for funding efficiencies.
Representative Lancaster MOVED to report CSHB 208 (RES) out
of Committee with the accompanying fiscal note. There being
NO OBJECTION, it was so ordered.
CSHB 208 (RES) was REPORTED out of Committee with a "do
pass" recommendation and with previously published fiscal
notes: DNR (#2), DFG (#3) and DFG (#4).
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